JetBlue Airlines 2008 Annual Report Download - page 63

The carrying amounts and estimated fair values of our long-term debt at December 31, 2008 were as
follows (in millions):
Carrying
Value
Estimated
Fair Value
Public Debt
Floating rate enhanced equipment notes
Class G-1, due through 2016.................................. $ 296 $ 189
Class G-2, due 2014 and 2016 ................................ 373 196
Class B-1, due 2014 . . . ..................................... 49 30
Fixed rate special facility bonds, due through 2036 ................... 85 43
33⁄4% convertible debentures due in 2035 .......................... 177 134
51⁄2% convertible debentures due in 2038 .......................... 126 217
31⁄2% convertible notes due in 2033............................... 1 1
Non-Public Debt
Floating rate equipment notes, due through 2020 ..................... 659 547
Fixed rate equipment notes, due through 2023....................... 1,075 1,022
The estimated fair values of our publicly held long-term debt were based on quoted market prices. The
fair value of our non-public debt was estimated using discounted cash flow analysis based on our current
borrowing rates for instruments with similar terms. The fair values of our other financial instruments
approximate their carrying values.
Note 3—Operating 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 2008,
2007 and 2006 was $243 million, $225 million and $190 million, respectively. We have $27 million in assets
that serve as collateral for letters of credit related to certain of our leases, which are included in restricted
cash.
At December 31, 2008, 55 of the 142 aircraft we operated were leased under operating leases, with initial
lease term expiration dates ranging from 2009 to 2026. Five of the 55 aircraft operating leases have variable
rate rent payments based on LIBOR. Leases for 47 of our aircraft can generally be renewed at rates based on
fair market value at the end of the lease term for one or two years. We have purchase options in 45 of our
aircraft leases 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 2008, we entered into a sale and
leaseback transaction for one EMBRAER 190 aircraft acquired during the year, which is being accounted for
as an operating lease. There were no material deferred gains recorded related to this transaction.
Future minimum lease payments under noncancelable operating leases with initial or remaining terms in
excess of one year at December 31, 2008, are as follows (in millions):
Aircraft Other Total
2009............................................ $ 179 $ 44 $ 223
2010............................................ 158 43 201
2011............................................ 146 40 186
2012............................................ 130 36 166
2013............................................ 109 30 139
Thereafter ........................................ 719 387 1,106
Total minimum operating lease payments................. $1,441 $580 $2,021
We hold variable interests in 45 of our 55 aircraft operating 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 in
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