The Discovery Air operating units provide both fixed-wing and rotary-wing services as well as logistics and remote operations management services. This includes cargo and passenger air charter services throughout Canada, vital air ambulance services in the North and utility flying for mining exploration.

The proposed debt repayment and debt-for-equity conversion (the "Transaction") will repay indebtedness of the Corporation arranged prior to Discovery Air's acquisition of Great Slave in June 2006.  Under the Agreement, the Transaction will be funded with a cash payment of approximately $3.2 million in the aggregate together with the issue from treasury and transfer to the Related Parties of approximately 10,300,000 Class A common shares of the Corporation.  

Based on the $0.43 closing price of Discovery Air's Class A common shares as at the day before the Agreement, the Class A common shares to be issued under the Transaction are valued at approximately $4.5 million. The Transaction is expected to result in a pre-tax gain of $5.5 million to the Corporation. 

Closing of the Transaction remains subject to Toronto Stock Exchange ("TSX") approval and shareholder approval (if required by the TSX). Discovery Air intends to close the transaction described herein by April 29, 2011 (the "Planned Closing Date"), subject to receipt of all necessary approvals including the approval of the Toronto Stock Exchange. 

The Planned Closing Date would be less than 21 days from the date of this material change report. Under NI 61-101, Discovery Air is required to disclose why it feels it is necessary or desirable to close the transaction prior to the 21st day from first disclosure of the proposed transaction. In this case, management of Discovery Air believes it is in the Corporation's best interest to book this transaction before month-end in order to realize the balance sheet benefits of the transaction and accelerate reduction of its fiscal 2012 interest expense, both commensurate with its overall recapitalization planning.