Sales of Aircraft Fractional Interests - "Put" to Fractional Operator
More thoughts on dispositions of fractional aircraft interests:
• Fractional ownership disposition options – repurchase by program operator. Broadly speaking, fractional interest owners in the larger programs (NetJets, Flexjet, for instance), may dispose of their interests in two ways. Either you exercise your “put” back to the program operator, or you sell your interest to a third party with the consent of the program operator. In the larger programs, the program operator will have committed itself to repurchase your interest at its fair market value, net of a stipulated remarketing commission. In most of these larger programs you can be reasonably sure that you will be able to dispose of your aircraft within “x” days (assuming you can agree with the program operator on what “fair market value” really is). Don’t take that timing certainty for granted, particularly in a market that is trending down. A later post will address problems associated with determining “fair market value.”
