Debt

3 Months Ended

Mar. 31, 2017

5. Debt

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


	March 31, 2017		December 31, 2016
Secured
2013 Credit Facilities, variable interest rate of 2.98%, installments through 2020	$	1,843	$	1,843
2014 Credit Facilities, variable interest rate of 3.38%, installments through 2021		735		735
April 2016 Credit Facilities, variable interest rate of 3.48%, installments through 2023		1,000		1,000
December 2016 Credit Facilities, variable interest rate of 3.41%, installments through 2023		1,250		1,250
Aircraft enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 9.75%, maturing from 2017 to 2029		11,181		10,912
Equipment loans and other notes payable, fixed and variable interest rates ranging from 2.21% to 8.53%, maturing from 2017 to 2029		5,305		5,343
Special facility revenue bonds, fixed interest rates ranging from 5.00% to 8.00%, maturing from 2017 to 2035		891		891
Other secured obligations, fixed interest rates ranging from 3.60% to 12.24%, maturing from 2017 to 2028		831		849

		23,036		22,823

Unsecured
5.50% senior notes, interest only payments until due in 2019		750		750
6.125% senior notes, interest only payments until due in 2018		500		500
4.625% senior notes, interest only payments until due in 2020		500		500

		1,750		1,750

Total long-term debt and capital lease obligations		24,786		24,573
Less: Total unamortized debt discount, premium and issuance costs		243		229
Less: Current maturities		1,714		1,855

Long-term debt and capital lease obligations, net of current maturities	$	22,829	$	22,489

The table below shows availability under revolving credit facilities, all of which were undrawn, as of March 31, 2017 (in millions):


2013 Revolving Facility	$	1,400
2014 Revolving Facility		1,025

Total	$	2,425

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

2017 Aircraft Financing Activities

2017-1 EETCs

In January 2017, American created three pass-through trusts which issued approximately $983 million aggregate principal amount of Series 2017-1 Class AA, Class A and Class B EETCs (the 2017-1 EETCs) in connection with the financing of 24 aircraft scheduled to be delivered to American through May 2017 (the 2017-1 Aircraft). A portion of the proceeds received from the sale of the 2017-1 EETCs has been used to acquire Series AA, A and B equipment notes issued by American to the pass-through trusts and the balance of such proceeds is being held in escrow for the benefit of the holders of the 2017-1 EETCs until such time as American issues additional Series AA, A and B equipment notes 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 our condensed consolidated balance sheet because the proceeds held by the depository are not American’s assets.

As of March 31, 2017, approximately $635 million of the escrowed proceeds from the 2017-1 EETCs have been used to purchase equipment notes issued by American. Interest and principal payments on the equipment notes will be payable semi-annually in February and August of each year, with interest payments beginning in August 2017 and principal payments beginning in February 2018. The equipment notes are secured by liens on the 2017-1 Aircraft.

Certain information regarding the 2017-1 EETC equipment notes and the remaining escrowed proceeds of the 2017-1 EETC, as of March 31, 2017, is set forth in the table below.


	2017-1 EETCs
	Series AA	Series A	Series B
Aggregate principal amount	$537 million	$248 million	$198 million
Remaining escrowed proceeds	$190 million	$88 million	$70 million
Fixed interest rate per annum	3.65%	4.00%	4.95%
Maturity date	February 2029	February 2029	February 2025

2016-3 EETCs

During the first quarter of 2017, all remaining proceeds of the Series 2016-3 Class AA and Class A (the 2016-3 EETCs), in the amount of $109 million, were used to purchase equipment notes issued by American and, after giving effect to such purchase, all of the proceeds received from the sale of the 2016-3 EETCs have been used to purchase equipment notes issued by American in connection with the financing of new aircraft on or following the delivery thereof. Interest and principal payments on the equipment notes are payable semi-annually in April and October of each year, with interest payments beginning in April 2017 and principal payments beginning in October 2017. These equipment notes are secured by liens on the aircraft financed with the proceeds of the 2016-3 EETCs.

Certain information regarding the 2016-3 EETC equipment notes, as of March 31, 2017, is set forth in the table below.


	2016-3 EETCs
	Series AA	Series A
Aggregate principal amount	$558 million	$256 million
Fixed interest rate per annum	3.00%	3.25%
Maturity date	October 2028	October 2028

Equipment Loans and Other Notes Payable Issued in 2017

In the first quarter of 2017, American entered into loan agreements to borrow $155 million in connection with the financing of certain aircraft. Debt incurred under these loan agreements matures in 2027 through 2029.

2017 Other Financing Activities

2013 Credit Facilities

In March 2017, American and AAG amended the Amended and Restated Credit and Guaranty Agreement dated October 26, 2015 (which amended and restated the Credit and Guaranty Agreement dated May 21, 2015), pursuant to which we refinanced the $1.8 billion term loan facility due June 2020 established thereunder (the 2013 Term Loan Facility and, together with the $1.4 billion revolving credit facility established under such agreement, the 2013 Credit Facilities) to reduce the London Interbank Offered Rate margin from 2.50% to 2.00% and the base rate margin from 1.50% to 1.00%. The $1.4 billion revolving credit facility under the 2013 Credit Facilities (the 2013 Revolving Facility) remains unchanged. As of March 31, 2017, $1.8 billion of principal was outstanding under the 2013 Term Loan Facility and there were no borrowings or letters of credit outstanding under the 2013 Revolving Facility.

American Airlines, Inc. [Member]

Debt

3. Debt

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


	March 31, 2017		December 31, 2016
Secured
2013 Credit Facilities, variable interest rate of 2.98%, installments through 2020	$	1,843	$	1,843
2014 Credit Facilities, variable interest rate of 3.38%, installments through 2021		735		735
April 2016 Credit Facilities, variable interest rate of 3.48%, installments through 2023		1,000		1,000
December 2016 Credit Facilities, variable interest rate of 3.41%, installments through 2023		1,250		1,250
Aircraft enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 9.75%, maturing from 2017 to 2029		11,181		10,912
Equipment loans and other notes payable, fixed and variable interest rates ranging from 2.21% to 8.53%, maturing from 2017 to 2029		5,305		5,343
Special facility revenue bonds, fixed interest rates ranging from 5.00% to 5.50%, maturing from 2017 to 2035		862		862
Other secured obligations, fixed interest rates ranging from 3.60% to 12.24%, maturing from 2017 to 2028		830		848

Total long-term debt and capital lease obligations		23,006		22,793
Less: Total unamortized debt discount, premium and issuance costs		231		216
Less: Current maturities		1,717		1,859

Long-term debt and capital lease obligations, net of current maturities	$	21,058	$	20,718

The table below shows availability under revolving credit facilities, all of which were undrawn, as of March 31, 2017 (in millions):


2013 Revolving Facility	$	1,400
2014 Revolving Facility		1,025

Total	$	2,425

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

2017 Aircraft Financing Activities

2017-1 EETCs

In January 2017, American created three pass-through trusts which issued approximately $983 million aggregate principal amount of Series 2017-1 Class AA, Class A and Class B EETCs (the 2017-1 EETCs) in connection with the financing of 24 aircraft scheduled to be delivered to American through May 2017 (the 2017-1 Aircraft). A portion of the proceeds received from the sale of the 2017-1 EETCs has been used to acquire Series AA, A and B equipment notes issued by American to the pass-through trusts and the balance of such proceeds is being held in escrow for the benefit of the holders of the 2017-1 EETCs until such time as American issues additional Series AA, A and B equipment notes 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 depository are not American’s assets.

Certain information regarding the 2017-1 EETC equipment notes and the remaining escrowed proceeds of the 2017-1 EETC, as of March 31, 2017, is set forth in the table below.


	2017-1 EETCs
	Series AA	Series A	Series B
Aggregate principal amount	$537 million	$248 million	$198 million
Remaining escrowed proceeds	$190 million	$88 million	$70 million
Fixed interest rate per annum	3.65%	4.00%	4.95%
Maturity date	February 2029	February 2029	February 2025

2016-3 EETCs

Certain information regarding the 2016-3 EETC equipment notes, as of March 31, 2017, is set forth in the table below.


	2016-3 EETCs
	Series AA	Series A
Aggregate principal amount	$558 million	$256 million
Fixed interest rate per annum	3.00%	3.25%
Maturity date	October 2028	October 2028

Equipment Loans and Other Notes Payable Issued in 2017

2017 Other Financing Activities

2013 Credit Facilities

In March 2017, American and AAG amended the Amended and Restated Credit and Guaranty Agreement dated October 26, 2015 (which amended and restated the Credit and Guaranty Agreement dated May 21, 2015), pursuant to which American refinanced the $1.8 billion term loan facility due June 2020 established thereunder (the 2013 Term Loan Facility and, together with the $1.4 billion revolving credit facility established under such agreement, the 2013 Credit Facilities) to reduce the London Interbank Offered Rate margin from 2.50% to 2.00% and the base rate margin from 1.50% to 1.00%. The $1.4 billion revolving credit facility under the 2013 Credit Facilities (the 2013 Revolving Facility) remains unchanged. As of March 31, 2017, $1.8 billion of principal was outstanding under the 2013 Term Loan Facility and there were no borrowings or letters of credit outstanding under the 2013 Revolving Facility.