Commitments and Contingencies

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Aircraft-Related Commitments and Financing Arrangements

The Company’s contractual purchase commitments consist primarily of aircraft and engine acquisitions through manufacturers and aircraft leasing companies. On June 20, 2013, the Company entered into an amendment to the Airbus A320 Family Purchase Agreement, by and between the Company and Airbus S.A.A., dated May 5, 2004 (Airbus Amendment) for the order of an additional 20 Airbus A321 aircraft. These aircraft are in addition to the 92 aircraft not yet delivered under Spirit's existing order with Airbus. In addition, the Company is committed to take delivery of an additional five aircraft directly from a third-party lessor. During the year, the Company converted ten Airbus A320 orders to Airbus A321 orders and converted five Airbus A321 orders to Airbus A321neo orders. On October 1, 2013, the Company entered into agreements with International Aero Engines AG (IAE) and Pratt & Whitney (collectively, the IAE & P&W Agreement) for the provision and servicing of engines to power its fleet of Airbus A320 family aircraft.

As of December 31, 2013, the Company's aircraft orders consisted of the following:

	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

The Company also has six spare engine orders for V2500 SelectOne engines with IAE and nine spare engine orders for PurePower PW 1100G-JM engines with Pratt & Whitney. Spare engines are scheduled for delivery from 2014 through 2024. Purchase commitments for these aircraft and engines, including estimated amounts for contractual price escalations and pre-delivery payments, will be approximately $559.3 million in 2014, $619.1 million in 2015, $633.1 million in 2016, $804.5 million in 2017, $543.1 million in 2018 and $2,197.1 million in 2019 and beyond. The Company has secured financing commitments with third parties for seven aircraft deliveries from Airbus, scheduled for delivery in 2014 and for the five aircraft to be leased directly from a third party. The Company does not have financing commitments in place for the remaining 105 Airbus firm aircraft orders scheduled for delivery between 2014 and 2021.

Litigation

The Company is subject to commercial litigation claims and to administrative and regulatory proceedings and reviews that may be asserted or maintained from time to time. The Company believes the ultimate outcome of such lawsuits, proceedings and reviews will not, individually or in the aggregate, have a material adverse effect on its financial position, liquidity or results of operations.

Employees

The Company has three union-represented employee groups that together represent approximately 59% of all employees at December 31, 2013 and 54% of all employees at December 31, 2012. The table below sets forth the Company's employee groups and status of the collective bargaining agreements as of December 31, 2013.

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%

In December 2013, with the help of the National Mediation Board (NMB), the Company reached a tentative agreement for a five-year contract with the Company's flight attendants. The tentative agreement was subject to ratification by the flight attendant membership. On February 7, 2014, the Company was notified that the flight attendants voted to not ratify the tentative agreement. The Company will continue to work together with the AFA and the NMB with a goal of reaching a mutually beneficial agreement.

The Company is self-insured for health care claims, subject to a stop-loss policy, for eligible participating employees and qualified dependent medical claims, subject to deductibles and limitations. The Company’s liabilities for claims incurred but not reported are determined based on an estimate of the ultimate aggregate liability for claims incurred. The estimate is calculated from actual claim rates and adjusted periodically as necessary. The Company has accrued $2.1 million and $1.9 million, for health care claims as of December 31, 2013, and 2012, respectively.

Other

The Company is contractually obligated to pay the following minimum guaranteed payments to the provider of its reservation system as of December 31, 2013: $3.9 million in 2014, $3.9 million in 2015, $3.9 million in 2016, $3.9 million in 2017, $2.6 million in 2018 and $0.0 million in 2019 and thereafter.

The Company entered into a Tax Receivable Agreement (TRA) with the Company's Pre-IPO Stockholders (as defined in the TRA) that became effective immediately prior to the consummation of the IPO. In accordance with the TRA, the Company paid $27.2 million, including $0.3 million of applicable interest, in the second quarter of 2012. As of December 31, 2013, the Company has $5.6 million accrued related to the TRA and $0.2 million of applicable interest. See Note 18.