AAL 2019 Proxy Statement

Realizable Compensation Significantly Less Than Target Compensation. As of December 31, 2018, Mr. Parker’s three-year average realizable compensation from 2016-2018 was only 61% of his three-year average target compensation, while his 2018 realizable compensation was only 46% of his 2018 target compensation. For our other named executive officers, their three-year average realizable compensation from 2016-2018 was only 72% of their three-year average targeted compensation, while their average 2018 realizable compensation was only 55% of their target compensation.

Three-year Average Realizable Compensation

3 Year Average NEO Target vs. Realizable Compensation (excluding CEO)

3 Year Average CEO Target vs. Realizable Compensation

$mm 14.00

$mm 14.00

12.00

Target: $11.6M

12.00

10.00

10.00

Realizable: $7.2M = 61%

8.00

8.00

6.00

6.00

Target: $4.8M

Realizable: $3.5M = 72%

4.00

4.00

2.00

2.00

0.00

0.00

STI

LTI

Base Salary

STI

LTI

Base Salary

Target compensation includes base salary, target annual short-term incentive and the grant date fair value of long-term incentives for the applicable year. Realizable compensation includes base salary and annual short-term incentives earned for each applicable year and values equity awards granted during 2016-2018 as follows: with respect to RSUs that had vested by December 31, 2018 based on the closing stock price and actual performance on the applicable vesting date, with respect to time-vesting RSUs that were unvested as of December 31, 2018 based on the closing stock price as of December 31, 2018, and with respect to performance-vesting RSUs that were unvested as of December 31, 2018 based on the performance and closing stock price as of December 31, 2018.

2018 Realizable Compensation

2018 Average NEO Target vs. Realizable Compensation (excluding CEO)

2018 CEO Target vs. Realizable Compensation

$mm 14.00

$mm 14.00

12.00

Target: $11.9M

12.00

10.00

10.00

8.00

8.00

Realizable: $5.5M = 46%

6.00

Target: $5.0M

6.00

Realizable: $2.7M = 55%

4.00

4.00

2.00

2.00

0.00

0.00

LTI

STI

Base Salary

STI

LTI

Base Salary

Target compensation includes base salary, target annual short-term incentive and the grant date fair value of long-term incentives. Realizable compensation includes base salary earned, annual short-term incentive earned for 2018, the value of time-vesting RSUs granted in 2018 based on our closing stock price as of December 31, 2018, and the value of performance-vesting RSUs granted in 2018 based on our performance and closing stock price as of December 31, 2018.

42

2019 Proxy Statement |