2019 Aircraft Transactions – It is not too early to plan for a successful 2019 Closing
Sep
19
to Oct 1

2019 Aircraft Transactions – It is not too early to plan for a successful 2019 Closing

2019 Aircraft Transactions – It is not too early to plan for a successful 2019 Closing

Originally published in BusinessAir Magazine, August 2019, Volume 29, No. 8.

PDF Version >

As we move into the last several months of 2019, whole aircraft transaction volume will increase, particularly in December. Personally, I have a number of clients who are ready to proceed immediately with a purchase or sale once either the right inventory can be sourced or once a buyer is found for the aircraft that is listed for sale.

Assuming the right aircraft can be found for buyers or the right buyer can be found by sellers, as transaction volumes increase those providing support services such as aircraft consultants, insurance agents, escrow companies and pre-buy inspection facilities may start to see the stress of the demand. As always, having a well-established acquisition or sales team and a process plan can help insure that nothing gets missed, that the closings go as planned and are completed in the 2019 calendar year. Ten items to consider to help closing occur in 2019:

  1. If you are considering selling in 2019, list the aircraft for sale as soon as possible to allow enough time for the sales process to conclude before the end of the year.

  2. If you are considering buying in 2019, you should already be looking for the right aircraft. Inventory is lower in many aircraft categories than it has been for years. Therefore sourcing the right aircraft is taking longer than it has in the past and may require expanding the search to outside of the United States.

  3. Many inspection facilities have long wait times to schedule a pre-buy inspection. As soon as an aircraft is sourced or a buyer is found (or perhaps even before), look for a pre-buy slot and try to hold it if possible. As a seller, if certain inspections are coming due, perhaps scheduling these in conjunction with a potential pre-buy inspection may help with reserving a slot.

  4. If you have an existing aircraft and plan to replace it, consult your tax team early in the process. Your tax team may recommend that both transactions occur in the same year since 1031 likekind exchanges are no longer available.

  5. If you are seeking depreciation in 2019 (bonus or straight-line), then the aircraft being purchased needs to be placed into service and used for business (preferably exclusively for business if closing is near the end of the year) before the end of the year.

  6. When support service providers are busy, checklists and a team leader become imperative. There must be one person leading the team who is checking to make sure all aspects of the transaction are completed prior to closing (i.e. assignment of mx. programs, insurance, funds, lender agreements, management agreements, international registry account set up, etc.).

  7. The last day of the year in 2019 is on a Tuesday. In the past, the FAA registry has closed early on holidays and also for weather. It is recommended that 2019 closings be completed no later than December 27, 2019 in order to allow time for the aircraft to be placed into service before year end and avoid any unexpected closing delays that could occur.

  8. Lenders are starting to require all ancillary documents be in place prior to funding. If the aircraft is going to be managed, chartered or on maintenance programs, the lender may require all of these documents be in place along with its own consent agreements, prior to closing. It is likely that these documents will not be allowed to be done as post-closing items, so plan enough time to get all relevant documents in order prior to year-end. Alternatively, consider paying cash and arrange financing after closing.

  9. If the transaction is a crossborder transaction, make sure all parties are realistic on the amount of time the import/export process will take and that there will not be any delays in getting the Aircraft on the new country registry.

  10. Having upgrades done at the same time as the pre-buy inspection often saves downtime on the aircraft for the buyer. However, it may also push the closing into 2020. Therefore, if a 2019 closing is important a close review of the calendar should be made to make sure the upgrades can be completed and the aircraft returned to service prior to the end of the year.

For more, information contact Amanda Applegate at aapplegate@aerlex.com  or at 310-392-5200.

Aerlex Law Group provides a wide range of services to all sectors of the aviation industry, representing the needs of business and corporate aviation, manufacturers, airlines, and airports.  Aerlex attorneys provide expert assistance with whole aircraft purchases and sales, leasing, financing and management, fractional jet ownership, regulatory issues, and tax, corporate, real estate, employment and litigation issues: www.aerlex.com

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Negotiating Aircraft Management Agreements
Jun
19
to Jul 31

Negotiating Aircraft Management Agreements

Negotiating Aircraft Management Agreements

Posted by Aerlex.com June 2019 Aerlex Newsletter: Amanda Applegate

Most aircraft owners who own an aircraft elect to use a management company to manage the daily operations and maintenance of their aircraft. This allows the aircraft owner to focus on what they do well and hire someone else to handle something that is complex and highly regulated. Aircraft owners expect that the management company knows how to maintain an aircraft so dispatch reliability will be good, safety is not compromised and costs are reasonable.

Once the management company is selected, it will provide its standard management agreement (“MA”). In general, the MA will state how the aircraft and records must be maintained, when the owner must approve maintenance work, fees for the services, insurance requirements, and if the owner elects to allow the management company to charter the aircraft. I am fortunate to have the opportunity to work with a number of great management companies who have invested time and money into creating good MAs. However, once in a while, I am asked to review a MA for a company I haven’t worked with before and I am sometimes shocked with what I find. Here is a list of some of the key items to focus on when reviewing the MA:

  1. Aircraft Records.

  2. Charter usage.

  3. Payment Terms.

  4. Storage.

  5. Scheduling.

  6. Crew.

  7. Maintenance.

  8. Insurance.

  9. Indemnification and Limitation of Liability.

  10. Term.

 Aerlex Related Article: Preparing for an Aircraft Purchase >

Aerlex Law Group provides a wide range of services to all sectors of the aviation industry, representing the needs of business and corporate aviation, manufacturers, airlines, and airports.  Aerlex attorneys provide expert assistance with whole aircraft purchases and sales, leasing, financing and management, fractional jet ownership, regulatory issues, and tax, corporate, real estate, employment and litigation issues: www.aerlex.com

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Aerlex Memorial Day Rememberance: Robert Hofer
May
24
to May 28

Aerlex Memorial Day Rememberance: Robert Hofer

aerlex memorial day 2019.jpg

A message from Aerlex Law Group President Stephen R. Hofer

“I think of my father, who parachuted out of a Douglas C-47 “Skytrain” 42 times in the Second World War, including three jumps with enemy bullets whizzing by him…”

On Monday, May 27th, Americans across the country will remember the brave men and women who gave their lives for our country. Whether you plan to observe the holiday with a parade, a service, or a moment of silence, we will each in our own way remember and honor our nation's greatest, those who have sacrificed themselves for our freedom.

Read the Robert Hofer Memorial Day Article Here >

For me, Memorial Day is more than just the ceremonial first day of the summer season, more than just an opportunity to enjoy the annual running of the Indianapolis 500 race “Back Home Again in Indiana” – Memorial Day is a time to honor all of the men and women who have served in the United States Armed Forces and, in many instances, given their lives for their country and everything it stands for.

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Protecting Your Privacy
Sep
26
to Sep 30

Protecting Your Privacy

Protecting Your Privacy: Public Tracking of Private U.S.- Registered Aircraft

Posted by Aerlex.com on Aug 15, 2018 in ArticlesThe Latest

Originally published in BusinessAir Magazine, May 2018, Volume 28, No. 5.

Most of my clients who own whole aircraft want to avoid the public’s scrutiny of their ownership details and flight itineraries. Privacy is an important reason why they choose to travel noncommercially. 

Full Article >

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Plane & Pilot Article: Going Direct: Ready for Rehab?
Aug
6
to Aug 31

Plane & Pilot Article: Going Direct: Ready for Rehab?

 
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Going Direct: Ready for Rehab? GA’s Unseemly Addiction to Low-Lead Avgas


Summary: There are things to love about flying and there are things to hate about it. Turbulence, ramp fees and mid-TBO overhauls make the not-so-nice list. As do fuel prices.

One thing that doesn’t make the list of things most pilots hate about GA is our contribution of lead to the environment...

Published May 23, 2018

By Robert Goyer

Read Full Article >

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Capitalizing on the TCJA
Jun
28
to Aug 2

Capitalizing on the TCJA

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Capitalizing on the TCJA

Authored by Amanda Applegate.

Originally published in Business Aviation Advisor Magazine, May/June 2018.

How will the Tax Cuts and Jobs Act of 2017 (“TCJA”) affect business aviation lending? And what does this mean for you?

While it is too early to speak with any certainty, it appears that there is a strong likelihood of more aircraft financing in 2018, including tax leases, as a result of the TCJA.

Full Article >

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Employee Or Independent Contractor Classification Update
Jun
2
to Jun 5

Employee Or Independent Contractor Classification Update

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Employee Or Independent Contractor Classification Update

Douglas L. Stuart- Arelex Law Group

EMPLOYEE OR INDEPENDENT CONTRACTOR UPDATE: A NEW CALIFORNIA RULING FURTHER LIMITS INDEPENDENT CONTRACTOR CLASSIFICATION

In 2015, Aerlex presented a two-part online series entitled “Employee or Independent Contractor?” which examined the question of whether pilots and cabin attendants could be treated as independent contractors rather than employees.

Full Article >

Posted by Aerlex.com on May 3, 2018 in ArticlesThe Latest


 

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2018 Federal Tax Changes Related to Business Aviation
Feb
21
to Mar 11

2018 Federal Tax Changes Related to Business Aviation

aerlex-logo-4.jpg
 

2018 Federal Tax Changes Related to Business Aviation

Originally published in BusinessAir Magazine, January 2018, Volume 28, No. 1.

Amanda Applegate - Arelex Law Group

The Tax Cuts and Jobs Act of 2017 (“TCJA”) contains several significant changes that impact business aviation. Some of the changes are merely clarifications that the aviation industry has sought for years, while the other changes have many people speculating that the modifications will stimulate the sales of both new and pre-owned aircraft for the next  several years.

Read Article Here > http://www.aerlex.com/2018-federal-tax-changes-related-to-business-aviation

Source:: Earlier Event: November 22
REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.


 

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ADS-B: AIRCRAFT OWNERS AND PROSPECTIVE OWNERS, LEARN THE ALPHABET!
Jan
2
to Jan 20

ADS-B: AIRCRAFT OWNERS AND PROSPECTIVE OWNERS, LEARN THE ALPHABET!

ADS-B: Aircraft Owners and Prospective Owners, Learn the Alphabet!

— Originally published in BusinessAir Magazine, January 2017, Volume 27, No. 1.

ADS-B stands for Automatic Dependent Surveillance – Broadcast. By January 1, 2020, the majority of aircraft operating within the United States will be required to have ADS-B Out capabilities – and for aircraft registered internationally, some compliance deadlines are even sooner. Aircraft lacking ADS-B Out capabilities after that date will be grounded or severely limited in where and how they can fly – perhaps for months!

Read Article Here >http://www.aerlex.com/ads-b-aircraft-owners-and-prospective-owners-learn-the-alphabet

Source:: Earlier Event: November 22
REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.


 

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BUYER BEWARE: PREPAID CHARTER PROGRAMS
Dec
14
to Jan 1

BUYER BEWARE: PREPAID CHARTER PROGRAMS

BUYER BEWARE: PREPAID CHARTER PROGRAMS

Posted by Aerlex.com on Dec 13, 2017 in ArticlesBusinessAir MagazineThe Latest

Amanda Applegate - Arelex Law Group

BUYER BEWARE: Prepaid Charter Programs — Originally published in BusinessAir Magazine, November 2017, Volume 27, No. 11.

"In the past six months, I have had three separate clients with problematic issues related to three separate prepaid charter programs. It is disturbing to have so many concerns in such a short period of time with three different private jet service providers..."

Read Article Here > http://www.aerlex.com/buyer-beware-prepaid-charter-programs

Source:: http://www.aerlex.com/buyer-beware-prepaid-charter-programs

Earlier Event: November 22

REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.

 

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REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.
Nov
22
1:30 PM13:30

REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.

REPLACING YOUR AIRCRAFT? 8 FACTORS TO CONSIDER.

Amanda Applegate - Arelex Law Group

Originally published in BusinessAir Magazine, September 2017, Volume 27, No. 9.

"Many current aircraft owners have decided that 2017 is the year to replace their aircraft. With pre-owned prices and residual values for their current aircraft skewing lower, many owners are upgrading to larger, newer preowned aircraft. When replacing a current aircraft with another aircraft, there are a number of important factors to consider..."

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Message from the U.S. Secret Service
Nov
15
to Nov 21

Message from the U.S. Secret Service

From the USSS Criminal Investigative Division:

The USSS Boston Field Office is currently investigating an organized ring of individuals targeting private jet charter companies. These individuals claim to be promoters/agents/managers in the music industry and use stolen credit cards to book jet charters and luxury rental vehicles across the country. Please contact USSS Special Agent Tyler Martin, Boston Field Office, at 202-809-8570 or 617-565-5640, should any of the following individuals attempt to book a private jet charter using the following contact information:

Possible Names
Brian Hatwood
Brian Atwood
Bryan Hayward
Brian Haywood
Rich O'Malley
Epic Music
Brian Atwood Global Communications
Bill Starkman

Possible Email Addresses
d.williamsonla[@]gmail.com
starkmanbill[@]gmail.com
omalleyauto[@]gmail.com
michaelatl2k17[@]gmail.com
globalbookingsworldwide[@]gmail.com
calboythewildboy[@]gmail.com

Possible Phone Numbers
815-618-1625
917-361-1844
323-347-8253
773-707-9757

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TSA BOLO Alert UPDATE: Suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs)
Oct
6
to Oct 20

TSA BOLO Alert UPDATE: Suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs)

TSA October 5, 2017 BOLO UPDATE ALERT NOTIFICATION CLICK HERE >

The Transportation Security Administration (TSA), Office of Security Operations (OSO) Compliance Division, is updating the July 10, 2017 BOLO advisory notice based on continued attempts by this individual to access restricted areas and aircraft at multiple airports

TSA is aware of numerous incidents involving a suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs).  The individual identified as Ahmed Olasunkahmi SALAU, aka SALAN, SALUH, Martinez Davon Wells has reportedly visited several FBOs falsely presenting himself as either a passenger or crewmember with the intent to gain unauthorized access to aircraft and/or facilities. TSA is also aware that the same individual may have also telephonically contacted FBOs in an attempt to gather passenger and aircraft data.  

As a result, TSA is issuing this BOLO for your security awareness. Contact the TSOC at 877-456-8722 or 703-563-3240 and local law enforcement if you contact or suspect suspicious or fraudulent activity regarding the individual mentioned above.  

UPDATE: Since the original notice is issued on July 10, 2017, TSA is aware of several additional FBO/GA encounters by SALAU. The attachment lists various activities conducted by SALAU.

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TSA BOLO Alert: Suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs)
Jul
11
3:30 PM15:30

TSA BOLO Alert: Suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs)

The Transportation Security Administration (TSA), Office of Security Operations (OSO) Compliance Division, is issuing this Be-On-The-Lookout (BOLO) advisory notice based on current information.

TSA is aware of numerous incidents involving a suspicious person attempting to gain unauthorized access to aircraft and facilities at primarily Fixed Based Operators (FBOs).  The individual identified as Ahmed O SALAU aka SALAN (see image) has reportedly visited several FBOs falsely presenting himself as either a passenger or crewmember with the intent to gain unauthorized access to aircraft and/or facilities. TSA is also aware that the same individual may have also telephonically contacted FBOs in an attempt to gather passenger and aircraft data.  

TSA 71017 BOLO ALERT NOTIFICATION CLICK HERE >

As a result, TSA is issuing this BOLO for your security awareness.  

Contact the TSOC at 877-456-8722 or 703-563-3240 and local law enforcement if you contact or suspect suspicious or fraudulent activity regarding the individual mentioned above.  

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