There are initially two agreement that must be executed to enter the Smart Yacht Business Program: (1) the Purchase & Sale Agreement and (2) the Yacht Management Agreement.
The overall Purchase & Sale Agreement consists of the following sections:
- Purchase & Sales Agreement is a typically a 2 page document that summarizes all the cost and cost adjustment components, payments schedule, any states all the terms and conditions including the buyer’s contingencies.
- Build-sheet shows all the yacht’s technical features and options with prices that are used to determine the full cost price of the yacht. There maybe be additional sheets that list the scope of major options or “packs”. The total price from this sheet transfers to the Purchase & Sales Agreement
- Dealer installed options sheet shows all the items to be installed by the dealer after the yacht is delivered. This sheet also lists all commissioning costs. The total price from this sheet transfers to the Purchase & Sales Agreement
- Addendum sheets are added to reflect changes and additions either not listed elsewhere or changes after the initial agreement.
Typically, the buyer with assistance from a broker prepare the buyer’s offer using the foregoing and present it together with a nominal deposit check to FYG. Then, if accepted by FYG Management, the agreement is established and payments are typically made up to 20% of the total as contingencies (such as financing approval) are satisfied. Typically, when the yacht is ready for delivery, the remaining 80% is paid in full.
You can access this important a typical Purchase & Sales Agreement package by registering your interest with FYG and, then, using the password provided to access it on-line. Register, and you will receive an automatic email with the password; then go to the following page: Smart Yacht Business Program Downloads
To enter the charter fleet, the yacht management agreement applicable to the Smart Yacht Business Program is executed by the buyer and FYG management. This agreement contain all the applicable terms and conditions for the yacht’s usage by both FYG and the owner for an annually renewable, 5 year period. This agreement covers all the following:
- FYG responsibilities with respect to marketing, booking, checking on charterer competency, vessel pre-checks+orientations, deposits, during and after charter services, and Owner’s services
- Owner responsibilities
- Guaranteed Income to Owner
- Emergency Repairs
- Promotional use of the yacht
- Vessel expenses including dockage+utilities, insurance, regular annual maintenance expenses, charter turn-around fees, and outside broker fees
- Owner’s use
- Working balance
- Exchanges for vessels in other charter programs
- Hurricane policy
Smart Yacht Business Management Agreement
Smart Yacht Program Checklist