AAR expects to receive $57.2 million from U.S. Treasury under Air Carrier Worker Support portion of CARES Act
July 20 2020 - 6:40PM
AAR (NYSE: AIR), a leading provider of aviation services to
commercial and government operators worldwide, today announced that
certain of its subsidiaries expect to receive $57.2 million from
the U.S. Treasury Department through the Payroll Support Program
under the Coronavirus Aid, Relief, and Economic Security (CARES)
Act. The funds are expected to consist of a $48.5 million grant and
an $8.7 million loan, and will be used exclusively to pay salaries,
wages and benefits of employees in AAR’s U.S. airframe and landing
gear maintenance, repair and overhaul (MRO) operations.
“We thank Congress and the Administration for passing
legislation that recognizes the essential service that our MRO team
provides to the aviation industry. We are also grateful to our
employees for their tireless support of our airline customers,”
said John M. Holmes, President and Chief Executive Officer of AAR.
“We appreciate the Treasury Department’s collaborative approach to
identifying the AAR businesses that are eligible for assistance
under the Payroll Support Program and are grateful to be able to
keep the current workforce of these businesses in place.”
The loan portion of the funding is a ten-year, low-interest note
that may be prepaid at any time at par. AAR will not issue warrants
or other equity or equity-like securities in conjunction with the
program.
The program requires AAR to refrain from involuntary furloughs,
layoffs and reductions in employee pay rates and benefits at our
U.S. airframe and landing gear MRO operations from the date of
signing until September 30, 2020. Additionally, the program
obligates AAR to eliminate dividends and share repurchases until
September 30, 2021 and to limit executive compensation until March
24, 2022.
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About AAR
AAR is a global aerospace and defense aftermarket
solutions company with operations in over 20 countries.
Headquartered in the Chicago area, AAR supports commercial and
government customers through two operating segments: Aviation
Services and Expeditionary Services. AAR’s Aviation Services
include Parts Supply; OEM Solutions; Integrated Solutions; and
Maintenance, Repair and Overhaul (MRO) Services. AAR’s
Expeditionary Services include Mobility Systems and Composites
Manufacturing operations. Additional information can be found at
www.aarcorp.com.
This press release contains certain statements relating to
future results, which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of 1995.
Forward-looking statements may also be identified because they
contain words such as ‘‘anticipate,’’ ‘‘believe,’’ ‘‘continue,’’
‘‘could,’’ ‘‘estimate,’’ ‘‘expect,’’ ‘‘intend,’’ ‘‘likely,’’
‘‘may,’’ ‘‘might,’’ ‘‘plan,’’ ‘‘potential,’’ ‘‘predict,’’
‘‘project,’’ ‘‘seek,’’ ‘‘should,’’ ‘‘target,’’ ‘‘will,’’ ‘‘would,’’
or similar expressions and the negatives of those terms. These
forward-looking statements are based on beliefs of Company
management, as well as assumptions and estimates based on
information currently available to the Company, and are subject to
certain risks and uncertainties that could cause actual results to
differ materially from historical results or those anticipated,
including those factors discussed under Item 1A, entitled “Risk
Factors”, included in the Company’s Form 10-K for the fiscal year
ended May 31, 2019 and the Company’s Form 10-Q for the fiscal
quarter ended February 29, 2020. Should one or more of these risks
or uncertainties materialize adversely, or should underlying
assumptions or estimates prove incorrect, actual results may vary
materially from those described. These events and uncertainties are
difficult or impossible to predict accurately and many are beyond
the Company’s control. The Company assumes no obligation to update
any forward-looking statements to reflect events or circumstances
after the date of such statements or to reflect the occurrence of
anticipated or unanticipated events. For additional information,
see the comments included in AAR’s filings with the Securities and
Exchange Commission.
Daniela Pietsch
AAR CORP.
6302275100
Editor@aarcorp.com
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