AMR uncertain that it will stay in compliance with loan EBITDAR covenant

By Sara Rosenberg

New York, April 18 - AMR Corp. is unsure of whether it will be able to comply with the EBITDAR covenant under its credit facility, according to a 10-Q filed with the Securities and Exchange Commission Friday.

The company was in compliance with the covenant for the four-quarter period ended March 31, but it's the subsequent periods that the have raised concerns.

AMR said that compliance uncertainty is a result of fuel prices that are high by historical standards and the volatility of fuel prices and revenues.

Failure to comply with the covenant would result in a default under the credit facility, which, if not cured by a waiver or other means, could result in a default under a significant amount of AMR's other debt and lease obligations and otherwise have a material adverse impact.

AMR is a Fort Worth, Texas-based scheduled passenger airline.

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