=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2003/05/15/f= inancial1650EDT0248.DTL ---------------------------------------------------------------------- Thursday, May 15, 2003 (AP) American Airlines announces $175 million in supplier cuts (05-15) 15:17 PDT FORT WORTH, Texas (AP) -- American Airlines said Thursday it would issue stock to suppliers and other creditors in exchange for agreements that will save the company $175 million a year. American, which has teetered on the brink of bankruptcy several times th= is year, said it would issue up to 3 million shares of common stock -- about 2 percent of its outstanding shares -- to suppliers, lessors and other creditors. The agreements are part of Fort Worth-based American's plan to cut annual costs by $4 billion. Last month, employees agreed to $1.8 billion in annual labor concessions. American said the agreements announced Thursday covered more than 100 creditors. "We are grateful to each supplier, lessor, and creditor who tangibly expressed support for our company by granting these significant concessions," said Gerard Arpey, chief executive of American and its parent, AMR Corp. "We continue to move through the most challenging period in our history, and our success is still far from assured," Arpey said, "but reaching these cost-reduction agreements with our suppliers, lessors, and creditors is another step forward and further strengthens AMR as we seek to put the company on a solid financial footing." The company did not identify the creditors who agreed to cost cuts but indicated more could be in the works. "We continue to be in discussions with this group to get additional cost savings," said spokeswoman Tara Baten. On Wednesday, American notified its unions that it would lay off more th= an 3,100 flight attendants on July 1. The president of the flight attendants' union called the announcement "another in a long line of very disheartening events of late." The layoffs were larger than American's previous estimate that it would cut the jobs of 2,400 flight attendants, but the company had sent layoff notices to 5,000 attendants late last month. In trading Thursday on the New York Stock Exchange, AMR shares fell 32 cents to $6.72 each. On the Net: www.amrcorp.com =20 ---------------------------------------------------------------------- Copyright 2003 AP