American Airlines, Inc. Series 2016-3 EETC Class B Investor Presentation September 2017 Issuer Free Writing Prospectus Filed pursuant to Rule 433(d) Registration No. 333-216167-01 September 20, 2017
Cautionary Statement Regarding Forward-Looking Statements and Information This document includes forward-looking statements within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,” “estimate,” “plan,” “project,” “could,” “should,” “would,” “continue,” “seek,” “target,” “guidance,” “outlook,” “if current trends continue,” “optimistic,” “forecast” and other similar words. Such statements include, but are not limited to, statements about future financial and operating results, the Company’s plans, objectives, estimates, expectations and intentions, and other statements that are not historical facts. These forward-looking statements are based on the Company’s current objectives, beliefs and expectations, and they are subject to significant risks and uncertainties that may cause actual results and financial position and timing of certain events to differ materially from the information in the forward-looking statements. These risks and uncertainties include, but are not limited to, those set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 (especially in Part I, Item 1A—Risk Factors and Part II, Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations), in the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017 (especially in Part I, Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Part II, Item 1A, Risk Factors) and in the Company’s other filings with the Securities and Exchange Commission (the “SEC”), and other risks and uncertainties listed from time to time in the Company’s other filings with the SEC. There may be other factors of which the Company is not currently aware that may affect matters discussed in the forward-looking statements and may also cause actual results to differ materially from those discussed. The Company does not assume any obligation to publicly update or supplement any forward-looking statement to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements other than as required by law. Any forward-looking statements speak only as of the date hereof or as of the dates indicated in the statements. This Investor Presentation highlights basic information about the issuer and this offering. Because it is a summary, it does not contain all of the information that you should consider before investing. The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, the underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Credit Suisse Securities (USA) LLC (“Credit Suisse”) toll-free at 1-800-221-1037.
2016-3 EETC Class B Offering
American 2016-3 EETC Class B American Airlines, Inc. (“American”) intends to issue $193,440,000 in aggregate face amount of Pass Through Certificates, Series 2016-3 Class B (“American 2016-3 Class B” or “Certificates”) The proceeds from the 2016-3 offering will be used to finance 25 aircraft currently owned by American: Five (5) Airbus A321-200 aircraft Eight (8) Boeing 737-800 aircraft Four (4) Boeing 787-9 aircraft Eight (8) Embraer ERJ 175 LR aircraft American previously issued $557,654,000 aggregate face amount of Pass Through Certificates, Series 2016-3 Class AA and $256,143,000 aggregate face amount of Pass Through Certificates, Series 2016-3 Class A, on October 3, 2016. The Series 2016-3 Class AA and Class A Certificates are not being offered hereby The Class B Certificates offered in this transaction will consist of one amortizing tranche of debt: Class B subordinated tranche amortizing over 8.0 years, with a 71.0% / 71.0% initial / max¹ loan-to-value ratio (“LTV”) The transaction’s legal structure, after giving effect to the offering, will be largely consistent with American’s Series 2017-1 EETC Standard cross-collateralization, cross-default and buy-out rights Three tranches of cross-subordinated and cross-defaulted debt 18-month Liquidity Facility on the Class B Certificates Waterfall with preferred junior interest Liquidity Facility Provider: KfW IPEX-GmbH Sole Structuring Agent and Sole Active Bookrunner: Credit Suisse 1 Initial LTV and Maximum LTV each calculated as of October 4, 2017, and each includes the principal amount of the AA and A Notes as of such date.
2016-3 Class B Structural Summary 1Actual ratings included for Existing Certificates, and expected ratings included for Class B Certificates. 2Unless otherwise noted, information for the Class AA and A Certificates provided as of October 3, 2016, which was the date of issuance for Class AA and Class A Certificates. 3Initial LTV and Maximum LTV for Class AA, Class A, and Class B Certificates calculated as of October 4, 2017. 4 Each series of Equipment Notes will mature on the Final Expected Distribution Date for the related class of Certificates. 5 The Final Legal Distribution Date for each of the Class B Certificates is the date that is 18 months after the Final Expected Distribution Date for the Class B Certificates, which represents the period corresponding to the applicable Liquidity Facility coverage of three successive semiannual interest payments. Existing 2016 -3 Class AA2 Existing 2016-3 Class A2 2016-3 Class B Face Amount $557,654,000 $256,143,000 $193,440,000 Rating / Expected Ratings1 (Moody’s / S&P) Aa3 / AA+ A2 / A+ Baa3 / BBB Initial LTV / Maximum LTV3 39.3% / 39.3% 57.4% / 57.4% 71.0% / 71.0% Coupon 3.000% 3.250% []% Weighted Average Life (years) 8.8 8.8 5.4 Regular Distribution Dates April 15 and October 15 April 15 and October 15 April 15 and October 15 Final Expected Distribution Date4 October 15, 2028 October 15, 2028 October 15, 2025 Final Legal Distribution Date5 April 15, 2030 April 15, 2030 April 15, 2027 Section 1110 Protection Yes Yes Yes Liquidity Facility Three semiannual interest payments Three semiannual interest payments Three semiannual interest payments
Key Structural Elements1 One Class of Certificates Offered One tranche of amortizing debt which will benefit from a liquidity facility covering three semi-annual interest payments Waterfall Interest on Eligible Pool Balance of the Class A Certificates is paid ahead of principal on the Class AA Certificates and interest on Eligible Pool Balance of the Class B Certificates is paid ahead of principal on the Class AA and Class A Certificates Buyout Rights After a Certificate Buyout Event, subordinate Certificate holders have the right to purchase all (but not less than all) of the senior Certificates at par plus accrued and unpaid interest No buyout right during the 60-day Section 1110 period No Equipment Note buyout rights Cross-Collateralization and Cross-Default The Equipment Notes will be cross-collateralized by all aircraft All indentures will include cross-default provisions Threshold Rating Criteria for Liquidity Provider and Depositary Downgrade drawing mechanics consistent with recent EETCs issued by American Collateral Strategically core aircraft types representative of American’s go-forward, long haul, short-haul and regional fleet strategy Twenty-five recently delivered aircraft Weighted average aircraft age of 0.9 years2 Additional Certificates American has the right to issue additional subordinated classes of certificates American has the right to issue additional series of certificates at any time 1 Certain terms defined in prospectus supplement related to the Class B Certificates. 2 As of October 4, 2017.
Overview of the Collateral Pool
2016-3 Aircraft Pool Aggregate aircraft appraised value of approximately $1,418 million1 from three appraisers (AISI, BK and mba)2 Appraisals indicate collateral cushion as of the first principal payment date for the Class B Certificates (after the Class B issuance) of 31.6% on the Class B Certificates3, which is expected to increase over time as the debt amortizes 1 Appraised value equals the lesser of the mean and median (“LMM”) of the maintenance adjusted Base Values of the aircraft (adjusted to reflect the maintenance status of suchAircraft or otherwise take such maintenance status into account at or around the time of the related appraisal). 2AISI, BK and mba are defined in the prospectus supplement related to the Class B Certificates. The appraisals were prepared for the 2016-3 EETC Class B issuance in September 2017, in the case of BK and AISI, and in August 2017, in the case of mba. The appraisedvalues provided by AISI are presented as of May 5, 2017, and the appraised values provided by BK and mba are presented as of May 2017. 3Collateral cushion calculated as of April 15, 2018, the first principal payment date for the Class B Certificates after the anticipated Class B Issuance Date. 4 The original expected delivery date for the Aircraft bearing manufacturer serial number 7407 was December 2016 but was delivered in November 2016, the original expected delivery date for the Aircraft bearing manufacturer serial number 7515 was January 2017 but was delivered in February 2017, the original expected delivery date for the Aircraft bearing manufacturer serial number 33342 was December 2016 but was delivered in November 2016 and the original expected delivery date for the Aircraft bearing manufacturer serial number 31255 was November 2016 but was delivered in December 2016. 1 AISI BK mba LMM 1 A321-200S 7188 N993AN Narrow V2533-A5 206,100 Nov-16 $53,260,000 $52,950,000 $53,220,000 $53,143,333 2 A321-200S 7407 N994AN Narrow V2533-A5 206,100 Nov-16 53,260,000 52,950,000 53,220,000 53,143,333 3 A321-200S 7301 N995AN Narrow V2533-A5 206,100 Dec-16 53,540,000 52,950,000 53,520,000 53,336,667 4 A321-200S 7310 N996AN Narrow V2533-A5 206,100 Dec-16 53,540,000 52,950,000 53,520,000 53,336,667 5 A321-200S 7515 N928AM Narrow V2533-A5 206,100 Feb-17 54,130,000 53,500,000 53,940,000 53,856,667 6 B737-800 31237 N988NN Narrow CFM56-7B 158,500 Mar-16 44,830,000 44,700,000 43,640,000 44,390,000 7 B737-800 33250 N997NN Narrow CFM56-7B 158,500 Sep-16 47,340,000 45,200,000 45,210,000 45,210,000 8 B737-800 31250 N998NN Narrow CFM56-7B 158,500 Sep-16 47,340,000 45,200,000 45,210,000 45,210,000 9 B737-800 33341 N200NV Narrow CFM56-7B 158,500 Oct-16 47,620,000 45,650,000 45,480,000 45,650,000 10 B737-800 33342 N301NW Narrow CFM56-7B 158,500 Nov-16 47,900,000 45,650,000 45,740,000 45,740,000 11 B737-800 31255 N301PA Narrow CFM56-7B 158,500 Dec-16 47,900,000 45,650,000 45,740,000 45,740,000 12 B737-800 31253 N305NX Narrow CFM56-7B 158,500 Nov-16 47,900,000 45,650,000 45,740,000 45,740,000 13 B737-800 33343 N306NY Narrow CFM56-7B 158,500 Dec-16 48,170,000 45,650,000 46,000,000 46,000,000 14 B787-9 40640 N821AN Wide GEnx-1B74/5 553,000 Oct-16 138,850,000 139,650,000 137,210,000 138,570,000 15 B787-9 40642 N822AN Wide GEnx-1B74/5 553,000 Oct-16 138,850,000 139,650,000 137,210,000 138,570,000 16 B787-9 40641 N823AN Wide GEnx-1B74/5 553,000 Dec-16 139,970,000 139,650,000 138,790,000 139,470,000 17 B787-9 40643 N824AN Wide GEnx-1B74/5 553,000 Jan-17 140,530,000 141,050,000 139,570,000 140,383,333 18 ERJ 175 LR 17000594 N240NN Regional CF34-8E5 85,517 Sep-16 29,070,000 27,600,000 29,150,000 28,606,667 19 ERJ 175 LR 17000595 N241NN Regional CF34-8E5 85,517 Sep-16 29,070,000 27,600,000 29,150,000 28,606,667 20 ERJ 175 LR 17000601 N242NN Regional CF34-8E5 85,517 Oct-16 29,240,000 27,900,000 29,330,000 28,823,333 21 ERJ 175 LR 17000604 N243NN Regional CF34-8E5 85,517 Oct-16 29,240,000 27,900,000 29,330,000 28,823,333 22 ERJ 175 LR 17000609 N244NN Regional CF34-8E5 85,517 Nov-16 29,410,000 27,900,000 29,500,000 28,936,667 23 ERJ 175 LR 17000614 N245NN Regional CF34-8E5 85,517 Nov-16 29,410,000 27,900,000 29,500,000 28,936,667 24 ERJ 175 LR 17000618 N246NN Regional CF34-8E5 85,517 Dec-16 29,580,000 27,900,000 29,670,000 29,050,000 25 ERJ 175 LR 17000619 N247NN Regional CF34-8E5 85,517 Dec-16 29,580,000 27,900,000 29,670,000 29,050,000 Assumed Total $1,439,530,000 $1,411,250,000 $1,418,260,000 $1,418,323,333 Maintenance Adjusted Base Value Aircraft Number Registration Number Month of Delivery Aircraft Type MTOW (lbs) Engine Type Body Type MSN 4 4 4 4
Young and Diversified Portfolio: AAL 2016-3 1 Calculated by LMM of the maintenance adjusted base value of the aircraft (adjusted to reflect the maintenance status of such Aircraft or otherwise take such maintenance status into account at or around the time of the related appraisal). The appraisals were prepared for the 2016-3 EETC Class B issuance in September 2017, in the case of BK and AISI, and in August 2017, in the case of mba. The appraised values provided by AISI are presented as of May 5, 2017, and the appraised values provided by BK and mba are presented as of May 2017. 2 As of October 4, 2017. Aircraft Type Narrowbody / Widebody / Regional New Delivery / Vintage By Delivery Date: 0.9 Years Average Age1,2
Investing in our product: new aircraft deliveries 2017 2018 2019 Beyond 2019 Total A320 Family / Neo 20 - 25 75 120 A350-900 - - - 22 22 B737-800 / Max 24 16 20 60 120 B787 Family 13 6 2 - 21 Mainline Total 57 22 47 157 283 E175 16 - - - 16 Regional Total 16 - - - 16
Airbus A321-200 The Airbus A321 (ceo and neo) is the best-selling aircraft in its class with 3,220 net orders and 1,556 deliveries Increasingly popular aircraft in the 180- to 230-seat category Benefits from airlines up-gauging as it has lower seat-mile costs than 150-seaters Provides more capacity at slot-constrained airports Large single-aisle aircraft with deep and well established base of 110 A321-200 operators, outperforming the Boeing competitor (737-900ER) in terms of fleet size, order growth and total backlog The Airbus A321-200 aircraft included in the collateral feature sharklets, which are a valuable addition Most aircraft equipped with sharklets have a higher MTOW and higher spec engine Sharklets increase payload / range, allowing for US transcontinental capability, and making it a better 757 replacement Sharklets wingtip upgrade improves fuel burn Source: Airbus as of August 31, 2017. 1 A321-200ceo and A321-200neo. Top 5 Operators & Lessors (In Service / On Order)1 A321-2001 Key Statistics Operators # of Aircraft 1 American Airlines 198 2 Turkish Airlines 160 3 Wizz Air 151 4 Jetblue Airways 123 5 Delta Air Lines 122 Total 754 Lessors # of Aircraft 1 Air Lease 138 2 AerCap 44 3 GECAS 32 4 Avolon Aerospace Leasing 30 5 BOC Aviation 24 Total 268 Firm Orders 3,220 # Delivered 1,556 # Backlog 1,664 # In Service 1,539 # of Current Operators 110
Boeing 737-800 Considered the most liquid narrowbody to date Over 4,300 in operation with more than 170 operators, with a backlog of 670 aircraft – very popular among mainline, charter and low-cost carriers, good regional distribution, and a favorite with the leasing community Over the last decade, the 737-800 has replaced the MD-80 as the workhorse of the American domestic network Order backlog demonstrates that the 800 remains the most popular 737 NG variant, and that airlines and lessors have confidence in the type well past the end of the decade Continued product improvements, such as longer maintenance intervals and Scimitar winglets, support long-term demand Source: Ascend Market Commentary and Boeing as of 2Q 2017. The B737-800 Has Wide Market Appeal Top 5 Operators & Lessors (In Service / On Order) Operators # of Aircraft 1 Ryanair 462 2 American Airlines 304 3 Southwest Airlines 185 4 China Southern Airlines 154 5 United Airlines 141 Total 1,246 Lessors # of Aircraft 1 AerCap 254 2 GECAS 250 3 SMBC AC 193 4 Avolon Aerospace Leasing 143 5 BBAM 136 Total 976
Boeing 787-9 Source: Ascend Market Commentary and Boeing as of 2Q 2017. 1Includes both 787-9 and 787-10 aircraft. With a predicted demand of over 5,300 widebody jetliners over the next 20 years, the Boeing 787 is well positioned to become the benchmark product in a growing sector of the industry Over 1,200 sales and strong backlog from the overall 787 family; 787-9 now lead variant with over 50% of orders With its all-composite fuselage, the Boeing 787 delivers up to 20% better fuel burn than the Boeing 767 Enables American to serve city pairs previously not accessible with the Boeing 767-300ER aircraft Recent widebody market weakness has been concentrated in specific types / variants (e.g. Rolls-powered A340s, 747s and certain A330s); high quality in-demand widebodies have shown resilience The 787-9 was certified in 2014, and continues to expand its operator base The Boeing 787 is the new benchmark in the long-haul widebody market Top 5 Operators & Lessors (In Service / On Order)1 Operators # of Aircraft 1 Etihad Airways 71 2 ANA-All Nippon Airways 47 3 United Airlines 39 4 KLM Royal Dutch Airlines 33 5 Norwegian 31 Total 221 Lessors # of Aircraft 1 AerCap 60 2 Air Lease 50 3 Avolon Aerospace Leasing 31 4 GECAS 12 5 BBAM 6 Total 159
Embraer ERJ 175 LR In-service fleet of over 580 aircraft, backlog of 80 Demand for Embraer ERJ 175 LR aircraft has been strong as major U.S. airlines placed significant new orders and contracts for 76-seaters to replace 50-seaters, as a result of new scope clause agreements American, United, Alaska and Delta have all ordered the ERJ 175 LR or contracted from regionals like SkyWest E-Jets are winning market share battle with CRJ900 Robust used activity and low availability The Embraer ERJ 175 LR offers mainline jet comfort, thanks to its double bubble design Most cabin volume per seat Large eye-level windows are 30% larger than those on similar aircraft Four-abreast seating and no middle seat, allowing easy access to seats and overhead bins and fast boarding and deplaning Generous headroom with overhead bins accommodate roll-on bags up to 24”x16”x10” Superior ground service access and baggage handling Top 5 Operators & Lessors (In Service / On Order) Operators # of Aircraft 1 SkyWest Airlines 199 2 Republic Airlines 196 3 Compass Airlines 58 4 Mesa Airlines 48 5 Envoy Air 40 Total 541 Lessors # of Aircraft 1 Nordic Aviation Capital 27 2 GECAS 10 3 Castlelake 6 4 Avolon Aerospace Leasing 4 5 Falko 4 Total 51 Range of Embraer 175 LR Source: Ascend Market Commentary and Embraer as of 2Q 2017.
