Why Hire an Aviation Transaction Attorney?
Aircraft transactions are complex and high-dollar value transactions. Choosing the right aviation transaction attorney will reduce your transaction costs and minimize transaction risk by streamlining your aircraft acquisition or sale, ensuring regulatory and tax compliance, and providing a comprehensive acquisition plan for your specific needs.
Jetlaw serves as your aircraft transaction team’s leader. Our transaction attorneys provide a single point of contact for the entire acquisition or sale process. As your transaction team leader, we:
- Provide a clear action plan and checkpoints so your executive team understands the deal flow and timelines.
- Develop practical aircraft ownership and operating structure that is FAA and IRS compliant.
- Help you identify and coordinate aircraft financing.
- Interface with your tax advisors to develop a tax strategy that maximizes the benefits of aircraft ownership.
- Interface with your corporate flight department or management company so your aircraft is ready for its first flight as soon as you close the deal.
- Support your aircraft broker during contract negotiations.
Jetlaw’s team of transaction attorneys includes experienced pilots, a former Air National Guard Crew Chief, and a repairman. Our industry experience guides our approach to drafting and reviewing purchase agreements and negotiating letters of intent. Our team can also assist you with:
Why Hire Jetlaw?
- Jetlaw’s Attorneys are Pilots. Jetlaw’s partners and senior advisors are pilots. Jetlaw owns and operates corporate aircraft. We fly in the same airspace that you do. We sign hangar leases, schedule maintenance, and attend recurrent pilot simulator training. We understand the challenges that your flight department handles because we handle those challenges too.
- Lasting Relationships. Jetlaw provides comprehensive aviation counsel for your entire aircraft transaction. We forge long-term relationships with our clients and continue to support them post-closing on their aircraft operations, regulatory compliance, and legal changes within their operation and the aviation industry.
- Tailored Tax Services. No one knows your tax situation better than you, and no one knows aviation taxes better than Jetlaw. We work hand-in-hand with your tax advisors to mesh the most current and advantageous aviation tax strategies with your tax-specific needs while keeping your structure compliant with FAA regulatory requirements.
- Risk Management. Jetlaw helps clients create aircraft ownership and operating structures that minimize risk. We advise our clients on mitigation strategies that include maximizing insurance coverages, implementing corporate or personal aircraft use policies, addressing hangar liability, and following aircraft operation best practices.
What Jet Should I Buy?
Jetlaw works with aircraft brokers, corporate flight departments, and aviation operations consultants to help you identify the make and model of aircraft that meets your needs. There are dozens of factors to consider when selecting a make and model, but at a minimum, consider the following:
- How many seats do I need for 90% of my operations?
- Can I fill all of the seats and still be within weight and balance limits?
- What is most important for my aircraft missions–speed, fuel efficiency, or range?
- Do I want to make the jet available for third-party charter?
- Is the runway length at my airport long enough for the jet to takeoff and land?
Aircraft Registration: Trust or No Trust
FAA registration and ownership requirements are complex and constantly evolving. Traditional aircraft registration is often the preferred option for aircraft ownership, but the FAA allows owners to own aircraft through grantor trusts that comply with the FAA Registry’s policies. Jetlaw helps owners evaluate aircraft registration options, find an owner trustee partner, and establish the ownership trust structure. The primary benefits of the ownership trust are:
- Privacy. The FAA Registry is a publicly searchable database. Using an ownership trust adds a layer of privacy to your aircraft ownership.
- U.S. Citizenship Issues. The FAA imposes limitations on non-U.S. citizen ownership of U.S. (“N”) registered aircraft. An owner trust allows non-U.S. citizens (individuals and entities) to own U.S. registered aircraft as beneficial owners without complying with complex reporting requirements.
If U.S. aircraft registration is not the right fit for you, Jetlaw can help you evaluate foreign registration options.
Our attorneys help borrowers and lenders structure and negotiate standard finance packages for single aircraft acquisitions to complex credit facility arrangements for fleet floor planning. Jetlaw’s corporate banking advisor helps our clients locate and evaluate finance options. Meet Toby Browne.
If you plan to finance your acquisition pre-closing, start this process well in advance of your anticipated closing date. If your lender has limited experience financing aircraft, we recommend that you start conversations with your lender even sooner.
Making the Offer
Drafting Tips for an Effective LOI:
The purchase agreement should accurately set expectations and protect your rights in the inspection and closing process.
- Warranties and Service Programs. Warranties and service programs may come standard, but many have hidden conditions and onerous termination and cancellation clauses. If you are buying, always have your jet acquisition team review the current warranties and service programs before signing the purchase agreement. The obligation to take assignment of warranties and service programs may be financially detrimental to the buyer. For sellers, the buyer’s decision not to accept assignment of a service program may trigger substantial cancellation fees.
- International Registry. The International Registry (IR) allows owners and lenders to perfect their ownership and security interests in the aircraft and its engines. Read more about the IR here: https://www.internationalregistry.aero/ir-web/
- Aircraft Registration Number. Just like a custom license plate on your car, the FAA allows for custom registration numbers. To search for your preferred registration number, click here: https://amsrvs.registry.faa.gov/E.Gov/NN/reserve.aspx. If you already have a custom registration number reserved, ask us how you can assign it to your new jet or retain the number after selling your jet.