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Press release from Marketwire

Cargojet Announces $25 Million Bought Deal Offering of 6.5% Convertible Unsecured Subordinated Debentures

Thursday, March 01, 2012

Cargojet Announces $25 Million Bought Deal Offering of 6.5% Convertible Unsecured Subordinated Debentures15:24 EST Thursday, March 01, 2012MISSISSAUGA, ONTARIO--(Marketwire - March 1, 2012) -NOT FOR RELEASE OVER US NEWSWIRE SERVICES OR DISSEMINATION IN THE USCargojet Inc. ("Cargojet" or the "Corporation") (TSX:CJT)(TSX:CJT.A) is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by RBC Capital Markets under which the underwriters have agreed to purchase C$25,000,000 aggregate principal amount of convertible unsecured subordinated debentures due April 30, 2017 (the "Debentures") at a price of $1,000 per Debenture (the "Offering"). Cargojet has also granted the underwriters an option to purchase up to an additional C$3,750,000 aggregate principal amount of Debentures, 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 March 21, 2012.The Debentures will be subordinated, unsecured obligations of Cargojet and will bear interest at a rate of 6.50% per annum, payable semi-annually in arrears on April 30 and October 31 of each year, commencing April 30, 2012. 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 $11.75 per share. The Debentures will mature on April 30, 2017. The Debentures will not be redeemable prior to April 30, 2015. On and after April 30, 2015 and prior to April 30, 2016, 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 April 30, 2016 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 redeem its outstanding 7.5% convertible unsecured subordinated debentures due April 30, 2013 (the "2008 Debentures") and for general corporate and working capital purposes. The Corporation will provide the requisite notice of redemption to the holders of the 2008 Debentures and the trustee of the 2008 Debentures immediately following closing of the Offering, with redemption expected to occur on May 1, 2012.A preliminary short-form prospectus will be filed with securities regulatory authorities in all provinces of Canada excluding Quebec. The offering is subject to customary regulatory approvals. The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933 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 securities in any jurisdiction.Cargojet is Canada's leading provider of time sensitive overnight air cargo services. Cargojet operates its network across North America each business night, utilizing a fleet of twelve all-cargo aircraft. Notice on Forward Looking Statements: Certain statements contained herein constitute "forward-looking statements". Forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "intends," "anticipates," "should," "estimates," "expects," "believes," "indicates," "targeting," "suggests" and similar expressions. These forward-looking statements are based on current expectations and entail various risks and uncertainties. Reference should be made to the issuer's most recent Annual Information Form filed with the Canadian securities regulators, and its most recent Annual Consolidated Financial Statements and Quarterly Financial Statements and Notes thereto and related Management's Discussion and Analysis (MD&A), for a summary of major risks. Actual results may materially differ from expectations, if known and unknown risks or uncertainties affect our business, or if our estimates or assumptions prove inaccurate. The issuer assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason, other than as required by applicable securities laws. In the event the issuer does update any forward-looking statement, no inference should be made that the issuer will make additional updates with respect to that statement, related matters, or any other forward-looking statement.FOR FURTHER INFORMATION PLEASE CONTACT: P. DhillonCargojet Inc.Vice President Marketing, Public & Government Relations(905) 501 7373pdhillon@cargojet.com