CPI Aerostructures announced April 13 that it closed on a $4.8 million loan under the Payroll Protection Program (PPP) as part of the new Coronavirus Aid, Relief, and Economic Security (CARES) Act in the U.S.
The two-year, unsecured loan came from a subsidiary of Bridge Bancorp, one of the lenders to the company’s existing credit facility, but it is guaranteed by the federal Small Business Administration. The loan bears interest of 1% annually but the first six months are deferred and will be forgiven if CPI Aero uses 75% of the loan proceeds to cover its payroll costs, including benefits to workers, as well as maintaining an unspecified workforce level during the eight weeks after origination.
“CPI Aero expects to meet the requirements for full loan forgiveness,” the company said.
As an American small business, CPI Aero qualified for the PPP, which allows businesses and nonprofits with fewer than 500 employees to obtain loans of up to $10 million to incentivize companies to maintain their workers as they manage the business disruptions caused by the COVID-19 pandemic.
CPI Aero is a U.S. manufacturer of structural assemblies for fixed wing aircraft, helicopters and airborne intelligence surveillance and reconnaissance pod systems in both the commercial aerospace and national security markets. The company builds subassemblies and parts for aerospace OEMs or Tier 1s and is also a defense prime, primarily for the U.S. Air Force.
“This loan gives us a cushion to support our workers in view of the uncertain duration of the pandemic and its unprecedented challenges,” CPI Aero CEO and President Douglas McCrosson said. “Small businesses such as CPI Aero are vital to the nation’s economy and we are proud of the fact that we are continuing to operate without layoffs or furloughs as a Defense Department-designated ‘critical infrastructure’ company.
“We continue to see robust demand from our national security customers, and with this assistance we expect to emerge from this crisis with our workforce intact and the capability to execute on our substantial backlog,” he added.
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