Transat A.T. redeems Series 4 shares, repays debt

Executive Summary

• Transat A.T. Inc. is using $30 million in proceeds from an engine sale and leaseback transaction to partially repay debt and redeem preferred shares held by the Canada Enterprise Emergency Funding Corporation (CEEFC).
• The transaction involves the redemption of 6,243,026 Series 4 preferred shares and the partial repayment of a debenture held by CEEFC, reducing CEEFC's equity and debt exposure in Transat.
• Following the redemption, CEEFC’s ownership interest (via remaining preferred shares and warrants) drops from approximately 32.6% to approximately 24.7% of outstanding voting shares, though it remains capped at 19.9% beneficial ownership.

Key Details

• Source of Funds: $30 million in proceeds from an engine sale and leaseback transaction announced on August 7, 2025.
• Redemption of Preferred Shares:
  • Amount applied: $16,264,955.
  • Shares redeemed: 6,243,026 Series 4 preferred shares.
  • Redemption price: $2.6053 per share.
  • Holder: Canada Enterprise Emergency Funding Corporation (CEEFC).
• Partial Debt Repayment:
  • Amount applied: $13,735,045.
  • Instrument: Partial repayment of the principal amount of a $158,735,045 debenture held by CEEFC.
• Outstanding Holdings Post-Transaction:
  • Preferred Shares: 3,691,591 Series 4 preferred shares remain outstanding and held by CEEFC.
  • Debenture: $145 million principal amount of debenture remains outstanding and held by CEEFC.
  • Credit Facility: The $175 million credit facility with CEEFC remains unaffected.
• Ownership Impact:
  • Pre-redemption CEEFC interest: Held preferred shares and warrants convertible/exercisable for 19,371,389 Class B voting shares (~32.6% of outstanding voting shares).
  • Post-redemption CEEFC interest: Holds 3,691,591 preferred shares and warrants exercisable for 9,436,772 Class B voting shares (~24.7% of outstanding voting shares).
  • Cap: Exercise of warrants or conversion of preferred shares will not result in CEEFC beneficially owning or controlling in excess of 19.9% of voting shares.
• Share Conversion Terms: Series 4 preferred shares are convertible into Class B voting shares on a one-for-one basis.
• Regulatory Filings: CEEFC intends to file an early warning report in accordance with applicable securities laws.

Notable Quotes

• None provided in the text.