Discovery Air Announces Revolving Credit Facility from Clairvest

TORONTO, March 30, 2016 /CNW/ - Discovery Air Inc. (DA.A) ("Discovery Air" or the "Corporation") announced today that it has entered into a credit agreement with certain funds or co-investors (such lenders, collectively "Clairvest") of Clairvest Group Inc., the majority shareholder of the Corporation, providing for a revolving credit facility in the aggregate principal amount of $12,000,000 (the "Revolving Credit Facility"), $2,000,000 of which will be subject to the prior consent of Clairvest. All borrowings under the Revolving Credit Facility bear interest at a rate of 12% per annum payable on a monthly basis, mature on December 31, 2016 and are secured. The Corporation may repay and re-borrow the principal under the Revolving Credit Facility on customary conditions. Proceeds from the Revolving Credit Facility will be used to finance aircraft upgrades in support of certain growth initiatives and for business development activities at certain subsidiaries. A material change report will be filed less than 21 days before the closing date of the transaction. This shorter period is reasonable and necessary in the circumstances to allow the Corporation to obtain financing for working capital. In connection with the Revolving Credit Facility, the Corporation also obtained certain adjustments to its existing debt arrangements, including principal repayment adjustments and covenant waivers.

The Revolving Credit Facility is a "related party transaction" within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Corporation is not required under MI 61-101 to obtain a formal valuation in respect of the Revolving Credit Facility and will be relying upon the exemption from the minority approval requirement in section 5.7(f) of MI 61-101 as a result of (i) the Revolving Credit Facility being provided on reasonable commercial terms that are not less advantageous to the Corporation than if the Revolving Credit Facility was obtained from an arm's length party and (ii) the Revolving Credit Facility not containing any equity component.

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 and the Corporation's proposed use of proceeds of the Revolving Credit Facility. 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.

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 Inc. is a global leader in specialty aviation services. We deliver exceptional air combat training; medevac equipped aircraft services; airborne firefighting services; air charter services; helicopter operations; and transport and logistics support to ensure operational readiness, health, safety, and vital lifelines for our clients and the communities we serve.

Discovery Air's Class A common voting shares and unsecured convertible debentures trade on the Toronto Stock Exchange (symbols DA.A and DA.DB.A, respectively).

SOURCE Discovery Air Inc.

Sheila Venman, VP, HR & Communications, [email protected], 866-903-3247