Northern California Business Aviation Association

1. Northern California Business Aviation Association Welcome!

2. Agenda • Lunch, Sponsored by Bloomer deVere • NCBAA Memberships • FAA Presentation • Bloomer deVere Presentation • Upcoming Events • Room Introductions

3. NCBAA Membership Reminder http://norcalbaa.org/Membership_Sign-up.html

4. FAA Presentation The Wright Brothers Master Pilot Award • The Wright Brothers Master Pilot Award recognizes pilots who have demonstrated professionalism, skill and aviation expertise by maintaining safe operations for 50 or more years.

5. Wright Brothers Master Pilot Award Charlie Johnson April 2012

6. Today’s Luncheon Sponsor Mark Bloomer, President Craig Bowers, Sales Director

7. NCBAA Luncheon Mark Bloomer, President Bloomer deVere Group Avia, Inc. Tuesday, April 10, 2012 NEW AND PRE-OWNED MARKET UPDATEIs a Recovery on the Horizon?

8. Used Aircraft Market Values % of Original Average Equipped Retail Used Aircraft Market Values% of Original Average Equipped Retail 67.37% 99.69% 109.53% 111.84% Source: Aircraft Bluebook Marketline Vol. 24, No. 3. September 2011 2

9. Market Forecast by Class of Aircraft 7% CAGR 15% CAGR 21% CAGR 20% CAGR Source: Rolls Royce (CAGR: Compound Annual Growth Rate) 3

10. Market Forecast by Class of Aircraft 7% CAGR 15% CAGR 21% CAGR 20% CAGR Source: Rolls Royce (CAGR: Compound Annual Growth Rate) 4

11. US Corporate Profits vs. Business Jet Deliveries # of aircraft ~ 1995 – 2013E What is the Probability … Source: J.P. Morgan Business Jet Monthly (GAMA, BEA, J.P. Morgan estimates (Excludes VLJ aircraft)) 5

12. Global Corporate Profits vs. Business Jet Deliveries # of aircraft ~ 1995 – 2013E What is the Probability … Source: J.P. Morgan Business Jet Monthly (GAMA, BEA, J.P. Morgan estimates (Excludes VLJ aircraft)) 6

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14. “Boom – Bust” Recovery Cycles 2000 Gulfstream GV Values • PREVIOUS CYCLE • Started 4Q/2001 • 9/11 • Enron bankruptcy • CURRENT CYCLE • Started 3Q/2008 • Lehman bankruptcy • Global financial crisis • US elections Retail Value Wholesale Value Source: Aircraft Bluebook 8

15. “Boom – Bust” Recovery Cycle 9

16. 2006 G550 vs 2002 GV Historical Retail Values and 12-month Sales G550 Sales GV Sales Source: Aircraft Bluebook, AircraftPost and JetNet 10

17. Market Forecast “What Comes Down Quickly… …Goes Up Slowly” • Price increase dynamics ~ next 6-12 months • Overall inventory levels decline to 10% ~ normal • Key market segments decline to 5% indicating a Seller’s Market • Seller’s hold firm ~ “Just say NO, this is my price!” • Inventory Buyers and Speculators return to the market • Credit restrictions ease Confidence 11

18. What is the Probability … Dow Jones Industrials ~ Bizjet Inventory 2008 - 2012 Source: BofA Merrill Lynch Global Research, AMSTAT 12

19. Business Jet Industry Gross Orders Units, % of world total, 2001 - 2010 Source: Bombardier analysis based on OEM disclosures, excluding VLJ and large corporate airliners 13

20. NCBAA Luncheon PRE-PURCHASE EVALUATIONThe Process and Pitfalls Craig Bowers, Sales Director Bloomer deVere Group Avia, Inc. Tuesday, April 10, 2012

21. Who Cares About the Pre-Buy? 2

22. I Want to Buy An Airplane! 3

23. Letter of Intent • Executive Summary • Short document Acquisition Decision Letter of Intent (LOI) Visual Inspection Aircraft Purchase Agreement Pre-Purchase Evaluation • Contains the “Basic” Terms of the Buyer’s Offer • Purchase Price • Delivery Conditions • Demo and/or Test Flight Requirements • Deposit • Pre-Purchase Evaluation • Accept/Reject Conditions • Transaction Timeline 4

24. Aircraft Purchase Agreement • Control Document • Replaces Letter of Intent • Long document Acquisition Decision Letter of Intent (LOI) Visual Inspection Aircraft Purchase Agreement Pre-Purchase Evaluation • Complete Transaction Details • Price, Taxes, Expenses, Warranties & Escrow • Indemnities, Insurance, Governing Law • Inspection, Delivery, Acceptance & Closing • Attachments • Spec • Warranty Bill of Sale • Technical Acceptance Receipt • Delivery Receipt 5

25. Pre-Purchase Evaluation • Workscope and Location • Mutually Agreed to by Buyer and Seller Acquisition Decision Letter of Intent (LOI) Visual Inspection Aircraft Purchase Agreement Pre-Purchase Evaluation • Pre-Purchase Contract • Buyer’s Agreement with Service Center • Cost • Work Order(s) • Buyer’s is For Pre-Purchase Evaluation • Seller’s is for Discrepancy Repair • Discrepancy Report • Format • When to Address Discrepancies 6

26. Pitfall #1Document Disconnect • Key Documents • Letter of Intent • Aircraft Purchase Agreement • Pre-Purchase Agreement • Service Center Work Order and Terms & Conditions • Discrepancy Report • Purchase Agreement may differ from Letter of Intent • Service Center has little or no knowledge of Purchase Agreement terms • Discrepancy Coding • Service Center definition may not necessarily conform to control document language 7

27. Pitfall #2Accept / Reject Conditions Buyer “Sole Right of Refusal” Seller “Delivery Conditions” • Wants an “out” as late as possible • Up-front agreement as to “acceptable” • “Buyer may, at any time prior to acceptance of the Aircraft following the Inspection, and in Buyer’s sole and exclusive discretion, reject the Aircraft…” • “On the Closing Date, the Seller shall deliver the Aircraft in conformance with the following conditions…” • Nothing could possibly need “repairing”, this aircraft is perfect! • Wants absolutely every, single discrepancy addressed! 8

28. Pitfall #3Discrepancy / Squawk List • Manage Expectations • Buyer wants every, single discrepancy repaired • Seller believes their aircraft is the best maintained aircraft flying – what could possible need repairing? • Clear Definition of a Discrepancy • What is “Airworthy” and “Non-Airworthy” • How does the Service Center code discrepancies? • Large number of Discrepancies are “Info Only” • Additional time and cost to investigate • Discrepancy Resolution • Accept/Reject Conditions • Correct discrepancies during inspection or wait? • Market conditions will likely influence ultimate agreement 9

29. Airworthy or Non-Airworthy? AIRWORTHY NON-AIRWORTHY INFO ONLY 10

30. The Bottom Line The reality is…. Can’t force anyone to SELL an aircraft and you can’t you force anyone to BUY one.

31. Thank YouMark Bloomer, PresidentCraig Bowers, Sales Directorwww.bloomerdevere.com

32. Next NCBAA Luncheon May 8th - Hayward Airport Event Luncheon, static displays, NCBAA Scholarship announcement, and more! www.norcalbaa.org

33. May 8th - Hayward Airport Event Where: ParkAvionHangar Complex at the Hayward Executive Airport When: 11:00AM – 1:00PM, Static display open until 3:00PM Lunch: Sit down, in-flight catering style heavy hors d'oeuvres starts at 11:30AM Key note speaker:   "When the FAA comes a knocking" by John Van Geffen, Michael Dworkin & Associates Static Display: Vintage Grumman Albatross, Legacy 650, Hawker 4000, Falcon 2000, Challenger, Piaggio, Eclipse,  Pending: Challenger (Solairus), G450 (Gulfstream), G200 (TWC) Sponsors:  Ascend Development, Air Culinaire, APP Jet Center, Avantair, Embraer, Dassault, Hawker Beechcraft, CTP Aviation, Mather Aviation, SP Aviation

34. eBay Scholarship Auction

35. Doug Rice – NCBAA Advocacy Committee