JetBlue Airlines 2005 Annual Report Download - page 61

At December 31, 2005, 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, predelivery deposits and other equipment and facilities having a net book value of
$2.50 billion at December 31, 2005 were pledged as security under various loan agreements. Cash
payments of interest, net of capitalized interest, aggregated $79 million, $41 million and $20 million in
2005, 2004 and 2003, respectively.
Maturities of long-term debt for the next five years are as follows (in millions):
2006 ................................................. $ 158
2007 ................................................. 167
2008 ................................................. 203
2009 ................................................. 117
2010 ................................................. 117
We have funding facilities to finance aircraft predelivery deposits. These facilities allow for
borrowings of up to $77 million through December 2008, of which $12 million was unused as of
December 31, 2005. Commitment fees are 0.5%per annum on the average unused portion of the
facilities. The weighted average interest rate on these outstanding short-term borrowings at
December 31, 2005 and 2004 was 6.1%and 4.1%, respectively.
We currently have shelf registration statements on file with the Securities and Exchange
Commission related to the issuance of $1 billion original aggregate amount of common stock,
preferred stock, debt securities and/or pass-through certificates. Through December 31, 2005, we had
issued a total of $903 million in securities under these registration statements.
Note 3—Leases
We lease aircraft, as well as airport terminal space, other airport facilities, office space and other
equipment, which expire in various years through 2035. Total rental expense for all operating leases in
2005, 2004 and 2003 was $137 million, $120 million and $100 million, respectively. We have $111
million in assets, which serves as collateral for letters of credit related to certain of our leases, which is
included in other assets.
At December 31, 2005, 31 of the 92 aircraft we operated were leased under operating leases, with
initial lease term expiration dates ranging from 2009 to 2023. Five of the 31 aircraft leases have
variable-rate rent payments based on LIBOR. Twenty-four aircraft leases generally can be renewed at
rates based on fair market value at the end of the lease term for one, two or four years. Twenty-one
aircraft leases have purchase options at the end of the lease term at fair market value and a one-time
option during the term at amounts that are expected to approximate fair market value. During 2005,
we entered into sale and leaseback transactions for six EMBRAER 190 aircraft acquired during the
year. Gains associated with sale and leaseback operating leases have been deferred and are being
recognized on a straight-line basis over the lease term as a reduction to aircraft rent expense.
Future minimum lease payments under noncancelable operating leases with initial or remaining
terms in excess of one year at December 31, 2005, are as follows (in millions):
Aircraft Other Total
2006...................................................... $ 109 $ 48 $ 157
2007...................................................... 109 46 155
2008...................................................... 104 41 145
2009...................................................... 99 30 129
2010...................................................... 89 30 119
Thereafter ................................................ 558 444 1,002
Total minimum lease payments .............................. $ 1,068 $ 639 $ 1,707
We hold variable interests in 21 of our 31 aircraft leases, which are owned by single owner trusts
whose sole purpose is to purchase, finance and lease these aircraft to us. Since we do not participate
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