Airtran 2001 Annual Report Download - page 40

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16. Subsequent Events
On March
21,
2002, we amended our 8717 purchase contract as follows:
(i)
our commitments to acquire 8717s
in
2002 increased from
12
aircraft
to
20
aircraft, comprised
of
13 firm and seven option aircraft;
(ii)
our commitments to acquire 8717s
in
2003 decreased from
11
aircraft to
10
aircraft,
comprised
of
nine firm and one option aircraft; and
(iii)
purchase deposits that were previously paid for aircraft deliveries
in
2002 will be applied to
future aircraft deliveries, rather than reducing the balance
of
the total purchase price due at delivery.
We have signed alease financing proposal from 80eing Capital for
19
(20 at 80eing Capital's option) new or previously owned 8717 aircraft to be
delivered in 2002. According to this proposal, the lease term for each
of
these aircraft commences upon delivery and will continue for
18
to
19
years,
at which time we can renew the lease at fair market rental or purchase the aircraft at the greater
of
apredetermined amount
or
its fair market value.
If
completed as contemplated, this lease financing will reduce our aggregate funding requirements for aircraft commitments to $211.3 million representing
the aircraft to be purchased
in
2003. Funding is subject to finalization
of
definitive agreements and other conditions. See Note
4.
On
March
13,
2002,
we
terminated all our derivative agreements with the counterparty. The current fair value
of
the derivative liability on the termination
date was estimated to be less than $1.0 million, as compared to aliability of $8.7 million at December 31,2001. Since this
is
an early termination
of
derivative contracts, losses
of
$6.8 million at December
31,
2001, deferred
in
other comprehensive loss will continue to be reclassified to earnings as
the related fuel
is
used through September 2004. See Note
5.