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Report Under Section 4026(b)(1) of the CARES Act on 

Loans to Air Carriers, Eligible Businesses, and National Security Businesses 

Program Description

Section 4003 of the Coronavirus Aid, Relief and Economic Security Act (CARES Act) 

authorizes the Treasury Department to make loans, loan guarantees, and other 

investments to provide liquidity to eligible businesses related to losses incurred as a result 

of coronavirus.

The CARES Act provides:

(1) up to $25 billion for loans and loan guarantees for passenger air carriers; eligible 

businesses that are certified under 14 CFR part 145 and approved to perform 

inspection, repair, replace, or overhaul services; and ticket agents (as defined in 

49 U.S.C. § 40102); 

(2) up to $4 billion for loans and loan guarantees for cargo air carriers; and

(3) up to $17 billion for loans and loan guarantees for businesses critical to 

maintaining national security.

A loan or loan guarantee under section 4003 may be made in such form and on such 

terms and conditions and contain such covenants, representations, warranties, and 

requirements as the Treasury Secretary determines appropriate. However, the CARES 

Act specifies a number of requirements applicable to these loans. Among other 

requirements under the statute, borrowers must agree to maintain employment levels as 

of March 24, 2020, to the extent practicable, and in any case not reduce their 

employment levels by more than 10 percent from the levels on such date, until 

September 30, 2020. Borrowers must also agree to certain restrictions on employee 

compensation; agree not to repurchase stock, except to the extent required under a 

contractual obligation in effect as of March 27, 2020; and agree not to pay dividends or 

make other capital distributions with respect to the borrower’s common stock until 12 

months after the loan has been repaid.

In addition, the CARES Act requires that Treasury receive a warrant or equity instrument 

in the borrower if the borrower is a public company (unless Treasury determines that the 

issuance of warrants or equity is infeasible, in which case the company must provide a 

senior debt instrument), or a warrant, equity instrument, or senior debt instrument if the 

borrower is a private company, to compensate taxpayers.

Reporting Requirements

The CARES Act requires Treasury to make a number of disclosures regarding its loans 

and loan guarantees under section 4003 of the CARES Act:

(1) under section 4026(a) of the CARES Act, not later than 72 hours after any 

transaction under section 4003(b)(1), (2), or (3) of the CARES Act, Treasury must 

publish on its website a description of the transaction, certain transaction terms, 

and transaction documentation;
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(2) under section 4026(b)(1)(A) of the CARES Act, not later than seven days after any 

loan or loan guarantee under section 4003(b)(1), (2), or (3), Treasury must submit 

to Congress a report summarizing the actions taken under those provisions and 

certain related financial information;

(3) under section 4026(b)(1)(B) of the CARES Act, not later than seven days after 

delivering the report to Congress described above, Treasury must publish the 

report on its website; and

(4) under section 4026(b)(1)(C) of the CARES Act, every 30 days while a loan or loan 

guarantee under section 4003(b)(1), (2), or (3) is outstanding, Treasury must 

publish on its website a report summarizing its reports to Congress described 

above. 

Current Report

This is Treasury’s seventh report under section 4026(b)(1) of the CARES Act and reflects

four transactions with new borrowers: one transaction on November 12 and three 

transactions on November 13, 2020. Treasury made these four loans pursuant to section 

4003(b)(3) of the CARES Act. Treasury’s total commitment under these four transactions

was $7,524,600, all of which has been disbursed.

This report also reflects disbursements to five entities whose loans closed before the 

reporting period: one disbursement on November 13 and four disbursements on 

November 16, 2020. The total amount disbursed to these five entities during this 

reporting period was $166,979,069.

Channel Logistics, LLC

Treasury agreed to make a loan totaling $2,500,000 to Channel Logistics, LLC 

(Channel), a business critical to maintaining national security with approximately 6 U.S. 

employees in March 2020.

Treasury made the loan pursuant to section 4003(b)(3) of the CARES Act. The loan is 

secured by all the assets of Channel. It has an annual interest rate equal to LIBOR 

plus 3.5% and matures on November 12, 2025. Treasury funded the full loan amount 

at close. The loan proceeds will be used to provide liquidity to continue Channel’s 

operations. The transaction agreement includes covenants by Channel to comply with 

certain restrictions on employee compensation, stock repurchases, dividends, and 

reductions in employment levels, as required by the CARES Act. The loan constitutes 

senior indebtedness of Channel, and Treasury will receive 3% payment-in-kind annual 

interest on the loan in accordance with section 4003(d) of the CARES Act. 

SemahTronix, LLC

Treasury agreed to make a loan totaling $1,999,100 to SemahTronix, LLC 

(SemahTronix), a business critical to maintaining national security with approximately 

172 U.S. employees in March 2020.

Treasury made the loan pursuant to section 4003(b)(3) of the CARES Act. The loan is 
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secured by all the assets of SemahTronix. It has an annual interest rate equal to 

LIBOR plus 3.5% and matures on November 13, 2025. Treasury funded the full loan 

amount on November 18, 2020. The loan proceeds will be used to provide liquidity to 

continue SemahTronix’s operations. The transaction agreement includes covenants 

by SemahTronix to comply with certain restrictions on employee compensation, stock 

repurchases, dividends, and reductions in employment levels, as required by the 

CARES Act. The loan constitutes senior indebtedness of SemahTronix, and Treasury 

will receive 3% payment-in-kind annual interest on the loan in accordance with section 

4003(d) of the CARES Act. 

Semantic AI, Inc.

Treasury agreed to make a loan totaling $506,300 to Semantic AI, Inc. (Semantic), a 

business critical to maintaining national security with approximately 51 U.S. employees 

in March 2020.

Treasury made the loan pursuant to section 4003(b)(3) of the CARES Act. The loan is 

secured by all the assets of Semantic. It has an annual interest rate equal to LIBOR 

plus 3.5% and matures on November 13, 2025. Treasury funded the full loan amount 

at close. The loan proceeds will be used to provide liquidity to continue Semantic’s 

operations. The transaction agreement includes covenants by Semantic to comply 

with certain restrictions on employee compensation, stock repurchases, dividends, and 

reductions in employment levels, as required by the CARES Act. The loan constitutes 

senior indebtedness of Semantic, and Treasury will receive 3% payment-in-kind 

annual interest on the loan in accordance with section 4003(d) of the CARES Act. 

SpinLaunch, Inc.

Treasury agreed to make a loan totaling $2,519,200 to SpinLaunch, Inc. (SpinLaunch), 

a business critical to maintaining national security with approximately 66 U.S. 

employees in March 2020.

Treasury made the loan pursuant to section 4003(b)(3) of the CARES Act. The loan is 

secured by all the assets of SpinLaunch. It has an annual interest rate equal to LIBOR 

plus 3.5% and matures on November 13, 2025. Treasury funded the full loan amount 

on November 18, 2020. The loan proceeds will be used to provide liquidity to continue 

SpinLaunch’s operations. The transaction agreement includes covenants by 

SpinLaunch to comply with certain restrictions on employee compensation, stock 

repurchases, dividends, and reductions in employment levels, as required by the 

CARES Act. The loan constitutes senior indebtedness of SpinLaunch, and Treasury 

will receive 3% payment-in-kind annual interest on the loan in accordance with section 

4003(d) of the CARES Act. 

The loan agreements are available on Treasury’s website at 

https://home.treasury.gov/policy-issues/cares/preserving-jobs-for-americanindustry/loans-to-air-carriers-eligible-businesses-and-national-security-businesses.
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Detailed Financial Statement

Borrower

Borrower 

Type1 City2 State2

Date of Loan 

Agreement

Maturity 

Date

Total 

Anticipated 

Loan Amount Disbursements3

American Jet 

International 

Corporation

Passenger Air 

Carrier Houston TX 11/5/2020 11/5/2025 $1,162,124 $1,162,124

Aviation 

Management & 

Repairs, Inc.

Repair Station 

Operator Fort Pierce FL 11/5/2020 11/5/2025 $4,026,705 $4,026,705

Channel 

Logistics, LLC

National 

Security Camden NJ 11/12/2020 11/12/2025 $2,500,000 $2,500,000 

Mesa Airlines, 

Inc.

Passenger Air 

Carrier Phoenix AZ 10/30/2020 10/30/2025 $200,000,0004 $195,000,000

SemahTronix,

LLC

National 

Security Flippin AR 11/13/2020 11/13/2025 $1,999,100 $1,999,100

Semantic AI, 

Inc.

National 

Security San Diego CA 11/13/2020 11/13/2025 $506,300 $506,300

SpinLaunch, 

Inc.

National 

Security Long Beach CA 11/13/2020 11/13/2025 $2,519,200 $2,519,200

Thomas Global 

Systems, LLC Repair Station 

Operator Irvine CA 11/9/2020 11/7/2025 $1,400,000 $1,400,000

Timco Engine 

Center, Inc. Repair Station 

Operator Oscoda MI 11/5/2020 11/5/2025 $8,390,240 $8,390,240

1. Only certain categories of entities are eligible to receive loans under sections 4003(b)(1), (2), and (3) of the CARES Act. Under those 

provisions, a borrower must be a passenger air carrier; a business that is certified under 14 CFR part 145 and approved to perform 

inspection, repair, replace, or overhaul services; a ticket agent (as defined in 49 U.S.C. 40102); a cargo air carrier; or a business 

critical to maintaining national security.

2. The location provided is the address included by borrowers in their applications and may not include all locations in which a borrower 

operates.

3. Includes disbursements to Channel Logistics, LLC on November 12, 2020; Mesa Airlines, Inc. and Semantic AI, Inc. on November 

13, 2020; American Jet International Corporation, Aviation Management & Repairs, Inc., Thomas Global Systems, LLC, and Timco 

Engine Center, Inc. on November 16, 2020; and SemahTronix, LLC and SpinLaunch, Inc. on November 18, 2020. Also includes a 

disbursement of $43 million to Mesa Airlines, Inc. on October 30, 2020. 

4. Treasury agreed to make a loan of up to $200 million to Mesa Airlines, Inc. The company elected to draw $43 million at close on 

October 30, 2020 and $152 million on November 13, 2020, and no further draws on the loan are available.