LAS VEGAS (AP) — Allegiant Airlines will receive $171.9 million in federal emergency relief through the Payroll Support Program created to help stimulate the economy in response to the COVID-19 pandemic, its Las Vegas-based parent company announced Tuesday.
The money provided under the Coronavirus Aid, Relief and Economic Security Act will cover about 76% of budgeted payroll and benefit costs for its 4,500 workers through Sept. 30, Allegiant Travel Co. said.
That includes $21 million to be repaid through a 10-year, low-interest loan, according to the integrated travel company targeting small- to medium-sized vacation destinations. Under the loan, Allegiant will issue warrants to the U.S. Treasury Department to purchase 25,890 shares of common stock with a cash settlement right at the company's option.
More than 25% of Allegiant's workforce already is participating in a voluntary short-term leave program or voluntary pay reductions, Chief Financial Officer Greg Anderson said.
“Further participation will go a long way to maximize the payroll assistance funds and extend their impact as long as possible,” Anderson said. “With so much uncertainty regarding the arc of the coronavirus outbreak and when demand for travel will return, we believe the airlines maintaining the most flexibility will be best positioned to emerge from this crisis even stronger.”