Essay: Aircraft purchase agreement

From: D. Fender

Date: May 21, 2017

Re: Icarus I-800 Purchase Agreement

Attached you will find the Purchase Agreement between Fly-By-Night Aviation and Supersonic Wings Corp for the Icarus I-800 airplane. However, there are a few concerns that needs to be addressed before the Agreement is completed.

First, there is a discrepancy as to the type of engines that are in the plane. When referring to the Purchase Offer, the information given is that there are two Rolls Royce engines. However, when referring to the literature you provided, it states that there are GE engines on the Icarus I-800.

Second, also concerning the engines, the range appears to be different on the literature and purchase offer. On the purchase offer, it states the range is 8,000 nautical miles. However, the literature states that there are only 6,000 nautical miles. Again, these documents show two different engine brands, so that may be the reason for the discrepancy.

Further, there is also the issue of financing. The provisions for outs have been provided should you not be able to receive financing for the remaining amount. They have been drafted to your specifications, but please let me know of any updated in progress or changes that develop so that they can be added.

Lastly, the issue of litigation is broached. As you mentioned, both parties address conditions for litigation. In your best interest, it would be most beneficial to keep the provisions concerning litigation that I have drafted. These conditions protect you should any unforeseeable circumstances arise and allow you to remain as an individual defendant and not jointly with the Seller. This protects you from further litigation and from being tied to any current litigation.

Please read over the provisions that have been drafted and contact me regarding the discrepancies that I mentioned earlier. If you have any further questions or concerns, please let me know.

Sincerely,

Christle C. Dixon

Aircraft Purchase Agreement

Aircraft Purchase Agreement, dated October 30, 2017, by and among Supersonic Wing Corp., a Delaware corporation, (“Seller”) and Fly-By-Night Aviation, Inc., a New York corporation, (“Buyer”).

WHEREAS, Seller desires to sell to Buyer, and Buyer desires to purchase from the Seller, the Aircraft;

NOW, THEREFORE, in consideration of the mutual promises and terms set forth in this Agreement, the parties agree as follows:

Article 1. Definitions

1.1 Defined Terms. As used in this Agreement, the following terms have the meanings set forth below:

“Agreement” means this Aircraft Purchase Agreement, subject to all the terms included.

“Aircraft” means the Airframe, equipped with Engines, together with all appliances,

avionics, furnishings, spare parts, and other components, equipment, and property incorporated in or otherwise related to the Airframe or engines.

“Airframe” means the Icarus Aerospace Corporation I-800 aircraft, with United States Registration No. N765BW and Manufacturer’s Serial No. 8181.

“Assigned Contracts” means the Maintenance Agreement and the Pilot Agreement.

“Assumed Liabilities” means all liabilities and obligations that arise under the Assigned Contracts.

“Aviation Fuel” means the gas used to power the aircraft for flight.

“Closing” means the closing of the sale of the Aircraft in this Agreement in New York, New York on the Closing Date.

“Closing Date” means the date, November 25, 20X2, in which the parties have agreed to close this Agreement in New York, New York.

“Consent” shall mean any consent of, approval of, authorization of, notice to, or designation, registration, declaration or filing with, any Person.

“Contract” means any contract, lease, agreement, license, arrangement, commitment, or understanding to which the Buyer and Seller have agreed to be bound.

“Engines” means the two Rolls-Royce engines, Model No, BR710, bearing Serial Nos. 72725 and 72726. [[Possibly GE Passport engines, awaiting confirmation from H. Flighty]]

“Escrow Agreement” means the agreement for Escrow between the seller and buyer.

“Escrow Amount” means the Buyer’s payment of $300,000 to the Escrow Agent.

“Laws” means all federal, state, local or foreign laws, rules and regulations.

“Lien” means any lien, charge, encumbrance, security interest, mortgage, or pledge.

“Maintenance Agreement” means the Maintenance Agreement, dated April 3, 20X0, between Greasemonkeys Inc., and Seller, as the same may be amended from time to time.

“Note” means the Buyer’s 9% promissory note, payable to the Seller, for the principal amount of $5,000,000 due on December 31, 20X8.

“Pilot Agreement” means the Pilot Agreement between Seller and Ace Pilots, Inc., dated as of May 12, 20X1.

Article 2. Purchase and Sale

2.1 Sale of the Property and Assignment. Subject to this Agreement, Seller shall sell and Buyer shall buy the Aircraft.

2.2 Purchase Price. The Purchase Price is $21,000,000, consisting of :

(a) The Note;

(b) The Escrow Amount; and

(c) The remaining amount to be financed.

2.3 The Closing. The Closing shall take place on the Closing Date, at the offices of Workhard & Playlittle LLP, 1122 Avenue of the Americas, New York, New York, at 9:00 a.m.

2.4 Instruments of Transfer; Payment of Purchase Price; Assumption of Liabilities; and Further Assurances.

(a) Seller’s Deliveries. At the Closing, Seller shall deliver to Buyer:

i. A bill of sale for the Aircraft, in a form satisfactory to Buyer;

ii. An assignment of all its rights in the Assigned Contracts;

iii. The Aircraft will be delivered to the Reagan National Airport in Washington, D.C. on the Closing Date.

(b) Further Assurances. Following the Closing,

i. At the request of Buyer, Seller shall deliver any further instruments of transfer and take all reasonable action as to the transfer of the Aircraft

A. To vest in Buyer title that is free and clear of all liens and encumbrances of any nature whatsoever.

B. Transfer to Buyer all permits and licenses necessary for the operation of the Aircraft.

C. Transfer of the Maintenance Agreement, dated as April 3, 20X2, with Greasemonkeys, Inc., to be assigned from Seller to Buyer.

D. Transfer of the Pilot Agreement, dated as May 12, 20X1, to be assigned to Buyer.

(c) Buyer’s Deliveries. At the Closing, Buyer shall deliver to the Seller the following:

i. The Promissory Note will bear interest at 9% per annum and will be due in a single bullet payment on December 31, 20X8.

A. Buyer shall deliver $300,000 in immediately available funds to the Escrow Agent.

B. Buyer is to assume all liabilities as of the date of execution of the definitive Aircraft Purchase Agreement.

C. An instrument, in a form satisfactory to Seller, whereby Buyer agrees to assume the Assumed Liabilities of Seller;

D. Such further instruments as any creditor or third person to whom Seller is obligated on any Purchase Offer, agreement, or instrument may timely and reasonably request as a condition to release Seller from its obligation

Article 3. Representations and Warranties of Seller

The Seller represents and warrants to the Buyer as follows:

3.1 Organization; Good Standing. The Seller is a corporation duly organized, validly existing, and in good standing to conduct business under the State of New York and the federal laws of the United States.

3.2. Authority. Seller has full authority to perform its obligations under this agreement and has taken all necessary action to authorize the purchase, under the terms and conditions of the Agreement. This duly-executed contract binds the seller under legal obligation and is enforceable under its terms.

3.3 Litigation. There is no legal suit or arbitration proceeding within the knowledge of the Seller that might materially or adversely affect the Seller of the Aircraft.

3.4 Enforceability. This Agreement has been duly executed by the Seller and constitutes a legal, valid, and binding obligation of the Seller enforceable against Seller in accordance with its terms, except as such enforceability may be limited by applicable

3.5 Non-contravention; Adverse Agreements. Neither the execution or the delivery of this Agreement by Seller will conflict or result in:

i. A violation of the certificate of incorporation; or

ii. The violation of any Law applicable to Seller or any of its assets, both with or without notice or lapse of time.

3.6 Title to Assets. Seller has good title to all its properties and tangible assets, subject to no liens or encumbrances that would hinder the Closing of this Agreement. The tangible asset of concern is the Aircraft and all related parts.

3.7 Condition of Aircraft. Except as set forth in Schedule 3.9, the Engines and Aircraft are in good operating condition, subject only to ordinary wear and tear.

3.8. Aircraft Range. The Range of the Aircraft with eight passengers and four crew members is 8,000 nautical miles. [[Possible change in range, due to change of engine type discrepancy]]

Article 4. Representations and Warranties of the Buyer

The Buyer represents and warrants to the Seller as follows:

4.1 Organization. The Buyer is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation and has all requisite authority and legal right to own, operate, and lease its properties, assets and business.

4.2 Authority. The Buyer has full corporate power, authority, and legal right to execute and deliver under this agreement. This Agreement has been duly executed by the Buyer, and constitutes a legal, valid, and binding obligation of the Buyer enforceable against Buyer in accordance with its terms except as such enforceability may be limited by applicable bankruptcy.

4.3 Compliance with Instruments, Consents, Adverse Agreements. The execution and delivery of this Agreement shall not result in:

i. A default under any term of the certificate of incorporation or the bylaws of the Buyer; or

ii. Any violation under any Law or Contract by which the Buyer is bound.

Article 5. Covenants of the Seller

Prior to Closing, the Seller agrees to:

5.1 Cooperation. Use reasonable efforts to cause this Agreement to be consummated, and, to obtain the Consents, permits, and licenses that may be necessary.

5.2 Maintenance of Aircraft. Maintain the Aircraft in regards to any repair, order, and condition set forth in the agreement, reasonable wear and tear excepted.

5.3 Physical Appearance of Aircraft. Seller shall paint the Aircraft’s tail with the Buyer’s logo.

5.4 Transactions Out of Ordinary Course of Business. Except with the prior written consent of the Buyer, the Seller shall not enter into any transaction out of the ordinary course of business.

5.5 Ordinary Course of Business. Except with the prior written consent of the Buyer , the Seller shall not make any business agreements concerning the capital stock or any assets of the Corporation.

5.6 Material Liens. The lien by Greasemonkey Inc. shall be removed from the Aircraft on or before the Closing Date.

Article 6. Covenants of the Buyer.

Prior to Closing, the Buyer agrees to:

6.1 Cooperation. Buyer shall make its best effort to proceed with Closing and shall finance the remaining amount due for the aircraft. Closing is only required if the Seller has performed all duties and covenants and if the Seller’s representations and warranties are true as of the Closing Date.

6.2 Financing. If the Buyer does not obtain proper financing for the remaining balance of the Aircraft, Buyer shall allow Seller to keep the Escrow Deposit. Seller shall also have the option to end the Agreement. The Buyer is currently in progress with Lex Banking N.A. and First National Bank of Lex for financing.

Article 7. Conditions to the Seller’s Obligations.

The Seller is obligated to fulfill this Agreement, so long as each of the following conditions has been satisfied or waived on or before the Closing Date:

7.1 Buyer’s Representations and Warranties. The representations and warranties of the Buyer shall be true in all material aspects on and as of the Closing Date, except as permitted by this Agreement.

7.2 Buyer’s Covenants. The Buyer shall have performed all its obligations and agreements and complied with all its covenants contained in this Agreement to be performed and complied with by the Buyer prior to the Closing Date.

7.3 Documentation. All matters and proceedings taken in connection with the Aircraft, including forms of instruments and matters of title, shall be reasonably satisfactory to the Seller and to its counsel.

7.4 No Litigation. No action, suit, or proceeding before any court or any governmental or regulatory authority shall have been commenced and still be pending, no investigation by any governmental or regulatory authority shall have been commenced and still be pending, and no action, suit, or proceeding by any governmental or regulatory authority shall have been threatened against the Seller or the Buyer (i) seeking to restrain, prevent, or change the transactions contemplated hereby or questioning the validity or legality of any of such transactions, or (ii) which if resolved adversely to such party would materially and adversely affect the financial condition, business, property, assets, or prospects of any such Person.

Article 8. Conditions to the Buyer’s Obligations.

The Buyer is obligated to fulfill this Agreement, so long as each of the following conditions has been satisfied or waived on or before the Closing Date:

8.1 Seller’s Representations and Warranties. The representations and warranties of the Seller shall be true in all material aspects on and as of the Closing Date, except as permitted by this Agreement.

8.2 Seller’s Covenants. The Seller shall have performed all its obligations and agreements and complied with all its covenants contained in this Agreement to be performed and complied with by the Seller prior to the Closing Date.

8.3 Documentation. All matters and proceedings taken in connection with the Aircraft, including forms of instruments and matters of title, shall be reasonably satisfactory to the Buyer and to its counsel.

8.4 No Litigation. No action, suit, or proceeding before any court or any governmental or regulatory authority shall have been commenced and still be pending, no investigation by any governmental or regulatory authority shall have been commenced and still be pending, and no action, suit, or proceeding by any governmental or regulatory authority shall have been threatened against the Seller or the Buyer (i) seeking to restrain, prevent, or change the transactions contemplated hereby or questioning the validity or legality of any of such transactions or (ii) which if resolved adversely to such party, would materially and adversely affect the financial condition, business, Property, assets, or prospects of any such Person.

Article 9. General Provisions.

9.1 Governing Law. All federal, state, local, or foreign laws pertaining to the Aircraft shall apply.

9.2 Notices. All notices must be in writing and delivered to the law offices of Workhard & Playlittle LLP, 1122 Avenue of the Americas, New York, New York.

9.3 Merger. This agreement constitutes the final and exclusive agreement of all the matters contained within this Agreement and it supersedes all previous offers, negotiations, or agreements.

Article 10. Termination.

Either party to this Agreement shall have the right to terminate by written notice prior to the Closing Date.

10.1 Condition to Termination.

i. In the event of a failure to close, 60% of the Escrow Deposit shall be awarded to the non-breaching party.

ii. If neither party is at fault for failure to close, the Escrow Deposit shall be divided equally between Buyer and Seller.

In accordance to all the provisions of this Agreement, the parties have signed and delivered it by such date as set forth in the preamble.

Supersonic Wings Corp.

Sam Samson, President

Fly-By-Night Aviation, Inc.

Horatio Flighty, President