Filed Pursuant to Rule 424(b)(3)

Registration No. 333-147690

 

PROSPECTUS

 

$350,000,000

 

 

Bristow Group Inc.

Offer to Exchange

registered

71/2% Senior Notes due 2017

for all outstanding

71/2% Senior Notes due 2017

 

 

Exchange Notes:

 

 

The exchange offer:

 

 

You should note that:

 

 

 

Please consider carefully the risk factors beginning on page 17 of this prospectus before participating in the exchange offer.

 

 

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 

 

 

 

The date of this prospectus is January 30, 2008.

 

This prospectus is part of a registration statement we filed with the Securities and Exchange Commission. You should rely only on the information we have provided or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional or different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted. You should assume that the information in this prospectus is accurate only as of the date on the front of this prospectus and that any information we have incorporated by reference is accurate only as of the date of the document incorporated by reference.

 

TABLE OF CONTENTS

 

 

Each broker dealer that receives Exchange Notes pursuant to this exchange offer in exchange for securities acquired for its own account as a result of market making or other trading activities must acknowledge that it will deliver a prospectus in connection with any resale of such new securities. The letter of transmittal attached as an exhibit to the registration statement of which this prospectus forms a part states that by so acknowledging and by delivering a prospectus, a broker dealer will not be deemed to admit that it is an underwriter within the meaning of the Securities Act of 1933, as amended. This prospectus, as it may be amended or supplemented from time to time, may be used by such a broker dealer in connection with resales of such new securities. We have agreed that, starting on the date of the completion of the exchange offer to which this prospectus relates for up to 180 days following completion of the exchange offer (or such earlier date as eligible broker-dealers no longer own Exchange Notes), we will make this prospectus available to any broker dealer for use in connection with any such resale. See “Plan of Distribution.”

 

 

 

 

 

We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document we file at the Public Reference Room of the SEC, 100 F Street, N.E., Washington, D.C. 20549.

 

Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC filings are also available to the public on the SEC’s website at http://www.sec.gov and on our website at http://www.bristowgroup.com. However, the information on our website does not constitute a part of this prospectus. Reports and other information concerning us can also be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. Our common stock is listed and traded on the New York Stock Exchange under the trading symbol “BRS.”

This prospectus is part of a registration statement we have filed with the SEC relating to the Notes. As permitted by SEC rules, this prospectus does not contain all of the information we have included in the registration statement and the accompanying exhibits and schedules we file with the SEC. You may refer to the registration statement, exhibits and schedules for more information about us and these securities.

 

The information included in the documents described below is incorporated by reference and is considered to be a part of this prospectus. The most recent information that we file with the SEC automatically updates and supersedes older information. We are incorporating by reference into this prospectus (excluding any information that was furnished to (and not filed with) the SEC the following documents (File No. 001-31617).

 

 

Until the termination of the exchange offer described in this prospectus, we will also incorporate by reference all documents that we may file in the future under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, excluding any information therein that was furnished to (and not filed with) the SEC.

 

We will provide you without charge a copy of any and all documents that have been incorporated by reference into this prospectus, except that exhibits to such documents will not be provided unless they are specifically incorporated by reference into such documents. Requests for copies of any such document should be directed to:

Bristow Group Inc.

2000 W. Sam Houston Pkwy S., Suite 1700

Houston, Texas 77042

Attention: Corporate Secretary

Telephone number is (713) 267-7600

 

To obtain timely delivery of any of our documents, you must make your request to us no later than February 25, 2008. Unless sooner terminated, the exchange offer will expire at 5:00 p.m., New York City time, on March 3, 2008. The exchange offer can be extended by us in our sole discretion, but we currently do not intend to extend the expiration date. Please read “The Exchange Offer” for more detailed information.

 

This prospectus contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21 E of the Securities Exchange Act of 1934. Forward-looking statements are statements about our future business, strategy, operations, capabilities and results; use of proceeds; financial projections; plans and objectives of our management; expected actions by us and by third parties, including our customers, competitors and regulators; and other matters. Some of the forward-looking statements can be identified by the use of words such as “believes”, “belief”, “expects”, “plans”, “anticipates”, “intends”, “projects”, “estimates”, “may”, “might”, “would”, “could” or other similar words; however, all statements in this prospectus, other than statements of historical fact or historical financial results are forward-looking statements.

 

Our forward-looking statements reflect our views and assumptions on the date we are filing this prospectus regarding future events and operating performance. We believe that they are reasonable, but they involve known and unknown risks, uncertainties and other factors, many of which may be beyond our control, that may cause actual results to differ materially from any future results, performance or achievements

expressed or implied by the forward-looking statements. Accordingly, you should not put undue reliance on any forward-looking statements. Factors that could cause our forward-looking statements to be incorrect and actual events or our actual results to differ from those that are anticipated include all of the following:

 

 

All forward-looking statements in this prospectus are qualified by these cautionary statements and are only made as of the date of this prospectus. We do not undertake any obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

PROSPECTUS SUMMARY

																						Percentage of
		Aircraft in Consolidated Fleet																				Revenue for the
		Helicopters												Fixed								Six Months Ended
		Small				Medium				Large				Wing				Total				September 30, 2007
Helicopter Services
North America			134				28				4				1				167				23	%
South and Central America			2				33				1				—				36				7	%
Europe			1				10				39				—				50				34	%
West Africa			12				27				2				7				48				15	%
Southeast Asia			3				12				9				—				24				9	%
Other International			—				13				10				3				26				4	%
EH Centralized Operations			—				—				—				—				—				1	%
Bristow Academy			52				—				—				1				53				1	%
Production Management(1)			—				—				—				—				—				6	%
Total(2)			204				123				65				12				404				100	%
Aircraft not currently in fleet:
On order(3)			6				10				16				—				32
Under option			—				24				18				—				42

(1)		On November 2, 2007 we sold our Production Management Services business.
(2)		Includes 12 aircraft held for sale.
(3)		Small aircraft on order include orders for 5 training aircraft.

	•	We have a global footprint.  We operate in 22 countries and have the largest fleet of helicopters serving the offshore energy market in the world. We have the largest fleet in the U.S. Gulf of Mexico and also have a strong market position in other key markets, including the North Sea, Nigeria and Australia. This global footprint allows us to provide our offshore energy customers with consistent, high-quality service, reduces our exposure to any one market and provides us with flexibility in deploying our aircraft to the most attractive markets.
	•	We have a record of safe operations and operate a modern, well-maintained fleet.  We have a record of safe operations, including fewer accidents per 100,000 flight hours over the past five years than the industry average for the U.S. Gulf of Mexico and the North Sea. We continuously maintain and improve the quality of the equipment that we operate and apply state-of-the-art safety technologies across our global organization. As of September 30, 2007, the average age of the helicopters in our consolidated fleet was approximately 15 years. The average age of our fleet has been reduced with the addition of 16 new aircraft in the six months ended September 30, 2007, and will be further reduced with the expected addition of 16 new aircraft in the second half of fiscal year 2008 and the periodic retirement of older aircraft.
	•	We have strong, long-term relationships with our customers.  We have strong, long-term relationships with our customers, which include major, independent, international and national energy companies. We are the largest provider of helicopter services by revenue for the Shell Companies and the

		BP Group companies. In addition, we have entered into global agreements with ConocoPhillips and the BP Group that provide for information sharing regarding future aircraft requirements, coordination of our respective operations and business volume discount arrangements. Our close relationships with these companies have allowed us to expand our aircraft fleet by allowing us to identify specific projects that require new aircraft prior to committing capital for aircraft purchases.

	•	We have a history of consistent revenue and Adjusted EBITDA growth.  We have a history of consistent revenue growth, including 10.5% compounded annual growth rate over the past four fiscal years and 16.4% from the six months ended September 30, 2006 to the six months ended September 30, 2007. Our growth has translated into increases in Adjusted EBITDA (as defined under “Summary Historical Financial Information”) of 11.8% compounded annually over the past four fiscal years and a 41.3% increase from the six months ended September 30, 2008 to the six months ended September 30, 2007. The majority of our revenue is attributable to production activity. Our revenues are driven primarily by offshore operating expenses, which over the last twelve years have been relatively stable, including during a downturn in the energy industry. The ongoing nature of production work makes it less volatile than exploration and development work, which is more reactive to changes or expected changes in commodity prices. Accordingly, we have experienced less volatility in demand than other sectors of the energy services industry. In addition, most of our contracts provide that the customer will reimburse us for cost increases associated with the contract, including fuel cost increases. Lastly, our pricing structure, consisting of a fixed reservation fee plus additional fees for each hour flown, fixes a percentage of our revenue stream in the short-term, stabilizing the impact of short-term fluctuations in flight hours by customers.
	•	We have a strong balance sheet that provides financial flexibility.  Pro forma for this offering, our balance-sheet debt as a percentage of total capital was 39.2% at September 30, 2007. Under our syndicated secured credit facilities, we have an undrawn $100 million revolving credit facility and $21.2 million available under a $25 million letter of credit facility as of the date of this prospectus. We believe that this capital structure provides us with the financial flexibility to pursue opportunities to grow our business, including through the aircraft fleet expansion program described above.
	•	We have significant asset coverage.  Since a substantial portion of a helicopter’s value resides in its dynamic components, and these dynamic components are periodically overhauled, replaced or upgraded, our helicopters generally retain a high portion of their original value. Pro forma for application of net proceeds from this offering, net property, plant and equipment as of September 30, 2007 was $1,150.2 million. As of September 30, 2007, we had an additional $659.7 million in cash, accounts receivable and inventories, bringing our asset coverage ratio to approximately 2.98x our pro forma long-term debt levels. If we experience a decline in demand for our helicopter services, this coverage allows us the option of actively managing our debt levels by monetizing a marginal amount of our helicopters and reducing our debt levels accordingly. Based on the relatively stable value of helicopters and their liquid aftermarket, we believe that the fair market value of these aircraft currently exceeds their book value, although future market conditions could vary.
	•	We have an experienced management team.  Our management team has extensive experience in the energy services industry and helicopter services sector. We train each of these managers on our corporate values, including safety, quality, integrity and profitability, and their performance is evaluated using key performance indicators which directly link to those values. Our senior management team is composed of nine executives who have an average of 31 years of relevant experience.

	•	Strategically position our company as the preferred provider of helicopter services.  We position our company as the preferred provider of helicopter services by maintaining strong relationships with our customers and providing high-quality service. We focus on maintaining relationships with our customers’ local and corporate management. We believe that this focus helps us to provide our customers with the right aircraft in the right place at the right time and to better anticipate customer needs, which in turn allows us to better manage our fleet. We also leverage our close relationships with our customers to establish mutually beneficial operating practices and safety standards worldwide. By applying standard operating and safety practices across our global operations, we are able to provide our customers with consistent, high-quality service in each of their areas of operation. By better understanding our customers’ needs and by virtue of our global operations and safety standards, we have effectively competed against other helicopter service providers based on customer service, safety and reliability, and not just price.
	•	Integrate our global operations.  Beginning in fiscal year 2006, we identified and implemented a number of changes in our business to integrate our global organization, and we intend to continue to identify and implement further integration opportunities. These changes included changes in our senior management team, the integration of our operations among previously independently managed businesses, improvements in global asset allocation and other changes in our corporate operations. We anticipate that these improvements will result in revenue growth, and may also generate cost savings.
	•	Grow our business internationally.  We plan to grow our business in most of the markets in which we operate. We expect this growth to be particularly strong in international markets outside our three largest markets (U.S. Gulf of Mexico, North Sea and Nigeria), which represented 65% of our fiscal year 2007 revenues. Although we have a footprint in most major oil and gas producing regions of the world, we have the opportunity to expand and deepen our presence in many of these markets, for example Southeast Asia. We anticipate this growth to result primarily from the deployment of new aircraft into markets where we expect they will be most profitably employed, as well as by executing opportunistic acquisitions. Our acquisition-related growth may include increasing our role and participation with existing unconsolidated affiliates and may include increasing our position in existing markets or expanding into new markets.

Expiration Date		Unless sooner terminated, the exchange offer will expire at 5:00 p.m., New York City time, on March 3, 2008, or such later date and time to which we extend it.
Withdrawal of Tenders		You may withdraw your tender of Outstanding Notes at any time prior to the expiration date. We will return to you, without charge, promptly after the expiration or termination of the exchange offer any Outstanding Notes that you tendered but that were not accepted for exchange.
Conditions to the Exchange Offer		We will not be required to accept Outstanding Notes for exchange if, in our reasonable judgment, the exchange offer, or the making of any exchange by a holder of Outstanding Notes, would:
		• violate applicable law or any applicable interpretation of the staff of the SEC; or
		• be impaired by any action or proceeding that has been instituted or threatened in any court or by or before any governmental agency with respect to the exchange offer.
		The exchange offer is not conditioned upon any minimum aggregate principal amount of Outstanding Notes being tendered.
		Please read “The Exchange Offer — Conditions to the Exchange Offer” for more information about the conditions to the exchange offer.
Procedures for Tendering Outstanding Notes		If you wish to participate in the exchange offer, you must complete, sign and date the letter of transmittal that we are providing

		with this prospectus and mail or deliver the letter of transmittal, together with the Outstanding Notes, to the exchange agent prior to the expiration date. If your Outstanding Notes are held through The Depository Trust Company (DTC), you may effect delivery of the Outstanding Notes by book-entry transfer.
		In the alternative, if your Outstanding Notes are held through DTC, you may participate in the exchange offer through DTC’s automated tender offer program. If you tender under this program, you will agree to be bound by the letter of transmittal as though you had signed it.
		By signing or agreeing to be bound by the letter of transmittal, you will represent to us that, among other things:
		• any Exchange Notes that you receive will be acquired in the ordinary course of your business;
		• you have no arrangement or understanding with any person to participate in the distribution of the Outstanding Notes or the Exchange Notes within the meaning of the Securities Act of 1933;
		• you are not our “affiliate,” as defined in Rule 405 of the Securities Act, or, if you are our affiliate, you will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable;
		• if you are not a broker-dealer, you are not engaged in, and do not intend to engage in, the distribution of the Exchange Notes;
		• if you are a broker-dealer, you will receive Exchange Notes in exchange for Outstanding Notes that you acquired for your own account as a result of market-making activities or other trading activities, and you will deliver a prospectus in connection with any resale of such Exchange Notes;
		• if you are a broker-dealer, you did not purchase the Outstanding Notes to be exchanged for the Exchange Notes from us; and
		• you are not acting on behalf of any person who could not truthfully and completely make the foregoing representations.
Special Procedures for Beneficial Owners		If you own a beneficial interest in Outstanding Notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender the Outstanding Notes in the exchange offer, please contact the registered holder as soon as possible and instruct it to tender on your behalf and to comply with our instructions described in this prospectus.
Guaranteed Delivery Procedures		You must tender your Outstanding Notes according to the guaranteed delivery procedures described in “The Exchange Offer — Guaranteed Delivery Procedures” if any of the following apply:
		• you wish to tender your Outstanding Notes but they are not immediately available;

		• you cannot deliver your Outstanding Notes, the letter of transmittal or any other required documents to the exchange agent prior to the expiration date; or
		• you cannot comply with the applicable procedures under DTC’s automated tender offer program prior to the expiration date.
Consequences of Failure to Exchange Your Outstanding Notes		Subject only to limited exceptions applicable to persons to whom the exchange offer is not available, if you do not exchange your Outstanding Notes in the exchange offer, you will no longer be entitled to registration rights. You will not be able to offer or sell the Outstanding Notes unless they are later registered, sold pursuant to an exemption from registration or sold in a transaction not subject to the Securities Act or state securities laws. Other than in connection with the exchange offer or as specified in the Registration Rights Agreement, we are not obligated to, nor do we currently anticipate that we will, register the Outstanding Notes under the Securities Act. See “The Exchange Offer — Consequences of Failure to Exchange.”
United States Federal Income Tax Consequences		We believe that the exchange of Outstanding Notes for Exchange Notes in the exchange offer should not be a taxable event for U.S. federal income tax purposes. Please read “Certain United States Federal Income Tax Considerations.”
Use of Proceeds		We will not receive any cash proceeds from the issuance of Exchange Notes in the exchange offer.
Plan of Distribution		All broker-dealers who receive Exchange Notes in the exchange offer have a prospectus delivery obligation. Based on SEC no-action letters, broker-dealers who acquired the Outstanding Notes as a result of market-making or other trading activities may use this exchange offer prospectus, as supplemented or amended, in connection with the resales of the Exchange Notes. We have agreed to make this prospectus available to any broker-dealer delivering a prospectus as required by law in connection with the resales of the Exchange Notes for up to 180 days following the completion of the exchange offer.
		Broker-dealers who acquired the Outstanding Notes from us may not rely on SEC staff interpretations in no-action letters and instead must comply with the registration and prospectus delivery requirements of the Securities Act, including being named as selling noteholders, in order to resell the Outstanding Notes or the Exchange Notes (or such earlier date as eligible broker-dealers no longer own Exchange Notes).

Issuer		Bristow Group Inc.
Exchange Notes Offered		$350 million principal amount of registered 71/2% Senior Notes due 2017.
Maturity Date		September 15, 2017.
Interest Payments		Interest will accrue on the Exchange Notes from September 15, 2007 and will be payable semi-annually, on each March 15 and September 15, with the first payment on March 15, 2008.
Subsidiary Guarantees		The Exchange Notes will initially be jointly and severally guaranteed on a senior unsecured basis by certain of our U.S. subsidiaries.
Ranking and Subordination		The Exchange Notes will be our unsecured senior obligations and will rank:

		• equally in right of payment with our outstanding 61/8% Senior Notes due 2013 and any of our and the guarantors’ future indebtedness;
		• will be effectively subordinated to all of our and the guarantors’ existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness, including indebtedness under our credit facilities; and
		• will rank senior to all of our and the guarantors’ existing and future subordinated indebtedness.
		In addition, the Exchange Notes will be effectively subordinated to the existing and future liabilities, including trade payables, of our non-guarantor subsidiaries. As of September 30, 2007, our non-guarantor subsidiaries had approximately $385.9 million of total liabilities (including trade payables but excluding intercompany liabilities and guarantees). Revenue related to our non-guarantor subsidiaries constituted 66% of our operating revenue during the six months ended September 30, 2007, and our non-guarantor subsidiaries held approximately 50% of our consolidated assets as of September 30, 2007.
Optional Redemption		We may redeem any of the Exchange Notes at any time on or after September 15, 2012, in whole or in part, in cash, at the redemption prices described in “Description of the Exchange Notes — Optional Redemption”, plus accrued and unpaid interest to the date of redemption.
		At any time prior to September 15, 2010, we may redeem up to 35% of the aggregate principal amount of the Exchange Notes issued under the indenture with the net proceeds of certain equity offerings at a redemption price equal to 107.5% of the principal amount of the Exchange Notes plus accrued and unpaid interest to the date of redemption. We may make that redemption only if, after the redemption, at least 65% of the aggregate principal amount of notes issued under the indenture (including the existing 71/2% senior notes) remains outstanding.
		In addition, at any time prior to September 15, 2012, we may redeem all, but not less than all, of the Exchange Notes at a redemption price equal to the principal amount plus the Applicable Premium (as defined in “Description of the Exchange Notes — Optional Redemption”) and accrued and unpaid interest, if any, to the redemption date.
Change of Control		If we experience a Change of Control together with a Ratings Event (as defined under “Description of the Exchange Notes — Repurchase at the Option of Holders”), we will be required to make an offer to repurchase the outstanding Exchange Notes at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of repurchase.

Certain Covenants		The terms of the Exchange Notes will restrict our ability and the ability of our restricted subsidiaries to, among other things:
		• incur additional indebtedness or issue preferred stock;
		• pay dividends or make other distributions to our stockholders;
		• purchase or redeem capital stock or subordinated indebtedness;
		• make investments;
		• create liens;
		• incur restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us;
		• sell assets;
		• consolidate or merge with or into other companies or transfer all or substantially all of our assets; and
		• engage in transactions with affiliates.
		These limitations will be subject to a number of important qualifications and exceptions. See “Description of the Exchange Notes — Certain Covenants”. In addition, many of the covenants will terminate before the new notes mature if one or more of two specified ratings agencies assign the new notes investment grade ratings in the future and no event of default exists under the indenture. Any covenants that cease to apply to us as a result of achieving these ratings will not be restored, even if the credit rating assigned to the Exchange Notes later falls below these ratings. See “Description of the Exchange Notes — Certain Investment Grade Covenants”.

		Six Months Ended September 30,								Fiscal Year Ended March 31,
		2007				2006				2007				2006				2005				2004				2003
		(In thousands, except ratios)
Statement of Operations Data:(1)
Total gross revenue(2)		$	518,338			$	445,271			$	897,861			$	768,940			$	673,646			$	617,001			$	601,550
Direct cost(2)(3)		$	326,600			$	287,341			$	681,191			$	591,043			$	518,139			$	475,449			$	467,776
Consolidated operating income(4)		$	80,465			$	61,921			$	115,303			$	73,795			$	77,608			$	88,725			$	65,366
Earnings from unconsolidated affiliates, net			7,508				3,287				11,423				6,758				9,600				11,039				12,054
Interest income(5)			6,247				2,359				8,950				4,159				3,188				1,689				1,523
Interest expense			(9,456	)			(6,107	)			(10,940	)			(14,689	)			(15,665	)			(16,829	)			(14,904	)
Loss on extinguishment of debt			—				—				—				—				—				(6,205	)			—
Other income (expense), net(6)			786				(6,093	)			(8,998	)			4,612				(1,126	)			(7,810	)			(3,284	)
Provision for income taxes(7)			(28,475	)			(18,271	)			(40,366	)			(16,607	)			(21,835	)			(19,402	)			(18,554	)
Minority interest			(453	)			(792	)			(1,200	)			(219	)			(210	)			(1,382	)			(1,797	)
Net income		$	56,622			$	36,304			$	74,172			$	57,809			$	51,560			$	49,825			$	40,404
Net income per common share:
Basic		$	2.13			$	1.54			$	2.87			$	2.48			$	2.24			$	2.21			$	1.80
Diluted			1.87				1.52				2.74				2.45				2.21				2.15				1.67
Balance Sheet Data:(1)
Total cash and cash equivalents		$	276,439			$	268,275			$	184,188			$	122,482			$	146,440			$	85,679			$	56,800
Working capital			502,221				421,337				368,006				283,337				270,747				235,691				101,082
Total assets			1,899,243				1,469,142				1,505,803				1,176,413				1,149,576				1,046,828				906,031
Total debt			557,335				260,543				259,082				265,296				262,080				255,534				232,818
Stockholders’ investment			942,322				794,437				871,657				537,697				492,993				429,952				350,206
Statement of Cash Flows Data:(1)
Net cash provided by operating activities		$	43,498			$	48,699			$	104,430			$	39,265			$	104,473			$	83,331			$	62,387
Net cash used in investing activities			(236,978	)			(99,966	)			(264,335	)			(54,180	)			(46,539	)			(62,582	)			(48,181	)
Net cash provided by (used in) financing activities			283,262				195,259				215,682				(5,394	)			2,763				3,539				(1,109	)
Other Financial Data:
Adjusted EBITDA(8)		$	118,234			$	83,662			$	170,470			$	131,856			$	140,009			$	128,072			$	108,556
Capital expenditures			221,095				108,556				304,776				154,262				90,023				67,855				55,031
Ratio of Adjusted EBITDA to Adjusted Interest Expense(8)(9)			8.0	x			10.3	x			10.5	x			8.1	x			8.6	x			7.4	x			7.6	x
Ratio of total debt to Adjusted EBITDA(8)(10)			2.7	x			1.7	x			1.5	x			2.0	x			1.9	x			2.0	x			2.1	x
Debt as a percentage of book capitalization(11)			37.0	%			24.6	%			22.8	%			32.9	%			34.5	%			36.8	%			38.8	%
Ratio of earnings to fixed charges(12)			5.1	x			5.4	x			5.5	x			4.4	x			5.1	x			4.1	x			4.4	x
Helicopters in fleet			404				332				345				331				320				332				335
Average revenue per helicopter		$	1,283			$	1,341			$	2,602			$	2,323			$	2,105			$	1,858			$	1,796

(1)		Amounts included Grasso, which was sold on November 2, 2007 and will be classified as discontinued operations starting with the fiscal quarter ending December 31, 2007. Grasso had revenue and operating income of $32.6 million and $2.0 million, respectively, for the six months ended September 30, 2007.
(2)		Gross revenue includes reimbursable revenue of $49.5 million, $48.4 million, $95.9 million, $80.2 million, $64.7 million, $58.9 million and $51.0 million for the six months ended September 30, 2007 and 2006 and for fiscal years 2007, 2006, 2005, 2004 and 2003, respectively. Direct cost includes reimbursable

		expense of $47.0 million, $47.8 million, $94.7 million, $78.5 million, $63.3 million, $58.1 million and $50.5 million for the six months ended September 30, 2007 and 2006 and for fiscal years 2007, 2006, 2005, 2004 and 2003, respectively.
(3)		During the six months ended September 30, 2007, we reserved a $5.4 million accrual for sales tax contingency in Nigeria.
(4)		Includes professional fees in connection with the Internal Review and DOJ matter of $3.1 million, $5.0 million, $13.1 million and $2.2 million for the six months ended September 30, 2006 and for fiscal years 2007, 2006 and 2005, respectively. During the six months ended September 30, 2007, we reversed $1.0 million of previously accrued settlement costs due to the fact that we settled the investigation with the SEC and incurred $0.5 million in professional fees in connection with the DOJ matter.
(5)		Includes interest income earned on cash balances generated through our 5.50% mandatory convertible preferred stock offering in September and October 2006 and the Outstanding Notes.
(6)		Includes foreign currency transaction gains of $0.7 million for the six months ended September 30, 2007 and losses of $6.1 million, $9.8 million, $1.3 million, $7.9 million and $2.9 million for the six months ended September 30, 2006, fiscal years 2007, 2005, 2004 and 2003, respectively, and foreign currency transaction gains of $5.4 million for fiscal year 2006. Includes a gain of $2.5 million recognized upon the sale of our 50% interest in a Brazilian joint venture during fiscal year 2007 and an impairment charge of $1.0 million recorded during fiscal year 2006 to reduce the recorded value of this investment, as we expected at that time that our investment would not be recoverable. Includes the expense of previously deferred acquisition costs of $1.9 million in fiscal year 2007.
(7)		Includes $2.5 million in additional tax expense during fiscal year 2007 recorded as a result of the sale of the assets of Turbo Engines, Inc. in December 2006 (See “Management’s Discussion and Analysis of Financial Condition and Results of Operating — Business Unit Operating Results — Fiscal Year 2007 Compared to Fiscal Year 2006 — Helicopter Services — North America” set forth in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007, incorporated herein by reference.). Includes the impact of the reversal of reserves for tax contingencies of $0.9 million, $1.5 million, $3.4 million, $11.4 million, $3.7 million and $3.5 million in the six months ended September 30, 2007 and 2006 and fiscal years 2007, 2006, 2005 and 2004, respectively in connection with the expiration of the related statutes of limitations.
(8)		Adjusted EBITDA means earnings before interest expense, taxes, depreciation and amortization, loss on extinguishment of debt and non-cash compensation adjusted for non-cash components of net income (minority interest in earnings and equity in earnings from unconsolidated affiliates (over) under dividends received). Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP. Accordingly, it should not be considered as a substitute for net income, operating income, net cash provided by operating activities or any other operating or liquidity measure prepared in accordance with GAAP. Additionally, our Adjusted EBITDA computation may not be comparable to other similarly titled measures of other companies. We believe that Adjusted EBITDA and the ratios provide additional information regarding our ability to meet our future debt service, capital expenditures and working capital requirements. While we believe that Adjusted EBITDA may provide additional information with respect to our ability to meet our future debt service, capital expenditures and working capital requirements, certain functional or legal requirements of our business may require us to use our available funds for other purposes.

		Six Months Ended September 30,								Fiscal Year Ended March 31,
		2007				2006				2007				2006				2005				2004				2003
		(In thousands)
Adjusted EBITDA		$	118,234			$	83,662			$	170,470			$	131,856			$	140,009			$	128,072			$	108,556
Cash items (deducted from) added to Adjusted EBITDA:
Current income tax			(14,636	)			(8,627	)			(20,383	)			(15,191	)			(19,995	)			(7,059	)			(23,083	)
Interest expense			(9,456	)			(6,107	)			(10,940	)			(14,689	)			(15,665	)			(16,829	)			(14,904	)
Losses (gains) on asset dispositions			170				(4,665	)			(10,618	)			(102	)			(8,039	)			(3,943	)			(3,734	)
Loss on extinguishment of debt			—				—				—				—				—				(6,205	)			—
Increase (decrease) in cash from:
Accounts receivable			(29,400	)			(3,172	)			(1,428	)			(34,718	)			(8,612	)			10,984				533
Inventories			(13,460	)			(5,241	)			(10,225	)			(12,518	)			(5,127	)			(4,111	)			(6,545	)
Prepaid expenses and other			(5,676	)			(3,798	)			(6,634	)			(5,925	)			(724	)			5,232				(3,541	)
Accounts payable			4,635				(7,949	)			(10,688	)			15,944				6,889				(5,156	)			1,621
Accrued liabilities			2,230				7,099				5,771				(35,397	)			11,090				(3,192	)			(12,735	)
Other liabilities and deferred credits			(7,241	)			(502	)			(811	)			9,933				(538	)			795				(2,558	)
Other non-cash items			(1,902	)			(2,001	)			(84	)			72				5,185				(15,257	)			18,777
Net cash provided by operating activities		$	43,498			$	48,699			$	104,430			$	39,265			$	104,473			$	83,331			$	62,387

(9)		Adjusted Interest Expense means interest expense adjusted to add capitalized interest and deduct amortization of deferred loan costs. Adjusted Interest Expense is not a measure of financial performance or liquidity under GAAP, but is used as a component of the conditions to debt incurrence, restricted payments and certain other events under the indenture governing the notes. Accordingly, it should not be considered as a substitute for interest expense or any other operating or liquidity measure prepared in accordance with GAAP. We believe that Adjustment Interest Expense provides additional information regarding our ability to meet our future debt service, capital expenditures and working capital requirements. While we believe that Adjusted Interest Expense may provide additional information with respect to our ability to meet our future debt service, capital expenditures and working capital requirements, certain functional or legal requirements of our business may require us to use our available funds for other purposes. The following table reconciles Adjusted Interest Expense to interest expense for the periods presented:

		Six Months Ended September 30,								Fiscal Year Ended March 31,
		2007				2006				2007				2006				2005				2004				2003
		(In thousands)
Interest expense		$	9,456			$	6,107			$	10,940			$	14,689			$	15,665			$	16,829			$	14,904
Capitalized interest			5,927				2,492				6,353				2,439				1,277				1,240				—
Amortization of deferred financing costs			(622	)			(498	)			(995	)			(885	)			(662	)			(708	)			(542	)
Adjusted Interest Expense		$	14,761			$	8,101			$	16,298			$	16,243			$	16,280			$	17,361			$	14,362

(10)		The Ratio of total debt to Adjusted EBITDA presented for the six months ended September 30, 2007 and 2006 is calculated based on Adjusted EBITDA for the twelve months ended September 30, 2007 and

		2006. Adjusted EBITDA for the twelve months ended September 30, 2007 is calculated by adding the amounts for fiscal year 2007 and the six months ended September 30, 2007 and then deducting the amount for the six months ended September 30, 2006. Adjusted EBITDA for the twelve months ended September 30, 2006 is calculated by adding the amounts for fiscal year 2006 and the six months ended September 30, 2006 and then deducting Adjusted EBITDA for the six months ended September 30, 2005, which totaled $62.6 million.
(11)		Book capitalization includes total debt, minority interest and stockholders’ investment.
(12)		For purposes of determining the ratios of earnings to fixed charges, earnings are defined as net income before provision for income taxes and minority interest, undistributed earnings of unconsolidated equity affiliates, amortization of capitalized interest and fixed charges, less capitalized interest. Fixed charges consist of interest (whether expensed or capitalized), amortization of debt issuance costs, and the estimated interest portion of rental expense deemed to be representative of interest.

 

In considering whether to participate in the exchange offer, you should consider carefully all of the information that we have included or incorporated by reference into this prospectus. In particular, you should consider carefully the risk factors described below.

 

Risks Relating to the Exchange Offer

 

If you fail to exchange your Outstanding Notes, the existing transfer restrictions will remain in effect and the market value of your Outstanding Notes may be adversely affected because they may be more difficult to sell.

 

If you fail to exchange your Outstanding Notes for Exchange Notes under the exchange offer, then you will continue to be subject to the existing transfer restrictions on the Outstanding Notes. In general, the Outstanding Notes may not be offered or sold unless they are registered or exempt from registration under the Securities Act and applicable state securities laws. Except in connection with this exchange offer or as required by the Exchange and Registration Rights Agreement, we do not intend to register resales of the Outstanding Notes.

 

The tender of Outstanding Notes under the exchange offer will reduce the principal amount of the Outstanding Notes outstanding. Due to the corresponding reduction in liquidity, this may have an adverse effect upon, and increase the volatility of, the market price of any Outstanding Notes that you continue to hold following completion of the exchange offer.

 

Risks Relating to Our Customers and Contracts

 

The demand for our services is substantially dependent on the level of offshore oil and gas exploration, development and production activity.

 

We provide helicopter services to companies engaged in offshore oil and gas exploration, development and production activities. As a result, demand for our services, as well as our revenue and our profitability, are substantially dependent on the worldwide levels of activity in offshore oil and gas exploration, development and production. These activity levels are principally affected by trends in, and expectations regarding, oil and gas prices, as well as the capital expenditure budgets of oil and gas companies. We cannot predict future exploration, development and production activity or oil and gas price movements. Historically, the prices for oil and gas and activity levels have been volatile and are subject to factors beyond our control, such as:

 

 

The implementation by our customers of cost-saving measures could reduce the demand for our services.

 

Oil and gas companies are continually seeking to implement measures aimed at greater cost savings. As part of these measures, these companies are attempting to improve cost efficiencies with respect to helicopter transportation services. For example, these companies may reduce staffing levels on both old and new installations by using new technology to permit unmanned installations and may reduce the frequency of transportation of employees by increasing the length of shifts offshore. In addition, these companies could initiate their own helicopter or other alternative transportation methods. The continued implementation of these kinds of measures could reduce the demand for helicopter services and have a material adverse effect on our business, financial condition and results of operations.

 

We are highly dependent upon the level of activity in North America and the North Sea.

 

For the six months ended September 30, 2007 and in fiscal years 2007, 2006, and 2005 approximately 54%, 53%, 53% and 51%, respectively, of our gross revenue was derived from helicopter services provided to customers operating in North America and the North Sea. The U.S. Gulf of Mexico and the North Sea are mature exploration and production regions that have experienced substantial seismic survey and exploration activity for many years. Hurricanes Katrina and Rita have resulted in, or may result in, the plugging and abandonment of many wells in the U.S. Gulf of Mexico. Because a large number of oil and gas prospects in these regions have already been drilled, additional prospects of sufficient size and quality could be more difficult to identify. In addition, the U.S. government’s exercise of authority under the Outer Continental Shelf Lands Act, as amended, to restrict the availability of offshore oil and gas leases could adversely impact exploration and production activity in the U.S. Gulf of Mexico. If activity in oil and gas exploration, development and production in either North America or the North Sea materially declines, our business, financial condition and results of operations could be materially and adversely affected. We cannot predict the levels of activity in these areas.

 

Our industry is highly competitive and cyclical, with intense price competition.

 

Our industry has historically been cyclical and is affected by the volatility of oil and gas price levels. There have been periods of high demand for our services, followed by periods of low demand for our services. Changes in commodity prices can have a dramatic effect on demand for our services, and periods of low activity intensify price competition in the industry and often result in our aircraft being idle for long periods of time.

 

We depend on a small number of large offshore energy industry customers for a significant portion of our revenues.

 

We derive a significant amount of our revenue from a small number of national oil companies and major and independent oil and gas companies. Our loss of one of these significant customers, if not offset by sales to new or other existing customers, could have a material adverse effect on our business, financial condition and results of operations. Additionally, a change in policy by national oil companies could adversely affect us. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our Annual report on Form 10-K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference.

 

Our contracts generally can be terminated or downsized by our customers without penalty.

 

Many of our fixed-term contracts contain provisions permitting early termination by the customer for any reason and generally without penalty, and with limited notice requirements. In addition, many of our contracts permit our customers to decrease the number of aircraft under contract with a corresponding decrease in the fixed monthly payments without penalty. As a result, you should not place undue reliance on our customer contracts or the terms of those contracts.

We may not be able to obtain customer contracts with acceptable terms covering some of our new helicopters, and some of our new helicopters may replace existing helicopters already under contract, which could adversely affect the utilization of our existing fleet.

 

We are substantially expanding our fleet of helicopters. Many of our new helicopters may not be covered by customer contracts when they are placed into service, and we cannot assure you as to when we will be able to utilize these new helicopters or on what terms. To the extent our helicopters are covered by a customer contract when they are placed into service, many of these contracts are for a short term, requiring us to seek renewals more frequently. Alternatively, we expect that some of our customers may request new helicopters in lieu of our existing helicopters, which could adversely affect the utilization of our existing fleet.

 

Risks Relating to Our Internal Review and Governmental Investigations

 

The SEC investigation, any related proceedings in other countries and the consequences of the activities identified in the Internal Review could result in civil or criminal proceedings, the imposition of fines and penalties, the commencement of third-party litigation, the incurrence of expenses, the loss of business and other adverse effects on our company.

 

In February 2005, we voluntarily advised the staff of the SEC that the Audit Committee of our board of directors had engaged special outside counsel to undertake a review of certain payments made by two of our affiliated entities in a foreign country. The review of these payments, which initially focused on Foreign Corrupt Practices Act matters, was subsequently expanded by such special outside counsel to cover operations in other countries and other issues (the “Internal Review”). As a result of the findings of the Internal Review (which was completed in late 2005), our quarter ended December 31, 2004 and prior financial statements were restated. We also provided the SEC with documentation resulting from the Internal Review which eventually resulted in a formal SEC investigation. In September 2007, we consented to the issuance of an administrative cease-and-desist order by the SEC, in final settlement of the SEC investigation. The SEC did not impose any fine or other monetary sanction upon the Company. Without admitting or denying the SEC’s findings, we consented to be ordered not to engage in future violations of certain provisions of the federal securities laws involving improper foreign payments, internal controls and books and records. For further information on the restatements, see our Annual Report on Form 10-K for the fiscal year ended March 31, 2005.

 

As a result of the disclosure and remediation of a number of activities identified in the Internal Review, we may encounter difficulties conducting business in certain foreign countries and retaining and attracting additional business with certain customers. We cannot predict the extent of these difficulties; however, our ability to continue conducting business in these countries and with these customers and through agents may be significantly impacted. We could still face legal and administrative proceedings, the institution of administrative, civil injunctive or criminal proceedings involving us and/or current or former employees, officers and/or directors who are within the jurisdictions of such authorities, the imposition of fines and other penalties, remedies and/or sanctions, including precluding us from participating in business operations in their countries. It is also possible that we may become subject to claims by third parties, possibly resulting in litigation. The matters identified in the Internal Review and their effects could have a material adverse effect on our business, financial condition and results of operations.

 

In addition, we face legal actions relating to remedial actions which we have taken as a result of the Internal Review, and may face further legal action of this type in the future. In November 2005, two of our consolidated foreign affiliates were named in a lawsuit filed with the High Court of Lagos State, Nigeria by Mr. Benneth Osita Onwubalili and his affiliated company, Kensit Nigeria Limited, which allegedly acted as agents of our affiliates in Nigeria. The claimants allege that an agreement between the parties was terminated without justification and seek damages of $16.3 million. We have responded to this claim and are continuing to investigate this matter.

 

As we continue to operate our compliance program, other situations involving foreign operations, similar to those matters disclosed to the SEC in February 2005 and described above, could arise that warrant further investigation and subsequent disclosures. As a result, new issues may be identified that may impact our financial statements and lead us to take other remedial actions or otherwise adversely impact us.

During fiscal years 2005, 2006 and 2007, and the six months ended September 30, 2006, we incurred approximately $2.2 million, $10.5 million, $3.1 million and $0.1 million, respectively, in legal and other professional costs in connection with the Internal Review. During the six months ended September 30, 2007, we reversed $1.0 million of previously accrued settlement costs due to the fact that we settled the investigation with the SEC.

 

Following the previously disclosed settlement with the SEC regarding improper payments made by foreign affiliates of the Company in Nigeria, outside counsel to the Company was contacted by the Department of Justice (“DOJ”) and was asked to provide certain information regarding our Audit Committee’s related Internal Review. We previously provided disclosure regarding the Internal Review in our Annual Report on Form 10-K for the fiscal year ended March 31, 2005. In addition, we were requested to enter into an agreement with the DOJ that would toll the statute of limitations relating to these matters. We intend to be responsive to the DOJ’s requests. At this time, it is not possible to predict what the outcome of the DOJ’s investigation into these matters will be for the Company.

 

The disclosure and remediation of activities identified in the Internal Review could result in the loss of business relationships and adversely affect our business..

 

As a result of the disclosure and remediation of a number of activities identified in the Internal Review, we may encounter difficulties conducting business in certain foreign countries and retaining and attracting additional business with certain customers. We cannot predict the extent of these difficulties; however, our ability to continue conducting business in these countries and with these customers and through agents may be significantly impacted. In addition, applicable governmental authorities may preclude us from bidding on contracts to provide services in the countries where improper activities took place.

 

The DOJ investigation or any related proceedings in other countries could result in criminal proceedings and the imposition of fines and penalties, the commencement of third-party litigation, the incurrence of expenses, the loss of business and other adverse effects on our company.

 

In June 2005, one of our subsidiaries received a document subpoena from the DOJ. The subpoena related to a grand jury investigation of potential antitrust violations among providers of helicopter transportation services in the U.S. Gulf of Mexico. The subpoena focused on activities during the period from January 1, 2000 to June 13, 2005. We believe we have submitted to the DOJ substantially all documents responsive to the subpoena. We have had discussions with the DOJ and provided documents related to our operations in the U.S. as well as internationally. We intend to continue to provide additional information as required by the DOJ in connection with the investigation. There is no assurance that, after review of any information furnished by us or by third parties, the DOJ will not ultimately conclude that violations of U.S. antitrust laws have occurred. The period of time necessary to resolve the DOJ investigation is uncertain, and this matter could require significant management and financial resources that could otherwise be devoted to the operation of our business.

 

The outcome of the DOJ investigation and any related legal proceedings in other countries could include civil injunctive or criminal proceedings involving us or our current or former officers, directors or employees, the imposition of fines and other penalties, remedies and/or sanctions, including potential disbarments, and referrals to other governmental agencies. In addition, in cases where anti-competitive conduct is found by the government, there is a greater likelihood for civil litigation to be brought by third parties seeking recovery. Any such civil litigation could have serious consequences for our company, including the costs of the litigation and potential orders to pay restitution or other damages or penalties, including potentially treble damages, to any parties that were determined to be injured as a result of any impermissible anti-competitive conduct. Any of these adverse consequences could have a material adverse effect on our business, financial condition and results of operations. The DOJ investigation, any related proceedings in other countries and any third-party litigation, as well as any negative outcome that may result from the investigation, proceedings or litigation, could also negatively impact our relationships with customers and our ability to generate revenue.

In connection with this matter, we incurred $0.5 million, $1.9 million and $2.6 million in legal and other professional fees for the six months ended September 30, 2007 and in the fiscal years 2007 and 2006, respectively, and significant expenditures may continue to be incurred in the future.

 

Risks Relating to Our Business

 

Our future growth depends on the level of international oil and gas activity and our ability to operate outside of North America and the North Sea.

 

Our future growth will depend significantly on our ability to expand into international markets outside of North America and the North Sea. Expansion of our business depends on our ability to operate in these regions.

 

Expansion of our business outside of North America and the North Sea may be adversely affected by:

 

 

We cannot predict the restrictions or requirements that may be imposed in the countries in which we operate. If we are unable to continue to operate or retain contracts in operations outside of North America and the North Sea, our future business, financial condition and results of operations may be adversely affected, and our operations outside of North America and the North Sea may not grow.

 

In order to grow our business, we may require additional capital in the future, which may not be available to us.

 

Our business is capital intensive, and to the extent we do not generate sufficient cash from operations, we will need to raise additional funds through public or private debt or equity financings to execute our growth strategy. Adequate sources of capital funding may not be available when needed, or may not be available on favorable terms. If we raise additional funds by issuing equity securities, dilution to the holdings of existing stockholders may result. If funding is insufficient at any time in the future, we may be unable to acquire additional aircraft, take advantage of business opportunities or respond to competitive pressures, any of which could harm our business. See discussion of our capital commitments in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Future Cash Requirements —” included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference.

 

Our operations outside of North America and the North Sea are subject to additional risks.

 

During fiscal years 2007, 2006 and 2005, approximately 40%, 38% and 40%, respectively, of our gross revenue was attributable to helicopter services provided to oil and gas customers operating outside of North America and the North Sea. Operations in most of these areas are subject to various risks inherent in conducting business in international locations, including:

 

 

For example, there has been continuing unrest in Nigeria, where we derived 15% of our gross revenues during the six months ended September 30, 2007 and 14% of our gross revenue in each of fiscal years 2007, 2006 and 2005. This unrest has adversely affected our results of operations in Nigeria in fiscal year 2007, and any future unrest in Nigeria or our other operating regions could adversely affect our business, financial condition and results of operations in those periods. We cannot predict whether any of these events will continue to occur in the future in Nigeria or occur in the future elsewhere.

 

Foreign exchange risks and controls may affect our financial position and results of operations.

 

Through our operations outside the U.S., we are exposed to currency fluctuations and exchange rate risks. The majority of both our revenue and expenses from our Europe business unit is denominated in British pounds sterling. Our foreign exchange rate risk is even greater when our revenue is denominated in a currency different from that associated with the corresponding expenses. In addition, some of our contracts provide for payment in currencies other than British pounds sterling or U.S. dollars. We attempt to minimize our exposure to foreign exchange rate risk by contracting the majority of our services, other than in our Europe business unit, in U.S. dollars. As a result, a strong U.S. dollar may increase the local cost of our services that are provided under U.S. dollar-denominated contracts, which may reduce the demand for our services in foreign countries. Generally, we do not enter into hedging transactions to protect against foreign exchange risks related to our gross revenue.

 

Because we maintain our financial statements in U.S. dollars, our financial results are vulnerable to fluctuations in the exchange rate between the U.S. dollar and foreign currencies, such as the British pound sterling. In preparing our financial statements, we must convert all non-U.S. dollar currencies to U.S. dollars. The effect of foreign currency translation is reflected in a component of stockholders’ investment, while foreign currency transaction gains or losses and translation of currency amounts not deemed permanently reinvested are credited or charged to income and reflected in other income (expense). In the past three fiscal years, our stockholders’ investment has decreased by as much as $20.7 million and increased by as much as $27.1 million, as a result of translation adjustments. In addition, during this period our results of operations have included foreign currency gains or losses ranging from a loss of $9.8 million to a gain of $5.4 million. Changes in exchange rates could cause significant changes in our financial position and results of operations in the future.

 

We operate in countries with foreign exchange controls including Brazil, Egypt, India, Kazakhstan, Malaysia, Nigeria, Russia and Turkmenistan. These controls may limit our ability to repatriate funds from our international operations and unconsolidated affiliates or otherwise convert local currencies into U.S. dollars. These limitations could adversely affect our ability to access cash from these operations.

 

See further discussion of foreign exchange risks and controls under “Quantitative and Qualitative Disclosure About Market Risk” in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference.

 

We operate in many international areas through entities that we do not control.

 

We conduct many of our international operations through entities in which we have a minority investment or through strategic alliances with foreign partners. For example, we have acquired interests in, and in some cases have lease and service agreements with, entities that operate aircraft in Egypt, Mexico, Norway, and the U.K. We provide engineering and administrative support to certain of these entities. We derive significant amounts of lease revenue, service revenue and dividend income from these entities. In fiscal years 2007, 2006 and 2005, we derived approximately $2.6 million, $2.7 million and $3.4 million, respectively, of dividend income from our unconsolidated affiliates. More significantly, in fiscal years 2007, 2006 and 2005, we received approximately $56.8 million, $56.2 million and $66.4 million, respectively, of revenues from the provision of aircraft and other services to unconsolidated affiliates, of which approximately $8.6 million, $8.0 million and $9.7 million, respectively, was derived from our former joint venture in a South American country (see discussion of the sale of our ownership interest in this joint venture in March 2007 under

“Business Operating Results — South and Central America” included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference). Because we do not own a majority or maintain voting control of our unconsolidated affiliates, we do not have the ability to control their policies, management or affairs. The interests of persons who control these entities or partners may differ from ours, and may cause such entities to take actions that are not in our best interest. If we are unable to maintain our relationships with our partners in these entities, we could lose our ability to operate in these areas, potentially resulting in a material adverse effect on our business and results of operations.

 

Labor problems could adversely affect us.

 

Approximately 300 pilots in our North America business unit and substantially all of our employees in the U.K., Nigeria and Australia are represented under collective bargaining or union agreements. Periodically, certain groups of our employees who are not covered by a collective bargaining agreement consider entering into such an agreement. In addition, many of the employees of our affiliates are represented by collective bargaining agreements. Any disputes over the terms of these agreements or our potential inability to negotiate acceptable contracts with the unions that represent our employees under these agreements could result in strikes, work stoppages or other slowdowns by the affected workers.

 

We are currently involved in negotiations with unions representing our pilots and engineers in the U.K., and we currently expect that labor rates under our existing contracts could increase 4-5% starting in July 2007 through June 2008. We expect to be able to pass these costs on to our customers through annual contract escalation charges built into existing contracts or through rate increases as customer contracts come up for renewal.

 

We are also currently involved in the annual contract negotiations with the unions in Nigeria and anticipate that we will increase certain benefits for union personnel as a result of these negotiations.

 

If our unionized workers engage in a strike, work stoppage or other slowdown, or other employees elect to become unionized or existing labor agreements are renegotiated on, or future labor agreements contain, terms that are unfavorable to us, we could experience a disruption of our operations or higher ongoing labor costs which could adversely affect our business, financial condition and results of operations.

 

Our failure to attract and retain qualified personnel could have an adverse affect on us.

 

Our ability to attract and retain qualified pilots, mechanics and other highly-trained personnel is an important factor in determining our future success. For example, many of our customers require pilots with very high levels of flight experience. The market for these experienced and highly-trained personnel is competitive and may become more competitive. Accordingly, we cannot assure you that we will be successful in our efforts to attract and retain such personnel. Some of our pilots, mechanics and other personnel, as well as those of our competitors, are members of the U.S. or U.K. military reserves who have been, or could be, called to active duty. If significant numbers of such personnel are called to active duty, it would reduce the supply of such workers and likely increase our labor costs. Additionally, our fleet expansion program will require us to retain additional pilots, mechanics and other flight-related personnel. Finally, as a result of the disclosure and remediation of activities identified in the Internal Review, we may have difficulty attracting and retaining qualified personnel, and we may incur increased expenses. Our failure to attract and retain qualified personnel could have a material adverse effect on our current business and our growth strategy.

 

Helicopter operations involve risks that may not be covered by our insurance or may increase our operating costs.

 

The operation of helicopters inherently involves a degree of risk. Hazards such as harsh weather and marine conditions, mechanical failures, crashes and collisions are inherent in our business and may result in personal injury, loss of life, damage to property and equipment and suspension or reduction of operations. Our aircraft have been involved in accidents in the past, some of which have included loss of life and property damage. We may experience similar accidents in the future.

We attempt to protect ourselves against these losses and damage by carrying insurance, including hull and liability, general liability, workers’ compensation, and property and casualty insurance. Our insurance coverage is subject to deductibles and maximum coverage amounts, and we do not carry insurance against all types of losses, including business interruption. We cannot assure you that our existing coverage will be sufficient to protect against all losses, that we will be able to maintain our existing coverage in the future or that the premiums will not increase substantially. In addition, future terrorist activity, risks of war, accidents or other events could increase our insurance premiums. The loss of our liability insurance coverage, inadequate coverage from our liability insurance or substantial increases in future premiums could have a material adverse effect on our business, financial condition and results of operations.

 

We are subject to government regulation that limits foreign ownership of aircraft companies.

 

We are subject to governmental regulation that limits foreign ownership of aircraft companies. In the U.S., our aircraft may be subject to deregistration under the Federal Aviation Act, and we may lose our ability to operate within the U.S. if persons other than citizens of the U.S. should come to own or control more than 25% of our voting interest, if the president of our company is not a U.S. citizen, if two-thirds or more of our directors are not U.S. citizens or if our company is not under the actual control of U.S. citizens. Deregistration of our aircraft for any reason, including foreign ownership in excess of permitted levels, would have a material adverse effect on our ability to conduct operations within our North America business unit. In the U.K., we are subject to regulation under English and European statutes and regulations and are required to hold an operating license issued by the CAA in order to operate in the U.K. To operate under this license, the company through which we conduct operations in the U.K., Bristow Helicopters Ltd., must be owned directly or through majority ownership by European Union nationals, and must at all times be effectively controlled by them. Bristow Helicopters Ltd. is a wholly owned subsidiary of Bristow Aviation. We own 49% of, and hold certain put/call rights over additional, shares of common stock of Bristow Aviation. If we were considered to have majority ownership of or control over Bristow Helicopters Ltd., either presently or in the future (including following the exercise of the put/call option), Bristow Helicopters Ltd. could lose its operating license, which would have a material adverse effect on our ability to operate in the U.K.

 

Changes in these statutes or regulations, administrative requirements or their interpretation may have a material adverse effect on our business or financial condition or on our ability to continue operations in these areas. Additionally, changes in local laws, regulations or administrative requirements or their interpretation in other international locations where we operate may have a material adverse effect on our business or financial condition or on our ability to continue operations in these areas.

 

We cannot assure you that there will be no changes in aviation laws, regulations or administrative requirements or the interpretations thereof, that could restrict or prohibit our ability to operate in certain regions. Any such restriction or prohibition on our ability to operate may have a material adverse effect on our business, financial condition and results of operations.

 

See further discussion in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference.

 

Actions taken by agencies empowered to enforce governmental regulations could increase our costs and reduce our ability to operate successfully.

 

Our operations are regulated by governmental agencies in the various jurisdictions in which we operate. These agencies have jurisdiction over many aspects of our business, including personnel, aircraft and ground facilities. Statutes and regulations in these jurisdictions also subject us to various certification and reporting requirements and inspections regarding safety, training and general regulatory compliance. Other statutes and regulations in these jurisdictions regulate the offshore operations of our customers. The agencies empowered to enforce these statutes and regulations may suspend, curtail or modify our operations. A suspension or substantial curtailment of our operations for any prolonged period, and any substantial modification of our

current operations, may have a material adverse effect on our business, financial condition and results of operations.

 

See further discussion in “Business — Government Regulation” and “Business — Environmental” set forth in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007, incorporated herein by reference.

 

We face substantial competition.

 

The helicopter business is highly competitive. Chartering of helicopters is usually done on the basis of competitive bidding among those providers having the necessary equipment, operational experience and resources. Factors that affect competition in our industry include price, reliability, safety, professional reputation, availability, equipment and quality of service.

 

In our North America business unit, we face competition from a number of providers, including one U.S. competitor with a comparable number of helicopters servicing the U.S. Gulf of Mexico. We have several significant competitors in the U.S. Gulf of Mexico, two significant competitors in the North Sea and one significant competitor in Nigeria.

 

Certain of our customers have the capability to perform their own helicopter operations should they elect to do so, which has a limiting effect on our rates. The loss of a significant number of our customers or termination of a significant number of our contracts could materially adversely affect our business, financial condition and results of operations.

 

As a result of significant competition, we must continue to provide safe and efficient service or we will lose market share, which could have a material adverse effect on our business, financial condition and results of operations. The loss of a significant number of our customers or termination of a significant number of our contracts could have a material adverse effect on our business, financial condition and results of operations.

 

Our operations are subject to weather-related and seasonal fluctuations.

 

Generally, our operations can be impaired by harsh weather conditions. Poor visibility, high wind, heavy precipitation and sand storms can affect the operation of helicopters and result in a reduced number of flight hours. A significant portion of our operating revenue is dependent on actual flight hours, and a substantial portion of our direct cost is fixed. Thus, prolonged periods of harsh weather can have a material adverse effect on our business, financial condition and results of operations.

 

In the Gulf of Mexico, the months of December through March have more days of harsh weather conditions than the other months of the year. Heavy fog during those months often limits visibility. In addition, in the Gulf of Mexico, June through November is tropical storm and hurricane season. When a tropical storm or hurricane is about to enter or begins developing in the Gulf of Mexico, flight activity may increase because of evacuations of offshore workers. However, during a tropical storm or hurricane, we are unable to operate in the area of the storm. In addition, as a significant portion of our facilities are located along the coast of the U.S. Gulf of Mexico, tropical storms and hurricanes may cause substantial damage to our property in these locations, including helicopters. Additionally, we incur costs in evacuating our aircraft, personnel and equipment prior to tropical storms and hurricanes.

 

The fall and winter months have fewer hours of daylight, particularly in the North Sea and Alaska. While some of our aircraft are equipped to fly at night, we generally do not do so. In addition, drilling activity in the North Sea and Alaska is lower during the winter months than the rest of the year. Anticipation of harsh weather during this period causes many oil companies to limit activity during the winter months. Consequently, flight hours are generally lower during these periods, typically resulting in a reduction in operating revenue during those months. Accordingly, our reduced ability to operate in harsh weather conditions and darkness may have a material adverse effect on our business, financial condition and results of operations.

Environmental regulations and liabilities may increase our costs and adversely affect us.

 

Our operations are subject to U.S. federal, state and local, and foreign environmental laws and regulations that impose limitations on the discharge of pollutants into the environment and establish standards for the treatment, storage, recycling and disposal of toxic and hazardous wastes. The nature of the business of operating and maintaining helicopters requires that we use, store and dispose of materials that are subject to environmental regulation. Environmental laws and regulations change frequently, which makes it impossible for us to predict their cost or impact on our future operations. Liabilities associated with environmental matters could have a material adverse effect on our business, financial condition and results of operations. We could be exposed to strict, joint and several liability for cleanup costs, natural resource damages and other damages as a result of our conduct that was lawful at the time it occurred or the conduct of, or conditions caused by, prior operators or other third parties. Additionally, any failure by us to comply with applicable environmental laws and regulations may result in governmental authorities taking action against our business that could adversely impact our operations and financial condition, including the:

 

 

For additional information see “Business — Environmental” and “Business — Legal Proceedings” set forth in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007, incorporated herein by reference.

 

Our dependence on a small number of helicopter manufacturers poses a significant risk to our business and prospects.

 

We contract with a small number of manufacturers for most of our aircraft expansion and replacement needs. If any of these manufacturers faced production delays due to, for example, natural disasters or labor strikes, we may experience a significant delay in the delivery of previously ordered aircraft, which would adversely affect our revenues and profitability and could jeopardize our ability to meet the demands of our customers. We have limited alternatives to find alternate sources of new aircraft.

 

A shortfall in availability of aircraft components and parts required for maintenance and repairs of our aircraft and supplier cost increases could adversely affect us.

 

In connection with the required routine maintenance and repairs performed on our aircraft in order for them to stay fully operational and available for use in our operations, we rely on a few key vendors for the supply and overhaul of certain key components fitted to our aircraft. Currently those vendors are working at or near full capacity supporting the aircraft production lines and the maintenance requirements of the aircraft operators who are also operating at near capacity in certain industries, including operators such as us who support the energy industry. These vendors are therefore experiencing backlogs in manufacturing schedules and some parts are in limited supply from time to time. Lead times for ordering certain critical components are extending into longer time periods, and this could have an adverse impact upon our ability to maintain and repair our aircraft. Our inability to perform timely maintenance and repairs can result in our aircraft being underutilized which could have an adverse impact on our operating results. Furthermore, our operations in remote locations, where delivery of these components and parts could take a significant period of time, may also impact our ability to maintain and repair our aircraft. While every effort is made to mitigate such impact, this may pose a risk to our operating results. Additionally, supplier cost increases for critical aircraft components and parts also pose a risk to our operating results. Cost increases are passed through to our customers through rate increases where possible, including as a component of contract escalation charges. However, as certain of our contracts are long-term in nature, cost increases may not be adjusted in our contract rates until the contracts are up for renewal.

Risks Relating to the Notes

 

The risks described in this “Risks Relating to the Notes” that apply to the Exchange Notes also apply to any Outstanding Notes not tendered by the Exchange Notes in the exchange offer.

 

Our substantial indebtedness could adversely affect our financial condition and impair our ability to fulfill our obligations under the Notes.

 

Following the completion of the offering of the Outstanding Notes, we had substantial debt and substantial debt service requirements. As of September 30, 2007, as adjusted to give effect to the November 13, 2007 71/2% notes offering, we had approximately $608.0 million of outstanding indebtedness.

 

Our level of indebtedness may have important consequences to our business and to you, including:

 

 

If we are unable to generate sufficient cash flow from operations in the future to service our debt, we may be required to refinance all or a portion of our existing debt, including the Notes, or to obtain additional financing. We cannot assure you that any such refinancing would be possible or that any additional financing could be obtained. Our inability to obtain such refinancing or financing may have a material adverse effect on us.

 

There may be no public market for the Exchange Notes.

 

The Exchange Notes will be new securities for which currently there is no trading market. We do not intend to apply for the Exchange Notes to be listed on any securities exchange or to arrange for any quotation system to quote them. The liquidity of any market for the Exchange Notes will depend on the number of holders of those Exchange Notes, the interest of securities dealers in making a market in those securities and other factors. Accordingly, we cannot assure you as to:

 

 

If such a market were to exist, the Exchange Notes could trade at prices that may be lower than the principal amount or purchase price, depending on many factors, including prevailing interest rates, the market for similar notes and our financial performance. If an active market does not develop or is not maintained, the price and liquidity of the Exchange Notes may be adversely affected.

Despite our and our subsidiaries’ current levels of indebtedness, we may incur substantially more debt, which could further exacerbate the risks associated with our substantial indebtedness.

 

We had $100 million of availability for borrowings under our existing credit facilities as of September 30, 2007, subject to our maintenance of covenants and other conditions. Although the agreements governing our credit facilities and the indentures governing our 61/8% senior notes due 2013 and the Outstanding Notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and we could incur substantial additional indebtedness. In addition to amounts that we may borrow under our existing credit facilities, the indentures governing our 61/8% notes and the Outstanding Notes also allow us to borrow significant amounts of money from other sources. Also, these restrictions do not prevent us from incurring obligations that do not constitute “indebtedness” as defined in the relevant agreement. If we incur additional indebtedness, the related risks that we now face could intensify.

 

To service our indebtedness, including the Notes, we will continue to require a significant amount of cash, and our ability to generate cash depends on many factors beyond our control.

 

Our ability to make scheduled payments of principal or interest with respect to our indebtedness, including the Notes, will depend on our ability to generate cash and on our financial results. Our ability to generate cash depends on the demand for our services, which is subject to levels of activity in offshore oil and gas exploration, development and production, general economic conditions, and financial, competitive, regulatory and other factors affecting our operations, many of which are beyond our control. We cannot assure you that our operations will generate sufficient cash flow or that future borrowings will be available to us under our credit facilities or otherwise in an amount sufficient to enable us to pay our indebtedness, including the Notes, or to fund our other liquidity needs.

 

We are dependent on our subsidiaries and our unconsolidated affiliates for our cash flow.

 

We are a holding company with no material assets other than cash, our equity interests in our subsidiaries, our interests in our unconsolidated affiliates and our indebtedness from those subsidiaries and affiliates. Our subsidiaries and our unconsolidated affiliates conduct substantially all of our operations and directly own substantially all of our assets. Therefore, our operating cash flow and ability to meet our debt obligations, including the Notes, will depend on the cash flow provided by our subsidiaries and our unconsolidated affiliates in the form of loans, dividends, aircraft leases, maintenance charges, reimbursable expenses or other payments to us as a shareholder, equity holder, service provider or lender. The ability of our subsidiaries and our unconsolidated affiliates to make such payments to us will depend on their earnings, tax considerations, legal restrictions and restrictions under their indebtedness. Our non-guarantor subsidiaries are not obligated to make funds available for payment of the Notes. Although the indenture will limit the ability of our guarantor subsidiaries to enter into consensual restrictions on their ability to pay dividends and make other payments, the limitations are subject to a number of significant qualifications and exceptions.

 

The Notes will continue to be structurally subordinated to all indebtedness of our subsidiaries that are not guarantors of the Notes.

 

We derive substantially all of our revenue from our consolidated subsidiaries and our unconsolidated affiliates. While certain of our U.S. subsidiaries will guarantee the Notes, our non-U.S. subsidiaries, many of which are significant, will not guarantee the Notes. You will not have any claim as a creditor against our subsidiaries that are not guarantors of the Notes. Accordingly, all obligations of our non-guarantor subsidiaries will have to be satisfied before any of the assets of such subsidiaries would be available for distribution, upon a liquidation or otherwise, to us or a guarantor of the Notes. As of September 30, 2007, our non-guarantor subsidiaries had approximately $385.9 million of total liabilities (including trade payables but excluding intercompany liabilities and guarantees). Revenue related to our non-guarantor subsidiaries constituted 66% of our operating revenue during the six months ended September 30, 2007, and our non-guarantor subsidiaries held approximately 50% of our consolidated assets as of September 30, 2007. Under the indenture governing the Notes, our non-guarantor subsidiaries will be permitted to incur substantial amounts of additional indebtedness, which would be structurally senior to the Notes.

Similar to our non-guarantor subsidiaries, you will not have any claim as a creditor against our unconsolidated affiliates. We own less than 50% of the equity of our unconsolidated affiliates and some of our subsidiaries so that, in addition to the claims of creditors of those entities, the equity interests of our partners or other shareholders in any dividend or other distribution made by these entities would need to be satisfied on a proportionate basis with us. These unconsolidated affiliates and subsidiaries may also be subject to restrictions on their ability to distribute cash to us in their financing or other agreements, and as a result, we may not be able to access their cash flow to service our debt obligations, including the Notes.

 

The Notes and the guarantees will continue to be unsecured and effectively subordinated to our and our subsidiary guarantors’ secured indebtedness.

 

The Notes and the related subsidiary guarantees will not be secured by any of our assets. As of September 30, 2007, we and our subsidiary guarantors had no secured debt outstanding. In addition, the indentures governing our 61/8% notes and the Notes will permit the incurrence of additional debt, some of which may be secured debt. Holders of our secured debt will have claims that are effectively senior to your claims as holders of the Notes to the extent of the value of the assets securing the secured debt. The Notes will be effectively subordinated to all secured debt.

 

If we become insolvent or are liquidated, or if payment under any secured debt is accelerated, the lender thereunder would be entitled to exercise the remedies available to a secured lender. Accordingly, the lender will have priority over any claim for payment under the Notes or the guarantees to the extent of the assets that constitute their collateral. If this were to occur, it is possible that there would be no assets remaining from which claims of the holders of the Notes could be satisfied. Further, if any assets did remain after payment of these lenders, the remaining assets might be insufficient to satisfy the claims of the holders of the Notes and holders of other unsecured debt that is deemed the same class as the Notes, and potentially all other general creditors who would participate ratably with holders of the Notes.

 

Restrictive covenants in our debt agreements may restrict the manner in which we can operate our business.

 

Our existing credit facilities and the indentures governing our 61/8% notes and the Notes limit, among other things, our ability and the ability of our restricted subsidiaries to:

 

 

If we fail to comply with these covenants, we would be in default under our existing credit facilities and the indentures governing our 61/8% notes and the Notes, and the principal and accrued interest on our 61/8% notes and the Notes and our other outstanding indebtedness may become due and payable. See “Description of Other Indebtedness” and “Description of the Exchange Notes — Certain Covenants”. In addition, our credit facilities contain, and our future indebtedness agreements may contain, additional affirmative and negative covenants, which are generally more restrictive than those contained in the indenture for the Notes.

 

As a result of these covenants, our ability to respond to changes in business and economic conditions and to obtain additional financing, if needed, may be significantly restricted, and we may be prevented from engaging in transactions that might otherwise be considered beneficial to us. Our existing credit facilities also require, and our future credit facilities may require, us to maintain specified financial ratios and satisfy certain financial condition tests. Our ability to meet these financial ratios and tests can be affected by events beyond

our control, and we cannot assure you that we will meet those tests. The breach of any of these covenants could result in a default under our existing credit facilities. Upon the occurrence of an event of default under our existing or future credit facilities, the lenders could elect to declare all amounts outstanding under such credit facilities, including accrued interest or other obligations, to be immediately due and payable. There can be no assurance that our assets would be sufficient to repay in full that indebtedness and our other indebtedness, including the Notes.

 

The instruments governing certain of our indebtedness, including our existing credit facilities and the indentures governing our 61/8% notes and the Notes, contain cross-default provisions. Under these provisions, a default under one instrument governing our indebtedness may constitute a default under our other instruments of indebtedness that contain cross-default provisions.

 

A court could subordinate or void the obligations under our subsidiaries’ guarantees.

 

Under the U.S. federal bankruptcy laws and comparable provisions of state fraudulent conveyance laws, a court could void obligations under the subsidiary guarantees, subordinate those obligations to other obligations of our subsidiary guarantors or require you to repay any payments made pursuant to the subsidiary guarantees, if:

 

(1) fair consideration or reasonably equivalent value was not received in exchange for the obligation; and

 

(2) at the time the obligation was incurred, the obligor:

 

 

The measure of insolvency for these purposes will depend upon the law of the jurisdiction being applied. Generally, however, a company will be considered insolvent if:

 

 

Moreover, regardless of solvency, a court might void the guarantees, or subordinate the guarantees, if it determined that the transaction was made with intent to hinder, delay or defraud creditors.

 

Each subsidiary guarantee contains a provision intended to limit the guarantor’s liability to the maximum amount that it could incur without causing the incurrence of obligations under its subsidiary guarantee to be a fraudulent transfer. This provision, however, may not be effective to protect the subsidiary guarantees from attack under fraudulent transfer law.

 

The indenture requires that certain subsidiaries must guarantee the Notes in the future. These considerations will also apply to these future guarantees.

 

We may not have the ability to repurchase the Notes upon a change of control as required by the indenture.

 

Upon the occurrence of a Change of Control together with a Ratings Event (each as defined in “Description of the Exchange Notes”), we will be required to offer to purchase all of the outstanding Notes at

101% of their principal amount plus accrued and unpaid interest to the date of repurchase. Upon such a change of control, we may not have sufficient funds available to repurchase all of the Notes tendered pursuant to this requirement. A change of control is an event of default under our existing credit facilities and would prevent our use of the facilities to pay for the Notes tendered in the change of control offer. Further, the occurrence of a change of control would allow the lenders under our existing credit facilities to accelerate the maturity thereof. Our failure to repurchase the Notes would be a default under the indenture, which would, in turn, be a default under our existing credit facilities and, potentially, other debt. If any debt were to be accelerated, we may be unable to repay these amounts and make the required repurchase of the Notes. See “Description of the Exchange Notes — Repurchase at the Option of Holders”.

 

On June 13, 2007 and November 13, 2007, we completed private offerings totaling $350 million principal amount of 71/2% Senior Notes due 2017 to the initial purchasers of the Outstanding Notes in transactions exempt from or not subject to registration under the Securities Act. The initial purchasers then offered and resold the Outstanding Notes to qualified institutional buyers and non-U.S. persons.

 

We received net proceeds of approximately $345.4 million from the private placements. We have used, and expect to continue using, the net proceeds to purchase additional aircraft and potentially acquire additional businesses.

 

We will not receive any cash proceeds from the issuance of the Exchange Notes. In consideration for issuing the Exchange Notes, we will receive in exchange a like principal amount of Outstanding Notes. The Outstanding Notes surrendered in exchange for the Exchange Notes will be retired and canceled and cannot be reissued. Accordingly, issuance of the Exchange Notes will not result in any change in our capitalization.

 

The following selected financial data as of and for each of the five years ended March 31, 2007 is derived from our audited consolidated financial statements. The selected financial data as of and for each of the six months ended September 30, 2007 and 2006 are derived from our unaudited consolidated financial statements and, in our opinion, have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of this information.

 

 

 

 

The following table reconciles Adjusted EBITDA to net cash provided by operating activities for the periods presented:

 

 

 

 

 

The following is a summary of certain of our other indebtedness. This summary does not purport to be complete and is qualified in its entirety by reference to the provisions in the documents governing such indebtedness, some of which are filed as exhibits to our reports filed with the SEC. See “Where You Can Find More Information.”

 

61/8% Senior Notes due 2013

 

On June 20, 2003, we completed an offering of $230.0 million aggregate principal amount outstanding of the 61/8% notes. The 61/8% notes are unsecured and are guaranteed by certain of our U.S. subsidiaries. The indenture to the 61/8% notes restricts, among other things, our payment of cash dividends to stockholders; repurchase of our capital stock or subordinated indebtedness; incurrence of additional indebtedness or issuance of “disqualified stock” (as defined in the indenture); making of loans, guarantees or investments; creation of liens or security interests; sale of assets; merger or consolidation with another company, or sale of all or substantially all of our assets; and entrance into transactions with affiliates. In addition, holders of the 61/8% notes may require us to repurchase all or part of their notes following a “change of control” (as defined in the indenture) of our company. Certain of these restrictions will cease to apply following the 61/8% notes receiving an investment grade rating from Moody’s and Standard & Poor’s, so long as no event of default has occurred and is continuing. The 61/8% notes are redeemable at our option; however, any payment or re-financing of these notes prior to June 2008 is subject to a make-whole premium and any payment or re-financing after June 2008 but prior to June 2011 is subject to a prepayment premium (approximately 103%, 102% and 101% in June 2008, 2009 and 2010, respectively). See Note 5 in the “Notes to Consolidated Financial Statements” included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007

and the Quarterly Reports on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference.

 

Senior Secured Credit Facilities

 

In August 2006, we entered into syndicated senior secured credit facilities which consist of a $100 million revolving credit facility (with a subfacility of $25 million for letters of credit) and a $25 million letter of credit facility. The aggregate commitments under the revolving credit facility may be increased to $200 million at our option following our 61/8% notes receiving an investment grade credit rating from Moody’s or Standard & Poor’s (so long as the rating of the other rating agency of such notes is no lower than one level below investment grade). As of September 30, 2007, our Moody’s and Standard & Poor’s ratings were Ba2 and BB, respectively, which are two levels below the investment grade ratings of Baa3 and BBB-, respectively. In May 2007 and November 2007, we amended the Credit Facilities to increase the amount of permitted additional indebtedness to $325 million and $375 million, respectively. The revolving credit facility may be used for general corporate purposes, including working capital and acquisitions. The letter of credit facility is used to issue letters of credit supporting or securing performance of statutory obligations, surety or appeal bonds, bid or performance bonds and similar obligations.

 

Borrowings under the revolving credit facility bear interest at an interest rate equal to, at our option, either the Base Rate or LIBOR (or EURIBO, in the case of Euro-denominated borrowings) plus the applicable margin. “Base Rate” means the higher of (1) the prime rate and (2) the Federal Funds rate plus 0.5% per annum. The applicable margin for borrowings range from 0.0% and 2.5% depending on whether the Base Rate or LIBOR is used, and is determined based on our credit rating. Fees owed on letters of credit issued under either the revolving credit facility or the letter of credit facility are equal to the margin for LIBOR borrowings. Based on our current ratings, the margins on Base Rate and LIBOR borrowings were 0.0% and 1.25%, respectively, as of September 30, 2007. There is also a commitment fee of 0.25% on undrawn borrowing capacity. Interest is payable at least quarterly, and the Credit Facilities mature in August 2011. Our obligations under the Credit Facilities are guaranteed by certain of our principal domestic subsidiaries and secured by the accounts receivable, inventory and equipment (excluding aircraft and their components) of Bristow Group Inc. and the guarantor subsidiaries, and the capital stock of certain of our principal foreign subsidiaries.

 

In addition, the Credit Facilities include covenants which are customary for these types of facilities, including certain financial covenants and restrictions on the ability of Bristow Group Inc. and its subsidiaries to enter into certain transactions, including those that could result in the incurrence of additional liens and indebtedness; the making of loans, guarantees or investments; sales of assets; payments of dividends or repurchases of our capital stock; and entering into transactions with affiliates.

 

In addition, the Credit Facilities contain various financial covenants, including, among others:

 

 

As of September 30, 2007, we had $3.8 million in letters of credit outstanding under the letter of credit facility and no borrowings or letters of credit outstanding under the revolving credit facility.

 

Term Loan

 

Two limited recourse term loans were created in connection with sale and lease transactions for two aircraft entered into with Heliair in fiscal year 1999. These limited recourse term loans were secured by both aircraft and our guarantee of the underlying lease obligations. In addition, we provided asset value guarantees totaling up to $3.8 million, payable at the expiration of the leases depending on the value received for the aircraft at the time of disposition. As a result of these guarantees and the terms of the underlying leases, for financial statement purposes, the aircraft and associated term loans were reflected on our consolidated balance sheet. In May 2007, BriLog Leasing Ltd., a subsidiary of ours, completed a new $18.7 million term loan financing, the proceeds of which were used to purchase the two aircraft from Heliair in May and July 2007. Heliair used the sale proceeds to repay the limited recourse term loans concurrently. This financing and aircraft purchase did not involve the transfer of cash. See Note 3 in the “Notes to Consolidated Financial Statements” included in our Annual Report Form 10-K for the fiscal year ended March 31, 2007 and Note 5 in the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference, for a discussion of our relationship with Heliair.

 

The new term loan is repayable by BriLog in quarterly installments with the first payment of $0.3 million having been made in June 2007, which will be followed by thirty-two consecutive quarterly principal payments of $0.6 million, the first of which was paid in September 2007. Interest is payable on the new term loan at LIBOR plus a margin of 1.25% (about 6.48% as of September 30, 2007). The new term loan is secured by the two aircraft and we have provided a parent guarantee of the loan.

 

Sakhalin Debt

 

On July 16, 2004, we assumed various existing debt liabilities that were outstanding and secured against assets purchased as part of our acquisition of a business in Sakhalin, Russia. See Note 2 in the “Notes to Consolidated Financial Statements” included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2007 and the Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2007, incorporated herein by reference for further discussion of our acquisition. Two promissory notes totaling $1.0 million as of September 30, 2007 are being repaid over five years at an interest rate of 8.5% and are scheduled to be fully paid in 2009 and 2010. The other liabilities assumed include a finance lease on an aircraft totaling $2.4 million as of September 30, 2007, with an interest rate of 8.5% and expiring in fiscal year 2009 with a final termination payment of $2.0 million.

 

RLR Note

 

RLR financed 90% of the purchase price of six aircraft acquired in July 2003 through a five-year term loan of $31.8 million with a bank requiring monthly principal and interest payments of $0.3 million and a balloon payment of $18.3 million due July 11, 2008 (the “RLR Note”). The RLR Note is secured by the six aircraft. The company and other shareholder have guaranteed 49% and 51%, respectively, of the RLR Note outstanding as of the most recent July anniversary date. As of September 30, 2007, the company and other shareholder had guaranteed $10.3 million and $10.7 million, respectively. In addition, we have given the bank a put option, which the bank may exercise if the aircraft are not returned to the U.S. within 30 days of a default on the RLR Note. Any such exercise would require us to purchase the RLR Note from the bank. We simultaneously entered into a similar agreement with the other RLR shareholder, which requires that, in event of exercise by the bank of its put option to us, the other shareholder will be required to purchase 51% of the RLR Note from us. As of September 30, 2007, a liability of $0.7 million representing the fair value of this guarantee was reflected in our balance sheet in other liabilities and deferred credits.

U.K. Facilities

 

As of September 30, 2007, Bristow Aviation had a £6.0 million ($12.2 million) facility for bank guarantees, of which £0.1 million ($0.2 million) was outstanding, and a £1.0 million ($2.0 million) net overdraft facility, under which no borrowings were outstanding. Both facilities are with a U.K. bank. The letter of credit facility is provided on an uncommitted basis, and outstanding letters of credit bear fees at a rate of 0.7% per annum. Borrowings under the net overdraft facility are payable upon demand and bear interest at the bank’s base rate plus a spread that can vary between 1% and 3% per annum depending on the net overdraft amount. The net overdraft facility will be reviewed by the bank annually on August 31 and is cancelable at any time upon notification from the bank. The facilities are guaranteed by certain of Bristow Aviation’s subsidiaries and secured by a negative pledge of Bristow Aviation’s assets.

 

Participation in the exchange offer is voluntary, and we urge you to consider carefully whether to accept. Please consult your financial and tax advisors in making your own decision on what action to take.

 

We are offering to issue new registered 71/2% Senior Notes due 2017 in exchange for a like principal amount of our outstanding 71/2% Senior Notes due 2017. We refer to our offer to exchange the Outstanding Notes for Exchange Notes as the “exchange offer.” We may extend, delay or terminate the exchange offer. Holders of Outstanding Notes who wish to exchange their notes will need to complete the exchange offer documentation related to the exchange.

 

Purpose and Effect of the Exchange Offer

 

We sold the Outstanding Notes in transactions that were exempt from or not subject to the registration requirements under the Securities Act. Accordingly, the Outstanding Notes are subject to transfer restrictions. In general, you may not offer or sell the Outstanding Notes unless either they are registered under the Securities Act or the offer or sale is exempt from or not subject to registration under the Securities Act and applicable state securities laws.

 

In connection with the sale of the Outstanding Notes, we entered into a Registration Rights Agreement with the initial purchasers of the Outstanding Notes. In that agreement, we agreed to file a registration statement relating to an offer to exchange the Outstanding Notes for Exchange Notes within 360 days after the issue date of the Outstanding Notes and to use our reasonable best efforts to have that registration statement declared effective by the SEC within 360 days after the issue date of the Outstanding Notes. We also agreed to keep the exchange offer open for at least 20 business days after the date of notice thereof is mailed to the holder. We are offering the Exchange Notes under this prospectus in an exchange offer for the Outstanding Notes to satisfy our obligations under the Registration Rights Agreement.

 

If,

 

 

we will, pursuant to the terms of the Registration Rights Agreement, use our reasonable best efforts to file with the SEC a shelf registration statement to cover resales of the Outstanding Notes.

Resale of Exchange Notes

 

Based on interpretations of the SEC staff in “no action letters” issued to third parties, we believe that each Exchange Note issued in the exchange offer may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery provisions of the Securities Act if:

 

 

The SEC has not, however, considered the legality of our exchange offer in the context of a “no action letter,” and there can be no assurance that the staff of the SEC would make a similar determination with respect to our exchange offer as it has in other circumstances.

 

If you tender your Outstanding Notes in the exchange offer with the intention of participating in any manner in a distribution of the Exchange Notes, you:

 

 

Unless an exemption from registration is otherwise available, the resale by any holder intending to distribute Exchange Notes should be covered by an effective registration statement under the Securities Act containing the selling holder’s information required by Item 507 or Item 508, as applicable, of Regulation S-K under the Securities Act. This prospectus may be used for an offer to resell, resale or other retransfer of Exchange Notes only as specifically described in this prospectus. We have agreed to make the prospectus available in connection with resales of the Exchange Notes for up to 90 days from the completion of the exchange offer. Failure to comply with the registration and prospectus delivery requirements by a holder subject to these requirements could result in that holder incurring liability for which it is not indemnified by us. With respect to broker-dealers, only those that acquired the Outstanding Notes for their own account as a result of market-making activities or other trading activities may participate in the exchange offer. Each broker-dealer that receives Exchange Notes in exchange for Outstanding Notes acquired for its own account as a result of market-making activities or other trading activities may be deemed to be an “underwriter” within the meaning of the Securities Act and must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Notes. Please read “Plan of Distribution” for more details regarding the transfer of Exchange Notes.

 

Terms of the Exchange Offer

 

Upon the terms and subject to the conditions described in this prospectus and in the letter of transmittal, we will accept for exchange any Outstanding Notes properly tendered and not withdrawn prior to the expiration date of the exchange offer. We will issue $1,000 principal amount of Exchange Notes in exchange for each $1,000 principal amount of Outstanding Notes surrendered under the exchange offer.

 

Outstanding Notes may be tendered only in integral multiples of $1,000. The exchange offer is not conditioned upon any minimum aggregate principal amount of Outstanding Notes being tendered for exchange.

 

As of the date of this prospectus, $350.0 million principal amount of Outstanding Notes is outstanding. This prospectus and the letter of transmittal are being sent to all registered holders of Outstanding Notes. There will be no fixed record date for determining registered holders of Outstanding Notes entitled to participate in the exchange offer.

 

We intend to conduct the exchange offer in accordance with the provisions of the Registration Rights Agreement, the applicable requirements of the Securities Act and the Securities Exchange Act of 1934 and the

rules and regulations of the SEC. Outstanding Notes that are not tendered for exchange in the exchange offer will:

 

 

However, these Outstanding Notes will not be freely tradable. Other than in connection with the exchange offer and as specified in the Registration Rights Agreement, we are not obligated to, nor do we currently anticipate that we will, register the Outstanding Notes under the Securities Act. See “— Consequences of Failure to Exchange” below.

 

By signing or agreeing to be bound by the letter of transmittal, you acknowledge that, upon request, you will execute and deliver any additional documents deemed by the exchange agent or us to be necessary or desirable to complete the exchange, assignment and transfer of the Outstanding Notes tendered by you, including the transfer of such Outstanding Notes on the account books maintained by DTC.

 

We will be deemed to have accepted for exchange properly tendered Outstanding Notes when we have given oral or written notice of the acceptance to the exchange agent and complied with the applicable provisions of the Registration Rights Agreement. The exchange agent will act as agent for the tendering holders for the purposes of receiving the Exchange Notes from us.

 

If you tender Outstanding Notes in the exchange offer, you will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes with respect to the exchange of Outstanding Notes. We will pay all charges and expenses, other than certain applicable taxes described below, in connection with the exchange offer. It is important that you read the section “— Fees and Expenses” for more details about fees and expenses incurred in the exchange offer.

 

We will return any Outstanding Notes that we do not accept for exchange for any reason without expense to the tendering holder as promptly as practicable after the expiration or termination of the exchange offer.

 

Expiration Date

 

The exchange offer will expire at 5:00 p.m., New York City time, on March 3, 2008, unless sooner terminated or, in our sole discretion, we extend it.

 

Extensions; Delay in Acceptance; Termination or Amendment

 

We reserve the right, at any time or at various times, to extend the period of time during which the exchange offer is open. During any extensions, all Outstanding Notes you have previously tendered and not withdrawn will remain subject to the exchange offer, and we may accept them for exchange. We do not currently intend to extend the expiration date.

 

To extend the exchange offer, we will notify the exchange agent orally or in writing of any extension. We also will make a public announcement of the extension no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date. Without limiting the manner in which we may choose to make public announcements of any delay in acceptance, extension, termination or amendment of the exchange offer, we have no obligation to publish, advertise or otherwise communicate any such public announcement, other than by making a timely release to an appropriate news agency.

 

If any of the conditions described below under “— Conditions to the Exchange Offer” have not been satisfied, we reserve the right, in our sole discretion to:

 

 

We will give oral or written notice of such delay, extension or termination to the exchange agent. Subject to the terms of the Registration Rights Agreement, we also reserve the right to amend the terms of the exchange offer in any manner.

 

Any such delay in acceptance, extension, termination or amendment will be followed as promptly as practicable by oral or written notice thereof to the registered holders of the Outstanding Notes. If we amend the exchange offer in a manner that we determine to constitute a material change, we will promptly disclose that amendment by means of a prospectus supplement. We will distribute the supplement to the registered holders of the Outstanding Notes. Depending upon the significance of the amendment and the manner of disclosure to the registered holders, we will extend the exchange offer if the exchange offer would otherwise expire during such period.

 

Conditions to the Exchange Offer

 

Despite any other term of the exchange offer, if in our reasonable judgment the exchange offer, or the making of any exchange by a holder of Outstanding Notes, would violate applicable law or any applicable interpretation of the staff of the SEC or would be impaired by any action or proceeding that has been instituted or threatened in any court or by or before any governmental agency with respect to the exchange offer:

 

 

In addition, we will not be obligated to accept for exchange the Outstanding Notes of any holder that has not made to us:

 

 

We reserve the right to amend or terminate the exchange offer, and to reject for exchange any Outstanding Notes not previously accepted for exchange in the exchange offer, upon the occurrence of any of the conditions to that exchange offer specified above. We will give oral or written notice of any extension, amendment, nonacceptance or termination to the holders of Outstanding Notes as promptly as practicable.

 

These conditions are for our sole benefit, and we may assert them or waive them in whole or in part at any time or at various times in our sole discretion. Our failure at any time to exercise any of these rights will not mean that we have waived our rights. Each right will be deemed an ongoing right that we may assert at any time or at various times.

 

In addition, we will not accept for exchange any Outstanding Notes tendered, and will not issue Exchange Notes in exchange for any such Outstanding Notes, if at that time any stop order has been threatened or is in effect with respect to the registration statement of which this prospectus constitutes a part or the qualification of the indenture relating to the notes under the Trust Indenture Act of 1939.

 

Procedures for Tendering

 

How to Tender Generally

 

Only a registered holder of Outstanding Notes may tender its Outstanding Notes in the exchange offer. If you are a beneficial owner of Outstanding Notes and wish to have the registered owner tender on your behalf, please see “— How to Tender if You Are a Beneficial Owner” below. To tender in the exchange offer, a holder must either comply with the procedures for manual tender or comply with the automated tender offer program procedures of DTC described below under “— Tendering Through DTC’s Automated Tender Offer Program.”

To complete a manual tender, a holder must:

 

 

If you wish to tender your Outstanding Notes and cannot comply with the requirement to deliver the letter of transmittal and your Outstanding Notes (including by book-entry transfer) or use the automated tender offer program of DTC described below before the expiration date, you must tender your Outstanding Notes according to the guaranteed delivery procedures described below.

 

To be tendered effectively, the exchange agent must receive any physical delivery of the letter of transmittal and other required documents at its address provided above under “Prospectus Summary — The Exchange Agent” prior to the expiration date.

 

The tender by a holder that is not withdrawn prior to the expiration date and our acceptance of that tender will constitute a legally binding agreement between the holder and us in accordance with the terms and subject to the conditions described in this prospectus and in the letter of transmittal.

 

The method of delivery of Outstanding Notes, the letter of transmittal and all other required documents to the exchange agent is at your election and risk. Rather than mail these items, we recommend that you use an overnight or courier service. In all cases, you should allow sufficient time to assure delivery to the exchange agent before the expiration date. You should not send the letter of transmittal or Outstanding Notes to us. You may request your broker, dealer, commercial bank, trust company or other nominee to effect the above transactions for you.

 

Book-Entry Transfer

 

The exchange agent will make a request to establish an account with respect to the Outstanding Notes at DTC for purposes of the exchange offer promptly after the date of this prospectus. Any financial institution participating in DTC’s system may make book-entry delivery of Outstanding Notes by causing DTC to transfer such Outstanding Notes into the exchange agent’s account at DTC in accordance with DTC’s procedures for transfer. If you are unable to deliver confirmation of the book-entry tender of your Outstanding Notes into the exchange agent’s account at DTC or all other documents required by the letter of transmittal to the exchange agent on or prior to the expiration date, you must tender your Outstanding Notes according to the guaranteed delivery procedures described below.

 

Tendering Through DTC’s Automated Tender Offer Program

 

The exchange agent and DTC have confirmed that any financial institution that is a participant in DTC’s system may use DTC’s automated tender offer program to tender its Outstanding Notes. Accordingly, participants in the program may, instead of physically completing and signing the letter of transmittal and delivering it to the exchange agent, transmit their acceptance of the exchange offer electronically. They may do so by causing DTC to transfer the Outstanding Notes to the exchange agent in accordance with its procedures for transfer. DTC will then send an agent’s message to the exchange agent.

An “agent’s message” is a message transmitted by DTC to and received by the exchange agent and forming part of the book-entry confirmation, stating that:

 

 

How to Tender if You Are a Beneficial Owner

 

If you beneficially own Outstanding Notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender those notes, you should contact the registered holder as soon as possible and instruct the registered holder to tender on your behalf. If you are a beneficial owner and wish to tender on your own behalf, you must, prior to completing and executing the letter of transmittal and delivering your Outstanding Notes, either:

 

 

The transfer of registered ownership may take considerable time and may not be completed prior to the expiration date.

 

Signatures and Signature Guarantees

 

You must have signatures on a letter of transmittal or a notice of withdrawal described below under “— Withdrawal of Tenders” guaranteed by an “eligible institution” unless the Outstanding Notes are tendered:

 

 

An “eligible institution” is a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States, or an “eligible guarantor institution” within the meaning of Rule 17Ad-15 under the Exchange Act, in each case that is a member of one of the recognized signature guarantee programs identified in the letter of transmittal.

 

When Endorsements or Bond Powers Are Needed

 

If a person other than the registered holder of any Outstanding Notes signs the letter of transmittal, the Outstanding Notes must be endorsed properly or accompanied by a properly completed bond power. The registered holder must sign the bond power as the registered holder’s name appears on the Outstanding Notes. An eligible institution must guarantee that signature.

 

If the letter of transmittal or any Outstanding Notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, those persons should so indicate when signing. Unless we waive this requirement, they also must submit evidence satisfactory to us of their authority to deliver the letter of transmittal.

Determinations Under the Exchange Offer

 

We will determine, in our sole discretion, all questions as to the validity, form, eligibility, time of receipt, acceptance of tendered Outstanding Notes and withdrawal of tendered Outstanding Notes. Our determinations will be final and binding. We reserve the absolute right to reject any Outstanding Notes not properly tendered or any Outstanding Notes our acceptance of which would, in the opinion of our counsel, be unlawful. We also reserve the absolute right to waive any defects, irregularities or conditions of the exchange offer as to particular Outstanding Notes. Our interpretation of the terms and conditions of the exchange offer, including the instructions in the letter of transmittal, will be final and binding on all parties.

 

Unless waived, any defects or irregularities in connection with tenders of Outstanding Notes must be cured within the time we determine. Neither we, the exchange agent nor any other person will be under any duty to give notification of defects or irregularities with respect to tenders of Outstanding Notes, nor will we or those persons incur any liability for failure to give such notification. Tenders of Outstanding Notes will not be deemed made until such defects or irregularities have been cured or waived. Any Outstanding Notes received by the exchange agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned to the tendering holder, unless otherwise provided in the letter of transmittal, as soon as practicable following the expiration date.

 

When We Will Issue Exchange Notes

 

In all cases, we will issue Exchange Notes for Outstanding Notes that we have accepted for exchange in the exchange offer only after the exchange agent timely receives:

 

 

Return of Outstanding Notes Not Accepted or Exchanged

 

If we do not accept any tendered Outstanding Notes for exchange for any reason described in the terms and conditions of the exchange offer or if Outstanding Notes are submitted for a greater principal amount than the holder desires to exchange, we will return the unaccepted or non-exchanged Outstanding Notes without expense to their tendering holder. In the case of Outstanding Notes tendered by book-entry transfer into the exchange agent’s account at DTC according to the procedures described above, such non-exchanged Outstanding Notes will be credited to an account maintained with DTC. These actions will occur as promptly as practicable after the expiration or termination of the exchange offer.

 

Your Representations to Us

 

By signing or agreeing to be bound by the letter of transmittal, you will represent to us that, among other things:

 

 

 

If you tender in the exchange offer for the purpose of participating in a distribution of the Exchange Notes:

 

 

Guaranteed Delivery Procedures

 

If you wish to tender your Outstanding Notes but they are not immediately available or if you cannot deliver your Outstanding Notes (including by book-entry transfer), the letter of transmittal or any other required documents to the exchange agent or comply with the applicable procedures under DTC’s automated tender offer program prior to the expiration date, you may tender if:

 

 

Upon request to the exchange agent, the exchange agent will send a notice of guaranteed delivery to you if you wish to tender your Outstanding Notes according to the guaranteed delivery procedures described above.

 

Withdrawal of Tenders

 

Except as otherwise provided in this prospectus, you may withdraw your tender at any time prior to 5:00 p.m., New York City time, on the expiration date unless we have previously accepted your Outstanding Notes for exchange. For a withdrawal to be effective:

 

 

 

Any notice of withdrawal must: