The airlines secured the first tranche of their bailout late Tuesday, with a group of 10 public and privately held carriers agreeing to terms to receive some of the $25 billion in payroll support authorized under the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
The deals came after a week of negotiations over how the government would be compensated for its largesse, and includes the airlines issuing warrants totaling between 1% and 3% of their total equity. They also pledged to do no layoffs before Sept. 30, an important factor for the government, given the mounting jobless claims nationally.
"We welcome the news that a number of major airlines intend to participate in the Payroll Support Program," Treasury Secretary Steven T. Mnuchin said in a statement. "This is an important CARES Act program that will support American workers and help preserve the strategic importance of the airline industry while allowing for appropriate compensation to the taxpayers."