Canada Jetlines Receives Exemption Order to Facilitate Trading by Non-Canadians
VANCOUVER, BRITISH COLUMBIA, Canada Jetlines Ltd. (TSX-V: JET) (the “Company” or “Jetlines”) is pleased to announce that it has received an exemption from the British Columbia Securities Commission, and other securities regulatory authorities, that will allow the Company’s variable voting shares and common voting shares to be treated as a single class for the purposes of applicable take-over bid requirements and early warning reporting requirements contained under Canadian securities laws. The Company applied for the exemption, which is effective immediately, to facilitate an investment in variable voting shares by non-Canadians, as defined under the Canada Transportation Act. This exemption is expected to facilitate trading in the Company’s shares by non-Canadians.
Pursuant to an application by the Company, the securities regulatory authorities in each of the provinces and territories of Canada (except for Quebec and Nunavut where the Company is not a reporting issuer) granted exemptive relief (the “Decision”) from:
- Applicable formal take-over bid requirements, as contained under Canadian securities laws, such that those requirements would only apply to an offer to acquire 20 per cent or more of the outstanding common voting shares and variable voting shares of the Company on a combined basis;
- Applicable early warning report requirements, as contained under Canadian securities laws, such that those requirements would only apply to an acquirer who acquires or holds beneficial ownership of, or control or direction over, 10 per cent or more of the outstanding common voting shares and variable voting shares of the Company on a combined basis; and
- Applicable requirement to issue and file a news release in respect of acquisitions during a take-over bid, such that those requirements would only apply to an acquirer who acquires or holds beneficial ownership of, or control or direction over, five percent or more of the outstanding common voting shares and variable voting shares of the Company on a combined basis.
Without the exemptive relief, shareholders were subject to these requirements based on the number of shares outstanding solely of the class held by the shareholder. This is a number that can vary without notice due to automatic conversions, which is in some respects not indicative of the shareholder’s real ownership value. Due to the relatively small number of outstanding variable voting shares, absent the Decision, it would have been more difficult for non-Canadians to acquire shares in the ordinary course without the apprehension of inadvertently triggering the take-over bid rules or early warning requirements.
The Decision takes into account that the Company’s dual class shareholding structure was implemented solely to ensure compliance with the foreign ownership requirements of the Canada Transportation Act. An investor does not control or choose which class of the Company’s shares it acquires and holds. The class of shares ultimately available to an investor is only a function of the investor’s status as a Canadian or non-Canadian (as defined under the Canada Transportation Act). The Decision considered the fact that the variable voting shares and voting shares have identical terms except for the foreign ownership voting limitations applicable in the case of the variable voting shares.
About Canada Jetlines Ltd.
Jetlines is set to become Canada’s first pure version ultra-low cost carrier (“ULCC”) airline. With plans to operate flights throughout Canada and provide non-stop service from Canada to the United States, Mexico, and the Caribbean, Jetlines will service the 10 million passenger trips and 30+ secondary airports that go unserved or underserved across Canada. The Jetlines board and management teams are comprised of industry experts with extensive collective expertise in aviation, start-ups and capital markets, successfully receiving an unprecedented exemption from the Government of Canada that will permit it to conduct domestic air services while having up to 49% foreign voting interests.
For more information on Jetlines, please visit our website at www.jetlines.ca.
ON BEHALF OF THE BOARD
“Mark J. Morabito”
President & CEO
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Cautionary Note Regarding Forward-Looking Information
This news release contains “forward-looking information” concerning anticipated developments and events that may occur in the future. Forward looking information contained in this news release includes, but is not limited to, statements with respect to with respect to: (i) Jetlines’ business objectives, operational timelines, operating cost expectations and investment requirements; (ii) anticipated operational and structural trends in the Canadian passenger airline market; (iii) removal of conditions relating to the completion of the Transaction; (iv) execution of the Transaction Documents; (v) completion of the Concurrent Financing; (vi) receipt of TSXV and shareholder approvals of the Transaction; and (vii) waiver of the sponsorship requirements.
In certain cases, forward-looking information can be identified by the use of words such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved” suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Forward-looking information contained in this news release is based on certain factors and assumptions regarding, among other things, the accuracy, reliability and applicability of the Jetlines’ business model; the timely receipt of governmental approvals, including the receipt of approval from regulators in Canada, the United States, Mexico and other jurisdictions where Jetlines may operate; the timely commencement of operations by Jetlines and the success of such operations; the ability of Jetlines to implement its business plan as intended; the legislative and regulatory environments of the jurisdictions where the Jetlines will carry on business or have operations; the impact of competition and the competitive response to the Jetlines’ business strategy; and the availability of aircraft. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.
Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include risks related to acts of God, the impact of general economic conditions, changing domestic and international airline industry conditions, volatility of fuel prices, increases in operating costs, terrorism, pandemics, currency fluctuations, interest rates, risks specific to the airline industry, the ability of management to implement Jetlines’ operational strategy, the ability to attract qualified management and staff, labour disputes, regulatory risks, including risks relating to the acquisition of the necessary licenses and permits, financing, capitalization and liquidity risks, including the risk that the financing necessary to fund operations may not be obtained and the additional risks identified in the “Risk Factors” section of the Company’s reports and filings with applicable Canadian securities regulators.
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this news release. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) has reviewed or accepts responsibility for the adequacy or accuracy of this release.