Debt

9 Months Ended

Sep. 30, 2019

Debt Instrument [Line Items]

Debt

Debt

Long-term debt included in the condensed consolidated balance sheets consisted of (in millions):

	September 30, 2019		December 31, 2018
Secured
2013 Credit Facilities, variable interest rate of 3.80%, installments through 2025	$	1,807	$	1,825
2014 Credit Facilities, variable interest rate of 4.05%, installments through 2021	1,215		1,215
April 2016 Credit Facilities, variable interest rate of 4.04%, installments through 2023	970		980
December 2016 Credit Facilities, variable interest rate of 4.03%, installments through 2023	1,225		1,225
Enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 8.39%, averaging 4.07%, maturing from 2020 to 2032	11,929		11,648
Equipment loans and other notes payable, fixed and variable interest rates ranging from 3.16% to 7.31%, averaging 3.74%, maturing from 2019 to 2031	4,882		5,060
Special facility revenue bonds, fixed interest rates ranging from 5.00% to 8.00%, maturing from 2020 to 2031	754		798
	22,782		22,751
Unsecured
5.50% senior notes, interest only payments until due in October 2019	750		750
4.625% senior notes, interest only payments until due in March 2020	500		500
5.000% senior notes, interest only payments until due in June 2022	750		—
	2,000		1,250
Total long-term debt	24,782		24,001
Less: Total unamortized debt discount, premium and issuance costs	223		222
Less: Current maturities	3,504		3,213
Long-term debt, net of current maturities	$	21,055	$	20,566

The table below shows the maximum availability under revolving credit facilities, all of which were undrawn, as of September 30, 2019 (in millions):

2013 Revolving Facility	$	1,000
2014 Revolving Facility	1,543
April 2016 Revolving Facility	300
Total	$	2,843

The December 2016 Credit Facilities provide for a revolving credit facility that may be established thereunder in the future.

Secured financings are collateralized by assets, primarily aircraft, engines, simulators, aircraft spare parts, airport gate leasehold rights, route authorities, airport slots and pre-delivery payments.

2019 Financing Activities

2019-1 Aircraft EETCs

In August 2019, American created three pass-through trusts which issued approximately $1.1 billion aggregate face amount of Series 2019-1 Class AA, Class A and Class B EETCs (the 2019-1 Aircraft EETCs) in connection with the financing of 35 aircraft previously delivered or to be delivered to American through September 2020 (the 2019-1 Aircraft). In the third quarter of 2019, approximately $513 million of the proceeds were used to purchase equipment notes issued by American in connection with financing 15 aircraft under the 2019-1 Aircraft EETCs, of which $464 million was used to repay existing indebtedness. Interest and principal payments on equipment notes issued in connection with the 2019-1 Aircraft EETCs are payable semi-annually in February and August of each year, with interest payments scheduled to begin in February 2020

and with principal payments scheduled to begin (i) in the case of equipment notes with respect to any 2019-1 Aircraft owned by American at the time of issuance of the 2019-1 Aircraft EETCs, in February 2020 and (ii) in the case of equipment notes with respect to the Embraer E175LR aircraft and the Airbus A321neo aircraft scheduled to be delivered after the issuance of the 2019-1 Aircraft EETCs, in August 2020 and August 2021, respectively. The remaining proceeds of approximately $584 million are being held in escrow with a depositary for the benefit of the holders of the 2019-1 Aircraft EETCs until such time as American issues additional equipment notes with respect to the remaining 2019-1 Aircraft to the pass-through trusts, which will purchase such additional equipment notes with the escrowed funds. These escrowed funds are not guaranteed by American and are not reported as debt on its condensed consolidated balance sheet because the proceeds held by the depositary for the benefit of the holders of the 2019-1 Aircraft EETCs are not American’s assets.

Certain information regarding the 2019-1 Aircraft EETC equipment notes and remaining escrowed proceeds, as of September 30, 2019, is set forth in the table below.

	2019-1 Aircraft EETCs
	Series AA	Series A	Series B
Aggregate principal issued	$579 million	$289 million	$229 million
Remaining escrowed proceeds	$308 million	$154 million	$122 million
Fixed interest rate per annum	3.15%	3.50%	3.85%
Maturity date	February 2032	February 2032	February 2028

2019-1 Spare Engine EETCs

In June 2019, American created pass-through trusts which issued $650 million in aggregate face amount of 2019-1 Engine EETCs (the 2019-1 Engine EETCs), with maturities from June 2022 to June 2026. All of the proceeds received by such pass-through trusts from the sale of the 2019-1 Engine EETCs have been used to acquire equipment notes issued by American to the pass-through trusts. The pass-through trust certificates represent the right to payment under the equipment notes that are full-recourse obligations of American and such equipment notes are secured by spare aircraft engines currently owned and operated by American.

Equipment Notes and Other Notes Payable Issued in 2019

In the first nine months of 2019, American entered into agreements under which it borrowed $1.6 billion in connection with the financing or refinancing, as the case may be, of certain aircraft and other flight equipment, of which $643 million was used to repay existing indebtedness. Debt incurred under these agreements matures in 2023 through 2031 and bears interest at variable rates (comprised of LIBOR plus an applicable margin) averaging 3.59% at September 30, 2019.

5.000% Senior Notes

In May 2019, AAG issued $750 million aggregate principal amount of 5.000% senior notes due 2022 (the 5.000% senior notes). These notes bear interest at a rate of 5.000% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2019. The 5.000% senior notes are senior unsecured obligations of AAG. The 5.000% senior notes mature on June 1, 2022 and are fully and unconditionally guaranteed by American. The indenture for the 5.000% senior notes contains covenants and events of default generally customary for similar financings. In addition, if AAG experiences a specified change of control, AAG must offer to repurchase the 5.000% senior notes in whole or in part at a repurchase price of 101% of the aggregate principal amount plus accrued and unpaid interest, if any, to (but not including) the repurchase date. Upon the occurrence of certain events of default, the 5.000% senior notes may be accelerated and become due and payable immediately.

American Airlines, Inc. [Member]

Debt Instrument [Line Items]

Debt

Debt

Long-term debt included in the condensed consolidated balance sheets consisted of (in millions):

	September 30, 2019		December 31, 2018
Secured
2013 Credit Facilities, variable interest rate of 3.80%, installments through 2025	$	1,807	$	1,825
2014 Credit Facilities, variable interest rate of 4.05%, installments through 2021	1,215		1,215
April 2016 Credit Facilities, variable interest rate of 4.04%, installments through 2023	970		980
December 2016 Credit Facilities, variable interest rate of 4.03%, installments through 2023	1,225		1,225
Enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 8.39%, averaging 4.07%, maturing from 2020 to 2032	11,929		11,648
Equipment loans and other notes payable, fixed and variable interest rates ranging from 3.16% to 7.31%, averaging 3.74%, maturing from 2019 to 2031	4,882		5,060
Special facility revenue bonds, fixed interest rate of 5.00%, maturing from 2020 to 2031	725		769
Total long-term debt	22,753		22,722
Less: Total unamortized debt discount, premium and issuance costs	215		219
Less: Current maturities	2,252		2,466
Long-term debt, net of current maturities	$	20,286	$	20,037

The table below shows the maximum availability under revolving credit facilities, all of which were undrawn, as of September 30, 2019 (in millions):

2013 Revolving Facility	$	1,000
2014 Revolving Facility	1,543
April 2016 Revolving Facility	300
Total	$	2,843

The December 2016 Credit Facilities provide for a revolving credit facility that may be established thereunder in the future.

Secured financings are collateralized by assets, primarily aircraft, engines, simulators, aircraft spare parts, airport gate leasehold rights, route authorities, airport slots and pre-delivery payments.

2019 Financing Activities

2019-1 Aircraft EETCs

In August 2019, American created three pass-through trusts which issued approximately $1.1 billion aggregate face amount of Series 2019-1 Class AA, Class A and Class B EETCs (the 2019-1 Aircraft EETCs) in connection with the financing of 35 aircraft previously delivered or to be delivered to American through September 2020 (the 2019-1 Aircraft). In the third quarter of 2019, approximately $513 million of the proceeds were used to purchase equipment notes issued by American in connection with financing 15 aircraft under the 2019-1 Aircraft EETCs, of which $464 million was used to repay existing indebtedness. Interest and principal payments on equipment notes issued in connection with the 2019-1 Aircraft EETCs are payable semi-annually in February and August of each year, with interest payments scheduled to begin in February 2020 and with principal payments scheduled to begin (i) in the case of equipment notes with respect to any 2019-1 Aircraft owned by American at the time of issuance of the 2019-1 Aircraft EETCs, in February 2020 and (ii) in the case of equipment notes with respect to the Embraer E175LR aircraft and the Airbus A321neo aircraft scheduled to be delivered after the issuance of the 2019-1 Aircraft EETCs, in August 2020 and August 2021, respectively. The remaining proceeds of approximately $584 million are being held in escrow with a depositary for the benefit of the holders of the 2019-1 Aircraft EETCs until such time as American issues additional equipment notes with respect to the remaining 2019-1 Aircraft to the pass-through trusts, which will purchase such additional equipment notes with the escrowed funds. These escrowed funds are not guaranteed by American and are not reported as debt on its condensed consolidated balance sheet because the proceeds held by the depositary for the benefit of the holders of the 2019-1 Aircraft EETCs are not American’s assets.

Certain information regarding the 2019-1 Aircraft EETC equipment notes and remaining escrowed proceeds, as of September 30, 2019, is set forth in the table below.

	2019-1 Aircraft EETCs
	Series AA	Series A	Series B
Aggregate principal issued	$579 million	$289 million	$229 million
Remaining escrowed proceeds	$308 million	$154 million	$122 million
Fixed interest rate per annum	3.15%	3.50%	3.85%
Maturity date	February 2032	February 2032	February 2028

2019-1 Spare Engine EETCs

In June 2019, American created pass-through trusts which issued $650 million in aggregate face amount of 2019-1 Engine EETCs (the 2019-1 Engine EETCs), with maturities from June 2022 to June 2026. All of the proceeds received by such pass-through trusts from the sale of the 2019-1 Engine EETCs have been used to acquire equipment notes issued by American to the pass-through trusts. The pass-through trust certificates represent the right to payment under the equipment notes that are full-recourse obligations of American and such equipment notes are secured by spare aircraft engines currently owned and operated by American.

Equipment Notes and Other Notes Payable Issued in 2019

In the first nine months of 2019, American entered into agreements under which it borrowed $1.6 billion in connection with the financing or refinancing, as the case may be, of certain aircraft and other flight equipment, of which $643 million was used to repay existing indebtedness. Debt incurred under these agreements matures in 2023 through 2031 and bears interest at variable rates (comprised of LIBOR plus an applicable margin) averaging 3.59% at September 30, 2019.