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AMERICAN AIRLINES GROUP INC.

(AAL)
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AMERICAN AIRLINES GROUP INC. : Regulation FD Disclosure (form 8-K)

06/11/2021 | 06:03am EDT

ITEM 7.01. REGULATION FD DISCLOSURE.



As previously reported, American Airlines, Inc. ("American"), entered into an
indenture, dated as of June 30, 2020, by and among American, American Airlines
Group Inc. and Wilmington Trust, National Association, as trustee (the
"Trustee"), relating to American's 11.75% Senior Secured Notes due 2025 (the
"Notes"). Pursuant to the Indenture, American is required to deliver to the
Trustee periodic appraisals with respect to the appraised value of the first
lien collateral for the Notes, which first lien collateral consists of certain
assets, rights and properties that American uses to provide non-stop scheduled
air carrier services between (a) certain airports in the United States and (b)
certain airports in Australia, Canada, the Caribbean, Central America, China,
Hong Kong, Japan, Mexico, South Korea, and Switzerland (collectively, the "First
Lien Collateral"). In addition, pursuant to the Indenture, American is required
to deliver to the Trustee periodic appraisals with respect to the appraised
value of the second lien collateral for the Notes, which second lien collateral
consists of certain assets, rights and properties that American uses to provide
non-stop scheduled air carrier services between (a) certain airports in the
United States and (b) certain airports in the European Union and the United
Kingdom (collectively, the "Second Lien Collateral").
American has delivered to the Trustee appraisals, each dated May 5, 2021, with
respect to the First Lien Collateral and the Second Lien Collateral. Using a
discount rate of 11.5% and a perpetuity growth rate of 1.5%, the aggregate
appraised value of the First Lien Collateral reflected in the appraisals is
$7.327 billion, and the aggregate appraised value of the Second Lien Collateral
reflected in the appraisals is $6.697 billion.
The appraisals are subject to a number of significant assumptions, limitations
and risks, and were prepared based on certain specified methodologies described
therein, including a discounted net present value calculation to projected
annual cash flows of certain of American's scheduled services. The appraisals
may not accurately reflect the fair market or realizable value of the First Lien
Collateral or the Second Lien Collateral. An appraisal that is subject to
different assumptions, limitations and risks, and/or that is based on other
methodologies, may result in valuations that are materially different from those
contained in the appraisals summarized above.
The information in Item 7.01 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, or otherwise subject to the liabilities of that Section and shall not
be deemed incorporated by reference into any registration statement or other
document filed pursuant to the Securities Act of 1933, as amended, except as
shall be expressly set forth by specific reference in such filing.


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© Edgar Online, source Glimpses

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