þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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38-1747023
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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2800 Executive Way Miramar, Florida
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33025
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Voting Common Stock, $0.0001 par value Non-Voting Common Stock, $0.0001 par value
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NASDAQ Global Select Market None
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Class
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Number of Shares
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Common Stock, $0.0001 par value per share
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72,670,673
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PART I
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Page
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PART II
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PART III
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PART IV
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•
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high aircraft utilization;
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•
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high-density seating configurations on our aircraft;
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•
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our simple operations;
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•
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no hub-and-spoke inefficiencies;
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•
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highly productive workforce;
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•
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opportunistic outsourcing of operating functions;
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•
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operating a modern single fleet type of Airbus A320-family aircraft with common flight crews across the fleet;
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•
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reduced sales, marketing and distribution costs through direct-to-consumer marketing;
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•
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efficient flight scheduling, including minimal ground times between flights; and
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•
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a company-wide business culture that is keenly focused on driving costs lower.
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•
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charging for checked and carry-on baggage;
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•
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passing through all distribution-related expenses;
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•
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charging for premium seats and advance seat selection;
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•
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enforcing ticketing policies, including service charges for changes and cancellations;
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•
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generating subscription revenue from our $9 Fare Club ultra low-fare subscription service;
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•
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deriving brand-based revenues from proprietary services, such as our FREE SPIRIT affinity credit card program;
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•
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offering third-party travel products (travel packages), such as hotel rooms, ground transportation (rental and hotel shuttle products) and attractions (show or theme park tickets) packaged with air travel;
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•
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selling third-party travel insurance through our website;
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•
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selling in-flight products and onboard advertising.
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•
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keeping a consistent focus on maintaining low unit operating costs;
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•
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ensuring our sourcing arrangements with key third parties are continually benchmarked against the best industry standards;
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•
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maintaining a simple operation that focuses on delivering transportation; and
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•
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generating and maintaining an adequate level of liquidity to insulate against volatility in key cost inputs, such as fuel, and in passenger demand that may occur as a result of changing general economic conditions.
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Employee Groups
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Representative
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Amendable Date
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Pilots
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Air Line Pilots Association, International (ALPA)
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August 2015
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Flight Attendants
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Association of Flight Attendants (AFA-CWA)
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August 2007
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Dispatchers
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Transport Workers Union (TWU)
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August 2018
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•
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changes and volatility in general economic conditions, including the severity and duration of any downturn in the U.S. or global economy and financial markets;
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•
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changes in consumer preferences, perceptions, spending patterns or demographic trends, including any increased preference for higher-fare carriers offering higher amenity levels, and reduced preferences for low-fare carriers offering more basic transportation, during better economic times;
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•
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higher levels of unemployment and varying levels of disposable or discretionary income;
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•
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depressed housing and stock market prices; and
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•
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lower levels of actual or perceived consumer confidence.
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•
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substantial loss of revenue and flight disruption costs caused by the grounding of all commercial air traffic in or headed to the United States by the Federal Aviation Administration, or FAA, for three days after the terrorist attacks;
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•
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increased security and insurance costs;
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•
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increased concerns about future terrorist attacks;
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•
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airport shutdowns and flight cancellations and delays due to security breaches and perceived safety threats; and
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•
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significantly reduced passenger traffic and yields due to the subsequent dramatic drop in demand for air travel.
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•
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require a substantial portion of cash flow from operations for operating lease and maintenance deposit payments, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate purposes;
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•
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limit our ability to make required pre-delivery deposit payment, or PDPs, including those payable to our aircraft and engine manufacturers for our aircraft and spare engines on order;
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•
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limit our ability to obtain additional financing to support our expansion plans and for working capital and other purposes on acceptable terms or at all;
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•
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make it more difficult for us to pay our other obligations as they become due during adverse general economic and market industry conditions because any related decrease in revenues could cause us to not have sufficient cash flows from operations to make our scheduled payments;
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•
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reduce our flexibility in planning for, or reacting to, changes in our business and the airline industry and, consequently, place us at a competitive disadvantage to our competitors with less fixed payment obligations; and
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•
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cause us to lose access to one or more aircraft and forfeit our rent deposits if we are unable to make our required aircraft lease rental payments and our lessors exercise their remedies under the lease agreement including cross default provisions in certain of our leases.
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•
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maintain profitability;
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•
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obtain financing to acquire new aircraft;
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•
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access airports located in our targeted geographic markets where we can operate routes in a manner that is consistent with our cost strategy;
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•
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gain access to international routes; and
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•
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access sufficient gates and other services at airports we currently serve or may seek to serve.
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•
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increases in airport rates and charges;
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•
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limitations on take-off and landing slots, airport gate capacity or other use of airport facilities;
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•
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termination of our airport use agreements, some of which can be terminated by airport authorities with little notice to us;
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•
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increases in airport capacity that could facilitate increased competition;
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•
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international travel regulations such as customs and immigration;
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•
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increases in taxes;
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•
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changes in the law that affect the services that can be offered by airlines in particular markets and at particular airports;
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•
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restrictions on competitive practices;
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•
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the adoption of statutes or regulations that impact customer service standards, including security standards; and
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•
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the adoption of more restrictive locally-imposed noise regulations or curfews.
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•
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announcements concerning our competitors, the airline industry or the economy in general;
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•
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strategic actions by us or our competitors, such as acquisitions or restructurings;
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•
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media reports and publications about the safety of our aircraft or the aircraft type we operate;
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•
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new regulatory pronouncements and changes in regulatory guidelines;
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•
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changes in the price of aircraft fuel;
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•
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announcements concerning the availability of the type of aircraft we use;
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•
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general and industry-specific economic conditions;
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•
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changes in financial estimates or recommendations by securities analysts or failure to meet analysts’ performance expectations;
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•
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sales of our common stock or other actions by investors with significant shareholdings;
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•
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trading strategies related to changes in fuel or oil prices; and
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•
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general market, political and economic conditions.
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•
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our board of directors is divided into three classes, with each class serving for a staggered three-year term, which prevents stockholders from electing an entirely new board of directors at an annual meeting;
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•
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actions to be taken by our stockholders may only be effected at an annual or special meeting of our stockholders and not by written consent;
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•
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special meetings of our stockholders can be called only by the Chairman of the Board or by our corporate secretary at the direction of our board of directors;
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•
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advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors and propose matters to be brought before an annual meeting of our stockholders may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company; and
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•
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our board of directors may, without stockholder approval, issue series of preferred stock, or rights to acquire preferred stock, that could dilute the interest of, or impair the voting power of, holders of our common stock or could also be used as a method of discouraging, delaying or preventing a change of control.
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Aircraft Type
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Seats
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Average Age (years)
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Number of Aircraft
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A319
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145
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6.8
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29
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A320
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178
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1.8
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23
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A321
|
218
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8.4
|
2
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5.1
|
54
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High
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Low
|
||||
Fiscal year ending December 31, 2012
|
|
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First Quarter
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$
|
20.70
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$
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13.90
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Second Quarter
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24.75
|
|
|
17.41
|
|
||
Third Quarter
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23.13
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15.85
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Fourth Quarter
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18.00
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15.64
|
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||
Fiscal year ending December 31, 2013
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|
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||||
First Quarter
|
$
|
26.87
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|
|
$
|
17.40
|
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Second Quarter
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33.75
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24.30
|
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||
Third Quarter
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36.83
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29.65
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Fourth Quarter
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47.62
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32.50
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ISSUER PURCHASES OF EQUITY SECURITIES
|
|||||||||||||
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|||||
Period
|
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Total Number of Shares Purchased
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Average Price Paid per Share
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
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Approximate Dollar Value of Shares that May Yet be Purchased Under Plans or Programs.
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|||||
October 1-31, 2013
|
|
—
|
|
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N/A
|
|
|
—
|
|
|
—
|
|
|
November 1-30, 2013
|
|
763
|
|
|
$
|
44.50
|
|
|
—
|
|
|
—
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|
December 1-31, 2013
|
|
—
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|
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N/A
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|
|
—
|
|
|
—
|
|
|
Total
|
|
763
|
|
|
$
|
44.50
|
|
|
—
|
|
|
—
|
|
|
|
5/26/2011
|
|
12/31/2011
|
|
12/31/2012
|
|
12/31/2013
|
||||||||
Spirit
|
|
$
|
100.00
|
|
|
$
|
130.00
|
|
|
$
|
147.75
|
|
|
$
|
378.42
|
|
NYSE ARCA Airline Index
|
|
$
|
100.00
|
|
|
$
|
75.49
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|
|
$
|
103.90
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|
|
$
|
164.39
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|
NASDAQ Composite Index
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|
$
|
100.00
|
|
|
$
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94.23
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|
|
$
|
110.91
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|
|
$
|
155.15
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|
|
Year Ended December 31,
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||||||||||||||||||
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2013
|
|
2012
|
|
2011
|
|
2010 (1)
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|
2009
|
||||||||||
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(in thousands except share and per share data)
|
||||||||||||||||||
Operating revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Passenger
|
$
|
986,018
|
|
|
$
|
782,792
|
|
|
$
|
689,650
|
|
|
$
|
537,969
|
|
|
$
|
536,181
|
|
Non-ticket
|
668,367
|
|
|
535,596
|
|
|
381,536
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|
|
243,296
|
|
|
163,856
|
|
|||||
Total operating revenue
|
1,654,385
|
|
|
1,318,388
|
|
|
1,071,186
|
|
|
781,265
|
|
|
700,037
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Aircraft fuel (2)
|
551,746
|
|
|
471,763
|
|
|
388,046
|
|
|
248,206
|
|
|
181,107
|
|
|||||
Salaries, wages and benefits
|
262,150
|
|
|
218,919
|
|
|
181,742
|
|
|
156,443
|
|
|
135,420
|
|
|||||
Aircraft rent
|
169,737
|
|
|
143,572
|
|
|
116,485
|
|
|
101,345
|
|
|
89,974
|
|
|||||
Landing fees and other rents
|
83,604
|
|
|
68,368
|
|
|
52,794
|
|
|
48,118
|
|
|
42,061
|
|
|||||
Distribution
|
67,481
|
|
|
56,668
|
|
|
51,349
|
|
|
41,179
|
|
|
34,067
|
|
|||||
Maintenance, materials and repairs
|
60,143
|
|
|
49,460
|
|
|
34,017
|
|
|
27,035
|
|
|
27,536
|
|
|||||
Depreciation and amortization
|
31,947
|
|
|
15,256
|
|
|
7,760
|
|
|
5,620
|
|
|
4,924
|
|
|||||
Other operating
|
144,586
|
|
|
127,886
|
|
|
91,172
|
|
|
83,748
|
|
|
72,921
|
|
|||||
Loss on disposal of assets
|
525
|
|
|
956
|
|
|
255
|
|
|
77
|
|
|
1,010
|
|
|||||
Special charges (credits) (3)
|
174
|
|
|
(8,450
|
)
|
|
3,184
|
|
|
621
|
|
|
(392
|
)
|
|||||
Total operating expenses
|
1,372,093
|
|
|
1,144,398
|
|
|
926,804
|
|
|
712,392
|
|
|
588,628
|
|
|||||
Operating income
|
282,292
|
|
|
173,990
|
|
|
144,382
|
|
|
68,873
|
|
|
111,409
|
|
|||||
Other expense (income):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense (4)
|
214
|
|
|
1,350
|
|
|
24,781
|
|
|
50,313
|
|
|
46,892
|
|
|||||
Capitalized interest (5)
|
(214
|
)
|
|
(1,350
|
)
|
|
(2,890
|
)
|
|
(1,491
|
)
|
|
(951
|
)
|
|||||
Interest income
|
(401
|
)
|
|
(925
|
)
|
|
(575
|
)
|
|
(328
|
)
|
|
(345
|
)
|
|||||
Gain on extinguishment of debt (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,711
|
)
|
|||||
Other expense
|
283
|
|
|
331
|
|
|
235
|
|
|
194
|
|
|
298
|
|
|||||
Total other expense (income)
|
(118
|
)
|
|
(594
|
)
|
|
21,551
|
|
|
48,688
|
|
|
26,183
|
|
|||||
Income before income taxes
|
282,410
|
|
|
174,584
|
|
|
122,831
|
|
|
20,185
|
|
|
85,226
|
|
|||||
Provision (benefit) for income taxes (7)
|
105,492
|
|
|
66,124
|
|
|
46,383
|
|
|
(52,296
|
)
|
|
1,533
|
|
|||||
Net income
|
$
|
176,918
|
|
|
$
|
108,460
|
|
|
$
|
76,448
|
|
|
$
|
72,481
|
|
|
$
|
83,693
|
|
Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
2.44
|
|
|
$
|
1.50
|
|
|
$
|
1.44
|
|
|
$
|
2.77
|
|
|
$
|
3.23
|
|
Diluted
|
$
|
2.42
|
|
|
$
|
1.49
|
|
|
$
|
1.43
|
|
|
$
|
2.72
|
|
|
$
|
3.18
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
72,592,765
|
|
|
72,385,574
|
|
|
53,240,898
|
|
|
26,183,772
|
|
|
25,910,766
|
|
|||||
Diluted
|
72,999,221
|
|
|
72,590,574
|
|
|
53,515,348
|
|
|
26,689,855
|
|
|
26,315,121
|
|
(1)
|
We estimate that the 2010 pilot strike had a net negative impact on our operating income for 2010 of approximately $24 million consisting of an estimated $28 million in lost revenues and approximately $4 million of incremental costs resulting from the strike, offset in part by a reduction of variable expenses during the strike of approximately $8 million for flights not flown. Additionally, under the terms of the pilot contract, we also paid $2.3 million in return-to-work payments during the second quarter, which are not included in the strike impact costs described above.
|
(2)
|
Aircraft fuel expense is the sum of (i) “into-plane fuel cost,” which includes the cost of jet fuel and certain other charges such as fuel taxes and oil, (ii) settlement gains and losses and (iii) unrealized mark-to-market gains and losses associated with fuel hedge contracts. The following table summarizes the components of aircraft fuel expense for the periods presented:
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Into-plane fuel cost
|
$
|
542,523
|
|
|
$
|
471,542
|
|
|
$
|
392,278
|
|
|
$
|
251,754
|
|
|
$
|
181,806
|
|
Realized losses (gains)
|
8,958
|
|
|
175
|
|
|
(7,436
|
)
|
|
(1,483
|
)
|
|
750
|
|
|||||
Unrealized losses (gains)
|
265
|
|
|
46
|
|
|
3,204
|
|
|
(2,065
|
)
|
|
(1,449
|
)
|
|||||
Aircraft fuel expense
|
$
|
551,746
|
|
|
$
|
471,763
|
|
|
$
|
388,046
|
|
|
$
|
248,206
|
|
|
$
|
181,107
|
|
(3)
|
Special charges (credits) include: (i) for 2009, amounts relating to the early termination in mid-2008 of leases for seven Airbus A319 aircraft, a related reduction in workforce and the exit facility costs associated with returning planes to lessors in 2008; (ii) for 2009 and 2010, amounts relating to the sale of previously expensed MD-80 parts; (iii) for 2010 and 2011 amounts relating to exit facility costs associated with moving our Detroit, Michigan maintenance operations to Fort Lauderdale, Florida; (iv) termination costs in connection with the IPO during the three months ended June 30, 2011 comprised of amounts paid to Indigo Partners, LLC to terminate its professional services agreement with us and fees paid to three individual, unaffiliated holders of our subordinated notes; (v) for 2011 and 2012, a $9.1 million gain related to the sale of four permanent air carrier slots at Ronald Reagan National Airport (DCA) offset by costs connected with the 2012 secondary offerings; and for 2013, costs related to the 2013 secondary offering. For more information, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Our Operating Expenses—Special Charges (Credits).”
|
(4)
|
Substantially all of the interest expense recorded in 2009, 2010 and 2011 relates to notes and preferred stock held by our principal stockholders that were repaid or redeemed, or exchanged for shares of common stock, in connection with the Recapitalization in 2011 that was effected in connection with the IPO. Interest expense in
2012
primarily relates to interest on PDPs and interest related to the TRA. Interest expense in
2013
primarily relates to interest related to the TRA.
|
(5)
|
Interest attributable to funds used to finance the acquisition of new aircraft, including PDPs is capitalized as an additional cost of the related asset. Interest is capitalized at the weighted average implicit lease rate of our aircraft.
|
(6)
|
Gain on extinguishment of debt represents the recognition of contingencies provided for in our 2006 recapitalization agreements, which provided for the cancellation of shares of Class A preferred stock and reduction of the liquidation preference of the remaining Class A preferred stock and associated accrued but unpaid dividends based on the outcome of the contingencies.
|
(7)
|
Net income for 2010 includes a $52.3 million net tax benefit primarily due to the release of a valuation allowance resulting in a deferred tax benefit of $52.8 million in 2010. Absent the release of the valuation allowance and corresponding tax benefit, our net income would have been $19.7 million for 2010.
|
|
As of December 31,
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
||||||||||
Balance Sheet Data:
|
(in thousands)
|
||||||||||||||||||
Cash and cash equivalents
|
$
|
530,631
|
|
|
$
|
416,816
|
|
|
$
|
343,328
|
|
|
$
|
82,714
|
|
|
$
|
86,147
|
|
Total assets
|
1,180,765
|
|
|
919,884
|
|
|
745,813
|
|
|
475,757
|
|
|
327,866
|
|
|||||
Long-term debt, including current portion
|
—
|
|
|
—
|
|
|
—
|
|
|
260,827
|
|
|
242,232
|
|
|||||
Mandatorily redeemable preferred stock
|
—
|
|
|
—
|
|
|
—
|
|
|
79,717
|
|
|
75,110
|
|
|||||
Stockholders' equity (deficit)
|
769,117
|
|
|
582,535
|
|
|
466,706
|
|
|
(105,077
|
)
|
|
(178,127
|
)
|
|
Year Ended December 31,
|
|||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|||||
Operating Statistics (unaudited) (A)
|
|
|
|
|
|
|
|
|
|
|||||
Average aircraft
|
49.9
|
|
|
41.2
|
|
|
34.8
|
|
|
30.5
|
|
|
28.0
|
|
Aircraft at end of period
|
54
|
|
|
45
|
|
|
37
|
|
|
32
|
|
|
28
|
|
Airports served in the period (B)
|
56
|
|
|
55
|
|
|
50
|
|
|
41
|
|
|
43
|
|
Average daily Aircraft utilization (hours)
|
12.7
|
|
|
12.8
|
|
|
12.7
|
|
|
12.8
|
|
|
13.0
|
|
Average stage length (miles)
|
958
|
|
|
909
|
|
|
921
|
|
|
941
|
|
|
931
|
|
Block hours
|
231,148
|
|
|
192,403
|
|
|
161,898
|
|
|
141,864
|
|
|
133,227
|
|
Passenger flight segments (thousands)
|
12,414
|
|
|
10,423
|
|
|
8,518
|
|
|
6,952
|
|
|
6,325
|
|
Revenue passenger miles (RPMs) (thousands)
|
12,001,088
|
|
|
9,663,721
|
|
|
8,006,748
|
|
|
6,664,395
|
|
|
6,039,064
|
|
Available seat miles (ASMs) (thousands)
|
13,861,393
|
|
|
11,344,731
|
|
|
9,352,553
|
|
|
8,119,923
|
|
|
7,485,141
|
|
Load factor (%)
|
86.6
|
|
|
85.2
|
|
|
85.6
|
|
|
82.1
|
|
|
80.7
|
|
Average ticket revenue per passenger flight segment ($)
|
79.43
|
|
|
75.11
|
|
|
80.97
|
|
|
77.39
|
|
|
84.77
|
|
Average non-ticket revenue per passenger flight segment ($)
|
53.84
|
|
|
51.39
|
|
|
44.79
|
|
|
35.00
|
|
|
25.91
|
|
Total revenue per passenger segment ($)
|
133.27
|
|
|
126.50
|
|
|
125.76
|
|
|
112.39
|
|
|
110.68
|
|
Average yield (cents)
|
13.79
|
|
|
13.64
|
|
|
13.38
|
|
|
11.72
|
|
|
11.59
|
|
RASM (cents)
|
11.94
|
|
|
11.62
|
|
|
11.45
|
|
|
9.62
|
|
|
9.35
|
|
CASM (cents)
|
9.90
|
|
|
10.09
|
|
|
9.91
|
|
|
8.77
|
|
|
7.86
|
|
Adjusted CASM (cents) (C)
|
9.89
|
|
|
10.15
|
|
|
9.84
|
|
|
8.79
|
|
|
7.89
|
|
Adjusted CASM ex fuel (cents) (C)
|
5.91
|
|
|
6.00
|
|
|
5.72
|
|
|
5.71
|
|
|
5.45
|
|
Fuel gallons consumed (thousands)
|
171,931
|
|
|
142,991
|
|
|
121,030
|
|
|
106,628
|
|
|
98,422
|
|
Average economic fuel cost per gallon ($)
|
3.21
|
|
|
3.30
|
|
|
3.18
|
|
|
2.35
|
|
|
1.85
|
|
(A)
|
See “Glossary of Airline Terms” elsewhere in this annual report for definitions of terms used in this table.
|
(B)
|
Includes airports served during the period that had service canceled as of the end of the period. Previously, we reported only airports served during the period with continuing operations.
|
(C)
|
Excludes special charges (credits) of $(0.4) million (less than (0.01) cents per ASM) in 2009, $0.6 million (less than 0.01 cents per ASM) in 2010, $3.2 million (0.03 cents per ASM) in 2011, $(8.5) million ((0.07) cents per ASM) in 2012 and
$0.2 million
(less than 0.01 cents per ASM) in 2013. These amounts are excluded from all calculations of Adjusted CASM provided in this prospectus. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Our Operating Expenses—Special Charges (Credits).” Also excludes unrealized mark-to-market, or MTM, (gains) and losses $(1.4) million ((0.02) cents per ASM) in 2009, $(2.1) million ((0.03) cents per ASM) in 2010, $3.2 million (0.03 cents per ASM) in 2011, $0.0 million (less than 0.01 cents per ASM) in 2012 and
$0.3 million
(
less than 0.01 cent
per ASM) in 2013. Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates.”
|
|
Year Ended 2013
|
|
% change 2013 versus 2012
|
|
Year Ended 2012
|
|
% change 2012 versus 2011
|
|
Year Ended 2011
|
||||||
Passenger
|
$
|
986,018
|
|
|
26.0%
|
|
$
|
782,792
|
|
|
13.5%
|
|
$
|
689,650
|
|
Non-ticket
|
668,367
|
|
|
24.8%
|
|
535,596
|
|
|
40.4%
|
|
381,536
|
|
|||
Total operating revenue
|
$
|
1,654,385
|
|
|
25.5%
|
|
$
|
1,318,388
|
|
|
23.1%
|
|
$
|
1,071,186
|
|
RASM (cents)
|
11.94
|
|
|
2.8%
|
|
11.62
|
|
|
1.5%
|
|
11.45
|
|
|||
Average ticket revenue per passenger flight segment
|
$
|
79.43
|
|
|
5.8%
|
|
$
|
75.11
|
|
|
(7.2)%
|
|
$
|
80.97
|
|
Average non-ticket revenue per passenger flight segment
|
$
|
53.84
|
|
|
4.8%
|
|
$
|
51.39
|
|
|
14.7%
|
|
44.79
|
|
|
Total revenue per passenger flight segment
|
$
|
133.27
|
|
|
5.4%
|
|
$
|
126.50
|
|
|
0.6%
|
|
$
|
125.76
|
|
|
Year Ended December 31,
|
|||||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|||||||||||||||
|
% of
Revenue
|
|
CASM
|
|
% of
Revenue
|
|
CASM
|
|
% of
Revenue
|
|
CASM
|
|||||||||
Operating revenue
|
100.0
|
%
|
|
|
|
100.0
|
%
|
|
|
|
100.0
|
%
|
|
|
||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Aircraft fuel (1)
|
33.4
|
%
|
|
|
3.98
|
¢
|
|
35.8
|
%
|
|
|
4.16
|
¢
|
|
36.2
|
%
|
|
|
4.15
|
¢
|
Salaries, wages and benefits
|
15.8
|
|
|
1.89
|
|
|
16.6
|
|
|
1.93
|
|
|
17.0
|
|
|
1.94
|
|
|||
Aircraft rent
|
10.3
|
|
|
1.22
|
|
|
10.9
|
|
|
1.27
|
|
|
10.9
|
|
|
1.25
|
|
|||
Landing fees and other rentals
|
5.1
|
|
|
0.60
|
|
|
5.2
|
|
|
0.60
|
|
|
4.9
|
|
|
0.56
|
|
|||
Distribution
|
4.1
|
|
|
0.49
|
|
|
4.3
|
|
|
0.50
|
|
|
4.8
|
|
|
0.55
|
|
|||
Maintenance, materials and repairs
|
3.6
|
|
|
0.43
|
|
|
3.8
|
|
|
0.44
|
|
|
3.3
|
|
|
0.38
|
|
|||
Depreciation and amortization
|
1.9
|
|
|
0.23
|
|
|
1.2
|
|
|
0.13
|
|
|
0.7
|
|
|
0.08
|
|
|||
Other operating expenses
|
8.7
|
|
|
1.04
|
|
|
9.7
|
|
|
1.13
|
|
|
8.4
|
|
|
0.96
|
|
|||
Loss on disposal of assets
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.01
|
|
|
—
|
|
|
—
|
|
|||
Special charges (credits) (2)
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
(0.07
|
)
|
|
0.3
|
|
|
0.03
|
|
|||
Total operating expense
|
82.9
|
%
|
|
|
|
86.8
|
%
|
|
|
|
86.5
|
%
|
|
|
||||||
CASM
|
|
|
|
9.90
|
¢
|
|
|
|
|
10.09
|
¢
|
|
|
|
|
9.91
|
¢
|
|||
MTM losses (gains)per ASM
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
0.03
|
|
||||||
Special charges (credits) per ASM
|
|
|
—
|
|
|
|
|
(0.07
|
)
|
|
|
|
0.03
|
|
||||||
Adjusted CASM (excludes MTM gains or losses, loss on disposal of assets and special charges (credits))
|
|
|
9.89
|
|
|
|
|
10.15
|
|
|
|
|
9.84
|
|
||||||
Adjusted CASM excluding fuel
|
|
|
5.91
|
|
|
|
|
6.00
|
|
|
|
|
5.72
|
|
(1)
|
Aircraft fuel expense is the sum of (i) “into-plane fuel cost,” which includes the cost of jet fuel and certain other charges such as fuel taxes and oil, (ii) settlement gains and losses and (iii) unrealized mark-to-market gains and losses both associated with fuel hedge contracts. The following table summarizes the components of aircraft fuel expense for the periods presented:
|
|
Year Ended December 31,
|
||||||||||
2013
|
|
2012
|
|
2011
|
|||||||
(in thousands)
|
|||||||||||
Into-plane fuel cost
|
$
|
542,523
|
|
|
$
|
471,542
|
|
|
$
|
392,278
|
|
Settlement losses (gains)
|
8,958
|
|
|
175
|
|
|
(7,436
|
)
|
|||
Unrealized mark-to-market losses (gains)
|
265
|
|
|
46
|
|
|
3,204
|
|
|||
Aircraft fuel
|
$
|
551,746
|
|
|
$
|
471,763
|
|
|
$
|
388,046
|
|
(2)
|
Includes special charges (credits) of
$(8.5) million
(
(0.07) cent
s per ASM) in
2012
and $3.2 million (0.03 cents per ASM) in 2011. Special charges (credits) for 2012 primarily include a $9.1 million gain related to the sale of four permanent air carrier slots at Ronald Reagan National Airport (DCA), offset by $0.6 million in secondary offering costs. Special charges for 2011 include $2.3 million of termination costs in connection with the IPO comprised of amounts paid to Indigo Partners, LLC to terminate its professional services agreement with us and fees paid to three individual, unaffiliated holders of our subordinated notes and $0.8 million of legal, accounting, printing and filing fees in the fourth quarter related to the secondary offering completed on January 25, 2012. Please see “—Our Operating Expenses—Special Charges (Credits).”
|
|
Year Ended December 31,
|
|
Percent Change
|
|||||||
|
2013
|
|
2012
|
|
||||||
|
(in thousands, except per gallon amounts)
|
|
|
|||||||
Into-plane fuel expense
|
$
|
542,523
|
|
|
$
|
471,542
|
|
|
15.1
|
%
|
Cash paid (received) from settled derivatives, net
|
8,958
|
|
|
175
|
|
|
5,018.9
|
%
|
||
Economic fuel expense
|
551,481
|
|
|
471,717
|
|
|
16.9
|
%
|
||
Impact on fuel expense from unrealized (gains) and losses arising from mark-to-market adjustments to our outstanding fuel derivatives
|
265
|
|
|
46
|
|
|
476.1
|
%
|
||
Aircraft fuel expense (per Statement of Operations)
|
$
|
551,746
|
|
|
$
|
471,763
|
|
|
17.0
|
%
|
Fuel gallons consumed
|
171,931
|
|
|
142,991
|
|
|
20.2
|
%
|
||
Economic fuel cost per gallon
|
$
|
3.21
|
|
|
$
|
3.30
|
|
|
(2.7
|
)%
|
Into-plane fuel cost per gallon
|
$
|
3.16
|
|
|
$
|
3.30
|
|
|
(4.2
|
)%
|
|
Year Ended December 31,
|
|
|
|||||
|
2013
|
|
2012
|
|
Change
|
|||
Website
|
61.0
|
%
|
|
64.2
|
%
|
|
(3.2
|
)
|
Third-party travel agents
|
33.5
|
|
|
27.2
|
|
|
6.3
|
|
Call center
|
5.5
|
|
|
8.6
|
|
|
(3.1
|
)
|
|
Year Ended December 31,
|
|
Percent Change
|
|||||||
|
2012
|
|
2011
|
|
||||||
|
(in thousands, except per gallon amounts)
|
|
|
|||||||
Into-plane fuel expense
|
$
|
471,542
|
|
|
$
|
392,278
|
|
|
20.2
|
%
|
Cash paid (received) from settled derivatives, net
|
175
|
|
|
(7,436
|
)
|
|
(102.4
|
)%
|
||
Economic fuel expense
|
471,717
|
|
|
384,842
|
|
|
22.6
|
%
|
||
Impact on fuel expense from unrealized (gains) and losses arising from mark-to-market adjustments to our outstanding fuel derivatives
|
46
|
|
|
3,204
|
|
|
(98.6
|
)%
|
||
Aircraft fuel expense (per Statement of Operations)
|
$
|
471,763
|
|
|
$
|
388,046
|
|
|
21.6
|
%
|
Fuel gallons consumed
|
142,991
|
|
|
121,030
|
|
|
18.1
|
%
|
||
Economic fuel cost per gallon
|
$
|
3.30
|
|
|
$
|
3.18
|
|
|
3.8
|
%
|
Into-plane fuel cost per gallon
|
$
|
3.30
|
|
|
$
|
3.24
|
|
|
1.9
|
%
|
|
Year Ended December 31,
|
|
|
|||||
|
2012
|
|
2011
|
|
Change
|
|||
Website
|
64.2
|
%
|
|
66.3
|
%
|
|
(2.1
|
)
|
Third-party travel agents
|
27.2
|
|
|
23.1
|
|
|
4.1
|
|
Call center
|
8.6
|
|
|
10.6
|
|
|
(2.0
|
)
|
|
|
Three Months Ended
|
||||||||||||||||||||||||||||||
|
|
March 31, 2012
|
|
June 30,
2012
|
|
September 30, 2012
|
|
December 31, 2012
|
|
March 31, 2013
|
|
June 30,
2013
|
|
September 30, 2013
|
|
December 31, 2013
|
||||||||||||||||
|
|
(in thousands except share and per share amounts)
|
||||||||||||||||||||||||||||||
Total operating revenue
|
|
$
|
301,495
|
|
|
$
|
346,308
|
|
|
$
|
342,317
|
|
|
$
|
328,268
|
|
|
$
|
370,437
|
|
|
$
|
407,339
|
|
|
$
|
456,625
|
|
|
$
|
419,984
|
|
Passenger
|
|
180,078
|
|
|
211,812
|
|
|
202,181
|
|
|
188,721
|
|
|
218,897
|
|
|
241,119
|
|
|
279,499
|
|
|
246,503
|
|
||||||||
Non-ticket
|
|
121,417
|
|
|
134,496
|
|
|
140,136
|
|
|
139,547
|
|
|
151,540
|
|
|
166,220
|
|
|
177,126
|
|
|
173,481
|
|
||||||||
Operating income
|
|
37,244
|
|
|
55,132
|
|
|
49,681
|
|
|
31,933
|
|
|
49,669
|
|
|
66,758
|
|
|
97,804
|
|
|
68,061
|
|
||||||||
Net income (loss)
|
|
$
|
23,419
|
|
|
$
|
34,591
|
|
|
$
|
30,884
|
|
|
$
|
19,566
|
|
|
$
|
30,554
|
|
|
$
|
42,068
|
|
|
61,103
|
|
|
43,193
|
|
||
Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
|
$
|
0.32
|
|
|
$
|
0.48
|
|
|
$
|
0.43
|
|
|
$
|
0.27
|
|
|
$
|
0.42
|
|
|
$
|
0.58
|
|
|
$
|
0.84
|
|
|
$
|
0.59
|
|
Diluted
|
|
$
|
0.32
|
|
|
$
|
0.48
|
|
|
$
|
0.43
|
|
|
$
|
0.27
|
|
|
$
|
0.42
|
|
|
$
|
0.58
|
|
|
$
|
0.84
|
|
|
$
|
0.59
|
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
|
72,292,164
|
|
|
72,379,185
|
|
|
72,427,490
|
|
|
72,442,183
|
|
|
72,486,209
|
|
|
72,592,973
|
|
|
72,631,646
|
|
|
72,657,916
|
|
||||||||
Diluted
|
|
72,498,705
|
|
|
72,583,690
|
|
|
72,658,298
|
|
|
72,622,718
|
|
|
72,804,245
|
|
|
72,992,084
|
|
|
73,002,761
|
|
|
73,195,479
|
|
|
|
Three Months Ended
|
||||||||||||||||||||||
|
|
March 31,
2012
|
|
June 30,
2012
|
|
September 30,
2012
|
|
December 31,
2012
|
|
March 31,
2013
|
|
June 30,
2013
|
|
September 30, 2013
|
|
December 31, 2013
|
||||||||
Other operating statistics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Aircraft at end of period
|
|
40
|
|
|
42
|
|
|
42
|
|
|
45
|
|
|
49
|
|
|
50
|
|
|
51
|
|
|
54
|
|
Airports served (1)
|
|
50
|
|
|
52
|
|
|
53
|
|
|
53
|
|
|
52
|
|
|
55
|
|
|
54
|
|
|
53
|
|
Average daily Aircraft utilization (hours)
|
|
12.8
|
|
|
12.9
|
|
|
12.8
|
|
|
12.6
|
|
|
12.6
|
|
|
12.8
|
|
|
12.8
|
|
|
12.5
|
|
Average stage length (miles)
|
|
912
|
|
|
902
|
|
|
892
|
|
|
932
|
|
|
941
|
|
|
935
|
|
|
956
|
|
|
998
|
|
Passenger flight segments (thousands)
|
|
2,349
|
|
|
2,613
|
|
|
2,814
|
|
|
2,647
|
|
|
2,768
|
|
|
3,111
|
|
|
3,374
|
|
|
3,161
|
|
Revenue passenger miles (RPMs) (thousands)
|
|
2,194,350
|
|
|
2,397,663
|
|
|
2,552,316
|
|
|
2,519,392
|
|
|
2,661,491
|
|
|
2,930,912
|
|
|
3,241,309
|
|
|
3,167,376
|
|
Available seat miles (ASMs) (thousands)
|
|
2,589,014
|
|
|
2,826,916
|
|
|
2,972,651
|
|
|
2,956,150
|
|
|
3,127,214
|
|
|
3,420,257
|
|
|
3,637,951
|
|
|
3,675,972
|
|
Load factor (%)
|
|
84.8
|
|
|
84.8
|
|
|
85.9
|
|
|
85.2
|
|
|
85.1
|
|
|
85.7
|
|
|
89.1
|
|
|
86.2
|
|
Average ticket revenue per passenger flight segment ($)
|
|
76.65
|
|
|
81.06
|
|
|
71.85
|
|
|
71.30
|
|
|
79.09
|
|
|
77.51
|
|
|
82.84
|
|
|
77.98
|
|
Average non-ticket revenue per passenger flight segment ($)
|
|
51.68
|
|
|
51.47
|
|
|
49.80
|
|
|
52.73
|
|
|
54.75
|
|
|
53.43
|
|
|
52.50
|
|
|
54.88
|
|
Operating revenue per ASM (RASM) (cents)
|
|
11.65
|
|
|
12.25
|
|
|
11.52
|
|
|
11.10
|
|
|
11.85
|
|
|
11.91
|
|
|
12.55
|
|
|
11.43
|
|
CASM (cents)
|
|
10.21
|
|
|
10.30
|
|
|
9.84
|
|
|
10.02
|
|
|
10.26
|
|
|
9.96
|
|
|
9.86
|
|
|
9.57
|
|
Adjusted CASM (cents) (2)(3)
|
|
10.18
|
|
|
10.26
|
|
|
10.15
|
|
|
10.03
|
|
|
10.14
|
|
|
9.78
|
|
|
10.00
|
|
|
9.67
|
|
Adjusted CASM ex fuel (cents) (2)
|
|
5.99
|
|
|
6.05
|
|
|
6.02
|
|
|
5.93
|
|
|
6.04
|
|
|
6.00
|
|
|
5.86
|
|
|
5.78
|
|
Fuel gallons consumed (thousands)
|
|
32,730
|
|
|
35,829
|
|
|
37,761
|
|
|
36,670
|
|
|
38,628
|
|
|
42,683
|
|
|
45,521
|
|
|
45,100
|
|
Average economic fuel cost per gallon ($)
|
|
3.31
|
|
|
3.32
|
|
|
3.26
|
|
|
3.31
|
|
|
3.32
|
|
|
3.03
|
|
|
3.31
|
|
|
3.17
|
|
|
|
2014
|
|
2015 - 2016
|
|
2017 - 2018
|
|
2019 and beyond
|
|
Total
|
||||||||||
Operating lease obligations
|
|
$
|
203
|
|
|
$
|
396
|
|
|
$
|
319
|
|
|
$
|
527
|
|
|
$
|
1,445
|
|
Flight equipment purchase obligations
|
|
559
|
|
|
1,252
|
|
|
1,348
|
|
|
2,197
|
|
|
5,356
|
|
|||||
Other
|
|
5
|
|
|
10
|
|
|
6
|
|
|
—
|
|
|
21
|
|
|||||
Total future payments on contractual obligations
|
|
$
|
767
|
|
|
$
|
1,658
|
|
|
$
|
1,673
|
|
|
$
|
2,724
|
|
|
$
|
6,822
|
|
|
|
Airbus
|
|
Third-Party Lessor
|
|
|
||||||
|
|
A320
|
|
A320NEO
|
|
A321
|
|
A321NEO
|
|
A320NEO
|
|
Total
|
2014
|
|
11
|
|
|
|
|
|
|
|
|
|
11
|
2015
|
|
11
|
|
|
|
2
|
|
|
|
1
|
|
14
|
2016
|
|
5
|
|
|
|
8
|
|
|
|
4
|
|
17
|
2017
|
|
10
|
|
|
|
10
|
|
|
|
|
|
20
|
2018
|
|
|
|
6
|
|
5
|
|
|
|
|
|
11
|
2019
|
|
|
|
8
|
|
|
|
5
|
|
|
|
13
|
2020
|
|
|
|
13
|
|
|
|
|
|
|
|
13
|
2021
|
|
|
|
18
|
|
|
|
|
|
|
|
18
|
|
|
37
|
|
45
|
|
25
|
|
5
|
|
5
|
|
117
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
|
|
|
|
|
||||||
Operating revenues:
|
|
|
|
|
|
||||||
Passenger
|
$
|
986,018
|
|
|
$
|
782,792
|
|
|
$
|
689,650
|
|
Non-ticket
|
668,367
|
|
|
535,596
|
|
|
381,536
|
|
|||
Total operating revenues
|
1,654,385
|
|
|
1,318,388
|
|
|
1,071,186
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Aircraft fuel
|
551,746
|
|
|
471,763
|
|
|
388,046
|
|
|||
Salaries, wages and benefits
|
262,150
|
|
|
218,919
|
|
|
181,742
|
|
|||
Aircraft rent
|
169,737
|
|
|
143,572
|
|
|
116,485
|
|
|||
Landing fees and other rents
|
83,604
|
|
|
68,368
|
|
|
52,794
|
|
|||
Distribution
|
67,481
|
|
|
56,668
|
|
|
51,349
|
|
|||
Maintenance, materials and repairs
|
60,143
|
|
|
49,460
|
|
|
34,017
|
|
|||
Depreciation and amortization
|
31,947
|
|
|
15,256
|
|
|
7,760
|
|
|||
Other operating
|
144,586
|
|
|
127,886
|
|
|
91,172
|
|
|||
Loss on disposal of assets
|
525
|
|
|
956
|
|
|
255
|
|
|||
Special charges (credits)
|
174
|
|
|
(8,450
|
)
|
|
3,184
|
|
|||
Total operating expenses
|
1,372,093
|
|
|
1,144,398
|
|
|
926,804
|
|
|||
|
|
|
|
|
|
||||||
Operating income
|
282,292
|
|
|
173,990
|
|
|
144,382
|
|
|||
Other (income) expense:
|
|
|
|
|
|
||||||
Interest expense
|
214
|
|
|
1,350
|
|
|
24,781
|
|
|||
Capitalized interest
|
(214
|
)
|
|
(1,350
|
)
|
|
(2,890
|
)
|
|||
Interest income
|
(401
|
)
|
|
(925
|
)
|
|
(575
|
)
|
|||
Other expense
|
283
|
|
|
331
|
|
|
235
|
|
|||
Total other (income) expense
|
(118
|
)
|
|
(594
|
)
|
|
21,551
|
|
|||
|
|
|
|
|
|
||||||
Income before income taxes
|
282,410
|
|
|
174,584
|
|
|
122,831
|
|
|||
Provision for income taxes
|
105,492
|
|
|
66,124
|
|
|
46,383
|
|
|||
|
|
|
|
|
|
||||||
Net income
|
$
|
176,918
|
|
|
$
|
108,460
|
|
|
$
|
76,448
|
|
Basic earnings per share
|
$
|
2.44
|
|
|
$
|
1.50
|
|
|
$
|
1.44
|
|
Diluted earnings per share
|
$
|
2.42
|
|
|
$
|
1.49
|
|
|
$
|
1.43
|
|
|
December 31, 2013
|
|
December 31, 2012
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
530,631
|
|
|
$
|
416,816
|
|
Accounts receivable, net
|
23,246
|
|
|
22,740
|
|
||
Deferred income taxes
|
16,243
|
|
|
12,591
|
|
||
Prepaid expenses and other current assets
|
78,955
|
|
|
95,210
|
|
||
Total current assets
|
649,075
|
|
|
547,357
|
|
||
|
|
|
|
||||
Property and equipment:
|
|
|
|
||||
Flight equipment
|
9,847
|
|
|
2,648
|
|
||
Ground and other equipment
|
50,987
|
|
|
43,580
|
|
||
Less accumulated depreciation
|
(25,221
|
)
|
|
(17,825
|
)
|
||
|
35,613
|
|
|
28,403
|
|
||
Deposits on flight equipment purchase contracts
|
157,669
|
|
|
96,692
|
|
||
Aircraft maintenance deposits
|
161,484
|
|
|
122,379
|
|
||
Deferred heavy maintenance, net
|
125,288
|
|
|
80,533
|
|
||
Other long-term assets
|
51,636
|
|
|
44,520
|
|
||
Total assets
|
$
|
1,180,765
|
|
|
$
|
919,884
|
|
|
|
|
|
||||
Liabilities and shareholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
23,104
|
|
|
$
|
24,166
|
|
Air traffic liability
|
167,627
|
|
|
131,414
|
|
||
Other current liabilities
|
145,262
|
|
|
121,314
|
|
||
Total current liabilities
|
335,993
|
|
|
276,894
|
|
||
|
|
|
|
||||
Long-term deferred income taxes
|
48,916
|
|
|
33,216
|
|
||
Deferred credits and other long-term liabilities
|
26,739
|
|
|
27,239
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Common stock: Common stock, $.0001 par value, 240,000,000 shares authorized at December 31, 2013 and 2012, respectively; 72,670,673 and 70,861,822 issued and 72,566,426 and 70,801,782 outstanding as of December 31, 2013 and 2012, respectively
|
7
|
|
|
6
|
|
||
Common stock: Non-Voting common stock: $.0001 par value, 50,000,000 shares authorized at December 31, 2013 and 2012, respectively; 0 and 1,669,205 issued and outstanding as of December 31, 2013 and 2012, respectively
|
—
|
|
|
1
|
|
||
Additional paid-in-capital
|
515,331
|
|
|
504,527
|
|
||
Treasury stock, at cost: 104,247 and 60,040 shares as of December 31, 2013 and 2012, respectively
|
(2,291
|
)
|
|
(1,151
|
)
|
||
Retained earnings
|
256,070
|
|
|
79,152
|
|
||
Total shareholders’ equity
|
769,117
|
|
|
582,535
|
|
||
Total liabilities and shareholders’ equity
|
$
|
1,180,765
|
|
|
$
|
919,884
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
176,918
|
|
|
$
|
108,460
|
|
|
$
|
76,448
|
|
Adjustments to reconcile net income to net cash provided by operations:
|
|
|
|
|
|
||||||
Changes in fair value of open fuel hedge contracts
|
265
|
|
|
46
|
|
|
3,204
|
|
|||
Non-cash restructuring credit charges, net
|
—
|
|
|
—
|
|
|
—
|
|
|||
Equity based stock compensation, net
|
5,689
|
|
|
4,327
|
|
|
530
|
|
|||
Allowance for doubtful accounts
|
143
|
|
|
78
|
|
|
27
|
|
|||
Amortization of deferred gains, losses and debt issuance costs
|
(558
|
)
|
|
(830
|
)
|
|
(1,047
|
)
|
|||
Depreciation and amortization
|
31,947
|
|
|
15,256
|
|
|
7,760
|
|
|||
Deferred income tax benefit
|
12,047
|
|
|
29,255
|
|
|
44,180
|
|
|||
Loss on disposal of assets
|
525
|
|
|
956
|
|
|
255
|
|
|||
Gain on slot sale
|
—
|
|
|
(9,060
|
)
|
|
—
|
|
|||
Interest and dividends incurred but not paid
|
—
|
|
|
—
|
|
|
21,875
|
|
|||
Capitalized interest
|
(214
|
)
|
|
(1,350
|
)
|
|
(2,890
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Restricted cash
|
—
|
|
|
—
|
|
|
72,736
|
|
|||
Accounts receivable
|
(461
|
)
|
|
(7,393
|
)
|
|
(5,728
|
)
|
|||
Prepaid maintenance reserves
|
(24,058
|
)
|
|
(31,567
|
)
|
|
(36,848
|
)
|
|||
Long-term deposits and other assets
|
(65,654
|
)
|
|
(68,248
|
)
|
|
(15,992
|
)
|
|||
Accounts payable
|
(1,674
|
)
|
|
8,452
|
|
|
2,457
|
|
|||
Air traffic liability
|
36,226
|
|
|
19,134
|
|
|
6,573
|
|
|||
Other liabilities
|
24,235
|
|
|
46,115
|
|
|
(2,189
|
)
|
|||
Other
|
—
|
|
|
—
|
|
|
(153
|
)
|
|||
Net cash provided by operating activities
|
195,376
|
|
|
113,631
|
|
|
171,198
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Proceeds from sale of property and equipment
|
—
|
|
|
14
|
|
|
150
|
|
|||
Proceeds from sale of slots
|
—
|
|
|
9,060
|
|
|
—
|
|
|||
Pre-delivery deposits for flight equipment, net of refunds
|
(70,288
|
)
|
|
(12,626
|
)
|
|
(53,274
|
)
|
|||
Purchase of property and equipment
|
(19,812
|
)
|
|
(23,771
|
)
|
|
(14,093
|
)
|
|||
Net cash used in investing activities
|
(90,100
|
)
|
|
(27,323
|
)
|
|
(67,217
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of common stock, net of offering expenses
|
—
|
|
|
—
|
|
|
170,828
|
|
|||
Proceeds from options exercised
|
852
|
|
|
469
|
|
|
423
|
|
|||
Payments on debt
|
—
|
|
|
—
|
|
|
(18,221
|
)
|
|||
Proceeds from sale and leaseback transactions
|
6,900
|
|
|
12,540
|
|
|
4,481
|
|
|||
Payments to pre-IPO shareholders pursuant to tax receivable agreement
|
—
|
|
|
(26,905
|
)
|
|
—
|
|
|||
Excess tax benefits from share-based compensation
|
1,927
|
|
|
2,098
|
|
|
—
|
|
|||
Repurchase of common stock
|
(1,140
|
)
|
|
(1,022
|
)
|
|
(886
|
)
|
|||
Debt issuance costs
|
—
|
|
|
—
|
|
|
8
|
|
|||
Net cash provided by (used in) financing activities
|
8,539
|
|
|
(12,820
|
)
|
|
156,633
|
|
|||
Net increase in cash and cash equivalents
|
113,815
|
|
|
73,488
|
|
|
260,614
|
|
|||
Cash and cash equivalents at beginning of period
|
416,816
|
|
|
343,328
|
|
|
82,714
|
|
|||
Cash and cash equivalents at end of period
|
$
|
530,631
|
|
|
$
|
416,816
|
|
|
$
|
343,328
|
|
Supplemental disclosures
|
|
|
|
|
|
||||||
Cash payments for:
|
|
|
|
|
|
||||||
Interest
|
$
|
29
|
|
|
$
|
303
|
|
|
$
|
10,562
|
|
Taxes
|
$
|
85,705
|
|
|
$
|
40,204
|
|
|
$
|
1,477
|
|
Non-cash transactions:
|
|
|
|
|
|
||||||
Exchange of notes due to related parties for common stock
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
279,206
|
|
Exchange of mandatorily redeemable preferred stock for common stock
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
81,747
|
|
Liability and equity related to tax receivable agreement
|
$
|
(2,336
|
)
|
|
$
|
(1,497
|
)
|
|
$
|
36,522
|
|
Capital expenditures funded by capital lease borrowings
|
$
|
(3,234
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Class A Common Stock
|
|
Class B Common Stock
|
|
Common Stock
|
|
Non- Voting Common Stock
|
|
Additional Paid-In Capital
|
|
Treasury Stock
|
|
Retained Earnings (Accumulated Deficit)
|
|
Total
|
||||||||||||||||
Balance at December 31, 2010
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
676
|
|
|
$
|
—
|
|
|
$
|
(105,756
|
)
|
|
$
|
(105,077
|
)
|
Conversion of Class A & B common stock to common stock
|
(2
|
)
|
|
(1
|
)
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Proceeds from initial public offering, net
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
170,827
|
|
|
—
|
|
|
—
|
|
|
170,828
|
|
||||||||
Conversion of debt to common stock
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
279,204
|
|
|
—
|
|
|
—
|
|
|
279,206
|
|
||||||||
Conversion of preferred stock to common stock
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
81,746
|
|
|
—
|
|
|
—
|
|
|
81,747
|
|
||||||||
Record liability under Tax Receivable Agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(36,522
|
)
|
|
—
|
|
|
—
|
|
|
(36,522
|
)
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
530
|
|
|
—
|
|
|
—
|
|
|
530
|
|
||||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(757
|
)
|
|
(129
|
)
|
|
—
|
|
|
(886
|
)
|
||||||||
Conversion of common stock to non-voting common stock
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Proceeds from options exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
423
|
|
|
—
|
|
|
—
|
|
|
423
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76,448
|
|
|
76,448
|
|
||||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
||||||||
Balance at December 31, 2011
|
—
|
|
|
—
|
|
|
6
|
|
|
1
|
|
|
496,136
|
|
|
(129
|
)
|
|
(29,308
|
)
|
|
466,706
|
|
||||||||
Adjustment to liability recorded under Tax Receivable Agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,497
|
|
|
—
|
|
|
—
|
|
|
1,497
|
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,327
|
|
|
—
|
|
|
—
|
|
|
4,327
|
|
||||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,022
|
)
|
|
—
|
|
|
(1,022
|
)
|
||||||||
Proceeds from options exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
469
|
|
|
—
|
|
|
—
|
|
|
469
|
|
||||||||
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,098
|
|
|
—
|
|
|
—
|
|
|
2,098
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
108,460
|
|
|
108,460
|
|
||||||||
Balance at December 31, 2012
|
—
|
|
|
—
|
|
|
6
|
|
|
1
|
|
|
504,527
|
|
|
(1,151
|
)
|
|
79,152
|
|
|
582,535
|
|
||||||||
Adjustment to liability recorded under Tax Receivable Agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,336
|
|
|
—
|
|
|
—
|
|
|
2,336
|
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,689
|
|
|
—
|
|
|
—
|
|
|
5,689
|
|
||||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(1,140
|
)
|
|
—
|
|
|
(1,140
|
)
|
|||||||||
Conversion of non-voting common stock to common stock
|
—
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Proceeds from options exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
852
|
|
|
—
|
|
|
—
|
|
|
852
|
|
||||||||
Excess tax benefits from share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,927
|
|
|
—
|
|
|
—
|
|
|
1,927
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
176,918
|
|
|
176,918
|
|
||||||||
Balance at December 31, 2013
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
515,331
|
|
|
$
|
(2,291
|
)
|
|
$
|
256,070
|
|
|
$
|
769,117
|
|
1.
|
Summary of Significant Accounting Policies
|
|
Estimated Useful Life
|
Spare rotables and flight assemblies
|
Lesser of the useful life of equipment or average remaining fleet life
|
Other equipment and vehicles
|
5 to 7 years
|
Internal use software
|
3 to 10 years
|
Capital lease
|
Lease term
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Depreciation
|
$
|
8,340
|
|
|
$
|
6,156
|
|
|
$
|
5,186
|
|
Amortization of heavy maintenance
|
23,607
|
|
|
9,100
|
|
|
2,574
|
|
|||
Total depreciation and amortization
|
$
|
31,947
|
|
|
$
|
15,256
|
|
|
$
|
7,760
|
|
|
Cash proceeds from sale of miles to non-airline third parties
|
|
Portion of proceeds recognized immediately as marketing component
|
||||
Year Ended
|
(in thousands)
|
||||||
December 31, 2013
|
$
|
28,496
|
|
|
$
|
23,124
|
|
December 31, 2012
|
24,938
|
|
|
20,998
|
|
||
December 31, 2011
|
20,954
|
|
|
16,580
|
|
|
|
Year Ended December 31,
|
||||||||||
Non-ticket revenue
|
Recognition method
|
2013
|
|
2012
|
|
2011
|
||||||
|
|
(in thousands)
|
||||||||||
Baggage
|
Time of departure
|
$
|
275,958
|
|
|
$
|
217,536
|
|
|
$
|
168,290
|
|
Passenger usage fee
|
Time of departure
|
188,911
|
|
|
149,577
|
|
|
71,757
|
|
|||
Advance seat selection
|
Time of departure
|
59,241
|
|
|
48,956
|
|
|
42,112
|
|
|||
Service charges for changes and cancellations
|
When itinerary is changed
|
32,546
|
|
|
27,762
|
|
|
25,927
|
|
|||
Other
|
|
111,711
|
|
|
91,765
|
|
|
73,450
|
|
|||
Non-ticket revenue
|
|
$
|
668,367
|
|
|
$
|
535,596
|
|
|
$
|
381,536
|
|
|
Year Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Flight hour-based maintenance expense
|
$
|
30,322
|
|
|
$
|
25,748
|
|
|
$
|
21,974
|
|
Non-flight hour-based maintenance expense
|
29,821
|
|
|
23,712
|
|
|
12,043
|
|
|||
Total maintenance, materials and repairs
|
$
|
60,143
|
|
|
$
|
49,460
|
|
|
$
|
34,017
|
|
2.
|
Recent Accounting Developments
|
3.
|
Special Charges and Credits
|
4.
|
Letters of Credit
|
5.
|
Credit Card Processing Arrangements
|
6.
|
Accrued Liabilities
|
|
As of December 31,
|
||||||
|
2013
|
|
2012
|
||||
|
(in thousands)
|
||||||
Aircraft maintenance
|
$
|
36,165
|
|
|
$
|
22,319
|
|
Federal excise and other passenger taxes and fees payable
|
26,979
|
|
|
23,401
|
|
||
Salaries and wages
|
26,174
|
|
|
21,057
|
|
||
Airport expenses
|
17,109
|
|
|
16,024
|
|
||
Fuel
|
13,819
|
|
|
11,219
|
|
||
Aircraft and facility rent
|
7,993
|
|
|
8,020
|
|
||
Tax receivable agreement
|
5,643
|
|
|
7,987
|
|
||
Other
|
11,380
|
|
|
11,287
|
|
||
Other current liabilities
|
$
|
145,262
|
|
|
$
|
121,314
|
|
7.
|
Common Stock and Preferred Stock
|
8.
|
Stock-Based Compensation
|
|
Number of Shares
|
|
Weighted-Average
Grant Date Fair Value ($) |
||
Outstanding at December 31, 2012
|
449,629
|
|
|
16.94
|
|
Granted
|
151,202
|
|
|
27.70
|
|
Vested
|
(168,514
|
)
|
|
13.19
|
|
Forfeited
|
(96,269
|
)
|
|
19.28
|
|
Outstanding at December 31, 2013
|
336,048
|
|
|
22.99
|
|
|
Number
of Options |
|
Weighted-
Average Exercise Price ($) |
|
Average
Remaining Contractual Term (Years) |
|
Aggregate
Intrinsic Value ($000) |
|||
Outstanding at December 31, 2012
|
247,650
|
|
|
9.59
|
|
|
8.0
|
|
2,015
|
|
Exercised
|
(92,400
|
)
|
|
9.22
|
|
|
|
|
|
|
Forfeited or expired
|
(98,750
|
)
|
|
10.70
|
|
|
|
|
|
|
Outstanding at December 31, 2013
|
56,500
|
|
|
8.26
|
|
|
6.7
|
|
2,099
|
|
Exercisable at December 31, 2013
|
27,125
|
|
|
8.12
|
|
|
6.6
|
|
1,011
|
|
Vested or Expected to Vest at December 31, 2013
|
56,260
|
|
|
8.25
|
|
|
6.7
|
|
2,090
|
|
|
Weighted-Average at Grant Date for Year Ended December 31, 2013
|
|
Weighted-Average at Grant Date for Year Ended December 31, 2012
|
|
Expected volatility factor
|
0.41
|
|
0.39
|
|
Risk free interest rate
|
0.33
|
%
|
0.44
|
%
|
Expected term (in years)
|
2.65
|
|
2.72
|
|
Expected dividend yield
|
—
|
%
|
—
|
%
|
|
Number of Awards
|
|
Weighted-Average Fair Value at Grant Date ($)
|
||
Outstanding at December 31, 2012
|
280,907
|
|
|
20.30
|
|
Granted
|
126,147
|
|
|
28.09
|
|
Vested
|
—
|
|
|
—
|
|
Forfeited
|
(79,950
|
)
|
|
21.76
|
|
Outstanding at December 31, 2013
|
327,104
|
|
|
22.94
|
|
9.
|
Net Income per Share
|
|
Year Ended December 31,
|
||||||||||
2013
|
|
2012
|
|
2011
|
|||||||
(in thousands, except per share amounts)
|
|||||||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
176,918
|
|
|
$
|
108,460
|
|
|
$
|
76,448
|
|
Denominator:
|
|
|
|
|
|
||||||
Weighted-average shares outstanding, basic
|
72,593
|
|
|
72,386
|
|
|
53,241
|
|
|||
Effect of dilutive stock awards
|
406
|
|
|
205
|
|
|
274
|
|
|||
Adjusted weighted-average shares outstanding, diluted
|
72,999
|
|
|
72,591
|
|
|
53,515
|
|
|||
Net Income per Share:
|
|
|
|
|
|
||||||
Basic earnings per common share
|
$
|
2.44
|
|
|
$
|
1.50
|
|
|
$
|
1.44
|
|
Diluted earnings per common share
|
$
|
2.42
|
|
|
$
|
1.49
|
|
|
$
|
1.43
|
|
|
|
|
|
|
|
||||||
Anti-dilutive weighted-average shares
|
1
|
|
|
88
|
|
|
70
|
|
10.
|
Debt, Related-Party Transactions and Other Obligations
|
11.
|
Leases and Prepaid Maintenance Deposits
|
(in thousands)
|
|
2013
|
|
2012
|
||||
Flight equipment
|
|
$
|
3,234
|
|
|
$
|
—
|
|
Less: accumulated amortization
|
|
54
|
|
|
—
|
|
||
|
|
$
|
3,180
|
|
|
$
|
—
|
|
|
|
|
|
Operating Leases
|
||||||||||||
|
|
Capital Leases
|
|
Aircraft and Spare Engine Leases
|
|
Property Facility Leases
|
|
Total Operating Leases
|
||||||||
|
|
(in thousands)
|
||||||||||||||
2014
|
|
$
|
1,200
|
|
|
$
|
184,131
|
|
|
$
|
18,535
|
|
|
$
|
202,666
|
|
2015
|
|
1,200
|
|
|
184,694
|
|
|
16,308
|
|
|
201,002
|
|
||||
2016
|
|
1,000
|
|
|
182,984
|
|
|
11,610
|
|
|
194,594
|
|
||||
2017
|
|
—
|
|
|
163,673
|
|
|
8,795
|
|
|
172,468
|
|
||||
2018
|
|
—
|
|
|
139,740
|
|
|
6,445
|
|
|
146,185
|
|
||||
2019 and thereafter
|
|
—
|
|
|
502,102
|
|
|
24,406
|
|
|
526,508
|
|
||||
Total minimum lease payments
|
|
$
|
3,400
|
|
|
$
|
1,357,324
|
|
|
$
|
86,099
|
|
|
$
|
1,443,423
|
|
Less amount representing interest
|
|
366
|
|
|
|
|
|
|
|
|
|
|
||||
Present value of minimum lease payments
|
|
3,034
|
|
|
|
|
|
|
|
|
|
|
||||
Less current portion
|
|
1,400
|
|
|
|
|
|
|
|
|
|
|
||||
Long term portion
|
|
1,634
|
|
|
|
|
|
|
|
|
|
|
12.
|
Financial Instruments and Risk Management
|
|
Year Ended December 31,
|
||||||||||
2013
|
|
2012
|
|
2011
|
|||||||
(in thousands)
|
|||||||||||
Into-plane fuel cost
|
$
|
542,523
|
|
|
$
|
471,542
|
|
|
$
|
392,278
|
|
Settlement losses (gains)
|
8,958
|
|
|
175
|
|
|
(7,436
|
)
|
|||
Unrealized mark-to-market losses (gains)
|
265
|
|
|
46
|
|
|
3,204
|
|
|||
Aircraft fuel
|
$
|
551,746
|
|
|
$
|
471,763
|
|
|
$
|
388,046
|
|
13.
|
Defined Contribution 401(k) Plan
|
14.
|
Income Taxes
|
|
For the Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
86,437
|
|
|
$
|
32,656
|
|
|
$
|
1,866
|
|
State and local
|
6,595
|
|
|
3,250
|
|
|
74
|
|
|||
Foreign
|
413
|
|
|
963
|
|
|
263
|
|
|||
Total current expense
|
93,445
|
|
|
36,869
|
|
|
2,203
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
11,658
|
|
|
27,870
|
|
|
42,148
|
|
|||
State and local
|
389
|
|
|
1,385
|
|
|
2,032
|
|
|||
Total deferred expense (benefit)
|
12,047
|
|
|
29,255
|
|
|
44,180
|
|
|||
Total income tax expense (benefit)
|
$
|
105,492
|
|
|
$
|
66,124
|
|
|
$
|
46,383
|
|
|
For the Years Ended December 31,
|
||||||||||
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in thousands)
|
||||||||||
Expected provision at federal statutory tax rate
|
$
|
98,843
|
|
|
$
|
61,104
|
|
|
$
|
42,991
|
|
State and foreign tax expense, net of federal benefit
|
4,695
|
|
|
3,726
|
|
|
2,255
|
|
|||
Interest and dividend on preferred stock
|
—
|
|
|
—
|
|
|
710
|
|
|||
Meals and entertainment
|
772
|
|
|
649
|
|
|
469
|
|
|||
Fines and penalties
|
134
|
|
|
84
|
|
|
(36
|
)
|
|||
Federal credits
|
(58
|
)
|
|
(182
|
)
|
|
(103
|
)
|
|||
Adjustment to deferred tax assets and liabilities
|
(54
|
)
|
|
(3
|
)
|
|
(3
|
)
|
|||
Other
|
1,160
|
|
|
746
|
|
|
100
|
|
|||
Total income tax expense (benefit)
|
$
|
105,492
|
|
|
$
|
66,124
|
|
|
$
|
46,383
|
|
|
December 31,
|
||||||
|
2013
|
|
2012
|
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss
|
$
|
188
|
|
|
$
|
83
|
|
Deferred loss
|
1,428
|
|
|
—
|
|
||
Deferred revenue
|
6,241
|
|
|
5,829
|
|
||
Nondeductible accruals
|
9,734
|
|
|
6,744
|
|
||
Other
|
2,767
|
|
|
1,073
|
|
||
Deferred tax assets
|
20,358
|
|
|
13,729
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Capitalized interest
|
736
|
|
|
1,125
|
|
||
Deferred gain
|
—
|
|
|
364
|
|
||
Fuel hedging
|
—
|
|
|
97
|
|
||
Accrued engine maintenance
|
45,911
|
|
|
29,497
|
|
||
Property, plant and equipment
|
6,384
|
|
|
3,271
|
|
||
Deferred tax liabilities
|
53,031
|
|
|
34,354
|
|
||
Net deferred tax assets (liabilities)
|
$
|
(32,673
|
)
|
|
$
|
(20,625
|
)
|
Deferred taxes included within:
|
|
|
|
||||
Assets:
|
|
|
|
||||
Other current assets
|
$
|
16,243
|
|
|
$
|
12,591
|
|
Liabilities:
|
|
|
|
||||
Other long-term liabilities
|
$
|
48,916
|
|
|
$
|
33,216
|
|
15.
|
Commitments and Contingencies
|
|
|
Airbus
|
|
Third-Party Lessor
|
|
|
||||||
|
|
A320
|
|
A320NEO
|
|
A321
|
|
A321NEO
|
|
A320NEO
|
|
Total
|
2014
|
|
11
|
|
|
|
|
|
|
|
|
|
11
|
2015
|
|
11
|
|
|
|
2
|
|
|
|
1
|
|
14
|
2016
|
|
5
|
|
|
|
8
|
|
|
|
4
|
|
17
|
2017
|
|
10
|
|
|
|
10
|
|
|
|
|
|
20
|
2018
|
|
|
|
6
|
|
5
|
|
|
|
|
|
11
|
2019
|
|
|
|
8
|
|
|
|
5
|
|
|
|
13
|
2020
|
|
|
|
13
|
|
|
|
|
|
|
|
13
|
2021
|
|
|
|
18
|
|
|
|
|
|
|
|
18
|
|
|
37
|
|
45
|
|
25
|
|
5
|
|
5
|
|
117
|
Employee Groups
|
|
Representative
|
|
Amendable Date
|
|
Percentage of Workforce
|
Pilots
|
|
Air Line Pilots Association, International (ALPA)
|
|
August 2015
|
|
24%
|
Flight Attendants
|
|
Association of Flight Attendants (AFA-CWA)
|
|
August 2007
|
|
34%
|
Dispatchers
|
|
Transport Workers Union (TWU)
|
|
August 2018
|
|
1%
|
16.
|
Fair Value Measurements
|
|
Fair Value Measurements as of December 31, 2013
|
||||||||||||||
|
Total
|
|
Level
1 |
|
Level
2 |
|
Level
3 |
||||||||
|
(in millions)
|
||||||||||||||
Cash and cash equivalents
|
$
|
530.6
|
|
|
$
|
530.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total assets
|
$
|
530.6
|
|
|
$
|
530.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Fair Value Measurements as of December 31, 2012
|
||||||||||||||
|
Total
|
|
Level
1 |
|
Level
2 |
|
Level
3 |
||||||||
|
(in millions)
|
||||||||||||||
Cash and cash equivalents
|
$
|
416.8
|
|
|
$
|
416.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Jet fuel options
|
0.3
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
||||
Total assets
|
$
|
417.1
|
|
|
$
|
416.8
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
|
|
|
|
|
|
|
||||||||
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Jet Fuel Options
|
||
|
(in millions)
|
||
Balance at January 1, 2011
|
$
|
3.5
|
|
Total realized or unrealized gains (losses) included in earnings, net
|
4.2
|
|
|
Settlements, net
|
(7.4
|
)
|
|
Balance at December 31, 2011
|
0.3
|
|
|
Total realized or unrealized gains (losses) included in earnings, net
|
(0.2
|
)
|
|
Settlements, net
|
0.2
|
|
|
Balance at December 31, 2012
|
0.3
|
|
|
Total realized or unrealized gains (losses) included in earnings, net
|
0.1
|
|
|
Settlements, net
|
(0.4
|
)
|
|
Balance at December 31, 2013
|
$
|
—
|
|
17.
|
Operating Segments and Related Disclosures
|
|
2013
|
|
2012
|
|
2011
|
||||||
|
(in millions)
|
||||||||||
DOT—domestic
|
$
|
1,467.5
|
|
|
$
|
1,135.1
|
|
|
$
|
900.1
|
|
DOT—Latin America
|
186.9
|
|
|
183.3
|
|
|
171.1
|
|
|||
Total
|
$
|
1,654.4
|
|
|
$
|
1,318.4
|
|
|
$
|
1,071.2
|
|
18.
|
Initial Public Offering and Tax Receivable Agreement
|
|
|
Three Months Ended
|
||||||||||||||
|
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||
2013
|
|
|
|
|
|
|
|
|
||||||||
Operating revenue
|
|
$
|
370,437
|
|
|
$
|
407,339
|
|
|
$
|
456,625
|
|
|
$
|
419,984
|
|
Operating income
|
|
49,669
|
|
|
66,758
|
|
|
97,804
|
|
|
68,061
|
|
||||
Net income
|
|
30,554
|
|
|
42,068
|
|
|
61,103
|
|
|
43,193
|
|
||||
Basic earnings per share
|
|
0.42
|
|
|
0.58
|
|
|
0.84
|
|
|
0.59
|
|
||||
Diluted earnings per share
|
|
0.42
|
|
|
0.58
|
|
|
0.84
|
|
|
0.59
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
2012
|
|
|
|
|
|
|
|
|
||||||||
Operating revenue
|
|
$
|
301,495
|
|
|
$
|
346,308
|
|
|
$
|
342,317
|
|
|
$
|
328,268
|
|
Operating income
|
|
37,244
|
|
|
55,132
|
|
|
49,681
|
|
|
31,933
|
|
||||
Net income
|
|
23,419
|
|
|
34,591
|
|
|
30,884
|
|
|
19,566
|
|
||||
Basic earnings per share
|
|
0.32
|
|
|
0.48
|
|
|
0.43
|
|
|
0.27
|
|
||||
Diluted earnings per share
|
|
0.32
|
|
|
0.48
|
|
|
0.43
|
|
|
0.27
|
|
|
SPIRIT AIRLINES, INC.
|
||
Date: February 20, 2014
|
By:
|
/s/ B. Ben Baldanza
|
|
|
|
B. Ben Baldanza
|
|
|
|
President and Chief Executive Officer
|
Signature
|
Title
|
Date
|
|
|
|
/s/ B. Ben Baldanza
|
President and Chief Executive Officer (principal executive officer)
|
February 20, 2014
|
B. Ben Baldanza
|
|
|
/s/ Edward M. Christie
|
Chief Financial Officer (principal financial and accounting officer)
|
February 20, 2014
|
Edward M. Christie
|
|
|
/s/ H. McIntyre Gardner
|
Director (Chairman of the Board)
|
February 20, 2014
|
H. McIntyre Gardner
|
|
|
/s/ Carlton D. Donaway
|
Director
|
February 20, 2014
|
Carlton D. Donaway
|
|
|
/s/ David G. Elkins
|
Director
|
February 20, 2014
|
David G. Elkins
|
|
|
/s/ Robert D. Johnson
|
Director
|
February 20, 2014
|
Robert D. Johnson
|
|
|
/s/ Barclay G. Jones
|
Director
|
February 20, 2014
|
Barclay G. Jones
|
|
|
/s/ Stuart I. Oran
|
Director
|
February 20, 2014
|
Stuart I. Oran
|
|
|
/s/ Horacio Scapparone
|
Director
|
February 20, 2014
|
Horacio Scapparone
|
|
|
Exhibit No.
|
|
|
Description of Exhibit
|
|
|
||
3.1
|
|
|
Amended and Restated Certificate of Incorporation of Spirit Airlines, Inc., dated as of June 1, 2011, filed as Exhibit 3.1 to the Company's Current Report on Form 8-K dated June 1, 2011, is hereby incorporated by reference.
|
|
|
||
3.2
|
|
|
Amended and Restated Bylaws of Spirit Airlines, Inc., dated as of June 1, 2011, filed as Exhibit 3.2 to the Company's Current Report on Form 8-K dated June 1, 2011, is hereby incorporated by reference.
|
|
|
||
4.1
|
|
|
Specimen Common Stock Certificate, filed as Exhibit 4.1 to the Company's Form S-1 Registration Statement (No. 333-178336), is hereby incorporated by reference.
|
|
|
||
10.1+
|
|
|
General Release, dated January 14, 2014, between Spirit Airlines, Inc. and Ben Baldanza.
|
|
|
||
10.2+
|
|
|
Amended and Restated Employment Agreement, dated as of January 8, 2014, between Spirit Airlines, Inc. and Ben Baldanza.
|
|
|
||
10.3+
|
|
|
Offer Letter, dated September 7, 2013, between Spirit Airlines, Inc. and John Bendoraitis.
|
|
|
|
|
10.4†
|
|
|
Amended and Restated V2500 General Terms of Sale, dated as of October 1, 2013, by and between Spirit Airlines, Inc. and IAE International Aero Engines AG, as supplemented by Side Letter No. 1 dated as of October 1, 2013, filed as Exhibit 10.1 to the Company's Form 10-Q/A dated February 20, 2014, is hereby incorporated by reference.
|
|
|
||
10.5†
|
|
|
Amended and Restated Fleet Hour Agreement, dated as of October 1, 2013, by and between Spirit Airlines, Inc. and IAE International Aero Engines AG, as supplemented by Side Letter No. 1 dated as of October 1, 2013, filed as Exhibit 10.2 to the Company's Form 10-Q/A dated February 20, 2014, is hereby incorporated by reference.
|
|
|
||
10.6†
|
|
|
V2500 General Terms of Sale, dated as of October 1, 2013, by and between Spirit Airlines, Inc. and IAE International Aero Engines AG, as supplemented by Side Letter No. 1 dated as of October 1, 2013 and Side Letter No. 2 dated as of October 1, 2013, filed as Exhibit 10.3 to the Company's Form 10-Q/A dated February 20, 2014, is hereby incorporated by reference.
|
|
|
|
|
10.7†
|
|
|
Fleet Hour Agreement, dated of as October 1, 2013, by and between Spirit Airlines, Inc. and IAE International Aero Engines AG, as supplemented by Side Letter No. 1 dated as of October 1, 2013, filed as Exhibit 10.4 to the Company's Form 10-Q/A dated February 20, 2014, is hereby incorporated by reference.
|
|
|
|
|
10.8†
|
|
|
PurePower PW1100G Engine Purchase Support Agreement, dated as of October 1, 2013, by and between the Company and United Technologies Corporation, acting through its Pratt & Whitney Division, filed as Exhibit 10.5 to the Company's Form 10-Q dated October 30, 2013, is hereby incorporated by reference.
|
|
|
|
|
10.9†
|
|
|
Hosted Services Agreement, dated as of February 28, 2007, between Spirit Airlines, Inc. and Navitaire Inc., as amended by Amendment No. 1 dated as of October 23, 2007, Amendment No. 2 dated as of May 15, 2008, Amendment No. 3 dated as of November 21, 2008, Amendment No. 4 dated as of August 17, 2009 and Amendment No. 5 dated November 4, 2009, filed as Exhibit 10.3 to the Company's Amendment No. 4 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
||
10.10†
|
|
|
Signatory Agreement, dated as of May 21, 2009, between Spirit Airlines, Inc. and U.S. Bank National Association, as amended by First Amendment dated January 18, 2010, filed as Exhibit 10.4 to the Company's Amendment No. 4 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
||
10.11†
|
|
|
Terms and Conditions for Worldwide Acceptance of the American Express Card by Airlines, dated September 4, 1998, between Spirit Airlines, Inc. and American Express Travel Related Services Company, Inc., as amended January 1, 2003 and August 28, 2003, filed as Exhibit 10.6 to the Company's Amendment No. 4 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
||
10.12
|
|
|
Tax Receivable Agreement, dated as of June 1, 2011 between Spirit Airlines, Inc., Indigo Pacific Partners LLC, and OCM FIE, LLC, filed as Exhibit 10.12 to the Company's Form S-1 Registration Statement (No. 333-178336), is hereby incorporated by reference.
|
|
|
10.13†
|
|
|
Lease, dated as of June 17, 1999, between Sunbeam Development Corporation and Spirit Airlines, Inc., as amended by Lease Modification and Contraction Agreement dated as of May 7, 2009, filed as Exhibit 10.13 to the Company's Amendment No. 4 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
||
10.14††
|
|
|
Lease Modification and Extension Agreement, dated as of September 26th, 2013, between Sunbeam Development Corporation and Spirit Airlines, Inc.
|
|
|
|
|
10.15††
|
|
|
Lease, dated as of September 26th, 2013, between Sunbeam Development Corporation and Spirit Airlines, Inc.
|
|
|
|
|
10.16
|
|
|
Airline-Airport Lease and Use Agreement, dated as of August 17, 1999, between Broward County and Spirit Airlines, Inc., as supplemented by Addendum dated August 17, 1999, filed as Exhibit 10.14 to the Company's Amendment No. 3 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
||
10.17†
|
|
|
Airbus A320 Family Purchase Agreement, dated as of May 5, 2004, between AVSA, S.A.R.L. and Spirit Airlines, Inc.; as amended by Amendment No. 1 dated as of December 21, 2004, Amendment No. 2 dated as of April 15, 2005, Amendment No. 3 dated as of June 30, 2005, Amendment No. 4 dated as of October 27, 2006 (as amended by Letter Agreement No. 1, dated as of October 27, 2006, to Amendment No. 4 and Letter Agreement No. 2, dated as of October 27, 2006, to Amendment No. 4), Amendment No. 5 dated as of March 5, 2007, Amendment No. 6 dated as of March 27, 2007, Amendment No. 7 dated as of June 26, 2007 (as amended by Letter Agreement No. 1, dated as of June 26, 2007, to Amendment No. 7), Amendment No. 8 dated as of February 4, 2008, Amendment No. 9 dated as of June 24, 2008 (as amended by Letter Agreement No. 1, dated as of June 24, 2008, to Amendment No. 9) and Amendment No. 10 dated July 17, 2009 (as amended by Letter Agreement No. 1, dated as of July 17, 2009, to Amendment No. 10), and as supplemented by Letter Agreement No. 1 dated as of May 5, 2004, Letter Agreement No. 2 dated as of May 5, 2004, Letter Agreement No. 3 dated as of May 5, 2004, Letter Agreement No. 4 dated as of May 5, 2004, Letter Agreement No. 5 dated as of May 5, 2004, Letter Agreement No. 6 dated as of May 5, 2004, Letter Agreement No. 7 dated as of May 5, 2004, Letter Agreement No. 8 dated as of May 5, 2004, Letter Agreement No. 9 dated as of May 5, 2004, Letter Agreement No. 10 dated as of May 5, 2004 and Letter Agreement No. 11 dated as of May 5, 2004, all filed as Exhibit 10.15 to the Company's Amendment No. 4 to Form S-1 Registration Statement (No. 333-169474); as further amended by Amendment No. 11 dated as of December 29, 2011 (as amended by Letter Agreement No. 1 dated as of December 29, 2011, Letter Agreement No. 2 dated as of December 29, 2011, Letter Agreement No. 3 dated as of December 29, 2011, Letter Agreement No. 4 dated as of December 29, 2011, Letter Agreement No. 5 dated as of December 29, 2011, Letter Agreement No. 6 dated as of December 29, 2011, Letter Agreement No. 7 dated as of December 29, 2011 and Letter Agreement No. 8 dated as of December 29, 2011) all filed as Exhibit 10.1 to the Company's Form 8-K dated January 5, 2012; Amendment No. 12, dated as of June 29, 2012, filed as Exhibit 10.1 to the Company's Form 10-Q dated July 26, 2013; Amendment No. 13, dated as of January 10, 2013, filed as Exhibit 10.2 to the Company's Form 10-Q dated July 26, 2013; and Amendment No. 14, dated as of June 20, 2013, filed as Exhibit 10.3 to the Company's Form 10-Q dated July 26, 2013 is hereby incorporated by reference.
|
|
|
|
|
10.18+
|
|
|
Spirit Airlines, Inc. Executive Severance Plan, filed as Exhibit 10.16 to the Company's Amendment No. 3 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
|
|
10.19+
|
|
|
Amended and Restated Spirit Airlines, Inc. 2005 Stock Incentive Plan and related documents, filed as Exhibit 10.17 to the Company's Amendment No. 3 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
|
|
10.20+
|
|
|
Spirit Airlines, Inc. 2011 Equity Incentive Award Plan, filed as Exhibit 10.2 to the Company's Form S-8 Registration Statement (No. 333-174812), is hereby incorporated by reference.
|
|
|
|
|
10.21+
|
|
|
Offer Letter, dated September 10, 2007, between Spirit Airlines, Inc. and Thomas Canfield, filed as Exhibit 10.22 to the Company's Amendment No. 3 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
|
|
10.22
|
|
|
Form of Indemnification Agreement between Spirit Airlines, Inc. and its directors and executive officers, filed as Exhibit 10.24 to the Company's Amendment No. 3 to Form S-1 Registration Statement (No. 333-169474), is hereby incorporated by reference.
|
|
|
|
|
10.23+
|
|
|
Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the Spirit Airlines, Inc. 2011 Equity Incentive Award Plan, filed as Exhibit 10.4 to the Company's Form S-8 Registration Statement (No. 333-174812), is hereby incorporated by reference.
|
|
|
|
10.24†
|
|
|
Addendum and Amendment to the Agreement Governing Acceptance of the American Express Card by Airlines, dated as of June 24, 2011, by and between Spirit Airlines, Inc. and American Express Travel Related Services Company, Inc., filed as Exhibit 10.1 to the Company's Form 10-Q dated July 28, 2011, is hereby incorporated by reference.
|
|
|
|
|
10.25†
|
|
|
Second Amendment to Signatory Agreement, effective as of September 6, 2011, by and between the Company and U.S. Bank, National Association, filed as Exhibit 10.1 to the Company's Form 10-Q/A dated December 22, 2011, is hereby incorporated by reference.
|
|
|
|
|
10.26+
|
|
|
Letter Agreement, effective April 16, 2012, by and between Spirit Airlines, Inc. and Edward M. Christie, III, filed as Exhibit 10.2 to the Company's Form 10-Q dated May 1, 2012, is hereby incorporated by reference.
|
|
|
|
|
10.27+
|
|
|
Letter Agreement, dated January 16, 2012, by and between Spirit Airlines, Inc. and Jim Lynde
|
|
|
|
|
10.28+
|
|
|
Separation and Transition Agreement with Tony Lefebvre, dated April 29, 2013, filed as Exhibit 10.4 to the Company's Form 10-Q dated July 26, 2013, is hereby incorporated by reference.
|
|
|
|
|
14.1
|
|
|
Code of Business Conduct and Ethics, filed as Exhibit 14.1 to the Company's Form S-1 Registration Statement (No. 333-178336), is hereby incorporated by reference.
|
21.1
|
|
|
List of subsidiaries.
|
23.1
|
|
|
Consent of Ernst & Young LLP, independent registered public accounting firm.
|
31.1
|
|
|
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
|
|
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1**
|
|
|
Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS***
|
|
|
XBRL Instance Document.
|
101.SCH***
|
|
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL***
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF***
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB***
|
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE***
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
†
|
Confidential treatment granted for certain portions of this Exhibit pursuant to Rule 406 under the Securities Act or Rule 24b-2 under the Exchange Act, which portions are omitted and filed separately with the Securities and Exchange Commission.
|
††
|
Confidential treatment has been requested for certain portions of this Exhibit pursuant to Rule 406 under the Securities Act or Rule 24b-2 under the Exchange Act which portions are omitted and filed separately with the Securities and Exchange Commission.
|
+
|
Indicates a management contract or compensatory plan or arrangement.
|
**
|
Exhibit 32.1 is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall such exhibit be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise specifically stated in such filing.
|
***
|
XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not otherwise subject to liability under these Sections.
|
|
|
|
DATE: January 14, 2014
|
|
/s/ B. Ben Baldanza
|
|
|
B. Ben Baldanza
|
(i)
|
pay to Executive, in equal installments over a period of twenty-four (24) months and consistent with past payroll practices, an amount equal to two (2) times the greater of (i) Executive’s then current Base Salary, or (ii) Executive’s Base Salary on the date hereof (in each case without giving effect to any bonuses or fringe benefits to which Executive may be entitled);
|
(ii)
|
provide Executive with the health care benefits described in
Section 10
hereof; and
|
(iii)
|
provide Executive (and Executive’s spouse and dependants) a lifetime travel pass for Company’s flights, enabling Executive (and Executive’s spouse and dependants) to travel (free of charge) in any class of service that is available at the time of reservation;
|
(i)
|
in no event shall the Travel Pass become or be effective unless (A) at the time of termination of his employment, Executive was at least 60 years of age or had served in the position of Chief Executive Officer of the Company and/or President of the Company for at least ten years, and (B) Executive has executed and delivered to the Company an effective and irrevocable General Release in form and substance identical in all material respects to
Exhibit A
attached hereto;
|
(ii)
|
the Travel Pass shall automatically terminate on Executive’s death; and
|
(iii)
|
the Travel Pass shall automatically terminate if Executive, directly or indirectly, (A) owns, manages, controls, participates in, consults with, renders services for, or in any manner engages in any business competing with the business conducted by the Company or its subsidiaries at any time or (B) engages in conduct that impairs or injures the reputation of, or harms, the Company.
|
•
|
Lead the development of the overall strategic direction and business plan of Company by orchestrating an ongoing planning process which produces a clear and compelling corporate vision and mid- and long-term business objectives.
|
•
|
Based on the broad direction provided by the strategic plan, develop and gain approval for the Company’s annual business plan, operating plan, and operating budget.
|
•
|
Manage ongoing business and operating performance against the plans and budgets above, on a quarterly, monthly, weekly, and daily basis. Provide timely and accurate reporting on financial and operating results and other special projects and initiatives under his/her direction.
|
•
|
Develop and execute an organizational plan for all key functions under Executive as a function of the Company’s strategic and operating plans. Ensure that major functional “holes” in the organization are addressed and that appropriate succession plans are developed and implemented.
|
•
|
Provide strong and inspired leadership to the commercial and operating employees of Company, promoting and maintaining strong employee morale. Establish high expectations for all employees with regard to performance and adherence to Company values.
|
•
|
Play the lead role in evolving the corporate culture for the Company in a manner consistent with the business focus of the Company and shareholder return expectations.
|
•
|
Oversee the day-to-day operations of the Company, ensuring adherence to high levels of safety, cost control, customer service, on-time performance, and financial performance. Display, and act on, a real and ongoing concern for the delivery of outstanding customer service and operating integrity by probing into daily operating performance and spending time “in the field.”
|
•
|
Provide active leadership in the resolution of operational issues as they arise.
|
•
|
Ensure that the Company meets all government and corporate regulations and policies on an ongoing basis. Address potential deviations immediately.
|
•
|
Ensure that the Company has full emergency preparedness. Lead and manage the response process when and if emergencies occur.
|
•
|
Ensure that the Company develops and maintains, in the face of current and future competition, a compelling and differentiable customer value proposition that drives profitable traffic growth.
|
•
|
Ensure that the Company translates its customer value proposition into workable product and service attributes that can be easily and efficiently implemented in the field day-to-day.
|
•
|
Through advertising and promotion, ensure that the Company has a compelling, exciting, and effective approach to consumer marketing that communicates, and regularly refreshes its value proposition in the face of competition.
|
•
|
Working through the sales and distribution organization, drive product distribution through efficient online distribution channels at lowest possible cost.
|
•
|
Manage an effective media relations program to maximize the Company’s profile in target markets. Serve as the primary external ambassador for the Company.
|
•
|
Manage the overall relationship with the Board of Directors and the key investors in the company. Engage the Board in discussion and decision making on key strategic issues as they arise.
|
•
|
Manage relationships with senior representatives of various key constituents including employees, suppliers, various levels of government regulators, local communities, and suppliers.
|
1.
|
I HAVE READ IT CAREFULLY;
|
|
|
|
DATE: _____________,______
|
|
________________________________
|
|
|
B. Ben Baldanza
|
a.
|
Term
. Extend the term of the Lease thru January 31, 2025. .
|
b.
|
Rent
. To reflect the extension described in this Lease Modification and Extension Agreement, the rent schedule is hereby extended and revised as shown below:
|
c.
|
Bioterrorism
. To the extent applicable, Lessee shall comply with the registration requirements of the Public Health Security and Preparedness and Response Act of 2002, and shall provide Lessor with written proof of such compliance not less than annually.
|
d.
|
Move-Out Inspection
. Lessee shall give written notice to Lessor not less than thirty (30) days prior to the end of the term of this Lease for the express purpose of arranging a meeting with Lessor for a joint inspection of the Premises. At such meeting, Lessee and Lessor shall make a list of all repairs that are required to be made by Lessee, if any. In the event (i) Lessee does not
|
e.
|
Lessor’s Maintenance
. To clarify possible ambiguity in Lease Paragraph 25(b), Lessee and Lessor hereby agree that Lessor’s maintenance obligations include exterior lighting and exterior loading areas and exclude any interior lighting or interior loading areas.
|
f.
|
Exclusives
. A number of lessees and owners at Miramar Park of Commerce have exclusive use rights. Accordingly, Lessee shall not use the Premises for any of the uses described in Exhibit “1”.
|
g.
|
Air Conditioning
. *****.
|
LESSEE:
|
Spirit Airlines, Inc.
|
i.
|
Repairs or other work occasioned by fire, windstorm or other casualty of any nature or by the exercise of the right of eminent domain. Notwithstanding, uninsured repairs and replacements to landscaping and irrigation required due to fire, windstorm or other casualty shall be included in Lessee’s Proportionate Share of Expenses.
|
ii.
|
Leasing commissions, attorneys' fees, costs and disbursements and other expenses incurred in connection with (i) leasing negotiations, or (ii) with respect to disputes, settlements, compromises, collection actions or litigation with other tenants, concessionaires, occupants, prospective tenants, or mortgages or with vendors, agents, independent contractors and others, unless such settlements or other expenses relate to work done at the common area of the Complex and is otherwise not an excluded expense pursuant to this Paragraph 28(f).
|
iii.
|
Renovating or otherwise improving or decorating, painting or redecorating interior space for tenants, concessionaires and other occupants of the Complex.
|
iv.
|
Lessor's costs of electricity and other services and materials furnished to other tenants of the Complex.
|
v.
|
Costs incurred by Lessor for construction, alteration. or remodeling of the Building, the Complex, or the Common Area or any costs in accordance with sound accounting principles consistently applied considered to be capital improvements or replacements, unless such capital improvements or replacements are done to lower operating costs, in which event such capital cost shall be amortized over the longest period allowed by Generally Accepted Accounting Principles (GAAP) to the extent of such savings.
|
vi.
|
Depreciation or amortization, bad debts, or reserves of any kind, including replacement reserves and reserves for bad debts or lost rent.
|
vii.
|
Interest, penalties, principal payments, late fees, default interest. and other costs and expenses with respect to debt or amortization payments on any mortgages on any part of the Building, and/or the Complex, rental under any ground lease or underlying leases, or payments in the nature of a return on or of equity of any kind.
|
viii.
|
Costs incurred due to a violation by Lessor or any tenant of the terms and conditions of any lease.
|
ix.
|
Fines, penalties and any other costs incurred due to any violation by Lessor or any tenant, of any governmental code, regulation, and/or rule, and/or the terms of a lease.
|
x.
|
Fees and costs paid to subsidiaries or affiliates of Lessor for services on or to the Building or the Complex in excess of market rates.
|
xi.
|
Lessor's general, corporate overhead, general administrative expenses, travel and entertaining, and administrative expenses not specifically incurred in the operation of the Building or Complex; any compensation paid to clerks, tenants or other persons in commercial concessions operated by Landlord. xii. Wages, salaries and other compensation (including employee benefits) of all personnel, to the extent that they are involved in leasing space in the Complex and of all management personnel who are above the grade of general manager, and of their respective
|
xiii.
|
Rentals and other related expenses incurred in leasing air-conditioning systems, elevators or other equipment ordinarily considered to be of a capital nature.
|
xiv.
|
All items and services for which any occupant or tenant of the Complex directly reimburses Lessor.
|
xvi.
|
Charitable-type and political contributions of Lessor.
|
xvii.
|
Cost and maintenance of paintings, sculptures or other art work leased and/or purchased for display in the Building or on the Complex.
|
xviii.
|
Cost of office space occupied by Lessor, its agents, employees or independent contractors for leasing or for other purposes other than property management activities.
|
xix.
|
Any other expense which under sound accounting principles consistently applied, would not be considered as reasonable management, security, maintenance or other operating expense.
|
xx.
|
Any concessions including but not limited to rent abatement, construction of improvements or other use granted by Lessor in favor of any occupant or tenant of the Complex.
|
xxi.
|
Any legal, accounting or other professional fees incurred by Lessor in connection with any mortgage indebtedness or underlying lease transactions including disputes between any persons holding such mortgage indebtedness or lease(s), refinancing costs, income or corporate taxes, capital gains taxes, inheritance taxes, taxes on rents or gross receipts (other than sales or use taxes), penalties and/or interest on late payments, consulting fees and personnel costs relating to capital expenditures, market study fees and costs, appraisals, structural repairs and replacements and any other fees, costs and expenses which are not applicable to the repair, replacement, maintenance, operation and/or security of the Complex.
|
xxii.
|
The cost of any capital repairs, alterations, additions, changes, replacements and other capital cost items required by any law or governmental regulation imposed after the date of this Lease.
|
(1)
|
Notice of Commencement
. File a Notice of Commencement with Broward County and provide Lessor with a copy of same;
|
(2)
|
Subcontracts
. Enter into a contract with its contractor and/or other persons who will do the work and install the equipment referred to, which contract will provide, among other things, that said work shall be done and equipment installed in a good workmanlike manner in accordance with the plans and specifications previously approved and consents, authorizations, and licenses previously obtained and which contract shall provide that the contractor, subcontractor, or other person referred to above will look solely to Lessee for payment and will hold Lessor and the premises free from all liens and claims of all persons furnishing labor or materials therefor, and will also provide that similar waivers of the rights to file liens shall be obtained from any and all said contractors or materialmen. A copy of said contract, together with a duly executed waiver of the right to file liens executed by the contractor, subcontractor, or other persons referred above, shall be furnished to Lessor as a condition of Lessor approving such alterations or installations.
|
(3)
|
Indemnification
. Indemnify and save Lessor harmless against any and all bills for labor performed and equipment, fixture, and materials furnished to Lessee in connection with said work as aforesaid and against any and all liens, bills or claims therefore or against the premises and from and against all loss, damages, costs, expenses, suits, claims, and demands related to such work.
|
(4)
|
Insurance.
Lessee and/or all contractors which Lessee employs shall procure and maintain at Lessee's and/or Lessee's contractors' own cost and expense insurance against claims under Workman Compensation Acts with limits of ***** for Employers Liability Insurance.
|
(5)
|
Inspections
. Lessor shall have the right to place its supervisory personnel or representatives on the job during the course of construction, at Lessor's expense, for the purpose of making inspections and insuring that Lessee and Lessee's contractors, suppliers, and materialman comply with these conditions.
|
(6)
|
Impact Fees
. In the event Lessee’s alterations to the Premises cause the City of Miramar to assess impact fees, Lessee shall be solely responsible for paying same. (In particular, Lessee acknowledges that the addition of plumbing fixtures may result in water and sewer impact fees being assessed by the City and that such fees shall be Lessee’s sole responsibility to pay.
|
•
|
Furniture
|
•
|
Cabinetry
|
•
|
Phone and data wiring
|
•
|
Phone Switch
|
•
|
Fire Alarm System
|
•
|
Security System
|
•
|
Computers and other equipment that is not attached to the Premises
|
•
|
Shelving
|
•
|
Racks
|
•
|
Scissor gates at overhead doors
|
•
|
Dock lights at overhead doors
|
•
|
Generator and fuel tank(s)
|
•
|
UPS and other backup power systems
|
(1)
|
Registration Statement (Form S-3 No. 333-182954) of Spirit Airlines, Inc. and the related Prospectus, and
|
(2)
|
Registration Statement (Form S-8 No.333-174812) pertaining to the Amended and Restated 2005 Incentive Stock Plan and the 2011 Equity Incentive Award Plan of Spirit Airlines, Inc.;
|
Date: February 20, 2014
|
/s/ B. Ben Baldanza
|
|
B. Ben Baldanza
|
|
President and Chief Executive Officer
|
Date: February 20, 2014
|
/s/ Edward M. Christie
|
|
Edward M. Christie
|
|
Senior Vice President and
|
|
Chief Financial Officer
|
(i.)
|
the Annual Report on Form 10-K of the Company for the year ended December 31, 2013 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
|
(ii.)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: February 20, 2014
|
/s/ B. Ben Baldanza
|
|
B. Ben Baldanza
|
|
President and Chief Executive Officer
|
|
|
Date: February 20, 2014
|
/s/ Edward M. Christie
|
|
Edward M. Christie
|
|
Senior Vice President and
|
|
Chief Financial Officer
|