EFTA00688337.pdf

From: Richard Joslin To: Jeffrey E. <jeevacation@gmail.com> Subject: FW: Further Revision of Amendment No. 2 to Charter Lease Date: Tue, 10 Feb 2015 14:09:34 +0000 From: Fenn, Patrick [mailto: Sent: Monday, February 09, 2015 1:26 PM To: Richard Joslin Subject: RE: Further Revision of Amendment No. 2 to Charter Lease Hi Richard. Let me review and catch up with Mandel and get back to you. Best regards From: Richard Joslin [rnailtcH Sent: Monday, February 09, 2015 8:20 AM To: Fenn, Patrick Cc: Mandel, Michael Subject: FW: Further Revision of Amendment No. 2 to Charter Lease Patrick: I would like your tax input on the charter arrangement. Before the 135 certification, Jet billed Rance/ Avioneta for fixed costs, variable costs and flight incidentals. Apollo would provide a payment for busiess related flights at a standard rate. After the 135 certification, the plane owner (Rance/ Avioneta Holdings LLC) leases G-V to Jet Aviation (third party). The fee that Jet charges its charter clients is set forth in a dry lease agreement. The net charter fee paid to Rance is $200 less than the amount Jet receives from its clients. From a billing perspective, Jet continues to send invoices to Avioneta for fixed costs (crew salaries/ maintenance). Jet invoices its charter clients a) standard hourly rate b) incidental costs. Clients are billed separately by Jet for flight incidentals. Jet pays to Rance/Avioneta the standard hourly rate less $200. With the standard hourly rate paid by Apollo now being increased to include incidental costs, Jet will revert to billing all fixed, variable and flight incidentals to Rance/ Avioneta and pay to Rance/Avioneta the standard hourly rate less $200. Given the billing has reverted to pre-charter reporting, and given that the lessee (Jet) is not incurring any costs to operate its charter business, I'd like to get your input on the rental relationship between Jet and Rance. While Jet is unlikely to change its billing rpcedures, I'd like to discuss ways to improve reporting/ structuring (if possible) Michael —if I have any facts incorrect, kindly correct. Thanks EFTA00688337 From: Mandel, Michael (mailto: Sent: Friday, February 06, 2015 5:29 PM To: Richard Joslin Subject: RE: Further Revision of Amendment No. 2 to Charter Lease Actually the Air Carrier is Jet and the Lessor is Rance. And is there any substantive difference between remitting the rent net of expenses to Rance and remitting the gross rent and then billing them separately for the trip-related expenses? Micha Direct: From: Richard loslin [mailto Sent: Friday, February 06, 2015 5:23 PM To: Mandel, Michael Subject: RE: Further Revision of Amendment No. 2 to Charter Lease The dry lease agreement says Air Carrier (Rance) will charge Lessor (Jet Aviation) $XX - $200 (when there is a 135 charter between Jet and LDB/Apollo). The billing of fixed, direct, indirect costs by Jet is always to Rance/Avioneta based on 91 past history and based on how their billing system is set up. For 135 flights, the fact that billing is unchanged negates the argument that Rance is leasing plane to Jet. (How can plane costs be billed to landlord — they are tenant's responsibility) It would make sense that Jet would remit any monies from that it receives net of flight expenses. Any shortfall could be billed to Rance/Avioneta. Please run by Patrick if billing Rance for 100% of the plane costs is fatal to the tax argument. From: Mandel, Michael (mailto Sent: Friday, February 06, 2015 5:14 PM To: Cc: • Richard Joslin; ; Fenn, Patrick Subject: RE: Further Revision of Amendment No. 2 to Charter Lease OK, the amendment as originally drafted provided that you could simply deduct those charges from the amount remitted to Rance, but assuming this is acceptable to Lisa and Rich I will revise the draft accordingly. Michael S. Mandel Direct: From: [mailto: Sent: Friday, February 06, 2015 5:10 PM EFTA00688338 To: Mandel Michael. Cc: Subject: RE: Further Revision of Amendment No. 2 to Charter Lease Fenn, Patrick Michael, Since the charter rate is all inclusive to Leon Black or Apollo, all trip related charges for the crew and aircraft relating to charter trip will be billed to Rance on their monthly billing from JAFS will all the other aircraft charges and we will reimburse Rance the all-inclusive rent, less the applicable taxes and administrative fee of $200. Jet Aviation Flight Services, Inc. Mary Demarest Account VP 112 Charles A. Lindbergh Dr. Teterboro New Jerse 07608 / United States Tel. mailto: From: Mandel, Michael [mailto: Sent: Friday, February 06, 2015 4:59 PM To: Demarest, Mary; Beversluis, William; Konicki, Ga Cc: • Fenn, Patrick Subject: RE: Further Revision of Amendment No. 2 to Charter Lease So that I'm clear, the rent Jet sends does not deduct out of pockets when sending a net rent to Rance? That is inconsistent with what Bill said on our last call. If your language is correct, then how and when are "Charges" billed and collected? Michael S. Mandel Direct: From: [mailto: Sent: Friday, Februa 06 2015 4:47 PM To: Mandel, Michael; Cc: • Subject: RE: Further Revision of Amendment No. 2 to Charter Lease Fenn, Patrick Good afternoon, Please find one minor change to the Revised Amendment on page 2 of Schedule A— we deleted in second paragraph "Less the charges" and inserted "less any applicable taxes" and I hope this meet with your approval. Thank you Mary Jet Aviation Flight Services, Inc. Mary Demarest Account VP 112 Charles A. Lindbergh Dr. Teterboro. New Jersey 07608 / United States Tel. mailto: EFTA00688339 From: Mandel, Michael [mailto: Sent: Monday, February 02, 2015 4:17 PM To: Demarest, Ma ; Beversluis, William; Konicki, Gary Cc: Lisa Graziano ); 'Richard Joslin Fenn, Patrick Subject: Further Revision of Amendment No. 2 to Charter Lease )'; Thomas Turrin ( This reflects our call last week but if there are still issues please let us know. Michael S. Mandel AKIN GUMP STRAUSS HAUER & FELD LLF, 1333 New Hampshire Avenue, N.W. Washington, DC 20036-1564 T USA I Direct: Bio The information contained in this e-mail message is intended only for the personal and confidential use of the recipient(s) named above. If you have received this communication in error, please notify us immediately by e- mail, and delete the original message. The information contained in this e-mail message is intended only for the personal and confidential use of the recipient(s) named above. If you have received this communication in error, please notify us immediately by e- mail, and delete the original message. The information contained in this e-mail message is intended only for the personal and confidential use of the recipient(s) named above. If you have received this communication in error, please notify us immediately by e- mail, and delete the original message. The information contained in this e-mail message is intended only for the personal and confidential use of the recipient(s) named above. If you have received this communication in error, please notify us immediately by e- mail, and delete the original message. The information contained in this e-mail message is intended only for the personal and confidential use of the recipient(s) named above. If you have received this communication in error, please notify us immediately by e- mail, and delete the original message. EFTA00688340