Item 1.01.
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Entry into a Material Definitive Agreement.
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On May 20, 2019, American Airlines Group Inc., a Delaware corporation (the Company or AAG), completed its
previously announced offering of $750 million aggregate principal amount of 5.000% Senior Notes due 2022 (the Notes). The obligations of AAG under the Notes are fully and unconditionally guaranteed by its direct wholly-owned
subsidiary, American Airlines, Inc. (the Guarantor). The Notes were issued pursuant to an indenture, dated as of May 20, 2019 (the Indenture), by and among the Company, the Guarantor and Wilmington Trust, National
Association, as trustee (the Trustee). The Notes were not registered under the Securities Act of 1933, as amended (the Securities Act), or any other securities laws of any jurisdiction and the Notes do not have the benefit of
any exchange offer or other registration rights. The Notes were offered and sold only to persons reasonably believed to be qualified institutional buyers, as defined in, and in reliance on, Rule 144A under the Securities Act and to
non-U.S.
persons in offshore transactions outside the United States in reliance on Regulation S under the Securities Act.
Interest on the Notes is payable semiannually in arrears on June 1 and December 1 of each year, beginning on December 1, 2019.
The Notes will mature on June 1, 2022.
The Notes are AAGs senior unsecured obligations and the note guarantee is the senior
unsecured obligation of the Guarantor. The Notes and the note guarantee rank
pari passu
in right of payment with AAGs and the Guarantors respective existing and future senior indebtedness and senior in right of payment to
AAGs and the Guarantors respective future subordinated indebtedness. The Notes and the note guarantee are effectively subordinated to AAGs and the Guarantors respective existing and future secured indebtedness to the extent
of the value of the assets pledged to secure those obligations. The Notes are structurally subordinated to all existing and future indebtedness of AAGs
non-guarantor
subsidiaries.
In the event of a specified change of control, each holder of Notes may require the Company to repurchase its Notes in whole or in part at a
repurchase price of 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to (but not including) the repurchase date.
The Indenture contains covenants that, among other things, restrict the ability of the Company and the ability of its restricted subsidiaries
to: (i) pay dividends, redeem or repurchase stock or make other distributions or restricted payments, (ii) repay subordinated indebtedness, (iii) make certain loans and investments, (iv) incur indebtedness or issue preferred
stock, (v) merge, consolidate or sell assets, (vi) undergo certain change of control transactions, and (vii) designate subsidiaries as unrestricted. These covenants are subject to a number of important exceptions and qualifications
set forth in the Indenture.
Upon the occurrence of any event of default (other than certain bankruptcy or insolvency events affecting the
Company or certain of its subsidiaries), the Trustee or the holders of at least 25% in aggregate principal amount of the outstanding Notes may declare all the Notes to be due and payable immediately. Upon the occurrence of certain bankruptcy or
insolvency events affecting the Company or certain of its subsidiaries, all outstanding Notes will become due and payable immediately without further action or notice on the part of the Trustee or any holder.
Copies of the Indenture and the form of the Notes are filed herewith as Exhibits 4.1 and 4.2, respectively, and are incorporated by reference
herein. The foregoing descriptions of the Indenture and the Notes are qualified in their entirety by reference to such exhibits.