JetBlue Airlines 2010 Annual Report Download - page 22

control. We are principally dependent upon our operating cash flows and access to the capital markets to fund
our operations and to make scheduled payments on debt and other fixed obligations. We cannot assure you
that we will be able to generate sufficient cash flows from our operations or from capital market activities to
pay our debt and other fixed obligations as they become due; if we fail to do so our business could be harmed.
If we are unable to make payments on our debt and other fixed obligations, we could be forced to renegotiate
those obligations or seek to obtain additional equity or other forms of additional financing.
Our substantial indebtedness may limit our ability to incur additional debt to obtain future financing
needs.
We typically finance our aircraft through either secured debt or lease financing. The impact on financial
institutions from the global credit and liquidity crisis may adversely affect the availability and cost of credit to
JetBlue as well as to prospective purchasers of our aircraft that we undertake to sell in the future, including
financing commitments that we have already obtained for purchases of new aircraft. To the extent we finance
our activities with additional debt, we may become subject to financial and other covenants that may restrict
our ability to pursue our growth strategy or otherwise constrain our operations.
If we fail to successfully implement our modified growth strategy, our business could be harmed.
We have grown, and expect to continue to grow our business whenever practicable, by increasing the
frequency of flights to markets we currently serve, expanding the number of markets we serve and increasing
flight connection opportunities. We have modified our growth plans several times over the past few years due
to higher fuel prices, the competitive pricing environment and other cost increases, by deferring some of our
scheduled deliveries of new aircraft, selling some used aircraft, terminating our leases for some of our aircraft,
and leasing aircraft to other operators. A continuation of the economic downturn may cause us to further
reduce our future growth plans from previously announced levels.
To the extent we continue to grow our business, opening new markets requires us to commit a substantial
amount of resources even before the new services commence. Expansion is also dependent upon our ability to
maintain a safe and secure operation and requires additional personnel, equipment and facilities. An inability
to hire and retain personnel, timely secure the required equipment and facilities in a cost-effective manner,
efficiently operate our expanded facilities, or obtain the necessary regulatory approvals may adversely affect
our ability to achieve our growth strategy, which could harm our business. In addition, our competitors often
add service, reduce their fares and/or offer special promotions following our entry into a new market. We
cannot assure you that we will be able to profitably expand our existing markets or establish new markets or
be able to adequately temper our growth in a cost effective manner through additional deferrals or selling or
leasing aircraft; if we fail to do so, our business could be harmed.
There are risks associated with our presence in some of our international emerging markets, including
political or economic instability and failure to adequately comply with existing legal requirements.
Expansion to new international emerging markets may have risks due to factors specific to those markets.
Emerging markets are countries which have less developed economies that are vulnerable to economic and
political problems, such as significant fluctuations in gross domestic product, interest and currency exchange
rates, civil disturbances, government instability, nationalization and expropriation of private assets and the
imposition of taxes or other charges by governments. The occurrence of any of these events in markets served
by us and the resulting instability may adversely affect our business.
We have recently expanded our service to countries in the Caribbean and Latin America, some of which
have less developed legal systems, financial markets, and business and political environments than the United
States, and therefore present greater political, economic and operational risks. We emphasize legal compliance
and have implemented policies, procedures and certain ongoing training of employees with regard to business
ethics and many key legal requirements; however, there can be no assurance that our employees will adhere to
our code of business ethics, other Company policies, or other legal requirements. If we fail to enforce our
policies and procedures properly or maintain adequate record-keeping and internal accounting practices to
accurately record our transactions, we may be subject to sanctions. In the event that we believe or have reason
to believe that employees have or may have violated applicable laws or regulations, we may be subject to
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