SUBJECT TO COMPLETION
Preliminary Prospectus Supplement dated June 21, 2020
Preliminary Prospectus Supplement
(To Prospectus dated February 19,
2020)
American Airlines Group Inc.
$750,000,000
% Convertible Senior Notes due 2025
American Airlines Group Inc. (AAG) is offering $750.0 million in aggregate principal amount of % Convertible Senior
Notes due 2025 (the notes). In addition, we have granted the underwriters an option to purchase, for settlement within a period of 30 days from the date of this prospectus supplement, up to an additional $112.5 million aggregate
principal amount of notes, solely to cover over-allotments, if any. The notes will bear interest at a rate of % per annum. Interest on the notes is payable semi-annually in arrears on January 1 and July 1 of each
year, beginning on January 1, 2021. The notes will mature on July 1, 2025, unless earlier converted or redeemed or repurchased by us. The obligations of AAG under the notes will be fully and unconditionally guaranteed by American
Airlines, Inc. (American), its direct wholly-owned subsidiary (the guarantor).
Noteholders may convert their notes at their
option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2020, if the last reported sale price per share of our common stock exceeds 130% of the conversion
price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any
10 consecutive trading day period (such 10 consecutive trading day period, the measurement period) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the
product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in
this prospectus supplement; (4) if we call such notes for redemption; and (5) at any time from, and including, April 1, 2025 until the close of business on the second scheduled trading day immediately before the maturity date. We will
settle conversions by paying or delivering, as applicable, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, based on the applicable conversion rate(s). The initial conversion rate is
shares per $1,000 principal amount of notes, which represents an initial conversion price of approximately
$ per share, and is subject to adjustment as described in this prospectus supplement. If a make-whole fundamental change (as defined in this prospectus supplement)
occurs, then we will in certain circumstances increase the conversion rate for a specified period of time.
The notes will be redeemable, in whole or
in part, at our option at any time, and from time to time, on or after July 5, 2023 and on or before the 20th scheduled trading day immediately before the maturity date, at a cash redemption
price equal to the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, but only if the last reported sale price per share of our common stock exceeds 130% of the conversion price on (1) each of at least 20
trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date we send the related redemption notice; and (2) the trading day immediately before the date we
send such notice. In addition, calling any note for redemption will constitute a make-whole fundamental change with respect to that note, in which case the conversion rate applicable to the conversion of that note will be increased in certain
circumstances if it is converted after it is called for redemption.
If a fundamental change (as defined in this prospectus supplement)
occurs, then, except as described in this prospectus supplement, noteholders may require us to repurchase their notes at a cash repurchase price equal to the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any.
The notes and the guarantee will rank pari passu in right of payment with all of our and the guarantors respective existing and future senior
indebtedness and senior in right of payment to all of our and the guarantors respective future subordinated indebtedness. The notes and the guarantee will be effectively subordinated to all of our 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 and the guarantee will also be structurally subordinated to all existing and future indebtedness of our non-guarantor subsidiaries.
Concurrently with this offering, (i) we are conducting a public offering (the
Concurrent Common Stock Offering) of $750.0 million of shares of our common stock (or up to $862.5 million of shares of our common stock if the underwriters in the Concurrent Common Stock Offering exercise their option to purchase
additional shares of common stock solely to cover over-allotments), (ii) American has announced its intention to conduct a private offering of $1,500.0 million aggregate principal amount of its senior secured notes due 2025 guaranteed by AAG (the
Concurrent Senior Secured Notes Offering) and (iii) American has announced its intention to borrow up to $500.0 million in aggregate principal amount of term loans under new senior secured credit facilities (the Concurrent
Term Loan Financing and, together with the Concurrent Common Stock Offering and the Concurrent Senior Secured Notes Offering, the Concurrent Transactions). Neither this offering nor any of the Concurrent Transactions is conditioned
upon the completion of the other, so it is possible that this offering occurs and one or more of the Concurrent Transactions do not occur, and vice versa. We cannot assure you that any of the Concurrent Transactions will be completed on the terms
described herein, on significantly different terms, or at all. The Concurrent Common Stock Offering is being made pursuant to a separate prospectus supplement and the Concurrent Senior Secured Notes Offering is being made pursuant to a separate
offering memorandum, and nothing contained herein shall constitute an offer to sell or the solicitation of an offer to buy our common stock or senior secured notes to be issued in the Concurrent Common Stock Offering or the Concurrent Senior Secured
Notes Offering, respectively. See Description of the Concurrent Transactions.
Investing in the notes
involves risks. See Risk Factors beginning on page S-11.
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Per Note
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Total(3)
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Price to public(1)
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$
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$
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Underwriting discount(2)
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$
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$
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Proceeds, before expenses, to American Airlines Group Inc.
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$
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$
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(1)
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Plus accrued interest from
, 2020, if settlement occurs after that date.
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(2)
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See Underwriting for a description of compensation to the underwriters.
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(3)
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Assumes no exercise of the underwriters option to purchase additional notes.
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No public market currently exists for the notes, and we do not intend to apply for listing of the notes on any securities exchange or for inclusion of the
notes in any automated quotation system. Our common stock is listed on The Nasdaq Global Select Market under the symbol AAL. On June 19, 2020 the last reported sale price of our common stock was $16.00 per share.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the notes or the shares of our
common stock, if any, issuable upon the conversion of the notes or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
We expect that delivery of the notes will be made to purchasers on or about
, 2020, in book-entry form through the facilities of The Depository Trust Company and its
participants.
Bookrunners
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Goldman Sachs & Co. LLC
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Citigroup
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BofA Securities
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J.P. Morgan
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Barclays
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Deutsche Bank Securities
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Credit Suisse
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ICBC Standard Bank
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Morgan Stanley
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SMBC Nikko
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The date of this prospectus
supplement is , 2020