Cargojet Announces Increase to Previously Announced $60 Million Bought Deal Offering of 5.50% Convertible Unsecured Subordinated Debentures

Cargojet Inc. (“Cargojet” or the “Corporation”) (TSX:CJT)(TSX:CJT.A) is pleased to announce that it has increased the size of its previously announced public offering to C$67 million aggregate principal amount of convertible unsecured subordinated debentures due June 30, 2019 (the “Debentures”) at a price of $1,000 per Debenture (the “Offering”). The transaction was increased from the original amount of $60.0 million.

Cargojet has also granted the underwriters an option to purchase up to an additional C$7 million aggregate principal amount of Debentures, on the same terms and conditions, exercisable in whole or in part, for a period of 30 days following closing of the Offering. The Offering is expected to close on or about April 29, 2014.

The Debentures will be subordinated, unsecured obligations of Cargojet and will bear interest at a rate of 5.50% per annum, payable semi-annually in arrears on June 30 and December 31 of each year, commencing December 31, 2014. The Debentures will be convertible at any time at the option of the holders into common voting shares or variable voting shares, as applicable, at a conversion price of $28.75 per share. The Debentures will mature on June 30, 2019.

The Debentures will not be redeemable prior to June 30, 2017. On and after June 30, 2017 and prior to June 30, 2018, the Debentures may be redeemed by the Corporation, in whole or in part from time to time, on not more than 60 days and not less than 40 days prior notice at a redemption price equal to their principal amount plus accrued and unpaid interest, if any, up to but excluding the date set for redemption, provided that the weighted average trading price of the common voting shares on the TSX for the 20 consecutive trading days ending five trading days prior to the date on which notice of redemption is provided is at least 125% of the conversion price. On or after June 30, 2018 and prior to the maturity date, the Corporation may, at its option, redeem the Debentures, in whole or in part, from time to time at par plus accrued and unpaid interest.

Cargojet intends to use the net proceeds of the Offering to finance a portion of the expansion of its domestic air cargo network related to its recently awarded contract with the Canada Post Corporation and Purolator Inc. (“MSA”). More specifically, the net proceeds will fund one-time startup costs, the purchase of one Boeing B767-300 freighter aircraft and the purchase of ground support equipment, aircraft spare parts and other related assets. Cargojet intends to apply the net proceeds of the over-allotment option to the acquisition of other freighter aircraft.

A preliminary short-form prospectus will be filed with securities regulatory authorities in all provinces and territories of Canada excluding Quebec. The offering is subject to customary regulatory approvals, including the approval of the Toronto Stock Exchange.

The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Cargojet is Canada’s leading provider of time sensitive overnight air cargo services and carries over 750,000 pounds of cargo each business night. Cargojet operates its network across North America each business night, utilizing a fleet of all-cargo aircraft.