Questions and Answers – March 14, 2013

Question: How does the 4.8% equity stake pay out?

Answer: Depending on instructions from the Bankruptcy Court, a combination of stock and/or cash will be provided to the TWU for distribution to members, amongst the seven classes or crafts.

Question: What makes up the 4.8% equity stake?

Answer: The stake is equivalent to 4.8% of the value of the Company when it exits bankruptcy and is calculated for all work groups based on their concessions and fairness considerations. Keep in mind that AA is intheprocessofamergerwithUSAirways. TheAmericanAirlinesportionof the total value of the merged airline is 72%, so the value the court assigns to the ‘New American Airlines’ our 4.8% would be based on 72% of the value, it is estimated that the combined value of the New American may be up to $13 billion dollars.

Also as part of the discussions with the company on receiving the 4.8% equity there was a settlement of the International 29d’s on the 757 outsourcing and medical cost increases. We agreed to settle both disputes $10M for the overcharges in medical coverage and $6.4M on the B757 outsourcing. In addition, there is a reimbursement to the locals for cost incurred in the 1113 negotiations for a total of ~$680K.

Question: If another Union or organization were elected to represent the Mechanic and Related group, would they get the entire 4.8% equity stake?

Answer: The 4.8% equity is allotted by agreement to TWU as a fund from which TWU will distribute their appropriate shares to all seven of the classes or crafts represented by TWU. Mechanic and Related, as a class or craft, will receive an appropriate share of this equity.

The responsibility of determining what that appropriate share is, must rest on TWU, since the equity agreement itself contains no formula as to how the equity is to be shared out among the seven classes or crafts.

Question: When will we get the company’s portion of the pre-funding?

Answer: The retiree medical issue is handled thru the 1114 process in bankruptcy court, currently there is a motion that AA can change retiree medical without going thru the 1114 process. This has been heard in a summary judgment hearing and Judge Lane will rule on that motion sometime in the near future. At this time AA has not filed an official 1114 motion in the court. Our position is that once the retiree medical plan is terminated our active members must receive the company match to their prefunding contributions.