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Chorus Aviation issues first tranche of convertible debt units to Fairfax Financial

HALIFAX, March 6, 2017 /CNW/ - Chorus Aviation Inc. ("Chorus" or the "Corporation") (CHR.TO) announced today that it has issued the first tranche of convertible debt units to subsidiaries of Fairfax Financial Holdings Limited (collectively, "Fairfax") contemplated in the Corporation's news release dated December 19, 2016 (the "First Tranche Closing").

Pursuant to the First Tranche Closing, Chorus issued CAD $50,000,000 principal amount of 6.00% senior debentures due December 31, 2024 (the "Debentures"), together with 24,242,424 warrants each of which may be exercised by the holder thereof to acquire one share1 of Chorus at an exercise price of $8.25 per share (the "Warrants"), to Fairfax for gross proceeds of CAD $50,000,000.

Of the Warrants issued pursuant to the First Tranche Closing, 6,060,606 relate to the Debentures issued as of the date hereof. The additional 18,181,818 Warrants relate to the remaining CAD $150,000,000 principal amount of Debentures which Chorus expects to issue to Fairfax on or before March 31, 2017 for gross proceeds of CAD $150,000,000. In the event that all or any portion of the remaining Debentures are not ultimately issued, any Warrants relating to the unissued Debentures will not be exercisable by the holder thereof and will expire on March 31, 2017.

Subject to the foregoing and except in certain circumstances relating to a change of control of the Corporation, the Warrants may only be exercised after December 31, 2019 up to and including the earlier of the redemption of the Debentures by the Corporation and the business day immediately preceding December 31, 2024, the maturity date of the Debentures.

Copies of the indentures for the Debentures and the Warrants are available on SEDAR at www.sedar.com.

Forward-Looking Information

This news release may contain "forward-looking information" as defined under applicable Canadian securities legislation. Forward-looking information typically contains words such as "anticipate", "believe", "could", "should", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar words and phrases, including references to assumptions. Such information may involve but is not limited to comments with respect to strategies, expectations, planned operations or future actions. Forward-looking information related to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and other uncertain events. Forward looking information, by its nature, is based on assumptions, including those described below, and is subject to important risks and uncertainties. Any forecasts or forward-looking predictions or statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements to differ materially from those expressed in the forward-looking statements. Factors that may cause results to differ materially from expectations in this news release include, without limitation, that the conditions precedent to the issuance of the remaining Debentures are not fulfilled by Chorus. For a further discussion of risks, please refer to the section titled "Risk Factors" in Chorus' 2016 Annual Information Form. Any statements containing forward-looking information in this news release represent Chorus' expectations as of March 6, 2017. Chorus disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

About Chorus
Headquartered in Halifax, Nova Scotia, Chorus was incorporated on September 27, 2010. Chorus' vision is to deliver regional aviation to the world.  Chorus owns Jazz Aviation and Voyageur Aviation –  companies that have long histories of safe and solid operations that deliver excellent customer service in the areas of contract flying operations, engineering, fleet management, and maintenance, repair and overhaul.  Chorus has been leasing its owned regional aircraft into Jazz's Air Canada Express operation since 2009, and recently established Chorus Aviation Capital Corp. to become a leading, global provider of regional aircraft leases and support services. Chorus Class A Variable Voting Shares and Class B Voting Shares trade on the Toronto Stock Exchange under the trading symbol 'CHR'. www.chorusaviation.ca

 

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1 "Share" refers, as the context requires, to a Class A Variable Voting Share of Chorus (which may be held by a non-Canadian) or to a Class B Voting Share of Chorus (which may be held by a Canadian). Please refer to Chorus' Annual Information Form (available at www.sedar.com) for a description of Chorus' capital structure.