Transat concludes a financing agreement under the Liquidity for Airline Sector Resilience Facility

MONTREAL, July 28, 2026 /CNW/ -- Transat A.T. Inc. (TSX: TRZ) ("Transat" or the "Corporation") has entered into a financing agreement under the Liquidity for Airline Sector Resilience (LASR) Facility recently established by the federal government, in line with the intention it expressed when releasing its second-quarter results on June 11, 2026. This agreement provides Transat with financial support of up to $150 million to help mitigate the impact of the unprecedented increase in aviation fuel prices affecting the entire industry.

The amount of the credit facility will be determined based on the amount required to offset the impact of higher aviation fuel costs through October 31, 2026, compared with the same period in 2025. The loan will be drawn in monthly tranches, with an initial amount of $125 million disbursed today. The loan has a four-year maturity and will bear interest at an annual rate of 3.91%.

Details of the LASR program are available on the Canada Enterprise Emergency Funding Corporation (CEEFC) website: https://ceefc-cfuec.ca/lasr-overview/.

Given that CEEFC holds share purchase warrants and convertible preferred shares exercisable or convertible for an aggregate of 13,893,390 Class B voting shares of the Corporation, representing approximately 25.3% of the Corporation's outstanding voting shares after giving effect to such exercise or conversion, provided that at no time will the exercise of warrants or conversion of preferred shares result in CEEFC beneficially owning or controlling in excess of 19.9% of the Corporation's voting shares, CEEFC may be considered a related party for the purposes of Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions ("Regulation 61-101"). The financing agreement can therefore constitute a related party transaction, as that term is defined in section 1.1 of Regulation 61-101. Pursuant to section 5.4(1) of Regulation 61-101, Transat is not required to obtain a formal valuation for the financing agreement. Furthermore, pursuant to section 5.7(1)(f) of Regulation 61-101, Transat is exempted from seeking minority approval as the financing agreement is on reasonable commercial terms that are not less advantageous to Transat that if the financing agreement was obtained from a person dealing at arm's length with Transat, and the financing agreement is not convertible or repayable (as to principal or interest) in equity or voting securities of Transat (and the financing arrangement does not impact the number of securities of the Corporation beneficially owned, or controlled, by CEEFC and its affiliates). Following the unanimous recommendation by a special committee comprised exclusively of independent directors, the financing arrangement has been unanimously approved by the Corporation's board of directors and all of Transat's directors are at arm's length from CEEFC.

The Corporation did not file a material change report more than 21 days before issuance of the financing arrangement because the details of the financing arrangement were not settled until recently.

Caution regarding forward-looking statements 

This news release contains certain forward-looking statements with respect to the Company, including those regarding its results, its financial position and its outlook for the future. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "potential", "predict", "project", "will", "would", the negative of these terms and similar terminology, including references to assumptions. All such statements are made pursuant to applicable Canadian securities legislation. Such statements may involve but are not limited to comments with respect to strategies, expectations, planned operations or future actions. Forward-looking statements, by their nature, involve risks and uncertainties that could cause actual results to differ materially from those contemplated by these forward-looking statements.

The forward-looking statements may differ materially from actual results for a number of reasons, including without limitation, economic conditions, changes in demand due to the seasonal nature of the business, extreme weather conditions, climatic or geological disasters, war, political instability, measures taken, planned or contemplated by governments regarding the imposition of tariffs on exports and imports, real or perceived terrorism, outbreaks of epidemics or disease, consumer preferences and consumer habits, consumers' perceptions of the safety of destination services and aviation safety, demographic trends, disruptions to the air traffic control system, the cost of protective, safety and environmental measures, competition, the Company's ability to maintain and grow its reputation and brand, the availability of funding in the future for the Company including its debt refinancing, the Company's ability to repay its debt from internally generated funds or otherwise, the Company's ability to adequately mitigate the Pratt & Whitney GTF engine issues, fluctuations in fuel prices and exchange rates and interest rates, the Company's dependence on key suppliers, the availability and fluctuation of costs related to our aircraft, information technology and telecommunications, cybersecurity risks, changes in legislation, regulatory developments or procedures, pending litigation and third-party lawsuits, the Company's ability to reduce operating costs through, among other things, the Elevation Program initiatives, the Company's ability to attract and retain skilled resources, labour relations, collective bargaining and labour disputes, pension issues, maintaining insurance coverage at favourable levels and conditions and at an acceptable cost, and other risks detailed in the Risks and Uncertainties section of the Management's Discussion and Analysis included in our 2025 Annual Report, filed on SEDAR+ at www.sedarplus.ca.

The reader is cautioned that the foregoing list of factors is not exhaustive of the factors that may affect any of the Company's forward-looking statements. The reader is also cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements.

The forward-looking statements in this news release are based on a number of assumptions relating to economic and market conditions (including the volatility of aviation fuel prices), as well as the Company's operations, financial position and transactions. Examples of such forward-looking statements include, but are not limited to, statements concerning the amount of the credit facility and the drawdown of monthly tranches under the credit facility.

The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by applicable securities legislation.

About Transat

Founded in Montreal in 1987, Transat has achieved worldwide recognition as a provider of leisure travel particularly as an airline under the Air Transat brand. Voted World's Best Leisure Airline by passengers at the 2025 Skytrax World Airline Awards, it flies to international destinations. Air Transat's fleet includes some of the most energy-efficient aircraft in their category. Based in Montreal, Transat has over 5,000 employees with a common purpose to bring people closer together. (TSX: TRZ) www.transat.com 

For more information

Media
Andréan Gagné
Senior Director, Public Affairs, Communications and Corporate Responsibility
[email protected] 
514-987-1616, ext. 104071

Financial Analysts
Juliette Gauthier
Senior Director, Investor relations and Corporate finance
[email protected]
514-987-1616, ext. 104019

SOURCE Transat A.T. Inc.