AMR amends credit agreement, covenants waived

The credit agreement that AMR entered into in March of 2006 contained a covenant requiring the company to maintain, for specified periods, a minimum ratio of cash flow to fixed charges, which consist of interest expense and rentals.

Under the amended agreement, the covenant was waived for all periods ending any time from June 30, 2008, through March 31, 2009.

After that, AMR is required to maintain a certain ratio of cash flow to fixed charges for specified periods up through 2010.

The loan facilities under the credit agreement consist of an undrawn $255 million secured revolving credit facility with a maturity date of June 17, 2009, and a fully drawn $440 million secured term loan with a maturity date of December 17, 2010.

AMR shares fell 28 cents, or 2.9 percent, to $9.20 in afternoon trading. Shares have traded between $6.81 and $29.32 in the past 12 months.