TORONTO, March 31, 2014 /CNW/ - Discovery Air Inc. (DA.A) (the
"Corporation") today announced that it has entered into a loan
agreement with Element Financial Corporation ("Element") in the
principal amount of $21,500,000 (the "Loan").
The proceeds of the Loan, which are expected to be advanced in full on
April 1, 2014, will be used to refinance approximately $20,500,000 in
existing term indebtedness of the Corporation. In connection with the
Loan, the Corporation's obligation to restore the airworthiness of two
aircraft (or, in the alternative, repay approximately $4,000,000 of
indebtedness secured by those aircraft) has also been eliminated.
The Loan matures on April 1, 2019 and is secured by first lien security
interests against certain aircraft owned by the Corporation and its
subsidiaries, as well as guarantees and general security agreements
from certain subsidiaries of the Corporation. The loan contains
customary representations and warranties, covenants and events of
default, including an event of default should the Corporation fail to
complete, by May 31, 2014, its previously announced rights offering to
raise gross proceeds of $15,000,000 or, to the extent necessary, a
secured, subordinated loan transaction, both as more fully described in
the Corporation's short form prospectus dated March 21, 2014 (the
"Prospectus"). A copy of the Prospectus can be found on SEDAR at www.sedar.com.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This news release includes forward-looking statements (as defined in
applicable securities laws) regarding Discovery Air and/or its
subsidiaries. Forward-looking statements by definition are based on
assumptions and, as a result, are subject to risks and uncertainties.
As a result of such risks and uncertainties, actual results may differ
materially from those discussed in forward looking statements, and
readers should not place undue reliance on such statements.
With respect to the matters described in this news release, specific
risks include the risk that the Loan proceeds are not advanced on April
1, 2014 and/or that the conditions precedent to Clairvest Group Inc.'s
standby commitment and/or the advance of a secured, subordinated loan,
as described in the Prospectus, are not satisfied.
Forward-looking statements represent expectations as of the date they
are made, and Discovery Air disclaims any intention or obligation to
update or revise any forward-looking statements it may make, whether as
a result of new information, future events or otherwise, except as
required under applicable securities laws.
ABOUT DISCOVERY AIR AND ITS SUBSIDIARIES
Discovery Air is a Canadian specialty aviation company operating over
160 aircraft with approximately 850 team members. Its subsidiaries
provide airborne training to the Canadian military, helicopter
operations, air ambulance services, airborne fire services, fixed-wing
air charter services, expediting and logistics support, and a range of
maintenance, repair, overhaul, modification, engineering and
Discovery Air's Class A common voting shares, unsecured convertible
debentures and rights trade on the Toronto Stock Exchange (symbols
DA.A, DA.DB.A and DA.RT, respectively).
SOURCE: Discovery Air Inc.
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