INSPECTION & APPRAISAL REPORT FOR H AW K E R F A L C O N 5 0 SERIAL NUMBER XXX

Prepared For: Acme Leasing Corp. April 1, 2007

TABLE OF CONTENTS
Assignment ............................................................................................................................1 Appraisal Assumptions .........................................................................................................1 Value Definitions...................................................................................................................2 Aircraft Value.........................................................................................................................3 Aircraft Inspection Summary................................................................................................7 Aircraft Specifications & Equipment....................................................................................12 Falcon 50 Background & Market Perspective .....................................................................14 Covenants ..............................................................................................................................21 Appendix I - Miscellaneous Documents Appendix II - CAMP Status Report Appendix III - Photographs

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3 . mid-time status.1 / 6. before the inspection of the aircraft itself. the subject aircraft is physically inspected and its maintenance records reviewed to determine its overall condition. ! ! Unless otherwise noted. (JPI) has been retained by Acme Leasing Corporation (the “Client”) to offer its opinion of the Fair Market Value and Future Fair Market Values of one 1985 manufactured Dassault Falcon 50 (the “Subject Aircraft”) detailed below: Manufacturer Model Serial Number Registration Date of Manufacture Engine Model Total Time (hours/cycles)1 Configuration Avions Marcel Dassault Falcon 50 XXX NXX February 30. 2006. A P PRAI SA L A S S U M P T I O N S In an appraisal supported by an inspection and records review. Inc. 1985 Three Garrett TFE-731-3D-1C 8. engine and other major components are in a mid-life. S ER IAL XXX AS S I G NM E N T Jet Perspectives. That it is typically equipped for a role as a corporate aircraft and that it does not have equipment or characteristics that would materially affect its value.566 Eight Passenger Executive 1. JPI first develops the aircraft’s Fair Market Value based upon the following assumptions. However.835. maintenance status and records quality.INSPECTION & APPRAISAL REPORT F A L C O N 5 0. Hours and cycles are as of September 19. the airframe.

The aircraft has no outstanding Airworthiness Directives or maintenance requirements. The aircraft is clean. and maintained under the manufacturers recommended maintenance program using factory authorized maintenance facilities. JPI also makes two further assumptions regarding any possible transaction involving the Subject Aircraft: ! ! That if sold. For the purpose of this appraisal. All major modifications and/or repairs have been properly documented. The aircraft has no damage history. recent major airframe inspections or engine overhauls will add to the value of the aircraft. JPI does not consider the value of an attached lease stream or its tax consequences. That the aircraft is not subject to an existing lease. It is certificated and operated under the auspices of the Federal Aviation Administration or other major regulatory authority if not registered in the United States.! ! ! ! ! ! ! Its historical and/or expected level of utilization for the aircraft is typical for its make and model. For instance. JPI uses the following definition of Fair Market Value as defined by the American Society of Appraisers: 4 . not involved in a fleet sale which would tend to discount from the value shown. the aircraft will be sold as a single unit. Its three Garrett TFE-731 engines are enrolled in the Honeywell Maintenance Service Plan (MSP) or the Jet Support Services EMS engine program. JPI then uses the condition and maintenance data obtained from the inspection of the aircraft to adjust for the variance from that assumed status. VA L U E D E F I N I T IO N S For the purpose of this appraisal. In addition to the foregoing assumptions about the aircraft itself.

that may reasonably be expected for property in exchange between a willing buyer and a willing seller with equity to both. 5 . An aircraft’s Future Fair Market Value is based on the long-term historical value trend of the aircraft and assumes the supply and demand equation to be in relative balance. as of a certain date.! Fair Market Value is the amount expressed in money. neither under any compulsion to buy or sell and both fully aware of all relevant facts.

A condition of the pending sale is that the engines of the Subject Aircraft are to be enrolled in the Honeywell MSP (Maintenance Service Plan).835 hours with 6. The Subject Aircraft is powered by the upgraded TFE-7313D-1C model. in the opinion of JPI. These issues are summarized below: ! Utilization.200-hour Core Zone Inspection and costs approximately $100. consequently the value of an aircraft with the “3D” engine modification is worth approximately $300. The Subject Aircraft was manufactured in February 1985 and as of the date of JPI’s inspection had 8.AIRCRAF T VA L U E JPI has inspected the Subject Aircraft and its records in order to gather independent information regarding its history. equipment. improved “hot and high” performance and improved engine reliability. and any other information considered germane to this appraisal. The upgrade to the “3D” engine is typically accomplished while the engine is undergoing its Major Periodic Inspection (hot section inspection) or its 4. maintenance status.566 landings.000 per engine (for MSP enrolled operators) to accomplish. As will be shown in the ! 6 . essentially prepaying for all scheduled and unscheduled maintenance events. Consequently with its utilization approximately 7% more than the fleet average.000 more than one with the original -3 engines. collectively have a material impact upon the value of the aircraft. the average is 394 hours per year. As will be detailed in the following section. These engines. which replace the original TFE731-31C engines. there are a number of issues which. among the 22 Falcon 50s known to be available for sale. in the opinion of JPI there is no material effect upon the value of the Subject Aircraft. a program in which an operator pays a fee for each hour of engine operation. provide increased thrust. This equates to an average utilization of approximately 421 hours per year with an average stage-length of 1 hour and 21 minutes duration. In comparison. Some brokers and dealers familiar with the Falcon 50 market suggest that the increased benefits offered by the modification enhance the value of the aircraft on a 1:1 basis. Engines.

! Maintenance Status. aircraft on OCIP have dedicated in-house maintenance personnel who can accomplish these block inspections every month. 7 . reducing the time and expense normally required. Consequently in the opinion of JPI. consequently enrollment in the program is inherent to its value. 319 and 222 hours remaining before the next Core Zone Inspection (CZI) on the left. Although the aircraft was manufactured in 1985. middle and right hand engines respectively. this engine and the two others will be “built to the MSP standard”. the history and high time status of the #1 engine should not necessarily be an issue affecting the value of the Subject Aircraft.following section. the aircraft will be enrolled in MSP and that the aircraft is scheduled to have this work done. Duncan Aviation. during the upcoming CZI. advises that after conclusion of the pending transaction. This engine has 10. deductions roughly equivalent to the “buy-in” cost should be made. In the case of the Subject Aircraft the engines have 85. of the 22 available Falcon 50s. OCIP is a progressive maintenance program designed primarily for low or high utilization operators used to avoid the extensive downtime of Falcon typical “A”. Assuming enrollment in the MSP program there will be no charge to operator for this work. where the aircraft has just completed a pre-purchase inspection. this high time engine was manufactured in 1979 and was first installed on Falcon 50 on an early production aircraft.884 hours total time. Although the age of this engine might be worrisome to some. The Subject Aircraft is currently maintained under Falcon’s Optimized Continuous Inspection Program. Under this program. routine maintenance events. However. the downside of the program is that is a greater need for routine monthly maintenance requirements. Typically. “B” and “C” inspection sequences. An unusual aspect of the Subject Aircraft relates to the status of the #1 engine. significantly more hours than that of the airframe. including the “A” and “B” inspections. For those aircraft not enrolled in the program. are grouped into monthly “block” inspections. 18 are enrolled in MSP.

consequently it will again be due by the end of June 2010. it was in very good condition with strong luster and only very small chipping noted. assuming no costly surprises are uncovered. In regard to its configuration. with a “wrap-around” couch in the aft cabin. the aircraft will undergo an “A” inspection and “A+” inspection (due every 150 and 300 hours respectively) in order to realign the aircraft’s inspection sequences. it was last painted by Duncan Aviation in 2004 and is considered by JPI to be a very handsome paint scheme. the major “C” inspection is still required. the “C” inspection was last performed in June 2004 (at 8. In addition. the aircraft is well suited for international travel equipped with dual Universal UNS-1K flight management systems. An important.000 to accomplish. The “C” inspection is an extensive inspection of the airframe and flight controls required every 6 years and has an estimated cost of $300. Duncan Aviation advises that as the new owner of the Subject Aircraft intends to fly the aircraft only 150 hours per year and does not have in-house maintenance personnel. due to market demands. dual HF radios and dual laser inertial reference systems. In the case of the Subject Aircraft. Cosmetics/Configuration. In addition to the Exit Block Inspection. In the case of the Subject Aircraft. subjective issue effecting all corporate aircraft is the cosmetic condition and configuration. ! Avionics. More importantly. However. Early aircraft were available only with a lavatory located in the foyer. The Subject Aircraft is equipped with a Collins EFIS 86C 5-tube EFIS system. an important issue for the Falcon 50 is the location of the lavatory.069 hours total time). upon conclusion of the transaction. the aircraft will be removed from OCIP with an “OCIP Exit Block Inspection” and will revert to the typical “A”. “B” and “C” inspections.Despite enrollment in the OCIP program. albeit. later production ! 8 .

particularly those intended for the North American market. the forward lav configuration is preferable in that flight crew will not need to travel through the passenger cabin. JPI considers the interior to be in average condition. the Government of Abu Dhabi. particularly that in Europe and the Middle East. As of the date of this report the Subject Aircraft has been owned by only three operators: The Government of Abu Dhabi. The Subject Aircraft is an eight-passenger configuration. Duncan refurbished from the drink ledges upward. The Subject Aircraft is in full compliance with FAA requirements regarding RVSM (Reduced Vertical Separation Minimums). The interior was installed in November 1994 by KC Aviation (now defunct). For many operators. it would be expected that the cabin have the aft wrap-around couch. in the case of the Subject Aircraft. At that time. Other Issues. In addition. In the opinion of JPI. the maintenance has been tracked with CAMP computerized maintenance program. However. With this forward lav configuration. TCAS and TAWs. The Subject Aircraft is equipped with the forward lav configuration. the aft cabin features a three-place couch on the starboard side across from which is a single forward facing seat with an unusual ottoman foot-rest. however the program has yet ! 9 . were built with an enclosed lavatory aft of the cabin. Fiat (registered in Italy) and the current owner Noname Corp. According to Duncan Aviation. one that will appeal to some and disqualify it from consideration for others.aircraft. Although there are some differences in the quality of the maintenance documentation between these three entities. it was this configuration that appealed to the buyer. with the upholstery of the seats and couch done in green chenille fabric. the current owner has done a very good job in maintaining the log books. ! Miscellaneous. this is a unique configuration. no doubt at the behest of its original owner. with partial refurbishment accomplished by Duncan Aviation in June 2004.

appear to have a renewed sense of bullishness.A. serial number XXX.46 2008 7. assuming enrollment in the Honeywell MSP program. there are only five available aircraft. representing almost 9% of the fleet is currently available for sale. based Falcon 50. dollars and with an assumed inflation rate of 2% per year. more almost 50 aircraft were available for sale. Values are expressed in both constant 2006 U. It is important to note that an aircraft’s Future Fair Market Value is based on the long-term historical value trend of the aircraft and assumes the supply and demand equation to be in relative balance and the aircraft to be in a “mid-life” status. particularly given that just within the past few years. has a Fair Market Value of $8.S.750.750. for those who are in the market for a relatively young low-time U. JPI is of the opinion Falcon 50. Consequently.18 10 .S. As will be detailed later in this report.000.to be changed reflecting the aircraft’s new maintenance regime noted above.29 $8. given the current status of the Subject Aircraft and in consideration of the current market environment for Falcon 50 aircraft.000 Constant 2006 USD 2006 USD Inflated at 2% P. 2007 $8. Consequently.86 8. the following table offers the opinion of JPI as to the Future Fair Market Values of the Subject Aircraft. The brokers and dealers involved in this market. However. 22 aircraft. 11 aircraft are available for sale of which four are known to have a deal pending. two other are overseas. Dassault Falcon 50 Serial Number XXX Value Summary (millions of USD) Fair Market Value $8. In that regard. in looking at the youngest half of this market. The Client has also requested that Jet Perspectives offer its opinion of the Future Fair Market Values of the aircraft. including the Subject Aircraft. The status of the Subject Aircraft must be taken within the context of the existing Falcon 50 market.

08 6.91 7.67 7.2009 2010 2011 7.43 11 .46 7.73 7.

the aircraft had 836 hours with 643 landings. 1987 notes that the “Aircraft transferred to FIAT”. (with registration mark I-CAFC) the Italian auto manufacturer. Switzerland. A logbook entry dated December 17. 1985 and delivered nine months later to its first owner (with registration mark A6-ZKM) to the Government of Abu Dhabi. and further substantiated by the documents reviewed it is possible to recreate this history. At the time of its sale to Fiat. it is difficult to precisely track a chain of ownership. However. The Subject Aircraft flew for the first time on February 11. Flight records reveal that during their ownership. USA 12345 A copy of this document. 124 Main Street Anytown. based on JPI’s own internal reference sources. can be found in Appendix I of this report. however it should be noted that all entries were made in English with virtually all maintenance performed by either European Falcon Service or at Jet Aviation’s facility in Basel. JPI inspected four airframe logbooks. The log books for those first years of service are not particularly detailed. For the purpose of this appraisal. During their 25 months of ownership the Subject Aircraft averaged approximately 400 hours per year. as well as a copy of the aircraft’s June 3. 2006 at the facilities of Duncan Aviation located in Lincoln. Certificate of Airworthiness. 1994 issued U. Nebraska. the majority of trips were intra-Italian flights. traveling primarily to European destinations. the Subject Aircraft and its records were physically inspected on September 19. Based on a review of an aircraft’s maintenance records.AIRCRAF T I N S P E C T I O N S UMMARY In support of the foregoing appraisal. Based upon the aircraft’s current United States Certificate of Registration the Subject Aircraft is registered to: Noname Corp.S. six engine logbooks FAA Form 337s and other miscellaneous documents. Routine maintenance was done by what appears to be Fiat’s own flight 12 .

however larger more extensive maintenance was primarily done at Jet Aviation in Basel. 13 .department.

in the opinion of JPI. registry.S. maintained under the manufacturer’s recommended maintenance program. Since March 1. are properly noted. as with all aircraft imported into the United States and prior to the issuance of a U. A logbook entry dated November 1. the aircraft also had a host of avionic and cabin electronics upgrades.Fiat owned and operated the Subject Aircraft until June 1. routine maintenance events are grouped into monthly “block” inspections. JPI must therefore assume that this was indeed the case. No doubt as a condition of its importation into the United States.S.889 hours with 3. Beginning with its U. 1994 when a logbook entry notes that the aircraft was put on the U. the Subject Aircraft would have required a thorough logbook review to insure that it was current under Falcon maintenance program. 1994 notes that the Subject Aircraft received complete cosmetic refurbishment by KC Aviation in Dallas. the Subject Aircraft has been maintained under the Falcon recommended maintenance program enrolled in Falcon’s Optimized Continuous Inspection Program.611 landings. 1996. The current owner appears to have their own maintenance personnel and all maintenance events. Most importantly. the aircraft had 3.A. the aircraft underwent an “A” inspection. C of A was issued on June 3.R. registration. At the time of its sale. and operated under F. Part 91. It is obvious from the records that since their acquisition of the Subject Aircraft in 1994.S. 14 .S. (The company has since been acquired by Gulfstream. which at the time was considered one of the premier facilities in the U. that section of the Federal Aviation Regulations that governs privately owned aircraft. Besides the refurbishment of late 1994. Certificate of Airworthiness. 1994. in September 1996 the three engines were converted to the preferred TFE-731-3D-1C configuration.409 (f) 3.S. the scope and quality of the logbooks improved dramatically. Under this program. However. scheduled or unscheduled. OCIP is a progressive type maintenance program designed primarily for low or high utilization operators used to avoid the downtime of Falcon’s typical “A” and “B” inspection sequences. to its current owner.) Maintenance documentation indicates that in addition to complete cosmetics. the downside of the program is that there is a greater need for routine monthly maintenance requirements. reducing the time and expense normally required. the current owner has done a very good job of keeping the aircraft well maintained and well equipped. As its current U.

In order to accomplish this. It is important to note that under the monthly OCIP block inspections. 2A. 2006 which offers an overview as to the status of every inspection. Under the Falcon maintenance program. that will become a moot issue. It is important to note that this report had yet to be changed to reflect the aircraft’s removal from the OCIP program. the Subject Aircraft is up-to-date under the manufacturer’s recommended maintenance program with no deferrals noted. dated September 19. it will be due again by the end of April 2008. Based on a review of this CAMP report. A+. this is required every 72 months. Under CAMP. B. The current price for this inspection is approximately $200. Last performed in November 2002. these overhauls are each referred to as a “dimensional check” and inspection for corrosion. the aircraft must first undergo an OCIP Exit Block inspection and an “A” and “A+” inspection. is still required and consequently in the case of the Subject Aircraft will be due again by the end of June 2010.500 hours) are merged into the monthly block inspections. all required maintenance tasks and life-limited airframe and engine components are tracked. the Computerized Aircraft Maintenance Program. 2A+. 4A+. the operator notifies CAMP of all the maintenance work performed and CAMP in turn updates the operator as to pending maintenance tasks. “B” and “C” inspection sequence. due every 72 months. From this point the routine inspection sequences will be realigned. A copy of this report is located in Appendix II. Duncan Aviation advises that as the new owner intends to fly the Subject Aircraft only 150 hours per year.000 to perform. The next inspection. the #100 Block Inspection will be required by the end of October. Like the “C” inspection. The comprehensive “C” inspection. The aircraft is enrolled in CAMP. but given the change in the maintenance program. the “A” inspection (required ever 300 hours to 6 months) and the “B” inspection (required every 1. 15 . the aircraft’s maintenance will revert to the typical “A”. Another significant maintenance event relates to the overhaul of the nose and main landing gear. Every month. C and 3C). airworthiness directive and service bulletin. JPI was able to obtain the most recent CAMP Status Report. According to this report. the last known maintenance on the aircraft was the #99 Block Inspection accomplished on September 12.The Subject Aircraft converted to Falcon’s OCIP program after undergoing the a host of inspections (A. life-limited component.

the current owner will enroll the aircraft in MSP and that all three engines will undergo the 4. Part of any records survey involves a review of FAA Form 337s. The aircraft has a Jade Mist Green (dark green) stripe. The three engines have been maintained under the factory recommended maintenance program since new.200 hours. The most significant inspection.100 hours of operation. ten of which related to the work done by KC Aviation in 1994. there is no enhancement to its value. relating to a host of upgrades done to the aircraft in May 2004. The upper fuselage and wings are done in an off white. the built-up equity remains with the engines. In the case of the Subject Aircraft.200 hour Core Zone Inspection. prepays for all scheduled and unscheduled engine maintenance.The engines of the Subject Aircraft are not current enrolled in Honeywell’s MSP (Maintenance Service Plan) program.9 hours total time and as a result the current meter only reads 187 hours total time. The auxiliary power unit (APU) is a Garrett GTCP-36-100A with 3.081 hours total time. engines are inspected every 150 hours with SOAP (Spectrographic Oil Analysis Program) samples submitted to inspect for metal contaminants. As the program is transferable from owner to owner. In the opinion of JPI. this model of APU is required to have a “Hot Section” inspection every 2. Under the Garrett recommended service schedule. This form is required for the repair.400 hours the TFE731-3 engine is required to undergo MPI (Major Periodic Inspection) which have been accomplished on time. In the case of the Subject Aircraft. Duncan Aviation advises that as a condition of its pending sale. All of these Form 337s relate to various modifications and upgrades. Some chipping was noted in the areas where chipping normally occurs 16 . modification or alteration of an aircraft and is a significant part of an aircraft’s maintenance history. 37 Form 337s were seen by JPI. red stripe and Jade Mist lower fuselage. immediately prior to the sale of the aircraft to its current owner. which in effect. The aircraft was seen by in bright daylight making any flaws obvious. At 1. Under this program. the CZI (Core Zone Inspection which can be roughly compared to an overhaul) is required every 4. its Hobbs Meter was replaced at 2.893. while 15 more were issued by Jet Aviation in Basel. the cosmetic condition of the Subject Aircraft is mixed. none relate to any damage repair. bring each engine to the “MSP Standard”. As the majority of the Falcon 50 fleet is enrolled in MSP. the operator pays a fee for each hour of engine operation. Under this program. It was last painted in June 2004 by Duncan Aviation and is considered to be in very good condition.

) The cabin is configured with four individual cabin seats arranged in a club configuration in the forward cabin. is testimony to the good paint job applied to the aircraft. however given that the aircraft is being sold to someone who appreciated both the configuration and cosmetic condition. etc. should the aircraft be eventually offered for sale in a weak market environment. However. In 2004. Photographs of the Subject Aircraft can be found in Appendix III of this report. Nevada.(radome. window shades and LED lighting. in the opinion of JPI.) with little chipping elsewhere. it is configured with a forward lavatory and forward galley in the foyer area. This is primarily due to the green upholstery and carpet. JPI is of the opinion that the Subject Aircraft is a well equipped aircraft. galley. bulkheads and drink rails) are done in a high gloss burl veneer. 17 . wing tips. windscreen. in average cosmetic condition. and the fact that the aircraft is always hangared while at its home based in Reno. (Due to a problem with a stubborn lavatory door. All of the seats are upholstered in green chenille fabric. with a side-facing aft three place couch on the starboard side across from which is a single forward facing seat with a tapestry upholstered ottoman. Overall. In the opinion of JPI. This. which in the opinion of JPI detracts from the look and feel of the interior. which actually show quite well with some minor chipping noted. JPI is of the opinion that the exterior of the aircraft is in excellent condition. the beige carpeting is showing wear and should be replaced. both of which are issues which can be easily corrected. The cosmetics of the Subject Aircraft are considered by JPI to be in average condition. one piece window liners. The aircraft’s interior is also considered by JPI to be in average condition. PSU (passenger service unit) panels. The interior of the aircraft is considered by JPI to be in average condition. this should not be an issue in the near term. All hardwood surfaces (foyer. the interior of the Subject Aircraft was partially refurbished by Duncan Aviation with a new cabin headliner. particularly given the popularity of leather found in most aircraft interiors. As noted earlier. these issues could take on a new level of importance. At issue is its forward lavatory configuration and unusual seating arrangement. it was impossible to see the lavatory.

equipment. hours and cycles based upon its September 19.566 Engines (Enrolled in MSP): Manufacturer: Model: Serial No.3 8.537 4.881 Right Garrett TFE731-3D-1C P-76575C 8.115 Center Garrett TFE731-3D-1C P-76578C 8. Interval: Hours Since CZI: APU: Manufacturer: Model: Serial Number: Total Time: HSI Interval: Time Since HSI: Avionics: Collins EFIS 86C Collins APS-80 Autopilot Dual Collins VHF-22C Comms.884. Systems Dual Universal GPS TSO-129 Honeywell Lasernav INS Honeywell Mark VII Enhanced Ground Proximity Warning System Dual Collins 718U-5M HF Radios w/SELCAL Left Garrett TFE731-3D-1C P-76193C 10.081(Note: Hobbs meter replaced at 2.200 3.: Total Time: Cycles Since New: Core Zone Inspec.33 spacing Dual Collins VIR-32 Navs w/FM Immunity Dual Collins ADF-60A ADFs Dual Collins DME-42 Dual Collins TDR-94D Transponders (Mode S) Dual Universal UNS-1K Flight Mgmt.9 5.893. 2006 inspection: Total Time Airframe: 8.978 Garrett 36-100A P-262 3.556 4.865 4.100 882 18 .200 3.579.432.AIRCRAF T S P E C IF ICAT IO N S & EQ U I PM E N T The following is a brief description of the Subject Aircraft including its avionics.835 hours Total Landings: 6.9 6.) 2. w/8.200 4.

Faux finished countertops. Overall upper fuselage and wings are off white with a red stripe. Right hand forward galley with three Mapco’s. Beige cut and loop carpet. All cabin hardware is custom Satin Antique Nickel & Brass. Forward lavatory. Considered by JPI to be in average condition. one hot cup. oven dish and wine storage. New headliner. A & C manual pleated window shades and Emteq downwash LED lighting installed in 2004. Jade Mist Green stripe and Jade Mist Green lower fuselage. Chairs and divan are upholstered in green chenille. PSU panels. Cabin entertainment system includes an Airshow 400 with DVD and dual Baker 15-inch monitors. High gloss burl veneer cabinetry. Drink rails and tables are in high gloss burl veneer. one piece window panels.Collins WXT-250A Radar Collins TCAS II w/Dual Indicators Other Equipment: RVSM Complaint Magnastar Telephone Cabin Entertainment System with DVD Airtex 100-406 MHz ELT Airshow 400 with Dual Baker 15-inch Monitors Universal CVR-30 Cockpit Voice Recorder Cosmetics: (See Appendix III for photographs) Interior: Eight passenger executive interior with forward four place club. Considered by JPI to be in excellent condition. Exterior: Painted June 20004 by Duncan Aviation. 19 . Beige leather lower sidewalls. Aft cabin features a 3-place divan opposite a forward facing single seat with a tapestry covered ottoman.

Dassault developed the Falcon 50 as an eight passenger intercontinental aircraft. Arkansas for final completion. a medium jet capable of transporting eight passengers up to 1. which found Gulfstream as the sole vendor. fuel economy and Stage III noise compliance as compared to the General Electric CF700 turbojet engines which had been the mainstay of the Falcon 20s. The first flight of the prototype Falcon 50 occurred in November 1976 with the flight of the first production aircraft taking place in June 1978. which made New York to Los Angeles and New York to Paris easily attainable. Marketed and sold in the United States by Dassault’s U. Of these. Dassault had been manufacturing the Falcon 20. but still was unable to compete with Gulfstream for a share of the for intercontinental aircraft market. sales organization. Until the first customer deliveries of the improved Falcon 50EX in 1995. which offered excellent performance. Dassault Falcon Jet of Teterboro. New Jersey.500 nautical miles. France. Although its fuselage and cabin were roughly equivalent to that of the Falcon 20 (both have 700 square feet of cabin volume) the aircraft was designed as a three engined aircraft and consequently is often referred to as a “Baby 727".000 nautical miles. The aircraft was capable of distances in excess of 3. In response to this valued market niche. 159 aircraft were 20 .S. The Falcon 20 had undergone a host of improvements throughout its production history.FA LCO N 50 BACK GRO U ND AND MARK E T OV ERV I E W The Falcon 50 series is a three-engined intercontinental aircraft built by Dassault Aviation of Paris. Since 1966. Falcon manufactured 250 aircraft. aircraft intended for North American customers are manufactured in France and then delivered to Falcon Jet’s Little Rock. The key to the success of the Falcon 50 was its Garrett TFE731-3 turbofan engines. FAA certification for the aircraft occurred in March 1979 with first customer deliveries beginning four months later.

two months after 21 . it did offer better operating economics. but at 40. which give the EX a range of 3. on a 91degree day with eight passengers and then fly 2. an increase of 200 nm over the range of the original Falcon 50. in long-range cruise at Mach .000 feet at M . Its AlliedSignal TFE731-40s have the same maximum sealevel thrust as the original Falcon 50's TFE731-3s. for some. By the time Gulfstream had ceased production of their G-III in favor of the G-IV in 1987. Serial number 251 was the first Falcon 50EX. the objective was to increase the range of the Falcon 50 and to enable the upgraded airplane to fly even its longest missions at a higher cruise speed.448 feet.75. Upon its first deliveries in 1979. Production of the Falcon 50 continued through 1994 with serial number 250 being the last aircraft manufactured. The Falcon 50EX can fly at Mach . As a result of this improved engine performance. 98 Falcon 50EXs are in service. delivered to German car manufacturer Volkswagen in March 1997 after two years of service as Dassault’s demonstrator aircraft. As of the date of this report. was an important selling point.700 nautical miles with NBAA IFR reserves. Better still is the performance increase in high-speed cruise of Mach . Dassault had sold 182 Falcon 50s. where field elevation is 8.80 as far as the original Falcon 50 could fly at Mach . a gain of 400 nm over its predecessor at the same speed. compared to the original 50's ability to reach 39.80 they have 24% more thrust and consume 7% less fuel. representing almost two-thirds of the entire line of aircraft.265 nautical miles with NBAA IFR reserves. was considered less ostentatious. the EX can carry eight passengers 3.000 at maximum takeoff weight in 23 minutes. and its third engine.4 million for a 1980 Falcon 50 versus $8. Gulfstream had sold approximately 200 G-IIIs. Equally impressive is the EX’s hot and high performance. Perhaps one of the biggest shortcomings of the Falcon 50 series is its lack of cabin space and passenger amenities. nor as expensive (approximately $7.80. With a new “glass” cockpit and new engines. In May 1983. Although the Falcon 50 was not as spacious as the Gulfstream III.9 for a Gulfstream III). They also allow the EX to climb direct to 41. The Falcon 50EX was seen by many as an attempt to modernize and improve an airframe that had met with good success in the market.manufactured between 1980 and 1982.035 nm. It can take off from Mexico City.75.000 feet in 30 minutes. the Falcon 50 quickly ate into Gulfstream’s market dominance.

However. The Falcon 50 and 50EX. the graph below plots the average asking prices of each of these aircraft (as preowned aircraft) against their maximum NBAA IFR range. Approximately 10% of the 22 .250 Falcon 50E X Falcon 50 CL-600 Citation X CL-601 Falcon 2000 3.000 2.250 4. the Gulfstream 200 (formerly the Galaxy) and the soon to be introduced Raytheon Hawker 4000 and Bombardier’s Challenger 300. with their intercontinental range. the Falcon 900.500 3. with the introduction of smaller aircraft with generally similar range and price points. Introduced in 1986.750 G-II 2. Dassault announced it own plan to build a stretched version of the Falcon 50. The Falcon 50 series is measured against the traditional “heavy” corporate aircraft and the new breed of “super medium” aircraft. Cessna’s Citation X. In this group are the Falcon 50 series. the Falcon 900 has evolved into the Falcon 900C and 900EX the top models in Dassault’s line of corporate aircraft.000 CL-604 NBAA IFR Range (nm) 3.Gulfstream’s announced G-IV program. over the past several yeas. Recognizing that the most important consideration for most buyers are the price of the aircraft and its maximum range. have historically been considered “heavy” corporate aircraft.500 Falcon 900E X 4.750 G-IV G-IVSP Falcon 900B/C G-IIB G-III CL-601-3AE R/3R Gulfstream 200 3. some pundits have argued for the creation of a class of aircraft known as the “super medium” aircraft. Leading Heavy Jets NBAA IFR Range vs Average Prices of Pre-Owned Aircraft 4.500 $2 $7 $12 $17 Average Asking Price (M illions of U SD) $22 $27 $32 The Falcon 50 has been successfully marketed throughout the world as both a corporate aircraft and for government VIP service.

As noted earlier in this report. (The Subject Aircraft is enrolled in MSP. Sears. and Volvo. the most attractive aircraft 23 . due to strong customer preferences. however each aircraft has different levels of coverage depending upon the hours and cycles on the aircraft's engines at the time of their enrollment. 22 Falcon 50s are known to be available for sale. MSP is an assumed enhancement to the value of an aircraft. In this configuration. aircraft with forward lavatory are considered less desirable in the marketplace given the very expensive costs of reconfiguring the entire cabin. Italy. allowing for a wrap-around 4-place couch to be placed in front of the aft bulkhead. Portugal. Generally. the cabin is pushed aft. Designed after Rolls Royce’s Power-By-The-Hour program. In the opinion of JPI however. Unlike MSP. a level of availability generally consistent with a balanced market environment in which demand equals supply. the lavatory was located in the entranceway. Like MSP. it has been used by such prominent American companies as Archer Daniels Midland. later production aircraft were manufactured with a smaller entranceway and an aft lavatory.fleet is in service with such governmental operators as the France. operators pay an hourly amount to Garrett which prepays both scheduled and unscheduled engine maintenance and provides for engine loaners and engine updates. Anheuser Busch. Hewlett Packard. the program is transferable among operators. BASF. Iraq. Bechtel and The New York Times. Among the early production aircraft.) A competing engine program is EMS (Engine Maintenance Systems). Borden. separated from the cabin and cockpit by folding wall panels. Major foreign operators have included such companies as Philips. HBO. However. Roebuck. In the opinion of JPI. which is transferable to new operators. As a corporate aircraft. Volkswagen. As for other TFE731 powered aircraft. Although some of the Falcon 50 owners are willing to accrue their own engine reserves and bear the financial risk of unscheduled engine maintenance. and South Africa. a major consideration is whether or not the engines are on Garrett’s MSP program (Maintenance Service Plan). the amount of which is a function of an aircraft’s age and engine status. over 50% of the Falcon 50 fleet is on the program. offered by Jet Support Services. JSSI will allow an aircraft to go on its program on a pro-rated basis and is therefore an attractive alternative for operators who wish to avoid large buy-in costs. These aircraft represent almost 9% of the 244 Falcon 50s in service worldwide. Another important issue relates to the location of the lavatory.

950 Owner Avion Sales LLC Avion Sales LLC Renar Charter Services G. of these aircraft. represent approximately 9% of the fleet.G. represents a unique history. 19 20 23 29 60 77 88 97 99 106 137 Yr. representing a more bullish 5% of the fleet. are retrofitted with the TFE731-3D-1C engines and have recent “C” inspections. of Mfg.S.475 10.250 8.497 10. the 22 aircraft available for sale.S. offers an overview of these available aircraft.613 “D” Engine Mods N N Y N N N N N N Y N Asking Price Make Offer Make Offer Make Offer 7.484 8. registered and of these.350 9.209 14.950 8.259 8. customers. As noted earlier. In the opinion of JPI. are enrolled in MSP. JPI is attempting to define the market extremes and to appropriately place the Subject Aircraft within these market parameters. a marketplace with 5% to 10% of its fleet available for sale is considered a balanced environment with supply and demand roughly equivalent. for U. 16 are U.are those with recent paint and interior.995 12. unique maintenance status. four are under contract. Consequently. 1981 1981 1980 1981 1982 1982 1982 1982 1982 1982 1985 Total Time 11.E. modifications and innumerable other factors.100 7.326 9. Corporation (Canada) U.R. who want a U. Leaseco Inc GECC Premier Air Center (France) Vesey Air LLC Powers Aviation LLC Aero Toy Store LLC Red Line Air LLC (Canada) MSP Y Y Y Y Y Y Y Y Y Y Y 24 .S.205 9. equipment.000 12.000 8. Falcon 50 Availability Summary Serial No. In valuing the Subject aircraft.S.374 12. The table located on the following page. It needs to be acknowledged that this and the subsequent review of transactions represent a broad over-simplification of the Falcon 50 marketplace.000 Make Offer 8. registered aircraft. Each available aircraft and each aircraft sold. However. there are only 13 aircraft available for sale.

816 8.F. The broker. Bechtel Corp. 25 .660 Y Y EMS Y EMS Y Y Y Y Y N N N N N Y N Y 8.C.950 8.572 7.A.000 Deal pending. has optimistically based the price upon the aircraft’s very low total time.169 7.995 9. Sol Melia Hotels & Resorts (Spain) Kiewit Engineering 8.995 5.5 million for this aircraft. who is asking $10.C. Global Wings Ltd.1451 159 1611 1631 170 1801 184 1882 201 204 205 1.492 6.675 10.376 9. 2.950 8. Hewlett Packard Company A.C.E.250 Make Offer Make Offer 10.00 9.289 N N 10.L.500 11. West Air LLC G.835 5. (Mexico) Marmon Group Inc.300 4.845 6. 1985 1986 1986 1986 1986 1987 1988 1988 1989 1990 1990 Oakmont Corp. Inc. (Switzerland) Air Travel Inc.

Serial Number 180. original -1C engines and enrolled in the JSSI EMS program.75 million.6 million. Among the relevant Falcon 50 transactions which have occurred recently. JPI has focused primarily upon those aircraft which have similar vintage to that of the Subject Aircraft. 1983 built aircraft sold in March from Maguire Aviation to Pinnacle Air Group for a price of $8.Regarding three of the four aircraft which are noted as “Deal pending”: ! Serial Number 161.2 million. Presumably due to its very low airframe time. Both of these aircraft are 1986 built. Available for sale via Duncan Aviation. JPI has learned that this aircraft is about to be sold for approximately $8. The aircraft had original paint and interior. Serial number 161 was last painted in 2000. In the opinion of JPI. original engines but had been upgraded with an EFIS cockpit. Serial Number 126.977 hours total time. This was a 1983 built aircraft with only 5. the pending sale of this aircraft and the serial number 163 set an important precedent in establishing the value of the Subject Aircraft.6 million.138 hours total time. a price which includes a “C” inspection. ! ! 26 . while its interior was refurbished in 2004. Serial Number 163. This aircraft is under contract for a price of $8. Serial Number 129. sold in January from Central Financial Services to Jet Choice. This aircraft sold in March from Peregrine Aviation to Kroger Company for a price of approximately $7. the aircraft was purchased for approximately $8 million. JPI has been advised that this aircraft is under contract for a price of $9 million. This was a 1982 built aircraft with 9. a Minneapolis based charter company. for the purpose of this appraisal. This was a 9. ! Serial Number 104.000 hour. ! ! Given the large number of Falcon 50s. although serial number 161 has slightly more hours and its engines are enrolled in the less preferable JSSI EMS program.

5 million. The resurgence in the market reflected by relatively balanced market of 27 .! Serial Number 148. which will make RVSM and DRVSM certification much easier to obtain. with 5. This was a 1985 built aircraft. despite a $10.5 million included a “C” inspection.1 million. have been able to capture a significant percentage of the market. -3D engines.055 hours total time and as a result sold for $8. with no prepurchase inspection.600 hours total time. The sale of this aircraft is another important data point in establishing the value of the Subject Aircraft. to Jesse Duplantis Ministries. The aircraft had only 7. This aircraft had -3D engines.L Hospitality G. those with the digital avionics. Serial Number 186. an inspection worth approximately $250. Serial Number 156. to two other companies and then ultimately sold to Real World Tours. Corp. The aircraft was sold in June from Anschutz Corp. Serial Number 154. The sales price of $8. -1C engines on MSP. Its three-engine configuration combined with Dassault’s reputation for quality. With approximately 9. Serial Number 209. the Falcon 50EX. ! ! ! ! Since first customer deliveries in 1979. twice the number of Falcon 50s was available for sale. this aircraft sold in April from Kimball International Transit to Bepco Oregon Holdings.2 million.500 hours and -3D engines.P. This was a 1990 built aircraft. the Falcon 50 and its younger sibling. selling from Pro Flights to Banc of America Leasing and then put on a 5-year lease to Regal Cinemas. Sold in April. JPI has learned that this aircraft was purchased for $8. high performance aircraft should continue to hold market attention for many more years to come. this was a 1985 built aircraft with almost 7.95 million asking price. This is particularly true for late model aircraft. but did not have EFIS and needed cosmetic refurbishment.000. As recently as two years ago.N. with almost 7. This was a 1985 built aircraft sold in February from C. JPI has leaned that this aircraft sold for approximately $9. The broker advises that this aircraft sold for $9 million.900 hours total time. sold in June from Shell Aircraft (England) to Intervest Construction.600 hours.

today supports the fact that the Falcon 50 will continue to attract good market interest and consequently residual values should remain strong. 28 .

Zuskin President Jet Perspectives.COVE NA N T S Jet Perspectives. by Client or other parties concerning the equipment. Inc. This report has been prepared for the exclusive use of the Client. Robert M. or not taken. Inc. 2007 29 . the statements of fact contained in this report are true and correct. all parties agree that JPI shall bear no such responsibility or legal liability including liability for special or consequential damages. JPI hereby certifies that. has no present or contemplated future interest in the subject property or any other interest which might tend to prevent making a fair and unbiased appraisal. By accepting this report. to the best of its knowledge and belief. and this report has been prepared in conformity with the Uniform Standards of Professional Appraisal Practice of The Appraisal Foundation and the Principles of Appraisal Practice and Code of Ethics of the American Society of Appraisers. April 1. JPI does not assume responsibility or legal liability for any actions taken. JPI will not provide it to any other party without the express consent of Client.