With fractional jets, customers (referred to as "owners") buy a “share” of a plane, rather than an entire plane. The price is pro-rated from the market price of a full aircraft. Owners then have guaranteed access (50-400 hours annually, depending on share size) to that plane with as little as four hours’ notice. Fractional owners pay a monthly maintenance fee and an “occupied” hourly operating fee. The latter is charged only when an owner or guest is on board, not when the plane is flying to a pick up point, or returning to base after completing a mission.
Owners have access to the full fleet of planes and may upgrade or downgrade for specific flights. At the end of a five-year term, owners sell their share back to the company for fair market value (called "residual value"), less a remarketing fee. A variety of factors may affect the residual value calculation, and the bottom-line cost of a fractional jet is highly dependent on this process.