Transat's Shareholders Overwhelmingly Approve the Arrangement with Air Canada

Transat A.T. Inc. ("Transat") is pleased to announce that, at the special meeting of its shareholders (the "Shareholders") held today (the "Meeting"), an overwhelming majority of Shareholders voted in favour of the special resolution (the "Arrangement Resolution") approving the plan of arrangement under Section 192 of the Canada Business Corporations Act appended to the arrangement agreement entered into between Air Canada and Transat on October 9, 2020 and pursuant to which Air Canada will acquire all of the issued and outstanding Class A variable voting shares and Class B voting shares of Transat (together, the "Shares") for $5.00 per share, payable at the holder's option either in cash or shares of Air Canada or a combination thereof (the "Arrangement"). Air Canada shares issuable under the share payment election will be issued on the basis of a price of $17.47 per Air Canada share, translating into an exchange ratio of 0.2862 Air Canada shares per Transat share.

Shareholders carrying an aggregate of 22,763,632 votes, representing approximately 60.31% of votes entitled to be cast at the Meeting, were represented in person or by proxy at the Meeting. The Arrangement Resolution was approved by 91.05% of the votes cast by Shareholders, voting together as a single class, as well as 90.88% of the votes cast by Shareholders, voting together as a single class, excluding the votes of Jean-Marc Eustache whose votes are required to be excluded in determining minority approval pursuant to Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions.

"We are pleased with the shareholder support for this revised arrangement that will create a Montreal-based global leisure leader with the scope necessary to overcome the current turbulence in the industry and to thrive beyond", said Jean-Marc Eustache, President and Chief Executive Officer of Transat. "We are more convinced than ever that it is in the best interests of all our stakeholders to join forces with Air Canada."

The transaction remains subject to the approval of the Superior Court of Québec and the applicable regulatory approvals such as the approvals under the Canada Transportation Act and the European Union Council Regulation (EC) No. 139/2004, as well as certain other customary closing conditions. The parties are working collaboratively with the objective of securing the requisite approvals before February 15, 2021, which has been set as the outside date for the closing of the transaction. Based on information currently available, the European Commission's decision is expected on February 9, 2021. The Government of Canada has not indicated when it would render its decision.

Letters of Transmittal and Election Forms
Registered Shareholders wishing to receive the share consideration must return the Letter of Transmittal and Election Form, attached to Transat's management proxy circular dated November 12, 2020, to AST Trust Company (Canada), acting as the depositary, by 5:00 p.m. (Montréal time) on or before the date that is two business days prior to the date of completion of the Arrangement (the "Election Deadline"). Non-registered Shareholders should carefully follow the instructions of the intermediary holding their Shares on their behalf. Transat will include notice of the Election Deadline in a press release disseminated over newswire service in Canada at the latest on the business day immediately before the Election Deadline.

Investors who purchase Shares of Transat shortly before the completion of the transaction are advised that they may not have sufficient time in order to submit a duly completed Letter of Transmittal and Election Form by the Election Deadline in respect of such Shares and should consult with their broker, trust company or other intermediary and seek advice from their professional advisers in advance of any such trade.

If you have any questions or require further information about the procedures to complete your Letter of Transmittal and Election Form, please contact AST Trust Company (Canada), Transat's transfer agent and depositary, at 1-800-387-0825 (toll free within North America) or 1-416-682-3860 (outside of North America) or by email at inquiries@astfinancial.com.