HHR Helps United Airlines Secure $ 7.491 Billion Under CARES – Coronavirus (COVID-19) Law
United States: HHR Helps United Airlines Secure $ 7.491 Billion Under CARES Act
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December 10, 2020 – The company represented United Airlines as the borrower on a $ 7.491 billion secured loan under the US Treasury Department’s airline loan program.
In March, Congress set aside $ 25 billion for a $ 2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES Act) guaranteed loan program to relieve U.S. passenger air carriers suffering from the impact of the COVID-19 pandemic.
On September 28, United entered into a loan agreement with the Treasury for a five-year term loan facility in the amount of $ 5.17 billion. Bank of New York Mellon served as administrative agent and collateral agent under the facility.
On November 6 and December 8, United pledged additional guarantees and entered into changes to bring the facility to $ 7.491 billion. United has borrowed $ 520 million under the facility and has the option of borrowing additional funds under two additional drawdowns no later than March 2021.
The United CARES Act loan is guaranteed by United Airlines Holdings and certain of its subsidiaries, and is secured by liens on (i) certain route authorities and slots and gate leases, (ii) certain Boeing 777-300ER and (iii) certain simulator flights and associated assets.
Under the loan facility, United Airlines Holdings has entered into a warrant agreement under which it will be required to issue warrants to the Treasury on the date of disbursement of each term loan in the corresponding amount. at 10% of the principal amount of each. such disbursement, at an exercise price of $ 31.50 per share (which was the closing price of its common share on the Nasdaq Stock Market on April 9, 2020).
John Hoyns and Emilio Saiz led the HHR team, which also included Mark Denham, Patrice Jean, Andy Braiterman, Alan Kravitz, Jim Delaney, Michael DeBernardis, Nathalie Rey, Arthur Souza Rodrigues, TJ Haley, Javad Husain, Hannah Miller and Katherine Thomas.
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