Canada Jetlines Announces $13.5 Million Equity Financing

TORONTO--(BUSINESS WIRE)--
Canada Jetlines Operations Ltd. (NEO: CJET) (“Canada Jetlines” or the “Company”), Canada’s friendly leisure airline, is pleased to announce that it intends to undertake a non-brokered private placement with a single arm’s length investor to raise $13,500,001 (the “Offering”). The Offering consists of common shares (each a “Share”) issued at $0.1721252 per Share. The investor is Jetstream Aviation Inc. the (“Investor” or “Jetstream”) which is a Canadian corporation.

The Offering is scheduled to close in three separate tranches. The first settlement will occur within two business days of the approval of the Neo Exchange Inc. (the “Exchange”) subject to the satisfaction of other closing conditions. This first tranche will see the Investor purchase 19,598,017 Shares, equal to approximately 19.9% of the issued and outstanding shares of the Company, for an aggregate purchase price of $3,373,313.

The completion of the second tranche and third tranche shall require shareholder approval under the rules and policies of Exchange as it will result in the creation of a new “control person”. The Company intends to obtain shareholder approval for the second and third tranche at a special meeting of shareholders that will be scheduled promptly to occur in Ontario (the “Meeting”).

Assuming shareholder approval is obtained, the second tranche is scheduled to close two business days after the Meeting. The second tranche will see the Investor purchase 29,416,635 Shares, equal to approximately 15% of the current issued and outstanding shares of the Company, for an aggregate purchase price of $5,063,344.

Assuming shareholder approval is obtained, the third tranche is scheduled to close sixty calendar days after the Meeting. The third tranche will see the Investor purchase 29,416,635 Shares, equal to approximately 15% of the current issued and outstanding shares of the Company, for an aggregate purchase price of $5,063,344. Upon completion of all three tranches of the Offering, the Investor will hold 78,431,287 Shares of the Company representing approximately 50% of the current issued and outstanding shares of the Company.

As part of the transaction, the Investor will have the right to nominate two directors to the Board of Directors of the Company. The first director will be nominated concurrent with the closing of the second tranche of the Offering. The second director will be nominated concurrent with the closing of the third tranche of the Offering.

The Company intends to use the net proceeds of the Offering for aircraft acquisition, general corporate and working capital purposes. The closing of the Offering is subject to customary closing conditions, including the receipt of the approval of the Exchange. No brokerage commissions or finder’s fees are payable in connection with the Offering.

Jetstream does not currently hold any Shares. Upon closing of the first tranche of the Offering, Jetstream will hold a total of 19,598,017 Shares, which will represent approximately 19.9% of the Company's issued and outstanding Shares. Upon closing of the second and third tranches of the Offering, Jetstream will hold 78,431,287 Shares of the Company representing approximately 50% of the issued and outstanding shares of the Company at such time.

This news release does not constitute an offer of securities for sale in the United States. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements.

About Canada Jetlines

Canada Jetlines Operations Ltd. (NEO: CJET) is a value-focused leisure airline that flies to high-demand sunny destinations. CJET's three revenue streams offer diversified growth potential: passenger revenue, chartered/ACMI flights, and Jetlines vacations. Jetlines vacations expand cash flow through ancillary revenue streams, including hotels, land, cruise, transfer and insurance plus destination co-operative marketing support. Currently operating 3 Airbus A320s, CJET is targeting to reach a fleet of 15 aircrafts by 2025. For more information about Canada Jetlines, including its growing list of destinations, please visit www.jetlines.com. Follow Canada Jetlines on all social media platforms and follow #CanadaJetlines for the latest news and updates.

About Jetstream

Jetstream Aviation Inc. is a private corporation focused on investments in the aviation space.

Jetstream is acquiring the securities in the Offering described herein for investment purposes. Depending on market conditions and other factors, Jetstream may from time to time acquire and/or dispose of securities of the Company or continue to hold its current position.

A copy of the early warning report required to be filed with the applicable securities commission in connection with the transaction will be available on SEDAR+ at www.sedarplus.com and can be obtained by contacting Gurdev Singh at 416.888.1906. Jetstream's address is set out below.

Jetstream Contact Information:

Jetstream Aviation Inc.

167 Don Minaker Drive

Brampton ON L6P 2V7

Canada

Connect With Us!

Instagram: @ca_jetlines

Twitter: @ca_jetlines

Facebook: @CAJetlines

LinkedIn: www.linkedin.com/company/jetlines

Cautionary Note Regarding Forward-Looking Information

Cautionary Note Regarding Forward-Looking Information This news release contains "forward-looking information" concerning anticipated developments and events that may occur in the future. Forward-looking information contained in this news release includes but is not limited to the completion of the Offering, the use of proceeds of the Offering, the receipt of shareholder approval for the offering, the Company’s intention to operate as a leisure airline, the number of aircraft it intends to operate, the destinations of intended flights, timelines to announce new schedules and destinations, growth plans and business of Jetlines. In certain cases, forward-looking information can be identified by the use of words such as "plans", "expects" "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Forward-looking information contained in this news release is based on certain factors and assumptions regarding, among other things, the receipt of financing to continue airline operations, the accuracy, reliability and success of Jetlines’ business model; the continued compliance with the terms of governmental approvals; Jetlines concluding definitive agreements for additional aircraft; the success of operations by Jetlines the legislative and regulatory environments of the jurisdictions where Jetlines will carry on business or have operations; the impact of competition and the competitive response to Jetlines’ business strategy; and the availability of aircraft. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include risks related to, the ability to obtain financing at acceptable terms, the impact of general economic conditions, domestic and international airline industry conditions, the failure of the Company to conclude definitive agreements to acquire additional aircraft, supply chain disruptions causing delays in expected timelines, the impact of the global uncertainty created by COVID-19, future relations with shareholders, volatility of fuel prices, increases in operating costs, terrorism, pandemics, natural disasters, currency fluctuations, interest rates, risks specific to the airline industry, the ability of management to implement Jetlines’ operational strategy, the ability to attract qualified management and staff, labour disputes, regulatory risks, including risks relating to the acquisition of (or compliance with) the necessary licenses from regulatory agencies, and the additional risks identified in the "Risk Factors" section of the Company's reports and filings with applicable Canadian securities regulators. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those described in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this news release. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update any forward-looking information.

src="https://cts.businesswire.com/ct/CT?id=bwnewssty=20230928059498r1sid=acqr8distro=nxlang=en" style="width:0;height:0" />

View source version on businesswire.com: https://www.businesswire.com/news/home/20230928059498/en/

Media:

[email protected]

Investor Relations:
Percy Gyara
Chief Financial Officer

Canada Jetlines

[email protected]

+1 647.921.7205

Source: Canada Jetlines Operations Ltd.