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AMR
CORPORATION
2010 Annual Report

Table of contents

  • Page 1
    AMR CORPORATION 2010 Annual Report

  • Page 2
    The following is the AMR Corporation Annual Report on Form 10-K for the fiscal year ended December 31, 2010, which was filed with the Securities and Exchange Commission on February 16, 2011. Additional information can be found at the end of this document.

  • Page 3
    ...a shell company (as defined in Rule 12b-2 of the Act). Â... Yes ; No The aggregate market value of the voting stock held by non-affiliates of the registrant as of June 30, 2010, was approximately $2.3 billion. As of February 9, 2011, 333,435,431 shares of the registrant's common stock were outstanding...

  • Page 4
    ...31, 2010, AMR Eagle operated approximately 1,500 daily departures, offering scheduled passenger service to over 175 destinations in North America, Mexico and the Caribbean. On a separate company basis, AMR Eagle reported $2.3 billion in revenue in 2010. However, this historical financial information...

  • Page 5
    ...customers with interline service in non-overlapping markets, letting customers connect between 15 of American's international destinations from New York and Boston and 26 domestic cities flown by JetBlue. Further, American expanded its relationship with JetBlue so that AAdvantage members and members...

  • Page 6
    ... unions relating to union representation and collective bargaining agreements. In addition, as a result of heightened levels of concern regarding data privacy, the Company is subject to an increasing number of domestic and foreign laws regarding the privacy and security of passenger and employee...

  • Page 7
    ... financial statements for additional information. In December 2009, the U.S. and Japan reached a tentative open skies air services agreement that provides airlines from the U.S. and Japan open access to each other's markets. The tentative agreement was signed by U.S. and Japanese representatives...

  • Page 8
    ... costs at such sites will be immaterial. Labor The airline business is labor intensive. Wages, salaries and benefits represented approximately 31 percent of the Company's consolidated operating expenses for the year ended December 31, 2010. The average full-time equivalent number of employees of the...

  • Page 9
    ... flight attendants. The Labor Agreements substantially moderated the labor costs associated with the employees represented by the unions. In conjunction with the Labor Agreements, American also implemented various changes in the pay plans and benefits for non-unionized personnel, including officers...

  • Page 10
    ... with the TWU concerning American Eagle's dispatchers and fleet services clerks continues. Fuel The Company's operations and financial results are significantly affected by the availability and price of jet fuel. The Company's fuel costs and consumption for the years 2008 through 2010 were: Gallons...

  • Page 11
    ..., the Company reserves the right to change the AAdvantage program at any time without notice, and may end the program with six months notice. As of December 31, 2010, AAdvantage had approximately 67 million total members, and 587 billion outstanding award miles. During 2010, AAdvantage issued...

  • Page 12
    ...airlift services to the Air Mobility Command under the Civil Reserve Air Fleet program. In the event the Company has to provide a substantial number of aircraft and crew to the Air Mobility Command, its operations could be adversely impacted. Available Information The Company makes its annual report...

  • Page 13
    ... special charges related to aircraft, employee reductions and certain other charges. Demand for air travel may weaken if the global economy does not continue to recover. No assurance can be given that capacity adjustments or other steps we may take in response to changes in demand will be successful...

  • Page 14
    ... with a number of credit card companies and processors to accept credit cards for the sale of air travel and other services. Under certain of these agreements, the related credit card processor may hold back a reserve from American's credit card receivables following the occurrence of certain events...

  • Page 15
    ...availability of jet fuel, which are in turn affected by a number of factors beyond our control. Due to the competitive nature of the airline industry, we may not be able to pass on increased fuel prices to customers by increasing fares. Although we had some success in raising fares and imposing fuel...

  • Page 16
    ...Competition with foreign air carriers and with such marketing/operational alliances has been increasing in recent years in part due to the adoption of liberalized open skies aviation agreements between the United States and an increasing number of countries around the world. Moreover, the percentage...

  • Page 17
    ... a joint business agreement and related marketing arrangements with British Airways and Iberia, providing for commercial cooperation on flights between North America and most countries in Europe, pooling and sharing of certain revenues and costs, expanded codesharing, enhanced frequent flyer program...

  • Page 18
    ... of an open skies policy), or because appropriate slots or facilities are not made available. Any such change could adversely impact the value of our international route authorities and related assets. Moreover, additional laws, regulations, taxes and airport rates and charges have been enacted...

  • Page 19
    ... orders, or agency regulations or orders, that would curtail an airline's ability to respond to a competitor); • the adoption of new passenger security standards or regulations that impact customer service standards (for example, "passenger bill of rights"); • restrictions on airport operations...

  • Page 20
    ... rights to fly beyond the U.S. and any airport in the EU including London's Heathrow Airport. The agreement has resulted in American facing increased competition in these markets, including Heathrow. In addition, an open skies air services agreement between the U.S. and Japan that provides airlines...

  • Page 21
    ... APA, the TWU) and the APFA. The Labor Agreements substantially moderated the labor costs associated with the employees represented by the unions. In conjunction with the Labor Agreements, American also implemented various changes in the pay plans and benefits for non-unionized personnel. The Labor...

  • Page 22
    ... affect the public's perception of us. Interruptions or disruptions in service at one or more of our primary market airports could have an adverse impact on us. Our business is heavily dependent on our operations at our primary market airports in Dallas/Ft. Worth, Chicago, Miami, New York City and...

  • Page 23
    ...31, 2010. Flight Equipment - Non-Operating Owned and leased aircraft not operated by the Company at December 31, 2010 included: Capital Leased Operating Leased Equipment Type Owned Total American Airlines Aircraft Airbus A300-600R Fokker 100 Boeing 737-800 McDonnell Douglas MD-80 Total AMR Eagle...

  • Page 24
    ... equipment operated by the Company as of December 31, 2010 are: 2016 and Thereafter Equipment Type American Airlines Aircraft Boeing 737-800 Boeing 757-200 Boeing 767-200 Extended Range Boeing 767-300 Extended Range McDonnell Douglas MD-80 AMR Eagle Aircraft Super ATR 2011 2012 2013 2014 2015...

  • Page 25
    ...Commission seeking information regarding the Company's corporate structure, and revenue and pricing announcements for air cargo shipments to and from the European Union. On December 18, 2007, the European Commission issued a Statement of Objection (SO) against 26 airlines, including the Company. The...

  • Page 26
    ... of American's services in its global distribution system (GDS), as well as substantially increasing the rates that it would charge the Company for bookings made through the Sabre GDS. Sabre contended that its agreement with the Company permitted it to take these actions. On January 10, 2010, the...

  • Page 27
    ... - Customer Services of American from 1998 to January 2000. Prior to that, he served as President of AMR Eagle from 1995 to 1998. Except for two years service as Senior Vice President and Chief Financial Officer of Continental between 1993 and 1995, he has been with the Company in various management...

  • Page 28
    ... March 2006 to July 2010. Prior to that, she served as Vice President Interactive Marketing and Reservations from July 2003 to March 2006, and as Vice President - Customer Services Planning from October 1998 to July 2003. She has been with the Company in various management positions since 1986. Age...

  • Page 29
    ... Company's common stock is traded on the New York Stock Exchange (symbol AMR). The approximate number of record holders of the Company's common stock at February 9, 2011 was 14,675. The range of closing market prices for AMR's common stock on the New York Stock Exchange was: 2010 High Quarter Ended...

  • Page 30
    ... share amounts) 2010 2 2009 2,6 2008 2,5 2007 4 2006 1 Total operating revenues Operating income (loss) Net income (loss) Net income (loss) per share: Basic Diluted Total assets Long-term debt, less current maturities Obligations under capital leases, less current obligations Obligation for pension...

  • Page 31
    ... airlines. In 2008, American entered into a joint business agreement (JBA) and related marketing arrangements with British Airways and Iberia. These agreements provide for commercial cooperation on flights between North America and most countries in Europe, pooling and sharing of certain revenues...

  • Page 32
    ...customers with interline service in non-overlapping markets, letting customers connect between 15 of American's international destinations from New York and Boston and 26 domestic cities flown by JetBlue. Further, American expanded its relationship with JetBlue so that AAdvantage members and members...

  • Page 33
    ...are current market rates received by other regional carriers for similar flying. Amounts paid to AMR Eagle under the capacity purchase agreement are available to pay for various operating expenses of AMR Eagle, such as crew expenses, maintenance, aircraft ownership (including the debt service on the...

  • Page 34
    ...website. Prior to expiration of that agreement, approximately 5.4% of American's passenger revenue, on an annualized basis, was booked through Expedia. We are engaged in active negotiations with Expedia to enter into a new agreement. On January 5, 2011, Sabre made it more difficult for travel agents...

  • Page 35
    ... fuel and special charges, were greater for the year ended December 31, 2010 than for the same period in 2009. Factors driving the increase include revenue related costs, such as credit card fees and booking fees and commissions, and higher aircraft rent related to the Company's fleet renewal plan...

  • Page 36
    ...return to profitability, if the overall industry revenue environment does not continue to improve or if fuel prices were to increase and persist for an extended period at high levels. Liquidity and Capital Resources Cash, Short-Term Investments and Restricted Assets At December 31, 2010, the Company...

  • Page 37
    ..., American had firm commitments for eleven Boeing 737-800 aircraft and seven Boeing 777-200 aircraft scheduled to be delivered in 2013-2016. AMR Eagle has firm commitments for 8 Bombardier CRJ-700 aircraft scheduled to be delivered in 2011. Payments for the Company's aircraft purchase commitments...

  • Page 38
    ...'s cash flow from operating activities during the year ended December 31, 2010 generated $1.2 billion, which is an increase of $311 million from the same period in 2009 primarily due to an improved revenue environment in 2010 as compared to 2009. The Company made debt and capital lease payments of...

  • Page 39
    ... AIP is American's annual bonus plan and provides for the payment of awards in the event certain financial and/or customer service metrics are satisfied. Working Capital AMR (principally American) historically operates with a working capital deficit, as do most other airline companies. In addition...

  • Page 40
    ... 31, 2010 (in millions): Payments Due by Year(s) Ended December 31, 2012 2014 and and 2016 and Total 2013 2015 Beyond Contractual Obligations 2011 Operating lease payments for aircraft and facility obligations 1 Firm aircraft commitments 2 Capacity purchase agreement 3 Long-term debt 4 Capital lease...

  • Page 41
    ...consolidated financial statements. The Company recorded a net loss of $2.1 billion in 2008. The Company's 2008 results included an impairment charge of $1.1 billion to write the McDonnell Douglas MD-80 and Embraer RJ-135 fleets and certain related longlived assets down to their estimated fair values...

  • Page 42
    ... passenger revenues from domestic operations and approximately 40 percent from international operations (flights serving international destinations). Following is additional information regarding American's domestic and international RASM and capacity: Year Ended December 31, 2010 Y-O-Y ASMs Change...

  • Page 43
    ... passenger revenues from domestic operations and approximately 40 percent from international operations (flights serving international destinations). Following is additional information regarding American's domestic and international RASM and capacity: Year Ended December 31, 2009 Y-O-Y ASMs Change...

  • Page 44
    ...'s price per gallon of fuel (net of the impact of hedging losses of $142 million). (b) Commissions, booking fees and credit card expenses increased due to an 11.3 percent increase in operating revenues. (c) Aircraft rental expense increased principally due to new aircraft deliveries in 2009 and 2010...

  • Page 45
    ...the year ended December 31, 2009 than the year ended December 31, 2008. Factors driving the increase include increased defined benefit pension expenses (due to the stock market decline in 2008), higher airport rent and landing fees and cost pressures associated with the Company's capacity reductions...

  • Page 46
    ...lieu of applicable bonus depreciation on certain qualifying capital investments. The Company did not record a net tax provision (benefit) associated with 2008 net loss due to the Company providing a valuation allowance, as discussed in Note 8 to the consolidated financial statements. However, during...

  • Page 47
    ... reflect the increase in the cost of fuel during the second half of 2010 and projected fuel prices in 2011. Despite anticipated higher revenue-related expenses (such as booking fees and commissions) and financing costs related to the Company's new Boeing 737-800 aircraft, the Company expects first...

  • Page 48
    ...identified the following critical accounting policies and estimates used by management in the preparation of the Company's financial statements: long-lived assets, routes, passenger revenue, frequent flyer program, stock compensation, pensions and retiree medical and other benefits, income taxes and...

  • Page 49
    ... marketing services sold, is recognized as related services are provided. The Company's total liability for future AAdvantage award redemptions for free, discounted or upgraded travel on American, American Eagle or participating airlines, as well as unrecognized revenue from selling AAdvantage miles...

  • Page 50
    ... corporate and U.S. government/agency bonds, 28 percent U.S. value stocks, 20 percent developed international stocks, 6 percent emerging markets stocks and bonds and 11 percent alternative (private) investments. The expected return on plan assets component of the Company's net periodic benefit...

  • Page 51
    ... is based upon an evaluation of the Company's historical trends and experience taking into account current and expected market conditions. Increasing the assumed health care cost trend rate by 100 basis points would increase estimated 2011 postretirement benefits expense by $22 million. Income taxes...

  • Page 52
    ... Defined Terms ASM-Available Seat Mile. A measure of capacity. ASMs equal the total number of seats available for transporting passengers during a reporting period multiplied by the total number of miles flown during that period. CASM-(Operating) Cost per Available Seat Mile. The amount of operating...

  • Page 53
    ... changes in the price and availability of aircraft fuel. In order to provide a measure of control over price and supply, the Company trades and ships fuel and maintains fuel storage facilities to support its flight operations. The Company also manages the price risk of fuel costs primarily by using...

  • Page 54
    ... $237 million and $316 million as of December 31, 2010 and 2009, respectively. The fair values of the Company's long-term debt were estimated using quoted market prices or discounted future cash flows based on the Company's incremental borrowing rates for similar types of borrowing arrangements. 51

  • Page 55
    ...CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Consolidated Statements of Stockholders' Equity (Deficit) Notes to Consolidated Financial Statements...

  • Page 56
    ... financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), AMR Corporation's internal control over financial reporting...

  • Page 57
    ... STATEMENTS OF OPERATIONS (in millions, except per share amounts) Year Ended December 31, 2009 2010 Revenues Passenger - American Airlines - Regional Affiliates Cargo Other revenues Total operating revenues Expenses Wages, salaries and benefits Aircraft fuel Other rentals and landing fees...

  • Page 58
    ... authorities Domestic slots and airport operating and gate lease rights, less accumulated amortization (2010 - $473; 2009 - $445) Other assets 708 224 2,236 3,168 $ 25,088 $ 736 252 2,332 3,320 25,438 Total Assets The accompanying notes are an integral part of these financial statements. 55

  • Page 59
    ... par value) December 31, 2010 Liabilities and Stockholders' Equity (Deficit) Current Liabilities Accounts payable Accrued salaries and wages Fuel derivative liability Accrued liabilities Air traffic liability Current maturities of long-term debt Current obligations under capital leases Total current...

  • Page 60
    ... by (used in) investing activities Cash Flow from Financing Activities: Payments on long-term debt and capital lease obligations Proceeds from: Issuance of common stock, net of issuance costs Reimbursement from construction reserve account Exercise of stock options Issuance of long-term debt Sale...

  • Page 61
    ...,860 shares to employees pursuant to stock option and deferred stock incentive plans Balance at December 31, 2008 Net loss Changes in pension, retiree medical and other liability Net changes in fair value of derivative financial instruments Non-cash tax provision Unrealized gain on investments Total...

  • Page 62
    ... significant changes to the Company' s network or capacity, or the implementation of open skies agreements in countries where the Company operates flights. Airport operating and gate lease rights are being amortized on a straight-line basis over 25 years to a zero residual value. Statements of Cash...

  • Page 63
    ... the use of regression analysis and other methods to model the outcome of future events based on the Company's historical experience, and are recorded at the scheduled time of departure. Various taxes and fees assessed on the sale of tickets to end customers are collected by the Company as an agent...

  • Page 64
    ... of Other revenues, as the related services have been provided. The Company's total liability for future AAdvantage award redemptions for free, discounted or upgraded travel on American, American Eagle or participating airlines as well as unrecognized revenue from selling AAdvantage miles was...

  • Page 65
    ... of the Company's special c harges, the remaining accruals for these charges and the capacity reduction related charges (in millions) as of December 31, 2010: Aircraft Charges Remaining accrual at January 1, 2008 Capacity reduction charges Non-cash charges Adjustments Payments Remaining accrual...

  • Page 66
    ...value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company's short-term investments classified as Level 2 primarily utilize broker quotes in a non...

  • Page 67
    ... information technology support related contract that requires minimum annual payments of $100 million in 2011 and declining to $70 million in 2014 through 2019. American has a capacity purchase agreement with Chautauqua Airlines, Inc. to provide Embraer -140 regional jet services to certain markets...

  • Page 68
    .... The Company's loan agreements and other London Interbank Offered Rate (LIBOR) -based financing transactions (including certain leveraged aircraft leases) generally obligate the Company to reimburse the applicable lender for incremental costs due to a change in law that imposes (i) any reserve or...

  • Page 69
    ... as of December 31, 2010, were (in millions): Capital Operating Year Ending December 31, Leases Leases 2011 $ 186 $ 1,254 2012 136 1,068 2013 120 973 2014 98 831 2015 87 672 2016 and thereafter 349 6,006 $ Less amount representing interest Present value of net minimum lease payments (1) 976 372 604...

  • Page 70
    ... guarantees covering $2.1 billion of AMR Eagle's secured debt (and interest thereon). AMR also guarantees $145 million of American's leases of certain Super ATR aircraft, which are subleased to AMR Eagle. On January 25, 2011, American closed on a $657 million Pass Through Trust Certificates (the...

  • Page 71
    ... in semi-annual installments with a balloon payment at maturity in 2019. Approximately $200 million of the proceeds from the sale of the Certificates were used by American during 2010 for the delivery and financing of Boeing 737-800 aircraft. Also in 2009, American entered into a sale leaseback...

  • Page 72
    ... of change. For the years ended December 31, 2010, 2009 and 2008, the Company recognized net gains (losses) of approximately ($142) million, ($651) million and $380 million, respectively, as a component of Aircraft fuel expense on the accompanying consolidated statements of operations related to...

  • Page 73
    ... with a net zero impact to the Company's financial statements. Fair Values of Financial Instruments The fair values of the Company's long-term debt were estimated using quoted market prices where available. For long-term debt not actively traded, fair values were estimated using discounted cash flow...

  • Page 74
    ... the Company's long-term debt, including current maturities, were (in millions): December 31, 2010 2009 Carrying Fair Carrying Fair Value Value Value Value Secured variable and fixed rate indebtedness Enhanced equipment trust certificates 6.00% - 8.50% special facility revenue bonds AAdvantage Miles...

  • Page 75
    ... (loss), described in Note 12 to the consolidated financial statements. The total increase in the valuation allowance was $121 million, $135 million, and $2.1 billion in 2010, 2009, and 2008, respectively. The Company recorded a $248 million non-cash income tax benefit from continuing operations...

  • Page 76
    ... Company established the 2003 Plan to provide equity awards to employees. Under the 2003 Plan, employees may be granted stock options, restricted stock and deferred stock. At December 31, 2010, the Company had stock options and deferred awards outstanding under this plan. The total number of shares...

  • Page 77
    ...make available enough shares to permit the Company to settle all outstanding performance and deferred share awards under the 1998 Plan in stock rather than cash. Options/SARs granted under the LTIP Plans and the 2003 Plan are awarded with an exercise price equal to the fair market value of the stock...

  • Page 78
    ... unrecognized compensation cost related to non-vested stock options/SARs granted under the LTIP Plans and the 2003 Plan that is expected to be recognized over a weighted-average period of 3.4 years. The total fair value of stock options/SARs vested during the years ended December 31, 2010, 2009 and...

  • Page 79
    ...The aggregate intrinsic value represents the Company's current estimate of the number of shares (9,290,446 shares at December 31, 2010) that will ultimately be distributed for outstanding awards computed using the market value of the Company's common stock at December 31, 2010. The weighted -average...

  • Page 80
    ... working lives. The Company funds benefits as incurred and makes contributions to match employee prefunding. The following table provides a reconciliation of the changes in the pension and retiree medical and other benefit obligations and fair value of assets for the years ended December 31, 2010...

  • Page 81
    ...retiree medical and other benefit plan assets of $232 million and $204 million, respectively, were invested in shares of certain mutual funds. The following tables provide the components of net periodic benefit cost for the years ended December 31, 2010, 2009 and 2008 (in millions): Pension Benefits...

  • Page 82
    ...80% 3.78 Pension Benefits 2010 6.10% 3.78 5.69% - 5.90% - 2009 Retiree Medical and Other Benefits 2010 2009 Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31 Discount rate Salary scale (ultimate) Expected return on plan assets 6.10% 3.78...

  • Page 83
    ...year. Securities traded in the over-the-counter market are valued at the last bid price. The money market fund is valued at fair value which represents the net asset value of the shares of such fund as of the close of business at the end of the period. Investments in limited partnerships are carried...

  • Page 84
    ...(Level 2) (Level 3) Total Asset Category Cash and cash equivalents Equity securities International markets (a)(e) Large-cap companies (b)(e) Mid-cap companies (c)(e) Small-cap companies(d)(e) Fixed Income Corporate bonds (f) Government securities (g) U.S. municipal securities Alternative investments...

  • Page 85
    ... return on plan assets: Relating to assets still held at the reporting date Relating to assets sold during the period Purchases, sales, settlements (net) Ending balance at December 31, 2010 $ 744 $ 1 69 (19) $ 795 $ 3 3 Changes in fair value measurements of Level 3 investments during the year ended...

  • Page 86
    ...Level 2) (Level 3) Asset Category Money market fund $ 4 $ - $ - $ 4 Unitized mutual funds - 202 - 202 Total $ 4 $ 202 $ - $ 206 Investments in the unitized mutual funds are carried at the per share net asset value and include approximately 27 percent of investments in non-U.S. common stocks in 2010...

  • Page 87
    ... 665 729 785 4,959 During 2008, AMR recorded a settlement charge totaling $103 million related to lump sum distributions from the Company's defined benefit pension plans to pilots who retired. Pursuant to U.S. GAAP, the use of settlement accounting is required if, for a given year, the cost of all...

  • Page 88
    ... 2010. The following tables provide information relating to the Company's amortized intangible assets as of December 31 (in millions): 2010 Accumulated Amortization $ $ 344 129 473 $ $ Cost Amortized intangible assets: Airport operating rights Gate lease rights Total $ $ 515 182 697 Net Book Value...

  • Page 89
    ... prices as of December 31, 2010) related to its fuel derivative hedges. The difference between Net earnings (loss) and other comprehensive income (loss) for the twelve month periods ended December 31, 2010 and 2009 is due primarily to the accounting for the Company's derivative financial instruments...

  • Page 90
    ... aircraft. American is also one of the largest scheduled air freight carriers in the world, providing a wide range of freight and mail services to shippers throughout its system onboard American's passenger fleet. AMR Eagle owns two regional airlines, which do business as "American Eagle" - American...

  • Page 91
    14. Segment Reporting (Continued) The Company's operating revenues by geographic region (as defined by DOT) are summarized below (in millions): Year Ended December 31, 2010 2009 2008 DOT Domestic DOT Latin America DOT Atlantic DOT Pacific Total consolidated revenues $ 13,081 4,619 3,365 1,105 $ 22...

  • Page 92
    ... Management of the Company is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934. The Company's internal control over financial reporting is designed to provide reasonable assurance...

  • Page 93
    ... the related consolidated statements of operations, stockholders' equity (deficit) and cash flows for each of the three years in the period ended December 31, 2010 of AMR Corporation and our report dated February 16, 2011 expressed an unqualified opinion thereon. /s/ Ernst & Young LLP Dallas, Texas...

  • Page 94
    ... price of outstanding options, warrants and rights 15,384,288 $ 13.99 - 13,208,383 28,592,671 $ $ 5.66 10.14 841,915 841,915 Additional shares may become available for future use per the terms of the LTIP Plans. See Note 9 to the consolidated financial statements for additional information...

  • Page 95
    ...(1) EXHIBITS AND FINANCIAL STATEMENT SCHEDULES The following financial statements and Independent Auditors' Report are filed as part of this report: Page Report of Independent Registered Public Accounting Firm Consolidated Statements of Operations for the Years Ended December 31, 2010, 2009 and 2008...

  • Page 96
    ... of informal arrangement relating to deferral of payment of directors' fees, incorporated by reference to Exhibit 10(c)(11) to American's Registration Statement No. 2-76709. AMR Corporation 2004 Directors Unit Incentive Plan, as amended, incorporated by reference to Exhibit 10.5 to AMR's report on...

  • Page 97
    ... to Exhibit 10.20 to AMR's report on Form 10-K for the year ended December 31, 1999. Deferred Compensation Agreement, dated as of January 22, 2001, between AMR and Armando M. Codina, incorporated by reference to Exhibit 10.20 to AMR's report on Form 10-K for the year ended December 31, 2000. 94 10...

  • Page 98
    ... to Exhibit 10.31 to AMR's report on Form 10-K for the year ended December 31, 2004. Deferred Compensation Agreement, dated as of November 29, 2005 between AMR and Ann M. Korologos, incorporated by reference to Exhibit 10.37 to AMR's report on Form 10-K for the year ended December 31, 2005. 95 10...

  • Page 99
    ... to Exhibit 10.46 to AMR's report on Form 10K for the year ended December 31, 2007 Deferred Compensation Agreement, dated as of December 4, 2008 between AMR and Michael A. Miles, incorporated by reference to Exhibit 10.46 to AMR's report on Form 10K for the year ended December 31, 2008. Deferred...

  • Page 100
    ... to Exhibit 10.55 to AMR's report on Form 10-K for the year ended December 31, 2008. Deferred Compensation Agreement, dated as of November 29, 2005 between AMR and Ray M. Robinson, incorporated by reference to Ex hibit 10.48 to AMR's report on Form 10K for the year ended December 31, 2005. Deferred...

  • Page 101
    ... to Exhibit 10.72 to AMR's report on Form 10K for the year ended December 31, 2006. Deferred Compensation Agreement, dated as of December 4, 2007 between AMR and Matthew K. Rose, incorporated by reference to Exhibit 10.73 to AMR's report on F orm 10K for the year ended December 31, 2007. Deferred...

  • Page 102
    ... to Exhibit 10.82 to AMR's report on Form 10K for the year ended December 31, 2008. Deferred Compensation Agreement, dated as of December 4, 2008, between AMR and Alberto Ibargüen, incorporated by reference to Exhibit 10.89 to AMR's report on Form 10K for the year ended December 31, 2008. Deferred...

  • Page 103
    ... Stock Award Agreement for Employees under the AMR 1998 Long Term Incentive Plan, incorporated by reference to Exhibit 10.44 to AMR's report on Form 10-K for the year ended December 31, 1999. Form of amendment to Career Equity Program Deferred Stock Award Agreement for Employees and Senior Officers...

  • Page 104
    ... Appreciation Right Agreement under the 2009 Long Term Incentive Plan, as Amended (with awards to executive officers noted), incorporated by reference to AMR's current report on Form 8-K dated May 21, 2010. Amended and Restated Executive Termination Benefits Agreement between AMR, American Airlines...

  • Page 105
    ... in the $uper $aver Plus Plan, as amended and restated as of June 1, 2007, incorporated by reference to Exhibit 10.129 to AMR's report on Form 10-K for the year ended December 31, 2008. Aircraft Purchase Agreement by and between American Airlines, Inc. and The Boeing Company, dated October 31, 1997...

  • Page 106
    ...99.1 to AMR's current report on Form 8-K dated January 22, 2010. 2011 Annual Incentive Plan for American, incorporated by reference to Exhibit 99.1 to AMR's current report on Form 8-K dated January 21, 2011. Purchase Agreement No. 3219 between American Airlines, Inc. and The Boeing Company, dated as...

  • Page 107
    ... under Rule 24b-2 of the Securities and Exchange Act of 1934, as amended, incorporated by reference to Exhibit 10.151 to AMR's report on Form 10-K for the year ended December 31, 2009. Purchase Agreement Supplement by and between American Airlines, Inc. and The Boeing Company, dated January 14, 2011...

  • Page 108
    ...152 to AMR's report on Form 10-K for the year ended December 31, 2008. AMR Eagle Holding Corporation 2011 Incentive Compensation Plan for Employees of Subsidiaries of AMR Eagle Holding Corporation, effective as of January 1, 2011. Computation of ratio of earnings to fixed charges for the years ended...

  • Page 109
    ..., thereunto duly authorized. AMR CORPORATION By: /s/ Gerard J. Arpey Gerard J. Arpey Chairman and Chief Executive Officer (Principal Executive Officer) Date: February 16, 2011 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following...

  • Page 110
    ...) Changes charged to statement of operations accounts Balance at beginning of year Year ended December 31, 2010 Allowance for $ 509 obsolescence of inventories Allowance for uncollectible accounts Reserves for environmental remediation costs 58 18 Payments Write-offs (net of recoveries) Sales...

  • Page 111
    ... taxes and cumulative effect of accounting change Add: Total fixed charges (per below) Less: Interest capitalized Total earnings (loss) Fixed charges: Interest Portion of rental expense representative of the interest factor Amortization of debt expense Total fixed charges Ratio of earnings to fixed...

  • Page 112
    ... respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in...

  • Page 113
    ... respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in...

  • Page 114
    ...), does hereby certify, to such officer's knowledge, that: The Annual Report on Form 10-K for the year ended December 31, 2010 (the Form 10-K) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10...

  • Page 115
    ... such information. BOARD OF DIRECTORS (as of April 1, 2011) Gerard J. Arpey Chairman and Chief Executive Officer AMR Corporation / American Airlines, Inc. (Air Transportation) Elected in 2003 John W. Bachmann Senior Partner Edward Jones (Financial Services) Elected in 2001 David L. Boren President...

  • Page 116
    ... - Airport Services Walter J. Aue Vice President - Network Planning David R. Brooks President - American Airlines Cargo Mark L. Burdette Vice President - Employee Relations David L. Campbell Vice President - Safety, Security and Environmental Donald B. Casey Vice President - Revenue Management...

  • Page 117
    ... graph compares the cumulative total stockholder return on AMR Corporation's common stock with the cumulative total returns on the Standard & Poor's 500 Stock Index and the NYSE Arca Airline Index (formerly AMEX Airline Index) as if $100 were invested in AMR Corporation's common stock and each of...

  • Page 118
    ... Dallas/Fort Worth International Airport, Texas 75261-9616 FINANCIAL AND OTHER COMPANY INFORMATION Our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, is available on our Investor Relations website at www.aa.com/investorrelations. If you would like to receive, without charge...