In his recent “Inside Fractionals” column for Business Jet Traveler, Shaircraft CEO, James Butler, reiterates the importance of reading the fine print and being skeptical of so-called “boilerplate” contract terms. Butler further explains the role of four key documents that can make or break your fractional contract:
- Binder/Deposit Agreement — Should specify the model/year of your aircraft, the price, the delivery date and the bases upon which the deposit will be refunded or will become nonrefundable.
- Purchase Agreement — Should describe the aircraft/engines/avionics you are buying in detail and include clear resale/valuation terms.
- Master Dry Lease Exchange Agreement — Should clearly state how your aircraft will be shared with other members.
- Management Agreement — Should include any concessions offered by your salesperson as part of the deal.
Butler closes by saying, “It’s your contract documents, not the slick brochures or sales pitches, that govern your rights and obligations as a fractional owner. Read and negotiate them carefully or you may make a very costly mistake.”
Inside Fractionals: “Four Must-Read Documents”
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