JetBlue Airlines 2003 Annual Report Download - page 61

JETBLUE AIRWAYS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
December 31, 2003
Note 2—Long-term Debt and Short-term Borrowings
Long-term debt at December 31, 2003 and 2002 consisted of the following (in thousands, with
interest rates as of December 31, 2003):
2003 2002
Floating rate equipment notes due through 2015, 3.1% weighted
average rate ....................................... $ 903,711 $ 687,542
31⁄2% convertible unsecured notes due in 2033 ................ 175,000 —
Aircraft manufacturer floating rate predelivery notes ........... — 2,710
Total debt .......................................... 1,078,711 690,252
Less: current maturities ............................... 67,101 50,754
Long-term debt ...................................... $ 1,011,610 $ 639,498
On July 15, 2003, we sold $175 million aggregate principal amount of 31⁄2% convertible unsecured
notes due 2033, raising net proceeds of $170.4 million. The notes bear interest at 31⁄2% payable
semi-annually on January 15 and July 15.
The notes are convertible into 4.1 million shares of our common stock at a price of approximately
$42.50 per share. The conversion rate is subject to adjustment in certain circumstances. Holders of the
notes may convert their notes under the following circumstances: (1) during any fiscal quarter
commencing after September 30, 2003, if the closing sale price of our common stock exceeds 120% of
the conversion price for at least 20 trading days in the 30 consecutive trading days ending on the last
trading day of the preceding fiscal quarter; (2) during the five business day period after any five
consecutive trading day period in which the trading price per note for each day of that period was less
than 95% of the product of the closing sale price of our common stock and the conversion rate; (3) if
the notes have been called for redemption; or (4) upon the occurrence of certain corporate
transactions.
We may redeem any of the notes in whole or in part beginning on July 18, 2006 at a redemption
price equal to the principal amount of the notes plus accrued and unpaid interest, if the closing price
of our common stock has exceeded 150% of the conversion price for at least 20 trading days in any
period of 30 consecutive trading days. In addition, beginning July 18, 2008, we may redeem any of the
notes at any time at a redemption price equal to the principal amount of the notes, plus accrued and
unpaid interest. Holders may require us to repurchase all or a portion of their notes for cash on
July 15 of 2008, 2013, 2018, 2023, and 2028 or upon the occurrence of certain designated events at a
repurchase price equal to the principal amount of the notes, plus accrued and unpaid interest.
Interest rates on floating rate notes adjust quarterly or semi-annually based on the London
Interbank Offered Rate. At December 31, 2003, we were in compliance with the covenants of all our
debt and lease agreements, which include among other things, a requirement to maintain certain
financial ratios. Aircraft, engines and predelivery deposits having a net book value of $1.21 billion at
December 31, 2003, were pledged as security under various loan agreements.
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