Risks
& Rewards 
·
Risks
o
Not enough Fractions sold to begin
operations
§
Equity partner or consortium could lose a
portion of start-up monies
o
Aircraft accident
§
Partial or total loss of airframe and/or
life could threaten LPI corporate survival
o
Luxury Passage Incorporated going defunct
§
Dissolution of the corporation at some
point in the future if necessitated
·
Addressing Risk
o
If enough Fractions are not sold to begin
operations of 1st aircraft
§
Any
unused portions of start-up capital will be returned to equity partner or
consortium proportionally
§
Aircraft
ownership will be transferred to equity funding partner or consortium for disposal
at their sole discretion
o
Sufficient insurance will be in force to
include airframes and reasonable liability claims against LPI
§
Additionally,
each Fractional Owner is protected through the Limited Liability Company (LLC)
form of business
o
In the event of LPI becoming defunct
§
All
assets will be dispersed proportionally and in accordance with all written
agreements, including LLCs (aircraft)
·
Rewards for Equity Partner or Consortium
o
Projected Dividends (paid in cash to
funding provider)
§
End of 1st year (4 aircraft), $4,000,000
§
End of 2nd year (10 aircraft total), an
additional $5,000,000
§
End of 3rd year (22 aircraft total), an
additional $9,000,000
o
Sale of 22 aircraft in 3 years projects
cumulative dividends of 514% of initial start-up funding monies
§
Projected total dividends of $18,000,000
derived by:
§
20% of gross income of first year
§
15% of gross income of second year
§
13% of gross income of third year