Transaction Summary: Treasury Loan to Mesa Airlines, Inc. (Updated)

Summary

A U.S. Department of the Treasury transaction summary for a loan totaling $195 million to Mesa Airlines, Inc., a wholly owned subsidiary of Mesa Air Group, Inc., made under section 4003(b)(1) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. It states Treasury originally agreed to lend up to $200 million and the company elected to draw a total of $195 million, $43 million at close and $152 million on November 13, 2020. The loan is secured by aircraft, engines, accounts receivable, tooling inventory, simulators and ground service equipment, carries LIBOR plus 3.5% and matures on October 30, 2025. Treasury will receive warrants equal to 10% of the total loan amount drawn.

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Cite this document

“Transaction Summary: Treasury Loan to Mesa Airlines, Inc. (Updated).” Original at home.treasury.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/treas-mesa-airlines-updated-transaction-summary-f68cd2bf86/, SHA-256 a04dcfdbe34d916f177f9f1dc2ad0d6df89f5d71e1ecd9a1f3809037676313f4.

Full text

                                    Transaction Summary

The U.S. Department of the Treasury agreed to make a loan totaling $195 million to Mesa
Airlines, Inc. (the Company). Treasury originally agreed to make a loan of up to $200 million to
the Company, and the Company elected to draw a total of $195 million. The Company is a
wholly owned subsidiary of Mesa Air Group, Inc., with approximately 3,540 U.S. employees in
March 2020.

Treasury made the loan pursuant to section 4003(b)(1) of the Coronavirus Aid, Relief, and
Economic Security (CARES) Act. The loan is secured by aircraft, engines, accounts receivable,
tooling inventory, simulators, and ground service equipment. The loan has an interest rate equal
to LIBOR plus 3.5% and matures on October 30, 2025. The Company elected to draw $43
million at close and $152 million on November 13, 2020. The loan proceeds will be used to
provide liquidity to continue the Company’s operations. The transaction agreement includes
covenants by the Company to comply with certain restrictions on employee compensation, stock
repurchases, dividends, and reductions in employment levels, as required by the CARES Act.
Treasury will receive warrants to purchase common stock equal to 10% of the total loan amount
drawn.

File and source

File: TREAS-Mesa-Airlines-Updated-Transaction-Summary.pdf
Size: 80,966 bytes
SHA-256: a04dcfdbe34d916f177f9f1dc2ad0d6df89f5d71e1ecd9a1f3809037676313f4
Our copy: TREAS-Mesa-Airlines-Updated-Transaction-Summary.pdf
Original: home.treasury.gov