CAE announces launch of marketed public offering of common shares in the United States and Canada

• Marketed deal of common shares for gross proceeds of approximately US$250 million, with 15% Over Allotment Option
• Use of proceeds to partly fund the previously announced acquisition of L3Harris Technologies’ Military Training business

Montreal. 08 March 2021 .  CAE Inc. launched a proposed underwritten marketed public offering of common shares in the United States and Canada for gross proceeds to the Corporation of approximately US$250 million (the “Offering”).

The Offering will be conducted through a syndicate of underwriters led by Goldman Sachs & Co. LLC, TD Securities Inc., RBC Capital Markets, and Scotia Capital (USA) Inc. as joint bookrunners (collectively, the “Underwriters”). The Offering will be priced in the context of the market; the issue price per share and size of the Offering will be confirmed when CAE enters into an underwriting agreement for the Offering (the “Underwriting Agreement”).

CAE intends to use the net proceeds of the Offering to finance a portion of the purchase price and related costs of its previously announced acquisition of L3Harris Technologies’ Military Training business (the “Acquisition”). CAE expects to fund the balance of the purchase price and related costs of the Acquisition with the net proceeds from its previously completed private placements of C$700 million (approximately US$550 million) aggregate amount of subscription receipts to two institutional investors, and from currently available liquidities, including cash on hand and/or advances or drawdowns under one or more of its senior credit facilities or other debt financing. Pending their use, CAE intends to invest the net proceeds from the Offering in short-term, investment grade, interest bearing instruments or hold them as cash or cash equivalents, and repay a portion of the indebtedness outstanding under one of more of its senior credit facilities. The Offering is not contingent on the closing of the Acquisition. If for any reason the Acquisition does not close, CAE intends to use the net proceeds from the Offering for general corporate purposes, which may include the financing of future potential acquisition and growth opportunities.

CAE will also grant the Underwriters an option to purchase additional common shares representing up to 15% of the number of common shares to be sold pursuant to the Offering, solely to cover the Underwriters’ over-allocation position, if any, and for market stabilization purposes. The option will be exercisable by the Underwriters for a period of 30 days following the closing of the Offering.

In connection with the Offering, CAE filed the preliminary prospectus supplement to its short form base shelf prospectus dated November 19, 2020 with the securities regulatory authorities in each of the provinces of Canada. The preliminary prospectus supplement has also been filed with the U.S. Securities and Exchange Commission (the “SEC”) as part of CAE’s registration statement on Form F-10 in accordance with the multi-jurisdictional disclosure system established between Canada and the United States.

The issuance of the common shares pursuant to the Offering is subject to market and other conditions, and to customary approvals of applicable securities regulatory authorities, including the Toronto Stock Exchange and the New York Stock Exchange. There can be no assurance as to whether or when the Offering may be completed, or as to the actual size or terms of the Offering.