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Long-term Debt, Short-term Borrowings and Finance Lease Obligations
 6 Months Ended
Jun. 30, 2023
Debt Disclosure [Abstract]  
Long-term Debt, Short-term Borrowings and Finance Lease Obligations Long-term Debt, Short-term Borrowings and Finance Lease Obligations
During the six months ended June 30, 2023, we made principal payments of $200 million on our outstanding debt and finance lease obligations.
At June 30, 2023, we had pledged aircraft, engines, other equipment, and facilities with a net book value of $6.2 billion as security under various financing arrangements.
At June 30, 2023, scheduled maturities of our long-term debt and finance lease obligations were as follows (in millions):
YearTotal
Remainder of 2023$134 
2024251 
2025220 
2026959 
2027207 
2028 and thereafter1,986 
Total$3,757 
The carrying amounts and estimated fair values of our long-term debt, net of debt acquisition costs, at June 30, 2023 and December 31, 2022 were as follows (in millions):
June 30, 2023December 31, 2022
Carrying Value
Estimated Fair Value (1)
Carrying Value
Estimated Fair Value (1)
Public Debt
Fixed rate special facility bonds, due through 2036$42 $43 $42 $43 
Fixed rate enhanced equipment notes:
  2019-1 Series AA, due through 2032490 352 504 345 
  2019-1 Series A, due through 2028153 126 157 124 
2019-1 Series B, due through 202776 81 82 87 
2020-1 Series A, due through 2032527 455 546 457 
2020-1 Series B, due through 2028126 134 135 142 
Non-Public Debt
Fixed rate enhanced equipment notes, due through 2023— — 61 60 
Fixed rate equipment notes, due through 2028381 320 447 422 
Floating rate equipment notes, due through 2030 (2)
120 100 56 49 
Sale-leaseback transactions, due through 2035565 419 341 329 
Unsecured CARES Act Payroll Support Program loan, due through 2030259 130 259 126 
Unsecured Consolidated Appropriations Act Payroll Support Program Extension loan, due through 2031144 70 144 68 
Unsecured American Rescue Plan Act of 2021 Payroll Support loan, due through 2031132 65 132 62 
Convertible senior notes due 2026741 560 739 534 
Total (3)
$3,756 $2,855 $3,645 $2,848 
(1) The estimated fair values of our publicly held long-term debt are classified as Level 2 in the fair value hierarchy. The fair values of our non-public debt are estimated using a discounted cash flow analysis based on our borrowing rates for instruments with similar terms and therefore classified as Level 3 in the fair value hierarchy. Refer to Note 7 for an explanation of the fair value hierarchy structure.
(2) Floating rate debt is equal to Secured Overnight Financing Rate (“SOFR”), plus an applicable margin.
(3) Total excludes finance lease obligations of $1 million and $2 million at June 30, 2023 and December 31, 2022, respectively.
We have financed certain aircraft with Enhanced Equipment Trust Certificates (“EETCs”). One of the benefits of this structure is being able to finance several aircraft at one time, rather than individually. The structure of EETC financing is that we create pass-through trusts in order to issue pass-through certificates. The proceeds from the issuance of these certificates are then used to purchase equipment notes, which are issued by us and are secured by our aircraft. These trusts meet the definition of a variable interest entity (“VIE”), as defined in Topic 810, Consolidation of the Financial Accounting Standards Board (“FASB”) Codification, and must be considered for consolidation in our financial statements. Our assessment of our EETCs considers both quantitative and qualitative factors including the purpose for which these trusts were established and the nature of the risks in each. The main purpose of the trust structure is to enhance the creditworthiness of our debt obligation through certain bankruptcy protection provisions and liquidity facilities, and also to lower our total borrowing cost. We concluded that we are not the primary beneficiary in these trusts because our involvement in them is limited to principal and interest payments on the related notes, the trusts were not set up to pass along variability created by credit risk to us, and the likelihood of our defaulting on the notes. Therefore, we have not consolidated these trusts in our financial statements.
Equipment Notes
In the second quarter of 2023, JetBlue entered into an agreement to finance certain aircraft for an aggregate principal amount of $78 million, bearing interest at a floating rate of SOFR plus a margin. Debt incurred under the agreement matures in 2030, with principal and interest payable quarterly in arrears.
2023 Sale-Leaseback Transactions
During the six months ended June 30, 2023, we entered into $228 million of sale-leaseback transactions. These transactions did not qualify as sales for accounting purposes. The assets associated with these transactions remain on our consolidated balance sheets within property and equipment and the related liabilities under the lease are classified within debt and finance leases obligations. These transactions are treated as cash from financing activities on our condensed consolidated statements of cash flows.
Short-term Borrowings
Citibank Line of Credit
On October 21, 2022, JetBlue entered into the $600 million Second Amended and Restated Credit and Guaranty Agreement (the “Second Amended and Restated Facility”), amending and restating the Company's existing $550 million credit facility. The Second Amended and Restated Facility is among JetBlue, Citibank N.A., as administrative agent, and the lenders party thereto. The Second Amended and Restated Facility modifies the existing credit facility to, among other things, (i) increase the lending commitments by $50 million, for total lending commitments of $600 million, and (ii) establish the maturity date for the $600 million in lending commitments as October 21, 2024. Borrowings under the Second Amended and Restated Facility bear interest at a variable rate based on SOFR, plus a margin of 2.00% per annum, or another rate (at JetBlue's election) based on certain market interest rates, plus a margin of 1.00% per annum, in each case with a floor of 0%. The Second Amended and Restated Facility is secured by spare parts, aircraft, simulators, and certain other assets as permitted thereunder. The Second Amended and Restated Facility includes covenants that require us to maintain certain minimum balances in unrestricted cash, cash equivalents, and unused commitments available under revolving credit facilities. In addition, the covenants restrict our ability to, among other things, dispose of certain collateral, or merge, consolidate, or sell assets.
As of and for the periods ended June 30, 2023 and December 31, 2022, we did not have a balance outstanding or any borrowings under this line of credit.
Morgan Stanley Line of Credit
We have a revolving line of credit with Morgan Stanley for up to approximately $200 million. As of and for the periods ended June 30, 2023 and December 31, 2022, we did not have a balance outstanding or any borrowings under this line of credit.
2022 $3.5 Billion Senior Secured Bridge Facility
In connection with the entry into the Merger Agreement, as defined in Note 12, JetBlue entered into a Second Amended and Restated Commitment Letter (the “Commitment Letter”), dated July 28, 2022, with Goldman Sachs Bank USA; BofA Securities, Inc.; Bank of America, N.A.; BNP Paribas; Credit Suisse AG, New York Branch; Credit Suisse Loan Funding LLC; Credit Agricole Corporate and Investment Bank; Natixis, New York Branch; Sumitomo Mitsui Banking Corporation; and MUFG Bank, Ltd. (collectively, the “Commitment Parties”), pursuant to which the Commitment Parties have committed to provide a senior secured bridge facility in an aggregate principal amount of up to $3.5 billion to finance the acquisition of Spirit Airlines, Inc. (“Spirit”). As of and for the periods ended June 30, 2023 and December 31, 2022, we did not have a balance outstanding or any borrowings under this facility.