Document:

Exhibit 4.17

 

EXECUTION COPY

 

(Multicurrency – Cross Border)

 

ISDAÒ

 

International Swaps and Derivatives
Association, Inc.

 

SCHEDULE

to the

Master
Agreement

 

dated as of March 24, 2004

 

between

 

	
  Morgan
  Stanley Capital Services Inc., a  corporation organized under the laws of the State of
  Delaware

  (“Party A”)

  	
   

  	
  and

  	
   

  	
  Wilmington Trust Company, a Delaware banking corporation, in
  its capacity as Subordination Agent on behalf of the Trustee under the Pass
  Through Trust Agreement dated as of the date hereof between Wilmington Trust
  Company and JetBlue Airways Corporation with respect to the JetBlue Airways
  Pass Through Trust, Series 2004-1C-O (for purposes of this agreement only,
  the “Class C Trust Agreement”)

  (“Party
  B”)

  

 

Part 1

Termination
Provisions

 

(a)                                  Specified
Entity.  None.

 

(b)                                  Specified
Transaction.  Specified Transaction
will have the meaning specified in Section 14.

 

(c)                                  Events
of Default.  The “Events of Default”
set forth in Section 5(a) will not apply to Party B but will apply to Party A
(subject to clause (d) below).

 

(d)                                  Cross
Default.  The “Cross Default”
provision of Section 5(a)(vi) will not apply.

 

(e)                                  Termination
Events.  The “Illegality” provisions
of Section 5(b)(i), the “Tax Event” provisions of Section 5(b)(ii), the “Tax
Event Upon Merger” provisions of Section 5(b)(iii) and the “Credit Event Upon
Merger” provisions of Section 5(b)(iv) will apply to Party A but will not apply
to Party B. Party A shall be the sole Affected Party (under Section 5(b)(i),
(ii) and 5(b)(iv)) and the sole Burdened Party (under Section 5(b)(iii)) with
respect to a Termination Event.

 

(f)                                    Credit Event Upon Merger.  The “Credit Event Upon Merger” provisions in
Section 5(b)(iv)

 

 

are hereby amended by: (I) deleting in the fourth line
thereof the words “another entity” and replacing them with the words “or
reorganizes, incorporates, reincorporates, reconstitutes, or reforms into or as, or receives all
or substantially all of the assets and/or liabilities or obligations of,
another entity or X, such Credit Support Provider, or such Specified Entity, as
the case may be,”; (II) deleting in the fifth line thereof the words “the
resulting, surviving or transferee” and replacing them with the words “X, such
Credit Support Provider, or such Specified Entity, as the case may be, or any
resulting, surviving, transferee, reorganized, reconstituted or reformed”; and
(III) deleting in the seventh line thereof the words “its successor or
transferee” and replacing them with the words “any resulting, surviving,
transferee, reorganized, reconstituted or reformed entity”.

 

(g)                                 Automatic
Early Termination.  The “Automatic
Early Termination” provision of Section 6(a) will not apply.

 

(h)                                 Right to Terminate Following Termination
Event.  Sections
6(b)(ii)-(iv) are deleted in their entirety and replaced by the following:

 

“(ii)  Replacement on Termination Event.  Upon the occurrence of a Termination Event
(other than an Additional Termination Event) with respect to Party A, Party A
shall have the right within 20 days of the date of such Termination Event, at
its own expense, to arrange for one or more Replacement Above-Cap Liquidity
Providers to enter into and deliver to Party B a Replacement Above-Cap
Liquidity Facility for such Above-Cap Liquidity Facility. If Party A does not
arrange for such replacement and if the Above-Cap Liquidity Facility has not
otherwise been replaced by JetBlue Airways Corporation (at the expense of
JetBlue Airways Corporation) in accordance with the terms of Section 3.6(c)(ii)
of the Intercreditor Agreement, such 20th day (or if such 20th
day is not a Business Day, the next succeeding Business Day) shall be deemed to
be an “Early Termination Date” and Party A shall make a termination payment to
Party B in accordance with Part 1(j) of this Schedule.  For the avoidance of doubt, Party B shall
have no right to designate an Early Termination Date following the occurrence
of any Termination Event.

 

(i)                                    Calculations.
The “Payment Date”
provisions in Section 6(d)(ii) are deleted in their entirety and replaced by
the following:

 

“The Termination Amount
calculated as being due in respect of any Early Termination Date under Section
6(e) will be payable on such Early Termination Date.”

 

(j)                                    Payments on
Early Termination.  Section
6(e) is deleted in its entirety and replaced with the following:

 

“Upon the occurrence or designation of an Early
Termination Date with respect to the Transaction evidenced by the Confirmation,
Party A shall make a termination payment to Party B on the Early Termination
Date in an amount equal to the “Termination Amount” for the Early Termination
Date for credit to the Above-Cap Reserve Account (as provided in Section 3.6(f)
of the Intercreditor Agreement) to be applied as set forth in said Section
3.6(f) plus all Unpaid Amounts due and payable by Party A under the
Confirmation on or prior to the Early Termination Date and upon such payments
the Transaction evidenced by the Confirmation shall terminate.

 

2

 

“Termination Amount” means, for any Early
Termination Date, the amount obtained by solving the following formula for TA:

 

TA =                  (20% per annum -
CR) x N x F

 

where

 

CR =                    the Cap Rate
designated in the Confirmation

 

N =                           the
Notional Amount for such date

 

F =
0.256

 

For the avoidance of doubt, the Termination Amount
shall not exceed US$3,809,402.88 at any time.”

 

(k)                                Termination
Currency.  “Termination Currency” means United States Dollars.

 

(l)                                    Additional
Termination Event.  Additional
Termination Event will apply solely as specified in the Confirmation.

 

(m)                              Limitations
on Conditions Precedent. 
Notwithstanding Section 2(a), the obligation of Party A to make
each payment specified in the Confirmation, so long as it shall remain in
effect, shall not be subject to any conditions precedent, and, without limiting
the foregoing, Party A agrees that it will make each such payment without
offset, counterclaim or defense.

 

 

Part 2

Tax
Representations

 

(a)                                  Payer
Tax Representations.  For the
purpose of Section 3(e), Party A and Party B each make the following representation:

 

It is not required by any applicable law, as modified
by the practice of any relevant governmental revenue authority, of any Relevant
Jurisdiction to make any deduction or withholding for or on account of any Tax
from any payment (other than interest under Section 2(e) or 6(e)) to be made by
it to the other party under this Agreement. In making this representation, it
may rely on:

 

(i)                                     the
accuracy of any representation made by the other party pursuant to
Section 3(f);

 

(ii)                                  the
satisfaction of the agreement of the other party contained in Section 4(a)(i)
or 4(a)(iii) and the accuracy and effectiveness of any document provided by the
other party pursuant to Section 4(a)(i) or 4(a)(iii); and

 

(iii)                               the
satisfaction of the agreement of the other party contained in Section 4(d);

 

provided that it shall not be a breach of this
representation where reliance is placed on clause (ii), and the other party
does not deliver a form or document under Section 4(a)(iii) by reason of
material prejudice to its legal or commercial position.

 

(b)                                  Payee
Tax Representations. For the purpose of Section 3(f),

 

3

 

(i)                                     Party
A represents that it is a corporation organized under the laws of the State of
Delaware.

 

(ii)                                  Party
B represents that it is a Delaware banking corporation.

 

 

Part 3

Agreement
to Deliver Documents

 

For the purpose of
Section 4(a)(ii) of this Agreement, each party agrees to deliver the following
documents, as applicable:

 

	
  Party
  required to

  deliver documents

  	
   

  	
  Form/Document/

  Certificate

  	
   

  	
  Date by which to be

  delivered

  	
   

  	
  Covered by

  Section 3(d)

  Representation

  
	
  Party A and
  Party B

  	
   

  	
  Evidence
  reasonably satisfactory to the other party as to the names, true signatures
  and authority of the officer or officials signing this Agreement or the
  Confirmation on its behalf

  	
   

  	
  Upon execution
  of this Agreement and the related Confirmation

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Party A

  	
   

  	
  A copy of the
  annual report for Party A containing audited and certified financial
  statements for the most recently ended financial year

  	
   

  	
  Upon request, as
  soon as publicly available

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Party A

  	
   

  	
  Opinions of
  counsel to Party A and its Credit Support Provider reasonably
  satisfactory in form and substance to Party B with respect to this
  Agreement and the Credit Support Document specified in Part 4(e)

  	
   

  	
  Upon execution
  of this Agreement

  	
   

  	
  No

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Party B

  	
   

  	
  Certified copies
  of all documents evidencing the necessary corporate authorizations and
  approvals with respect to the execution, delivery, and performance of derivatives
  transactions

  	
   

  	
  Upon execution
  of this Agreement

  	
   

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Party A

  	
   

  	
  Correct,
  complete and executed U.S. Internal Revenue Form W-9 or any successor thereto

  	
   

  	
  Upon execution
  of this Agreement, upon the appointment of a successor Subordination Agent, and
  at any time upon reasonable request by Party B

  	
   

  	
  Not applicable

  

 

4

 

	
  Party B

  	
   

  	
  Correct,
  complete and executed U.S. Internal Revenue Form W-9 or any successor thereto

  	
   

  	
  Upon execution
  of this Agreement, upon the appointment of a successor Subordination Agent,
  and at any time upon reasonable request by Party A

  	
   

  	
  Not applicable

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Party A

  	
   

  	
  Credit Support
  Document specified in Part 4(e)

  	
   

  	
  Upon execution
  of this Agreement

  	
   

  	
  Yes

  

 

Part 4

Miscellaneous

 

(a)                                  Addresses for Notices.  For the purpose of Section 12(a):

 

(i)                                     Address
for notices or communications to Party A (including all notices pursuant to
Sections 5, 6 and 7 as well as any changes to Party B’s address, telephone
number or facsimile number):

 

	
  Address:

  	
   

  	
  Morgan Stanley
  Capital Services Inc.

  
	
   

  	
   

  	
  Transaction
  Management Group

  
	
   

  	
   

  	
  1585 Broadway

  
	
   

  	
   

  	
  New York,
  NY  10036-8293

  
	
  Attention:

  	
   

  	
  Chief Legal
  Officer

  
	
  Facsimile:

  	
   

  	
  212-507-4622

  

 

(ii)                                  Address
for notices or communications to Party B:

 

	
  Address:

  	
   

  	
  Wilmington Trust
  Company

  
	
   

  	
   

  	
  Rodney Square
  North

  
	
   

  	
   

  	
  1100 North
  Market Street

  
	
   

  	
   

  	
  Wilmington,
  Delaware 19890-0001

  
	
  Attention:

  	
   

  	
  Corporate Trust
  Administration

  
	
  Telephone:

  	
   

  	
  302-651-1000

  
	
  Facsimile:

  	
   

  	
  302-636-4140

  

 

(b)                                  Offices.  The provisions of Section 10(a) will apply to this
Agreement.

 

(c)                                  Multibranch
Party.  For the purpose of Section
10(c):

 

Party A is not a Multibranch Party.

Party B is not a Multibranch Party.

 

(d)                                  Calculation
Agent.  The Calculation Agent is
Party A, provided that if Party B disagrees with respect to any calculation or
determination, Party A and Party B each will appoint an independent Reference
Market-maker, and such two Reference Market-makers jointly will appoint a third
Reference Market-maker. Such three Reference Market-makers jointly will make such
calculation or determination (acting as experts and not as arbitrators), whose
calculation or determination will

 

5

 

be binding and conclusive absent manifest error.  In addition, if an Event of Default with
respect to Party A has occurred and is continuing, Party B may appoint one of
the following five entities as Calculation Agent: JP Morgan Chase, UBS AG, Bank
of America, N.A., Deutsche Bank AG or Citibank, N.A.

 

(e)                                  Credit Support Documents.  Party
A shall deliver an unconditional and irrevocable guarantee dated as of March
24, 2004 from Morgan Stanley with respect to Party A’s obligations under this
Transaction for the benefit of Party B and such guarantee shall be a Credit
Support Document with respect to Party A.

 

With respect to Party B: None.

 

(f)                                    Credit
Support Provider.

 

Credit Support Provider means in relation to Party A:
Morgan Stanley.

 

Credit Support Provider means in relation to Party B:
None.

 

(g)                                 Governing
Law.  This Agreement and each Confirmation
will be governed by and construed in accordance with the laws of the State of
New York.

 

(h)                                 Jurisdiction.  Section 13(b) is hereby amended by: (i)
deleting in the second line of subparagraph (i) thereof the word “non-”; and
(ii) deleting the final paragraph thereof.

 

(i)                                    Netting
of Payments. The Netting provision
set forth in Section 2(c) will not apply to any Transaction.

 

(j)                                    Affiliate.  Affiliate will have the meaning
specified in Section 14, provided
that the definition of Affiliate in relation to Party A does not include Morgan
Stanley Derivative Products, Inc.

 

(k)                                Covered Transaction.
The Transaction evidenced by the Confirmation dated the
date of this Agreement (Reference Number: KQAUS) will constitute the only
Transaction and Confirmation supplementing, forming part of, and subject to,
this Agreement.

 

Part 5

Other
Provisions

 

(a)                                  Definitions.  This Agreement and the Transaction between
the parties are subject to the 2000 ISDA Definitions and Annex to the 2000 ISDA
Definitions (June 2000 Version) as published by the International Swaps and
Derivatives Association, Inc. (collectively, the “Definitions”), and will be
governed in all relevant respects by the provisions set forth in the
Definitions, without regard to any amendment to the Definitions subsequent to
the date hereof. The provisions of the Definitions are incorporated by
reference in and shall be deemed a part of this Agreement, except that
references in the Definitions to a “Swap Transaction” shall be deemed
references to a “Transaction” for purposes of this Agreement. In the event of
any inconsistency between the provisions of this Agreement and the Definitions,
this Agreement will prevail. 
“Intercreditor Agreement” as used in this Agreement shall mean the
Intercreditor Agreement dated as of March 24, 2004 among Wilmington Trust
Company, as Trustee under the JetBlue Airways Pass Through Trust 2004–1G-1,
JetBlue Airways Pass Through Trust 2004–1G–2 and JetBlue Airways Pass Through
Trust 2004–1C, Landesbank Hessen-Thüringen Girozentrale, as Class G–1 Primary

 

6

 

Liquidity Provider, Class G–2 Primary Liquidity
Provider and Class C Primary Liquidity Provider, Morgan Stanley Capital
Services Inc. as Class G–1 Above-Cap Liquidity Provider, Class G–2 Above-Cap
Liquidity Provider and Class C Above-Cap Liquidity Provider, MBIA Insurance
Corporation as Policy Provider and Wilmington Trust Company as Subordination
Agent, attached hereto as Exhibit A. 
Capitalized terms used and not defined herein, the Confirmation, or the
Definitions shall have the meanings set forth in the Intercreditor Agreement,
as amended or modified from time to time in accordance with the terms thereof.

 

(b)                                  Relationship
Between Parties.  Each party will be
deemed to represent to the other party on the date on which it enters into the
Transaction that (absent a written agreement between the parties that expressly
imposes affirmative obligations to the contrary for that Transaction):

 

(i)                                     Non-Reliance.  It is acting for its own account, and it has made its
own independent decisions to enter into the Transaction and as to whether the
Transaction is appropriate or proper for it based upon its own judgment and
upon advice from such advisers as it has deemed necessary.  It is not relying
on any communication (written or oral) of the other party as investment advice
or as a recommendation to enter into the Transaction; it being understood that
information and explanations related to the terms and conditions of the
Transaction shall not be considered investment advice or a recommendation to
enter into the Transaction.  No communication (written or oral) received
from the other party shall be deemed to be an assurance or guarantee as to the
expected results of the Transaction.

 

(ii)                                  Assessment and
Understanding.  It is capable of assessing the merits of and understanding
(on its own behalf or through independent professional advice), and understands
and accepts, the terms, conditions and risks of the Transaction.  It is
also capable of assuming, and assumes, the risks of the Transaction

 

(iii)                               Status of Parties.  The other party is not
acting as a fiduciary for or an adviser to it in respect of the Transaction.

 

(c)                                  WAIVER
OF JURY TRIAL.  EACH PARTY HEREBY
WAIVES ITS RESPECTIVE RIGHT TO JURY TRIAL WITH RESPECT TO ANY LITIGATION
ARISING UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR THE TRANSACTION.

 

(d)                                  Non-petition.  Party A agrees that it will not, prior to
the date that is one year and one day following the final payment of the Certificates,
acquiesce, petition or otherwise invoke or cause, or join in invoking or
causing, Party B or any other person or entity to invoke the process of any
governmental authority for the purpose of commencing or sustaining a case
(whether voluntary or involuntary) against Party B under any bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of Party B or
any substantial part of its property or ordering the winding-up or liquidation
of the affairs of Party B, provided,
however, that nothing herein shall restrict or prohibit Party A from
joining in any existing bankruptcy, reorganization, arrangement, insolvency,
moratorium or liquidation proceedings or other analogous proceedings under
applicable laws.

 

(e)                                  Waiver of Right of Set-off. Notwithstanding any provision of this
Agreement, the Confirmation or any other existing or future agreement between
the parties hereto, each party irrevocably waives any and all rights it may
have to set-off, net, recoup or otherwise withhold or suspend or condition
payment or performance of any obligation between the two parties hereunder
against any obligations between the two parties, whether arising under any
agreement, applicable law or otherwise.

 

7

 

(f)                                    Amendments.  This Agreement is hereby further amended as
follows:

 

(1)                                  Section
2(b) is hereby amended by the insertion of the following at the end thereof
after the word “change”: “provided that if such new account shall not be in the
same jurisdiction having the same power to tax as the original account, the
party not changing its account shall not be obliged to pay any greater amounts
and shall not receive less as a result of such change than would have been the
case if such change had not taken place.”

 

(2)                                  Section
2(d) is amended by adding thereto a new final sentence reading as follows:
“Anything in this Section 2(d) to the contrary notwithstanding, Party B shall
not be obligated to make any payment under this Section 2(d) to Party A”.

 

(3)                                  Section
7 is amended by adding a new penultimate sentence to Section 7 as follows: “Any
purported transfer under this Section 7 shall require Ratings Confirmation”.

 

(4)                                  Section
9(b) is amended by adding thereto a new sentence reading as follows: “In
addition, no amendment, modification or waiver in respect of this Agreement
will be effective unless Ratings Confirmation is received.”

 

(g)                                 Limitation
of Liability.  The obligations of
Party B under this Agreement, and in respect of the Transaction evidenced by
the Confirmation, are expressly limited to the extent of funds, if any, made
available for such payment to Party B under, and in accordance with, the
priorities of payments set forth in Sections 3.2 and 3.6 of the Intercreditor
Agreement. No recourse under any obligation, covenant or agreement of Party B
contained in this Agreement or the Confirmation shall be had against any
incorporator, stockholder, agent, affiliate, officer, employee or trustee of
Party B, as such, by the enforcement of any assessment or by any legal or
equitable proceeding, by virtue of any statute or otherwise; it being expressly
agreed and understood that the agreements of Party B contained in this
Agreement or the Confirmation are solely trust obligations of Party B and that
no personal liability whatsoever shall attach to or be incurred by the
incorporators, stockholders, agents, affiliates, officers, employees or
trustees of Party B, as such, or any of them, under or by reason of any of the
obligations, covenants or agreements of Party B contained in this Agreement or
the Confirmation and that any and all personal liability of every such
incorporator, stockholder, agent, affiliate, officer, employee or trustee of
Party B for breaches by Party B of any such obligation, covenant or agreement,
which liability may arise either at common law or at equity, by statute or
constitution, or otherwise, is hereby expressly waived as a condition of and in
consideration for the execution of this Agreement; provided, however,
that nothing in this paragraph shall relieve any of the foregoing persons from
any liability which any such person may otherwise have for his/her or its gross
negligence or willful misconduct or, with respect to the handling or transfer
of funds, ordinary negligence.

 

(h)                                 Eligible Contract Participant.  Each
party represents to the other that it is an “eligible contract participant” as defined in
Section 1a(12) of the Commodity Exchange Act of 1922 (7 U.S. Code §1 et seq.) as amended (“CEA”). This
Agreement and the Transaction hereunder are subject to individual negotiation
by the parties. Neither this Agreement nor the Transaction hereunder has been
executed or traded on a “trading facility” as defined in Section 1a(33) of the
CEA.

 

(i)                                    Accuracy
of Specified Information.  Section 3(d) is
hereby amended by adding in the third line thereof after the word “respect” and
before the period the words “or, in the case of audited or unaudited financial
statements or balance sheets, a fair representation of the financial condition
of the relevant person.”

 

8

 

[Signatures follow on separate page]

 

9

 

IN WITNESS WHEREOF the parties have executed this
Schedule to the ISDA Master Agreement on the respective dates specified below
with effect from the date specified on the first page of this document.

 

 

	
   

  	
  MORGAN
  STANLEY CAPITAL SERVICES INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nina C.
  Simmons

  
	
   

  	
  Name:

  	
  Nina C. Simmons

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
  Date:

  	
  March 24, 2004

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WILMINGTON
  TRUST COMPANY

  
	
   

  	
  in its capacity
  as Subordination Agent on behalf of the Trustee under the Class C Trust
  Agreement.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kathleen A.
  Pedelini

  
	
   

  	
  Name:

  	
  Kathleen A.
  Pedelini

  
	
   

  	
  Title:

  	
  Financial
  Services Officer

  
	
   

  	
  Date:

  	
  March 24, 2004

  

 

10

 

Exhibit A

 

Intercreditor Agreement

 

11Exhibit
4.18

 

EXECUTION
COPY

 

 

	
  Date:

  	
   

  	
  March
  24, 2004

  
	
   

  	
   

  	
   

  
	
  To:

  	
   

  	
  Wilmington
  Trust Company

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  Morgan
  Stanley Capital Services Inc.

  
	
   

  	
   

  	
   

  
	
  Subject:

  	
   

  	
  CLASS G – 1 ABOVE CAP LIQUIDITY FACILITY CONFIRMATION

  

 

 

Reference
Number: KQAUQ

 

 

Ladies
and Gentlemen:

 

The purpose of this
letter agreement (this “Confirmation”) is to confirm the terms and
conditions of the Interest Rate Cap Transaction entered into on the Trade Date
referred to in Paragraph 2 below (the “Transaction”) between Morgan
Stanley Capital Services Inc. (“Party A”) and Wilmington Trust Company
in its capacity as Subordination Agent on behalf of the Trustee under the Pass
Through Trust Agreement dated as of the date hereof between Wilmington Trust
Company and JetBlue Airways Corporation, with respect to the JetBlue Airways
Pass Through Trust, Series 2004–1G–1–O (“Party B”). This letter
agreement constitutes a “Confirmation” as referred to in the ISDA Master
Agreement specified below.

 

1.                                       The
definitions and provisions contained in the 2000 ISDA Definitions and Annex to
the 2000 ISDA Definitions (June 2000 Version) as published by the International
Swaps and Derivatives Association, Inc. (as so supplemented, the “Definitions”)
are incorporated into this Confirmation. 
In the event of any inconsistency between the Definitions and this
Confirmation, this Confirmation will govern. References herein to a
“Transaction” shall be deemed to be references to a “Swap Transaction” for the
purposes of the Definitions.

 

This
Confirmation supplements, forms a part of, and is subject to the 1992 ISDA
Master Agreement (Multicurrency – Cross Border) including the Schedule thereto,
dated as of March 24, 2004  as
amended and supplemented from time to time (collectively, the “Agreement”),
between us.  All provisions contained in
the Agreement govern this Confirmation except as modified below. In the event
of any inconsistency between the Agreement and this Confirmation, this
Confirmation will govern. Capitalized terms not otherwise defined in the
Agreement or this Confirmation shall have the meanings ascribed to them in the
Intercreditor Agreement dated as of March 24, 2004  among Wilmington Trust Company, as Trustee under
the JetBlue Airways Pass Through Trust 2004–1G–1, JetBlue Airways Pass Through
Trust 2004–1G 2 and JetBlue Airways Pass Through Trust 2004–1C, Landesbank
Hessen-Thüringen Girozentrale, as Class G–1
Primary Liquidity Provider, Class G–2 Primary Liquidity Provider and Class C
Primary Liquidity Provider,  Morgan
Stanley Capital Services Inc. as Class G–1 Above-Cap Liquidity Provider, Class
G–2 Above-Cap Liquidity Provider and Class C Above-Cap Liquidity Provider, MBIA
Insurance Corporation, as Policy Provider, and Wilmington Trust Company, as

 

1

 

Subordination
Agent (the “Intercreditor Agreement”). The Agreement and each
Confirmation will be governed by and construed in accordance with the laws of
the State of New York.

 

Each
of Party A and Party B represents to the other that it has entered into this
Transaction in reliance upon such independent accounting, regulatory, legal,
tax and financial advice as it deems necessary and not upon any view expressed by the other.

 

2.                                       Party
A and Party B by this Confirmation are entering into a Transaction (the “Above
Cap Liquidity Facility”) that provides an irrevocable interest rate
cap.  The terms of the Above Cap
Liquidity Facility are as follows:

 

	
  General
  Terms:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Transaction
  Type:

  	
   

  	
  Interest
  Rate Cap Transaction

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Notional
  Amount:

  	
   

  	
  The
  Pool Balance for the Class G-1 Certificates from time to time.  The Notional Amount as of any Floating
  Rate Payer Payment Date shall be determined before giving effect to any
  distributions on such Class G-1 Certificates on such Floating Rate Payer
  Payment Date.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Trade
  Date:

  	
   

  	
  March 18, 2004

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Effective
  Date:

  	
   

  	
  March 24, 2004

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Termination
  Date:

  	
   

  	
  The
  first Business Day following the earlier of (i) June 15, 2015 and (ii) the
  date on which payment in full of Final Distributions with respect to the
  Class G-1 Certificates has been made.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Currency
  Unit:

  	
   

  	
  USD

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Business
  Day/Local Business Day:

  	
   

  	
  “Business Day” as
  defined in the Intercreditor Agreement for all purposes under the Agreement.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Business
  Day Convention:

  	
   

  	
  Following

  
	
   

  	
   

  	
   

  	
   

  
	
  Fixed
  Amounts:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Fixed
  Amount Payer:

  	
   

  	
  Party
  B

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Fixed
  Amount Payer Payment Date:

  	
   

  	
  Effective Date

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Fixed
  Amount:

  	
   

  	
  As
  set forth in a separate letter agreement between Party A and Party B.

  
	
   

  	
   

  	
   

  	
   

  
	
  Floating
  Amounts:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Floating
  Rate Payer:

  	
   

  	
  Party
  A

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Floating
  Amount:

  	
   

  	
  On
  each Floating Rate Payer Payment Date on which (i) the Floating Rate Option
  exceeds the Cap Rate and (ii) a Drawing 

  

 

2

 

	
   

  	
   

  	
   

  	
  Event
  (as defined below) has occurred, the Floating Amount shall be calculated as
  follows:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  In
  the event that either (a) the Available Amount under the Primary Liquidity
  Facility (before giving effect to any Interest Drawing to be made on such
  Payment Date) is greater than zero or (b) the amount on deposit in the Primary
  Cash Collateral Account (before giving effect to any withdrawals to be made
  from such account on such Payment Date) is greater than zero, the Floating
  Amount shall equal the Above-Cap Payment for such date.  In the
  event that both statements in clauses (a) and (b) above are not true, then
  the Floating Amount shall equal zero.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Period
  End Dates:

  	
   

  	
  Each
  March 15, June 15, September 15 and December 15, commencing on June 15, 2004
  and ending on the Termination Date, subject to adjustment in accordance with
  the Following Business Day Convention.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Floating
  Rate Payer Payment Dates:

  	
   

  	
  Each
  day that is a Period End Date and any Special Distribution Date not
  coinciding with a Period End Date on which a distribution of interest is, by
  the terms of the Intercreditor Agreement, to be made on the Class G-1
  Certificates.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Floating
  Rate Option:

  	
   

  	
  USD-LIBOR-BBA;
  provided that, if the relevant
  rate does not appear on the Telerate Page 3750, the rate shall be
  “Three-Month LIBOR” as determined by the Loan Trustee in accordance with the
  definition of “Three-Month LIBOR” in Annex A to the Indentures; and provided further that the Floating Rate
  Option shall be deemed to equal the Cap Rate during such period as the Stated
  Interest Rate applicable to the Class G-1 Certificates is subject to the
  Capped Interest Rate pursuant to the proviso in the definition of “Stated
  Interest Rate” in the Intercreditor Agreement.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Cap
  Rate:

  	
   

  	
  8%

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Designated
  Maturity:

  	
   

  	
  3-Month

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Spread:

  	
   

  	
  None

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Floating
  Rate Day Count Fraction:

  	
   

  	
  Actual/360

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Reset
  Dates:

  	
   

  	
  The
  first day of the relevant Calculation Period.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Compounding:

  	
   

  	
  Inapplicable

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Notice:

  	
   

  	
  Party
  B shall, on or before 1:00 p.m. (New York time) on each Floating Rate Payer
  Payment Date, provide Party A with notice

  

 

3

 

	
   

  	
   

  	
   

  	
  of
  the then-current Pool Balance of the Class G-1 Certificates and the Floating
  Amount payable, if any, together with, if such Floating Amount is payable,
  the certification referred to in the final sentence of Section 3.6(a)  of the Intercreditor Agreement.

  

 

3.                                       Role
of Party A; Role of Calculation Agent

 

(i)                                     Party
B acknowledges that: (a) in connection with this Transaction and this
Agreement, Party A has acted in the capacity of an arm’s-length contractual
counterparty and not as its financial advisor or fiduciary; and (b) in
exercising its rights or performing any of its duties under this Agreement,
Party A will act as principal and not as a fiduciary of Party B.

 

(ii)                                  Whenever
the Calculation Agent is required to act or exercise judgment in any way, it
will do so in good faith and in a commercially reasonable manner. The
calculations and determinations of the Calculation Agent shall be made in
accordance with terms of this Confirmation having regard in each case to the
criteria stipulated herein.

 

4.                                       Additional
Termination Event/Replacement of Above-Cap Liquidity Provider

 

It will be an Additional
Termination Event with respect to Party A if the relevant credit rating of
Morgan Stanley or any assignee issued by any Rating Agency at any time is lower
than the applicable Threshold Rating (“Credit Downgrade”).  Party A shall be the sole Affected Party
with respect to such Additional Termination Event.

 

In the event of a Credit
Downgrade or an Event of Default specified in Section 5(a)(iii)(2) of the
Agreement, Party A may, within ten days, at its own expense, arrange for one or
more Replacement Above-Cap Liquidity Providers to enter into and deliver to
Party B a Replacement Above-Cap Liquidity Facility for the Above-Cap Liquidity
Facility.  If Party A does not
arrange for such replacement and if this Above-Cap Liquidity Facility has not
otherwise been replaced by JetBlue Airways Corporation (at the expense of
JetBlue Airways Corporation) in accordance with the terms of Section 3.6(c)(ii)
of the Intercreditor Agreement, such 10th day (or if such 10th
day is not a Business Day, the next succeeding Business Day) shall be deemed to
be an “Early Termination Date” and Party A shall make a termination payment to
Party B in accordance with Part 1(j) of the Schedule to the Agreement.

 

5.                                       Additional
Definitions

 

“Drawing Event”
shall mean an event on any Distribution Date where Party B, after giving effect
to the subordination provisions of the Intercreditor Agreement and any Election
Interest Payments made by the Policy Provider (but without regard to drawings
under a Primary Liquidity Facility or withdrawals from the Cash Collateral
Account or Above-Cap Account), shall not have sufficient funds for the payment
of accrued interest due and owing on the Class G–1 Certificates other than any
amount of interest due and payable on the Class G–1 Certificates on such
Distribution Date that remains unpaid due to the failure of the Depositary to
pay any amount of accrued interest on the Deposits on such Distribution Date.

 

“Threshold Rating”
shall mean, for purposes of this Agreement, the short-term unsecured debt
rating of P-1 by Moody’s and short-term issuer credit rating of A-1 by Standard
& Poor’s.

 

4

 

6.                                       Payments

 

Party A hereby
irrevocably instructs Party B to make any payment due to Party A directly to
the account specified below in the name of Party A. Party B hereby irrevocably
instructs Party A to make any payments of Floating Amounts and any Termination
Amount due to Party B directly to the account(s) specified below in the name of
Party B. All payments by Party A of Floating Amounts and any Termination Amount
due to Party B shall be made prior to 4:00 p.m. (New York City time) on the
date such payment is due without setoff, deduction, withholding, netting, or
any other reduction.

 

7.                                       Account
Details

 

	
  Payments
  to Party A:

  	
   

  	
  Citibank,
  New York

  
	
   

  	
   

  	
  ABA#:
  021 000 089

  
	
   

  	
   

  	
  Account#:
  4072 4601

  
	
   

  	
   

  	
  Reference:
  Morgan Stanley Capital Services Inc.

  
	
   

  	
   

  	
   

  
	
  Payments
  to Party B:

  	
   

  	
  Wilmington
  Trust Company

  
	
   

  	
   

  	
  ABA#:
  031 1000 92

  
	
   

  	
   

  	
  Account#:
  65540-2

  
	
   

  	
   

  	
  Reference:
  JetBlue 2004-1 G-1

  

 

8.                                       Offices

 

The Office of Party A for the Transaction is its
office at the address specified for notices to it in the Schedule to the
Agreement. The Office of Party B for the Transaction is its office at the
address specified for notices to it in the Schedule to the Agreement.

 

9.                                       Counterparts

 

This Confirmation may be executed in any number of
counterparts and by each party hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same Confirmation.

 

[Signatures follow on separate page]

 

5

 

Please confirm that the
foregoing correctly sets forth the terms of our agreement by executing the copy
of this Confirmation enclosed for that purpose and returning it to us.

 

	
   

  	
  Yours sincerely,

  
	
   

  	
   

  
	
   

  	
  MORGAN
  STANLEY CAPITAL SERVICES INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nina C. Simmons

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Nina C. Simmons

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  

 

 

Confirmed
as of the date first written above:

 

WILMINGTON TRUST COMPANY

in
its capacity as Subordination Agent on behalf

of the Trustee under the Class G-1 Trust Agreement

 

	
  By:

  	
  /s/ Kathleen A.
  Pedelini

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Kathleen A. Pedelini

  	
   

  
	
   

  	
   

  	
   

  
	
  Title

  	
  Financial Services
  Officer

  	
   

  

 

6

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