– Alaska Air Group, Inc. (the “Company”) launched a proposed senior secured term loan facility and intends to issue additional pari passu senior secured debt (collectively, the “Mileage Plan Financing”). 

– The aggregate principal amount of the Mileage Plan Financing is expected to be $1.5 billion.

Alaska Air Group, Inc. (the “Company”) today announced that it launched a proposed senior secured term loan facility and intends to issue additional pari passu senior secured debt (collectively, the “Mileage Plan Financing”). The aggregate principal amount of the Mileage Plan Financing is expected to be $1.5 billion.

The borrower under the Mileage Plan Financing is AS Mileage Plan IP Ltd. (“Borrower”), an exempted company incorporated with limited liability under the laws of the Cayman Islands and an indirect, wholly owned subsidiary of the Company.

The Mileage Plan Financing will be (i) fully and unconditionally guaranteed on a senior secured basis, jointly and severally, by Alaska Airlines, Inc. (“Alaska”) and AS Mileage Plan Holdings Ltd. and on an unsecured basis by the Company (together, the “Guarantors”) and (ii) secured, on a first-priority basis by the Guarantors’ right, title and interest in certain collateral associated with Alaska’s customer loyalty program, Alaska Airlines Mileage Plan™.

Borrower intends to use the borrowings under the Mileage Plan Financing, after deducting fees and expenses payable by the Company, (i) to fund, in part, the reserve account for the Mileage Plan Financing and (ii) to fund, in part, a collection account, and the proceeds deposited into the collection account will be used to make an intercompany loan to Alaska on the closing date of the Mileage Plan Financing (the “Intercompany Loan”). Alaska intends to use the proceeds from the Intercompany Loan (i) to redeem certain outstanding debt acquired or assumed in the merger of the Company with Hawaiian Airlines pursuant to an Agreement and Plan of Merger dated as of December 2, 2023 and (ii) for general corporate purposes and to support its liquidity position.

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