AVIANCA HOLDINGS S.A. (Exact Name of Registrant As Specified in Its Charter)
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Table of Contents As filed with the Securities and Exchange Commission on June 10, 2020 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-36142 AVIANCA HOLDINGS S.A. (Exact name of registrant as specified in its charter) Avianca Holdings S.A. (Translation of registrant’s name into English) Republic of Panama (Jurisdiction of incorporation or organization) Arias, Fábrega & Fábrega, P.H. ARIFA, Floors 9 and 10, West Boulevard, Santa María Business District Panama City, Republic of Panama (+507) 205-6000 (Address of principal executive offices) Luca Pfeifer Tel: (57+1) 587 77 00 ext. 7575 • Fax: (57+1) 423 55 00 ext. 2544/2474 Address: Avenida Calle 26 # 59 – 15 P5, Bogotá, Colombia (Name, telephone, e-mail and/or facsimile number and address of company contact person) Securities registered or to be registered pursuant to Section 12(b) of the Act: Title of each class Trading symbol Name of each exchange on which registered American Depositary Shares (as evidenced by AVH N/A* American Depositary Receipts), each representing 8 preferred shares, with a par value of $0.125 per preferred share * The New York Stock Exchange filed Form 25 with the U.S. Securities and Exchange Commission on May 27, 2020 in order to delist the American Depositary Shares. Securities registered or to be registered pursuant to Section 12(g) of the Act: None Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of December 31, 2019: Common Shares — 660,800,003 Preferred Shares — 340,507,917 (includes 4,320,632 preferred shares held on behalf of the registrant) Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒ If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Emerging growth company ☐ If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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. ☐ † The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing: U.S. GAAP ☐ International Financial Reporting Standards as issued Other ☐ by the International Accounting Standards Board ☒ If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐ If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ (APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS) Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐ Table of Contents TABLE OF CONTENTS Page PRESENTATION OF FINANCIAL AND OTHER INFORMATION 5 MARKET DATA 6 CERTAIN TERMS 7 FORWARD LOOKING STATEMENTS 9 PART I 10 Item 1. Identity of Directors, Senior Management and Advisers 10 Item 2. Offer Statistics and Expected Timetable 10 Item 3. Key Information 10 Item 4. Information on the Company 40 Item 4A. Unresolved Staff Comments 76 Item 5. Operating and Financial Review and Prospects 76 Item 6. Directors, Senior Management and Employees 98 Item 7. Major Shareholders and Related Party Transactions 106 Item 8. Financial Information 112 Item 9. The Offer and Listing 113 Item 10. Additional Information 117 Item 11. Quantitative and Qualitative Disclosures About Market Risk 132 Item 12. Description of Securities Other than Equity Securities 133 PART II 134 Item 13. Defaults, Dividends Arrearages and Delinquencies 134 Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds 134 Item 15. Controls and Procedures 135 Item 16. Reserved 136 Item 16A. Audit Committee Financial Expert 136 Item 16B. Code of Ethics 136 Item 16C. Principal Accountant Fees and Services 136 Item 16D. Exemptions from the Listing Standards for Audit Committees 137 Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers 137 Item 16F. Change in Registrant’s Certifying Accountant 137 Item 16G. Corporate Governance 137 Item 16H. Mine Safety Disclosure 138 PART III 138 Item 17. Financial Statements 139 Item 18. Financial Statements 139 Item 19. Exhibits 139 i Table of Contents EXPLANATORY NOTE On May 10, 2020, Avianca Holdings S.A. and certain of its affiliated entities filed voluntary petitions for chapter 11 relief under title 11 of the United States Code (11 U.S.C. § 101, et. seq.) with the United States Bankruptcy Court for the Southern District of New York, which cases are being jointly administered under Case No. 20-11133 (MG). We refer to these proceedings in this annual report as our “Chapter 11 proceedings.” LifeMiles, our loyalty program, is administered by a separate company and is not part of our Chapter 11 proceedings. As of the date of this annual report, our subsidiary Avianca Peru S.A. has initiated a voluntary dissolution and liquidation process. The information in this annual report is presented as of December 31, 2019, unless expressly stated otherwise, and is subject to and qualified in its entirety by our Chapter 11 proceedings and developments related thereto. RELIANCE ON SEC ORDER TO EXTEND FILING DEADLINE As disclosed in our report on Form 6-K furnished to the U.S. Securities and Exchange Commission (the “SEC”) on April 23, 2020, we have relied on the SEC’s order dated March 25, 2020 (Release No. 34-88465) regarding an extension to file certain reports due to circumstances relating to the spread of a new strain of coronavirus (“COVID-19”). The airline industry has been among the sectors of the global economy most affected by the spread of COVID-19 and related government measures, which have resulted in unprecedented challenges for us. Our management has since the second half of March 2020 been focused primarily on addressing the unprecedented challenges that the COVID-19 pandemic has created for our business and employees. Consequently, this situation resulted in a delay in our completion of this annual report on Form 20-F. PRESENTATION OF FINANCIAL AND OTHER INFORMATION In this annual report, we use the terms “we,” “us,” “our,” “the Company” and “Avianca Holdings” to refer to Avianca Holdings S.A., together with its subsidiaries, except where the context requires otherwise. IFRS Financial Statements This annual report includes our audited consolidated financial statements as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017, together with the notes thereto, prepared in accordance with IFRS. Unless otherwise indicated, all financial information provided in this annual report has been prepared in accordance with IFRS. Our consolidated financial statements prepared in accordance with IFRS are stated in U.S. dollars. Change in Accountants On February 21, 2018, our board of directors approved the appointment of KPMG S.A.S. as our external auditor as of May 1, 2018. Our consolidated financial statements as of and for the years ended December 31, 2019 and 2018 have been audited by KPMG S.A.S., independent auditors, as stated in their report included in this annual report. Our consolidated financial statements as of and for the year ended December 31, 2017, included in this annual report, have been audited by Ernst & Young Audit S.A.S., independent auditors. Currency Presentation In this annual report, references to “dollars,” “U.S.