The acquisition process will begin with the identification of the aircraft. Identifying the aircraft that best fits the needs of the client typically begins with engaging someone with extensive knowledge and experience with many types of aircraft and market asking prices.
Mr. Lapayowker has personally handled the following transactions, among others:
Negotiated the purchase of one of the first Boeing Business Jets and Global Express aircraft, the first operational Eurocopter EC 155B VIP-configured helicopter delivered in the United States.
Represented aircraft owner in connection with arrangements for having its aircraft appear in the MGM major motion picture James Bond 007 Casino Royale starring Daniel Craig.
Aircraft Acquisition Process
There are a variety of aircraft consultants and aircraft brokers in the industry but the quality and experience of the consultants and brokers varies drastically. We have extensive industry contacts and can provide referrals to full-time professionals.
After the aircraft is selected, a Letter of Intent or “Offer to Purchase” will be drafted, and the buyer’s agent will arrange for a visual inspection and demonstration flight of the aircraft. If the client decides that they would like to purchase the aircraft after the visual inspection, a comprehensive Aircraft Purchase Agreement will be drafted to memorialize the terms of the purchase. The duration of negotiations of an Aircraft Purchase Agreement is dependent upon the sophistication of the parties and whether counsel to the parties is experienced with aircraft transactions.
After the Aircraft Purchase Agreement is finalized, the aircraft will typically enter a pre-purchase inspection at an authorized inspection facility for the type of aircraft. After the completion of the inspection, the inspection facility will generate a report detailing the items that are not airworthy or “discrepancies.” The buyer will then issue its “technical acceptance” subject to the repair of discrepancies by the seller, or, in some instances, reject the aircraft.
After the confirmation of the correction of the discrepancies the transaction will be ready to close. All legal, registration, and other applicable documents should be placed with the escrow agent several days prior to the prospective closing date.
The failure to properly structure an aircraft acquisition, negotiate purchase documentation, and/or register the aircraft can have an adverse effect upon the success of the transaction. However, experienced aviation professionals will have the ability to foresee potential issues and address them early in the process, thereby facilitating a smooth transaction.