Canada Jetlines Operations Ltd. (NEO: CJET) (“Canada Jetlines” or the “Company”) the new, all-Canadian, leisure airline, announces that it intends to undertake a non-brokered private placement to raise from $1,200,000 to $1,500,000 (the “Offering”). The Offering consists of units issued at $0.255 per unit (each a “Unit”). Each Unit consists of one common or 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 (each a “Warrant Share”) for a period of 24 months after closing at a price of $0.40 per Warrant Share.

In order to encourage share ownership by employees of the Company, the Company will be offering all of its employees that chance to participate in the Offering with a bonus incentive. Employees that participate in the Offering with receive one additional Unit (without payment of additional consideration) for every six Units subscribed for in the Offering.

In support of the Company, the Company expects that founding shareholder Global Crossing Airlines Group Inc., along with the Company’s executives and management team will participate in the Offering.

The Company also announces that it intends to enter into a Loan Agreement for a US$130,000 loan from an arms’ length third party lender (the “Lender”). The terms of the Loan include:

  • the Loan bears interest at the rate of 7% per annum;
  • a maturity date of 6 months from the closing date, renewable for additional 6 month terms upon agreement of the Company and the Lender;
  • principal and interest amounts are payable at maturity, unless the Loan is renewed in which case only interest is paid; and
  • the Loan is unsecured.

The Company intends to use the net proceeds of the Offering and the Loan for aircraft acquisition, general corporate and working capital purposes. The closing of the Offering and the Loan is subject to customary closing conditions, including the execution of definitive documentation and receipt of the approval of the Neo Exchange Inc.

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