TORONTO, ONTARIO, August 9, 2021 – Canada Jetlines Operations Ltd. (the “Company” or “Jetlines”) announces that it has closed its previously announced non-brokered private placement (the “Offering”). Due to investor demand, the Company increased the size of the Offering and closed on final gross proceeds of $6,599,064.80. The Offering consisted of 16,497,662 units issued at $0.40 per unit (each a “Unit”). Each Unit consists of, depending on residency of the subscriber, one common voting share or one variable voting share (each a “Share”) and one half of one warrant (each whole warrant a “Warrant”). Each Warrant entitles the holder thereof to purchase an additional Share for $0.70 for a period of 24 months after closing. Subscribers who are Canadian received common voting shares and subscribers who are not Canadian received variable voting shares. The Company also issued 1,125,328 Warrants to finders as part of a finder’s fee for certain subscribers who participated in the Offering.
The Company intends to use the net proceeds of the Offering to advance the Canadian airline licensing process and for general corporate and working capital purposes.
To demonstrate continued support of the Company, certain directors and officers of the Company participated in the Offering and acquired 610,500 Units for proceeds of $244,200. Such participation is considered a related party transaction within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The related party transaction will be exempt from minority approval, information circular and formal valuation requirements pursuant to the exemptions contained in Sections 5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair market value of the gross securities to be issued under the Offering nor the consideration to be paid by the insiders will exceed 25% of the Company's market capitalization. The Company did not file a material change report related to this financing more than 21 days before the expected closing of the Offering as required by MI 61-101 since the details of the participation by the related parties of the Company were not settled until shortly prior to the closing of the Offering and the Company wished to close on an expedited basis for sound business reasons. The Units that will be acquired by the related parties have been acquired pursuant to an exemption from the prospectus requirement in section 2.24 of National Instrument 45-106.
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.