Ms. Pauline Dhillon reports

CARGOJET ANNOUNCES INCREASE TO PREVIOUSLY ANNOUNCED $100 MILLION BOUGHT DEAL OFFERING OF 4.65% CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES

Cargojet Inc. has increased the size of its previously announced public offering to $115-million aggregate principal amount of convertible unsecured subordinated debentures due Dec. 31, 2021, at a price of $1,000 per debenture. The transaction was increased from the original amount of $100-million.

Cargojet has also granted the underwriters an option to purchase up to an additional $10-million aggregate principal amount of debentures, on the same terms and conditions, exercisable in whole or in part, for a period of 30 days following closing of the offering. The offering is expected to close on or about Sept. 15, 2016.

The debentures will be subordinated, unsecured obligations of Cargojet and will bear interest at a rate of 4.65 per cent per annum, payable semi-annually in arrears on June 30 and Dec. 31 of each year, commencing Dec. 31, 2016. The debentures will be convertible at any time at the option of the holders into common voting shares or variable voting shares, as applicable, at a conversion price of $58.65 per share. The debentures will mature on Dec. 31, 2021.

The debentures will not be redeemable prior to Dec. 31, 2019. On and after Dec. 31, 2019, and prior to Dec. 31, 2020, the debentures may be redeemed by the corporation, in whole or in part from time to time, on not more than 60 days and not less than 40 days prior notice at a redemption price equal to their principal amount plus accrued and unpaid interest, if any, up to but excluding the date set for redemption, provided that the weighted average trading price of the common voting shares on the Toronto Stock Exchange for the 20 consecutive trading days ending five trading days prior to the date on which notice of redemption is provided is at least 125 per cent of the conversion price. On or after Dec. 31, 2020, and prior to the maturity date, the corporation may, at its option, redeem the debentures, in whole or in part, from time to time at par plus accrued and unpaid interest.

The corporation intends to use the net proceeds of the offering to refinance approximately $103-million of U.S.-dollar-denominated aircraft finance loans and for general corporate purposes.

A preliminary short-form prospectus will be filed with securities regulatory authorities in all provinces and territories of Canada, excluding Quebec. The offering is subject to customary regulatory approvals, including the approval of the Toronto Stock Exchange.

We seek Safe Harbor.