Air Lease Credit Agreement


Basic concepts for the establishment of an aircraft lease agreement. ALC is a leading aircraft leasing company based in Los Angeles, California, that has airline customers around the world. ALC and its team of committed and experienced professionals are primarily involved in the purchase of commercial aircraft and their leasing to its airline customers around the world through tailor-made aircraft leasing and financing solutions. For more information, visit the Alc website in The lessor is attractive to the lessee, since the lessee can claim capital cost allowances over the useful life of the aircraft, which offset the profits of the lease for tax purposes and withdraw the interest paid to the creditors who financed the purchase. This has made aircraft a popular form of tax assistance for investors and has made finance leases a more advantageous alternative to operating leasing or secure purchasing. The Annexes to the Agreement set out the specific details of the leased aircraft, its serial number, airworthiness data and inspection conditions. When designing a leasing transaction, it should be taken into account that, unlike the regime of obtaining a commercial loan, interest on the loan, non-life insurance payments and property tax payments made by the lessor to the bank (if they appear on the lessor`s balance sheet) are subject to VAT. The legislation allows the VAT paid to be recoverable. One concept related to operating leasing is leaseback, in which the operator sells his own aircraft for cash and then leases the same aircraft to the buyer for a regular payment. Operating leasing can offer airlines flexibility in changing the size of their fleet and weigh on leasing companies. Thus, the costs of leasing the aircraft were multiplied by 1.47 times the initial costs (173.34 / 118 – 1.47), which is quite justified by the inclusion of interest on the use of bank credits and income (margin) of the lessor in leasing payments.

In overall practice, the development of strategies for the development of leasing projects by airlines and airlines to achieve a positive financial result should be based on the consequent acquisition of aircraft (fig. 15). In other words, if an aircraft purchased on lease terms is purchased and the airline has leased a second aircraft on leasing terms, the financial result of the operation of two aircraft will be positive. The primary responsibility of the charterer is to provide the capacity and maintenance of the aircraft throughout the term of the contract, in a condition appropriate for use for the purposes defined in the contract. An essential element of the contract is the determination of the type of aircraft supplied, the maximum number of seats offered for the carriage of passengers, containers for the carriage of luggage, cargo and mail. Therefore, the charterer is required, under a charter contract, to provide the capability of an aircraft of a given type. The characteristics of lease contracts in aviation are the ability to obtain with the aircraft the necessary infrastructure, equipment and even pilots. Contracts are concluded both for entirely new aircraft and for those that were in service with other airlines. Funder.

Under a lease that is usually 10 to 20 years, the aircraft is entirely under the responsibility of the leasing company with the payment of the equipment costs in agreed shares throughout the duration of the lease. . . .