STOCK TITAN

Alaska Air Group (NYSE: ALK) adds $1B notes and secured term loan

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Alaska Air Group disclosed two major financing actions. Subsidiary Alaska Airlines issued and sold $500 million of 6.500% senior notes due 2031, fully and unconditionally guaranteed by the parent company. These notes pay interest semiannually each June 1 and December 1, starting December 1, 2026, and include make-whole redemption provisions before December 1, 2030 and a 101% change-of-control repurchase right.

Separately, indirect subsidiary AS Mileage Plan IP Ltd. added a new $500 million Incremental Term Loan Facility under its existing term loan agreement. This senior secured term loan bears interest at Term SOFR plus 2.00% and is secured on a first-priority basis by loyalty program collateral that also backs $1.25 billion of existing Loyalty Notes and a $750 million existing term loan facility.

Positive

  • None.

Negative

  • Alaska Air Group is incurring an additional $1 billion of debt through 6.500% senior notes and a Term SOFR + 2.00% secured term loan, which increases leverage and fixed interest obligations.
  • The new $500 million Incremental Term Loan Facility is secured by a first-priority lien on loyalty program collateral that already backs $1.25 billion of Loyalty Notes and a $750 million term loan, concentrating secured claims on key assets.

Insights

Alaska Air adds $1B of new debt, including secured borrowing against its loyalty program.

Alaska Air Group is layering on substantial new obligations: $500 million in 6.500% senior notes due 2031 and a $500 million Incremental Term Loan Facility. The notes are unsecured senior debt guaranteed by the parent, while the new term loan is senior secured.

The term loan shares a first-priority lien on loyalty program collateral with existing Loyalty Notes totaling $1.25 billion and a $750 million term loan. This concentrates secured claims on a key asset pool, increasing structural complexity and limiting future flexibility around the loyalty business.

Together, these transactions materially increase gross debt and fixed obligations through a 6.500% coupon and SOFR-based term loan spread of 2.00%. Actual balance sheet impact, repayment profile, and any refinancing of existing facilities will be clearer in the company’s Form 10-Q for the quarter ended June 30, 2026.

Item 1.01 Entry into a Material Definitive Agreement Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial
The company incurred a new significant debt or off-balance-sheet obligation.
New senior notes $500 million aggregate principal 6.500% senior notes due 2031, issued May 12, 2026
Coupon rate 6.500% per annum Interest on new senior notes, paid semiannually
Notes maturity June 1, 2031 Final maturity date of senior notes
Change-of-control repurchase price 101% of principal Repurchase obligation on notes upon specified change of control
Incremental Term Loan Facility size $500 million New senior secured term loans under Existing Term Loan Agreement
Term loan interest margin Term SOFR + 2.00% Variable rate on Incremental Term Loan Facility, SOFR floor zero
Existing Loyalty Notes $1.25 billion total $625M 5.021% due 2029 and $625M 5.308% due 2031
Existing term loan facility $750 million Senior secured term loans sharing first-priority lien on loyalty collateral
senior notes financial
"Alaska Airlines, Inc. issued and sold $500 million aggregate principal amount of 6.500% senior notes due 2031"
Senior notes are a type of loan that a company borrows from investors, promising to pay it back with interest. They are called "senior" because in case the company faces financial trouble, these lenders are paid back before others. This makes senior notes safer for investors compared to other types of loans or bonds.
Indenture regulatory
"pursuant to an Indenture dated as of May 12, 2026, by and between Alaska and U.S. Bank Trust Company"
An indenture is a legal agreement between a company that borrows money by issuing bonds and the people who buy those bonds. It explains the rules the company must follow, like paying back the money and keeping certain financial promises. This document helps both sides understand their rights and responsibilities.
Term Loan Credit and Guaranty Agreement financial
"entered into an amendment to the Term Loan Credit and Guaranty Agreement, dated as of October 15, 2024"
Incremental Term Loan Facility financial
"pursuant to which the Borrower incurred a new incremental class of $500 million in senior secured term loans (the “Incremental Term Loan Facility”)"
An incremental term loan facility is an additional fixed‑repayment loan added to a company’s existing long‑term debt package, like taking out a second mortgage on a house to pay for a new project. It matters to investors because it increases the company’s total debt, interest obligations and potential risk profile, and can affect credit terms and future earnings — in short, it changes how risky and costly the business may be going forward.
Term SOFR financial
"The loans under the Incremental Term Loan Facility will bear interest at a variable rate equal to Term SOFR"
Term SOFR is a benchmark interest rate that reflects the cost of borrowing money over a specific period, based on actual transactions in the financial markets. It is used by lenders and borrowers to set the interest rates on loans and financial contracts, helping to ensure rates are fair and transparent. For investors, understanding term SOFR helps gauge borrowing costs and the overall direction of interest rates in the economy.
first-priority lien financial
"secured on an equal and ratable basis ... by a first-priority lien on the Loyalty Collateral"
A first-priority lien is a legal claim that gives one lender or creditor the top spot to seize and sell specified assets if a borrower fails to pay. For investors, it matters because being first in line usually means a higher chance of recovering money after a default, lowering risk compared with holders who are behind in the queue — like a person cutting to the front of a checkout line for payment from the same pile of goods.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549


FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

May 12, 2026
(Date of earliest event reported)

ALASKA AIR GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)

Delaware
(State or Other Jurisdiction of Incorporation)
1-895791-1292054
(Commission File Number)(IRS Employer Identification No.)
19300 International BoulevardSeattleWashington98188
(Address of Principal Executive Offices)(Zip Code)

(206) 392-5040
(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTicker SymbolName of each exchange on which registered
Common stock, $0.01 par value ALKNew York Stock Exchange
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

This document is also available on our website at http://investor.alaskaair.com






ITEM 1.01 Entry Into a Material Definitive Agreement

Indenture Governing Senior Notes

On May 12, 2026, Alaska Airlines, Inc. (“Alaska”) issued and sold $500 million aggregate principal amount of 6.500% senior notes due 2031 (the “Notes”) pursuant to an Indenture dated as of May 12, 2026, by and between Alaska and U.S. Bank Trust Company, National Association (the “Base Indenture”), as supplemented by the First Supplemental Indenture dated as of May 12, 2026 by and among Alaska, Alaska Air Group, Inc. (the “Company”), as guarantor, and U.S. Bank Trust Company, National Association, as trustee (the “First Supplemental Indenture” and together with the Base Indenture, the “Indenture”). The Notes will be fully and unconditionally guaranteed by the Company.

The Notes will mature on June 1, 2031. The Notes bear interest at a rate of 6.500% per annum, payable semiannually in arrears on June 1 and December 1 of each year, commencing on December 1, 2026.
The Notes and the note guarantee of the Company will rank equally in right of payment with all of Alaska’s existing and future senior indebtedness. The Notes and the note guarantee are effectively subordinated to all of Alaska’s and the Company’s existing and future secured debt to the extent of the collateral securing such debt and structurally subordinated to all existing and future obligations of the Company’s subsidiaries other than Alaska.

Prior to December 1, 2030 (the “Par Call Date”), Alaska may redeem the Notes, in whole or in part, at a redemption price equal to the greater of (1) 100% of the principal amount of the Notes being redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on such Notes (excluding accrued and unpaid interest to the redemption date, and assuming final maturity on the Par Call Date) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the First Supplemental Indenture) plus 50 basis points, plus, in either case, accrued and unpaid interest to the redemption date.

If the Company experiences specified kinds of changes of control, Alaska must offer to repurchase the Notes at 101% of their principal amount, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The Indenture provides for customary events of default. In the case of an event of default with respect to Alaska or the Company arising from specified events of bankruptcy or insolvency, all outstanding Notes will become due and payable immediately without further action or notice.

The description of the Indenture contained in this Item 1.01 does not purport to be complete and is qualified in its entirety by reference to the Base Indenture and the First Supplemental Indenture, copies of which will be filed as exhibits to Air Group’s Form 10-Q for the quarter ended June 30, 2026.

Term Loan Facility

On May 12, 2026, AS Mileage Plan IP Ltd. (the “Borrower”), an exempted company incorporated with limited liability under the laws of the Cayman Islands and an indirect wholly owned subsidiary of the Company, entered into an amendment to the Term Loan Credit and Guaranty Agreement, dated as of October 15, 2024 (the “Existing Term Loan Agreement”) by and among the Borrower, and the Company, Alaska and AS Mileage Plan Holdings Ltd., an exempted company incorporated with limited liability under the laws of the Cayman Islands, as guarantors, Bank of America, N.A., as administrative agent, and the lenders party thereto from time to time, pursuant to which the Borrower incurred a new incremental class of $500 million in senior secured term loans (the “Incremental Term Loan Facility”) under the Existing Term Loan Agreement.

The Incremental Term Loan Facility will be secured by certain collateral (the “Loyalty Collateral”) associated with Alaska’s customer loyalty program, Atmos Rewards, which also secures (i) the Borrower’s existing $625 million 5.021% senior secured notes due 2029 and the $625 million 5.308% senior secured notes due 2031 (collectively, the “Loyalty Notes”), and (ii) the Borrower’s existing $750 million class of senior secured term loans under the Existing Term Loan Agreement (the “Existing Term Loan Facility”). The Incremental Term Loan Facility will be secured on an equal and ratable basis with the Existing Term Loan Facility and the Loyalty Notes by a first-priority lien on the Loyalty Collateral and will rank pari passu in right of payment with the Existing Term Loan Facility and the Loyalty Notes.

The loans under the Incremental Term Loan Facility will bear interest at a variable rate equal to Term SOFR (subject to a floor of zero) plus a specified margin of 2.00%.

The description of the Incremental Term Loan Facility contained in this Item 1.01 does not purport to be complete and is qualified in its entirety by reference to the Second Amendment to the Existing Term Loan Agreement, a copy of which will be filed as an exhibit to Air Group’s Form 10-Q for the quarter ended June 30, 2026.



ITEM 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information described under Item 1.01 above is hereby incorporated by reference into this Item 2.03.




Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ALASKA AIR GROUP, INC.                                                                           
Registrant

Date: May 12, 2026

/s/ KYLE B. LEVINE
Kyle B. Levine
Executive Vice President Corporate and Public Affairs,
Chief Legal Officer and Corporate Secretary

FAQ

What new debt did Alaska Air Group (ALK) announce in this 8-K?

Alaska Air Group announced $1 billion of new financing: $500 million of 6.500% senior notes due 2031 and a separate $500 million Incremental Term Loan Facility, both incurred on May 12, 2026, through its subsidiaries.

What are the key terms of Alaska Air’s new 6.500% senior notes due 2031?

The notes total $500 million, bear 6.500% interest annually, and mature June 1, 2031. Interest is payable semiannually each June 1 and December 1, starting December 1, 2026, and the notes are fully and unconditionally guaranteed by Alaska Air Group.

Can Alaska Airlines redeem the new senior notes before maturity?

Before December 1, 2030, Alaska may redeem the notes at the greater of 100% of principal or a make-whole amount based on Treasury Rate plus 50 basis points, in each case plus accrued interest to the redemption date.

How is the new $500 million Incremental Term Loan Facility for Alaska Air structured?

The Incremental Term Loan Facility is a $500 million senior secured term loan under an existing agreement. It bears interest at a variable Term SOFR rate, subject to a zero floor, plus a 2.00% margin and is secured by specified loyalty program collateral.

What collateral backs Alaska Air’s new Incremental Term Loan Facility?

The facility is secured by loyalty collateral tied to the Atmos Rewards program. This collateral also secures $625 million 5.021% senior secured notes due 2029, $625 million 5.308% notes due 2031, and a $750 million existing senior secured term loan facility.

What happens to the new notes if Alaska Air Group undergoes a change of control?

If specified change-of-control events occur, Alaska Airlines must offer to repurchase the notes at 101% of principal plus accrued and unpaid interest, up to but excluding the repurchase date, giving noteholders a protective exit option.

Filing Exhibits & Attachments

3 documents