Is Your Aircraft Ready to be Sold? May 8, 2019 | 1:30 pm 3:00 pm - - PowerPoint PPT Presentation

Is Your Aircraft Ready to be Sold?

May 8, 2019 | 1:30 pm – 3:00 pm

MODERATOR: PRESENTERS: Lee Brewster, Flightdocs Amanda Applegate, Aerlex Law Group Blair Robson, Exxon Mobil Corporation

• W. Ashley Smith, Jet Logistics

Presentation Objectives

• Examine the aircraft sales process
• Build the sales team – it takes a team to sell an aircraft
• Discuss best practices that will have a positive impact on aircraft value and demand
• Recommendations on how to manage your aircraft asset in a proactive manner so it is

always ready to sell

Aircraft Sale Preparation and Process Considerations

• Aircraft Sales Team
• Aircraft and Records Pedigree
• Listing
• Showings
• LOI and Sales Agreement Negotiations
• Pre-Purchase Inspection
• Closing

Aircraft Sales Team

• Define roles and responsibilities and identify who

will lead the team

• Team members

– Director of Aviation – Aircraft broker/consultant – Aviation attorney – Escrow agent – Insurance broker (for cancellation and refund of premium paid) – Technical representative (in house or outsource?) – Lender (if financed, need payoff letter and lien release)

Aircraft and Records Pedigree

• One owner or multiple – Title issues? Does the history of ownership create challenges?
• Interior Configuration – will the configuration be an advantage?
• Paint condition and interior condition – first impressions are important
• Avionics and interior upgrades – the more the better
• Complete and accurate aircraft logbooks and records – an absolute

must to enhance the value of the aircraft

• Part 91 vs. Part 135 – how the current operations may impact the value?
• Mandate compliance – lack of compliance will influence price

Listing

• Aircraft and hangar preparation – first impressions are everything
• Engage an experienced aircraft photographer – lighting and angles
• Prepare a complete and accurate specification – very

important to sales agreement

• Continually update hours, landings, and inspections on the digital aircraft brochure
• Examine engine and/or aircraft programs – effect aircraft valuation; are accounts current
• Compile list of loose equipment being sold with the aircraft – include in sales agreement

to avoid conflict later

Showings

• Planning and preparation – put your best foot forward
• Proper representation of the aircraft – have a subject matter expert present
• Do not negotiate the sales price or terms during the showing

– do not make promises that you can’t keep

• Ask for feedback from potential buyers

– what can we do better for the next showing

LOI and Sales Agreement Negotiations

• What do you do with a written offer?
• Evaluating Fair Market Value vs. Offer vs. Seller Expectations – is the offer acceptable?
• Pay close attention to revisions made during the negotiations of the LOI and Sales

Agreement – do not make assumptions

• Keep the process moving to a conclusion – time kills deals
• Give special attention to engine/aircraft programs and loose equipment

– make clear what is transferrable and be prepared for the transfer

• Is the seller retaining registration number – start the process early and document it the

Sales Agreement

Pre-Purchase Inspection

• Clearly define in the LOI and Sales Agreement:

– The scope of the pre-purchase inspection (including test flight duration) – What is a discrepancy – What the delivery condition of the aircraft must be upon closing (i.e. airworthy, inspection compliance dates, systems functioning)

• If possible, send the aircraft records prior to the aircraft – the records review

can be two weeks longer (on average) than the inspection of the aircraft

• Proper and continual participation from the buyer and seller – it is a

fast moving process and it is easy to have misunderstandings

• Clarify the discrepancies during discovery by the inspection facility – this can sometimes

decrease or eliminate the potential of the buyer rejecting the aircraft

Closing

• Be prepared for discrepancies that occur on the flight to the closing location – how will

this be handled?

• Follow an Aircraft Closing Checklist – helpful to track all of the necessary steps of

closing, including subscriptions and change of ownership notifications

• Pre-position closing documents and funds with the Escrow Agent

– Avoid surprises or delays – Successful and smooth closing

Questions?

Contact Information

Lee Brewster, Flightdocs E-Mail: lbrewster@flightdocs.com Phone: 817-727-8298 Amanda Applegate, Aerlex Law Group E-Mail: aapplegate@aerlex.com Phone: 614-940-9181 Blair Robson, Exxon Mobil Corporation E-Mail: blair.t.robson@exxonmobil.com Phone: 214-208-5468

• W. Ashley Smith, Jet Logistics

E-Mail: ashley@jetlogistics.us Phone: 919-840-0555