What is the LASR Facility?
For LASR inquiries, contact [email protected]
What is the LASR Facility?
The Liquidity for Airline Sector Resilience (LASR) Facility is a financing program designed to help eligible Canadian passenger airlines address temporary liquidity pressures caused by elevated operating costs, particularly aviation fuel price volatility, by mitigating the impact of aviation fuel price increases.
Administered by Canada Enterprise Emergency Funding Corporation (CEEFC), a subsidiary of Canada Development Investment Corporation (CDEV), the facility provides targeted financing support to Canadian airlines experiencing a rise in costs of fuel, a significant element of costs in the airline industry.
Who is eligible?
- Have reported at least 70 million available seat kilometers (ASK) to Transport Canada as of December 31, 2025.
- Be a commercial entity incorporated under federal, provincial, or territorial laws in Canada.
- Be engaged in the commercial operation of aircraft providing passenger air transportation services.
- Not have filed for protection under the Companies’ Creditors Arrangement Act (CCAA) or other bankruptcy or insolvency legislation and not be subject to ongoing insolvency proceedings.
What is the application process?
Applicants should submit an enquiry via CEEFC’s email: [email protected].
A CEEFC representative will send applicants a non-disclosure agreement and instructions. The application instructions will request important information relating to the applicant, its current financial condition, fuel consumption and its projected cash flow requirements.
What are the terms and conditions of the loans?
The terms and conditions for the LASR Facility are commercial in nature. Key terms are summarized below:
Size / Principal Amount – The maximum aggregate loan amount available to an eligible borrower is $150 million. The facility amount will be based on CEEFC’s assessment of the amount required to offset the impact of increased aviation fuel costs from May 1st to November 1st, 2026, relative to the same period in 2025. The loan may be advanced in monthly tranches during the availability period ending November 15, 2026.
Interest Rate – The interest rate will be equal to the 10-year Government of Canada bond yield at the date of program launch plus 50 basis points.
Term – The duration of the loan will be four (4) years from the closing date. Borrowers may prepay all or part of the loan and accrued interest at any time without penalty.
Restrictions – While the loan remains outstanding, the borrower will be subject to certain operating restrictions, including: (i) restrictions on dividends, capital distributions and share repurchases; (ii) executive compensation restrictions for named executive officers; (iii) restrictions on certain acquisitions, investments and additional indebtedness; and (iv) restrictions on certain non-arm’s length transactions.
Borrower Commitments – Borrowers will be expected to: (i) maintain Canadian business operations and make commercially reasonable efforts to maintain domestic employment levels; (ii) make commercially reasonable efforts to maintain domestic passenger transportation services in accordance with their business plans; (iii) make commercially reasonable efforts to increase sales to and purchases from Canadian markets; and (iv) make commercially reasonable efforts to maintain levels of domestic employment.
Covenants – The borrower will be subject to customary affirmative covenants, including: (i) compliance with applicable laws; (ii) maintenance of business operations, permits and insurance; (iii) payment of taxes and other obligations; (iv) performance of obligations under pension plans; and (v) performance of material obligations under applicable collective bargaining agreements.
Governance – CEEFC will reserve the right to appoint an observer to the board of directors of the borrower.
Reporting Requirements – Borrowers will be required to provide audited annual financial statements, unaudited quarterly financial statements, executive compensation reporting, and other information reasonably requested by CEEFC.
Conditions – Certain conditions must be satisfied before the initial advance of funds, including customary corporate approvals, anti-money laundering documentation, legal opinions, accuracy of representations and warranties, executive compensation waivers, and, where applicable, a business plan demonstrating a path to financial stability.
How will CEEFC be compensated?
The LASR facility is designed to help Canadian airlines, whilst also protecting the interests of Canadian taxpayers.
- Loan Fee – Borrowers will pay a fee equal to 5% of the aggregate principal amount advanced under the facility, payable at maturity.
- Additional Fee – If the loan is not repaid and terminated within 12 months of the initial advance, an additional fee equal to 5% of the aggregate principal amount advanced will be payable at maturity.
- Transaction Fee – Borrowers will pay a transaction fee equal to 25 basis points (0.25%) of the aggregate principal amount of the facility, payable at closing.