FORT WORTH, Texas – American Airlines Group Inc. (NASDAQ: AAL) (the “Company”) today announced the increase and price of the previously announced private offer of the Company`s subsidiary, American Airlines, Inc. (“American”), and AAdvantage Loyalty IP Ltd., a newly created, cayman Islands-exempt limited liability company and a wholly-owned indirect subsidiary of the Company and American, known. A total principal amount of $3.5 billion in senior secured debentures maturing in 2026 totalling $3.5 billion and a total of $3.0 billion in senior secured debentures maturing in 2029 (collectively, the “Notes”) are expected to be issued on March 24, 2021, subject to customary closing conditions. The Bonds will be issued to investors at a price of 100% of their capital. In conjunction with the issuance of the tickets, American and AAdvantage Loyalty IP Ltd. plan to enter into a credit agreement providing for a $3.5 billion long-term credit facility (the “New AAdvantage Term Loan Facility”), which is also subject to customary closing conditions. Overall, the Notes and the new AAdvantage Term Loan Facility will generate gross proceeds of $10.0 billion, an increase of $2.5 billion from the expected initial transaction volume of $7.5 billion at an average annual coupon of 5.575%. Cautionary Note Regarding Forward-Looking StatementsSome of the statements contained herein or referred to herein, including those relating to the proposed offering of the Notes and the new AAdvantage Term Lending Facility, should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words such as “may”, “will”, “expects”, “intends”, “anticipates”, “believes”, “estimates”, “plans”, “projects”, “could”, “should”, “should”, “continues”, “seeks”, “target”, “forecast”, “outlook”, “if current trends continue”, “optimistic”, “forecast” and other similar words. These statements include, but are not limited to, statements about plans, objectives, expectations, intentions, estimates and strategies for the future of the Company and other statements that are not historical facts.
These forward-looking statements are based on the Company`s current objectives, beliefs and expectations and are subject to significant risks and uncertainties that could cause actual results and financial condition and the timing of certain events to differ materially from the information contained in the forward-looking statements. These risks and uncertainties include, but are not limited to, American Airlines Group Inc.`s Annual Report on Form 10-K for the year ended December 31, 2020 (including, without limitation, in Part I, Item 1A. Risk Factors and Part II, Item 7). Management`s Discussion and Analysis on Financial Condition and Results of Operations) and other risks and uncertainties listed from time to time in the Company`s other filings with the Securities and Exchange Commission. In particular, the impact of the coronavirus outbreak on the economic environment and the travel industry in general, as well as on the financial and operational situation of the company in particular, has been significant, is evolving rapidly and is not predictable. In addition, there may be other factors that the Company is not currently aware of that affect the matters addressed in the forward-looking statements and may also cause actual results to differ materially from those discussed. The Company assumes no obligation to publicly update or supplement any forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements, except as required by law. All forward-looking statements speak only as of the date of this press release or as set forth in the press release.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the Notes, and there will be no sale of the Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release is issued pursuant to Rule 135c of the Securities Act. The Notes will only be offered and sold to persons who can reasonably be expected to be qualified institutional purchasers within the meaning of Rule 144A of the Securities Act of 1933, as amended (the “Securities Act”), and to non-U.S. citizens. Persons conducting offshore transactions outside the United States in accordance with Regulation S of the Securities Act. The Notes will not be registered under the Securities Act or any other securities law of any jurisdiction and will not be subject to an exchange offer or other registration fees. Tickets may not be offered or sold in the United States without registration or an applicable exemption from registration requirements. Our automated service is available 24/7 or calls during business hours to speak to an agent. AAdvantage Loyalty IP Ltd. intends to lend the net proceeds of the issuance of the Notes and the new AAdvantage Term Loan Facility to American after a portion of the proceeds have been deposited in certain reserve accounts.
American intends to use the proceeds of this intercompany loan from AAdvantage Loyalty IP Ltd. to repay all outstanding amounts under the U.S. Term Loan Facility. The Treasury Department, which is currently backed by a guarantee, which partially guarantees the notes and the new advantageous term loan facility, and uses the rest for general corporate purposes, which may include repaying other debts. American Airlines Credit CardP.O. P.O. Box 6403Sioux Falls, SD 57117-6403 American Airlines Credit Planp.O. P.O. Box 183015Collumbus, OH 43128-3015. . .