JetBlue Airlines 2010 Annual Report Download - page 78

result of NOLs and statute of limitations in our major tax jurisdictions, years 2000 through 2009 remain
subject to examination by the relevant tax authorities.
Note 10—Employee Retirement Plan
We sponsor a retirement savings 401(k) defined contribution plan, or the Plan, covering all of our
employees. In 2010, we matched 100% of our employee contributions up to 5% of their compensation in cash,
which vests over five years of service measured from an employees hire date. Participants are immediately
vested in their voluntary contributions.
Another component of the Plan is a profit sharing contribution. In 2007, we amended the Plan to provide
for a Company discretionary contribution of at least 5% of eligible non-management employee compensation.
These contributions vest 100% after three years of service measured from an employees hire date. Our total
contributions expensed for the Plan in 2010, 2009 and 2008 were $55 million, $48 million and $43 million,
respectively. Profit sharing amounts exceeding the minimum contribution per the Plan may be paid to
employees in cash. In 2010, the profit sharing contribution slightly exceeded the 5% of eligible employee
compensation, and we plan to allow employees to elect whether they want to receive the amount exceeding
the 5% as a cash payment or as an additional contribution to their 401(k) account.
Note 11—Commitments
As of December 31, 2010, our firm aircraft orders consisted of 55 Airbus A320 aircraft, 54 EMBRAER
190 aircraft and 14 spare engines scheduled for delivery through 2018. We have the right to cancel three firm
EMBRAER 190 deliveries in 2012 or later, provided no more than two deliveries are canceled in any one
year. Committed expenditures for these aircraft and related flight equipment, including estimated amounts for
contractual price escalations and predelivery deposits, will be approximately $375 million in 2011,
$475 million in 2012, $585 million in 2013, $805 million in 2014, $925 million in 2015, and $1.20 billion
thereafter. In February 2010, we amended our Airbus A320 purchase agreement, deferring six aircraft
previously scheduled for delivery in 2011 and 2012 to 2015. This amendment had the effect of reducing our
2010 capital expenditures by $40 million in related predelivery deposits, which will be required in future
periods. In August 2010, we cancelled the orders for two EMBRAER 190 aircraft previously scheduled for
delivery in 2012. In October 2010, we further amended our Airbus A320 purchase agreement, deferring
delivery of 10 aircraft previously scheduled for delivery in 2012 and 2013 to 2016 for a rescheduling fee of
$5 million, which was paid and expensed upon execution of the amendment.
We have options to purchase eight Airbus A320 aircraft for delivery from 2014 through 2015 and 65
EMBRAER 190 aircraft for delivery from 2012 through 2018. We are scheduled to receive four new Airbus
A320 and five new EMBRAER 190 aircraft in 2011. We have received committed debt financing for the nine
aircraft scheduled for delivery in 2011.
We utilize several credit card processors to process our ticket sales. Our agreements with these processors
do not contain covenants, but do generally allow the processor to withhold cash reserves to protect the
processor for potential liability for tickets purchased, but not yet used for travel. We have not historically had
cash reserves withheld; however, in June 2008 we issued a $55 million letter of credit, collateralized by cash,
to one of our processors. This letter of credit established for our primary credit card processor in 2008 was
eliminated as of December 31, 2009. As of December 31, 2010, we had approximately $19 million pledged
related to our workers compensation insurance policies and other business partner agreements, which will
expire according to the terms of the related policies or agreements. While we currently do have any collateral
requirements related to our credit card processors, we may be required to issue additional collateral to our
credit card processors, or other key vendors, in the future.
Our commitments also include those of LiveTV, which has several noncancelable long-term purchase
agreements with its suppliers to provide equipment to be installed on its customers’ aircraft, including
JetBlue’s aircraft. At December 31, 2010, committed expenditures to these suppliers were approximately
$15 million in 2011, $8 million in 2012 and $4 million in 2013.
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