Regional Express Holdings (Rex) has signed a long-form term sheet and is in advanced exclusive negotiations with PAG Asia Capital (PAG), a leading Asia-Pacific-focused investment firm, regarding an investment by PAG of up to AU$150 million (US$210 million) to be used exclusively to support the launch of Rex's domestic major city jet operations scheduled to commence on March 1, 2021 (Funding).
The funding is proposed to comprise first ranking senior secured convertible notes (Notes). It is proposed that an initial Funding tranche of AU$50 million (US$70 million) will be drawn on completion of the transaction, targeted for the end of December 2020 (completion), with the balance of the funding drawn over the following three years.
The funding is subject to completion of due diligence by PAG; to agreement and execution of long-form documentation; to customary conditions including Rex shareholder approval for the purposes of section 611 (Item 7) of the Corporations Act 2001 (Cth) (Corporations Act) and the ASX Listing Rules, which is intended to be sought at Rex's Annual General Meeting that is tentatively scheduled for early December 2020; as well as to the Foreign Investment Review Board (FIRB) and any other required regulatory approvals. The terms of the funding will also be reviewed by an independent expert.
