American Airlines has been a prolific issuer of bonds, mostly secured on assets. However the airline has also issued some $3.2billion of special facilities revenue bonds in 19 transactions funding projects at the airline’s airport hubs and maintenance facilities. Some $1.4bn of these bonds are unsecured and backed only by the guaranty of the airline, yet investors piled into the deals despite the risk the airline would file for bankruptcy. In 2007 American sold $108.7 million of O’Hare International Airport special facility revenue refunding bonds in 2007 that mature in 2024 and paid a 5.50% rate. Even though the bond

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