Investor Presentaiton
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on planned new aircraft acquisitions and scheduled heavy maintenance requirements, and (iii) satisfactory aircraft
return conditions consistent with modified lease expiry dates.
Embraer Purchase Agreement
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In 2004, Air Canada signed a definitive purchase agreement with EMBRAER Empresa Brasileira de
Aeronautica S.A. ("Embraer") covering firm orders for 45 Embraer ERJ-190 aircraft as well as 15 Embraer ERJ-175
aircraft. See "Business of Air Canada - Aircraft Fleet - Narrowbody and Regional Jet Aircraft Fleet - Embraer Orders
and Financing Terms".
Aircraft Purchase Agreement between The Boeing Company and Air Canada
On November 4, 2005, the Corporation concluded agreements with The Boeing Company ("Boeing") for the
acquisition of up to 36 Boeing 777 aircraft and up to 60 Boeing 787 aircraft. The agreements include firm orders for 18
Boeing 777 aircraft, plus purchase rights for an additional 18 aircraft, in a yet-to-be determined mix of the 777 family's
newest models. Deliveries of the Boeing 777 aircraft are scheduled to commence in March 2007. Seven of the firm
orders for Boeing 777 aircraft are expected to be delivered in 2007, nine in 2008, and two in 2009. The agreements also
include firm orders for 14 Boeing 787 aircraft, plus options and purchase rights for an additional 46 aircraft. Air
Canada's first Boeing 787 aircraft is scheduled for delivery in 2010.
Initial Public Offering of Air Canada
On November 24, 2006, Air Canada and ACE completed the initial public offering and secondary offering of an
aggregate 25 million Variable Voting Shares and Voting Shares at $21 per Share for gross proceeds of $525 million.
The Shares trade on the TSX under the symbol AC.A for the Variable Voting Shares and the symbol AC.B for the
Voting Shares.
Through the Initial Public Offering, Air Canada sold an aggregate of 9,523,810 Variable Voting Shares and Voting
Shares for gross proceeds of $200 million to be used for general corporate purposes, including the partial funding of its
fleet renewal program. In a secondary offering, ACE sold an aggregate of 15,476,190 Variable Voting Shares and
Voting Shares for gross proceeds of $325 million.
OVERVIEW OF THE BUSINESS
Air Canada is Canada's largest domestic and international airline and the largest provider of scheduled passenger
services in the Canadian market, the Canada-U.S. transborder market and in the international market to and from
Canada.
In 2006, Air Canada, together with Jazz, operated an average of approximately 1,300 scheduled flights each day
and carried over 32 million passengers. Air Canada, together with Jazz, provided direct passenger service to 161
destinations and, through commercial agreements with other unaffiliated regional airlines, to an additional 15
destinations, for a total of 176 direct destinations on five continents.
Air Canada enhances its network through a capacity purchase agreement with Jazz pursuant to which Air Canada
purchases substantially all of Jazz's fleet capacity based on predetermined rates and determines the routes and schedule
operated by Jazz. Jazz operates with smaller jet and turboprop aircraft that have lower trip costs than conventional large
jet aircraft, allowing Jazz to provide service to Air Canada's customers in lower density markets and also in higher
density markets at off-peak times throughout Canada and the United States.
Air Canada is a founding member of the Star Alliance network, the world's largest airline alliance group. As of
February 2007, the Star AllianceⓇ network included 17 member airlines and three regional member airlines. Through
its membership in the Star AllianceⓇ network, Air Canada is able to offer its customers access to over 855 destinations
in 155 countries, as well as reciprocal participation in frequent flyer programs and use of airport lounges.
Through its long-term relationship with Aeroplan, Air Canada's frequent flyer program, Air Canada is able to build
customer loyalty by offering those customers who are Aeroplan members the opportunity to earn Aeroplan miles when
they fly with Air Canada. Aeroplan is also Air Canada's single largest customer. The relationship with Aeroplan
provides a long-term stable and growing source of revenue from the purchase by Aeroplan of Air Canada seats to be
provided to Aeroplan members who choose to redeem their Aeroplan miles for air travel rewards.View entire presentation