Air Canada — Capital/Financing Update 2020

May 27, 2020

TREASURY OFFERING OF CLASS A VARIABLE VOTING SHARES AND/OR CLASS B VOTING SHARES

May 26, 2020

AIR CANADA

A preliminary short-form prospectus of the Company dated May 26, 2020 containing important information relating to the securities described in this document has been filed with the securities regulatory authorities in each of the provinces and territories of Canada. A copy of the preliminary short-form prospectus, and any amendment, is required to be delivered to any investor with this document. The preliminary short-form prospectus is still subject to completion.

There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final short-form prospectus has been issued.

The securities described in this document have not been and will not be registered under the U.S. Securities Act 1933, as amended (the "Securities Act") or any U.S. state securities laws. Accordingly, the securities described herein will not be offered in the United States except to persons reasonably believed to be qualified institutional buyers, as defined under Rule 144A of the Securities Act, in reliance on exemptions from registration provided under the Securities Act and the rules thereunder.

This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the preliminary short-form prospectus, final short-form prospectus and any amendment for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.

AIRCANADA	AIRCANADA
TREASURYOFFERING OAND/ORCLASSBVOTIN		FCLASSA VARIABLEVOTINGSHARESGSHARESMa26 2020
		_y , _
A preliminary short-form prospectus of thedocument has been filed with the securities rprospectus, and any amendment, is requiredcompletion.There will not be any sale or any acceptance		Company dated May 26, 2020 containing important information relating to the securities described in thisegulatory authorities in each of the provinces and territories of Canada. A copy of the preliminary short-formto be delivered to any investor with this document. The preliminary short-form prospectus is still subject toof an offer to buy the securities until a receipt for the final short-form prospectus has been issued.
The securities described in this document haany U.S. state securities laws. Accordingly, t		ve not been and will not be registered under the U.S. Securities Act 1933, as amended (the "Securities Act") orhe securities described herein will not be offered in the United States except to persons reasonably believed to
be qualified institutional buyers, as defined uAct and the rules thereunder.		nder Rule 144A of the Securities Act, in reliance on exemptions from registration provided under the Securities
This document does not provide full disclosprospectus, final short-form prospectus andmaking an investment decision.IAi C		ure of all material facts relating to the securities offered. Investors should read the preliminary short-formany amendment for disclosure of those facts, especially risk factors relating to the securities offered, before
	IAi C	d h “C”	y
	SSUER:rISSUE:● Cla	anaa (te ompany)ss A Variable Voting Shares and/or Class B Voting Shares of the Compan
	(“Sha	res”).
	**AMOUNT: **Appro	ximately C$500 million.
	ISSUEPRICE:C$● pOVER-ALLOTMENT The u	er Share.nderwriters will have an option to purchase up to an additional 15% of the Issue	atile
	**OPTION: **the Is30 da**USE OFPROCEEDS: **The n	sue Price to cover over-allotments, exercisable in whole or in part at any time untys after Closing.
		et roceeds of this offerin and the concurrent convertible notes offerin will b
		p g g
	used tand wflexib	o supplement the Company's working capital and other general corporate purposeill serve to increase the Company's cash position, thereby allowing for additionility both from an operational standpoint and in the implementation of its planne	saldya
	mitigCONCURRENTConc	tion and recovery measures in response to the COVD-19 pandemic.urrent with this offering of Shares, the Company intends to issue approximatel
	CONVERTIBLENOTES US$4	00 million aggregate principal amount of convertible senior unsecured notes on
	**OFFERING: ** marke	ted private placement basis.
	CANADIAN/ NON-CANADIAN**PURCHASERS: **CanadShareA Va	ians (as defined by the_Canada Transportation Act_) will receive Class B Votins. Non-Canadians (as defined by the_Canada Transportation Act_) will receive Clasiable Voting Shares
	**FORM OFOFFERING: **Mark	.eted public offering in all provinces and territories of Canada by way of a shor
	formPrivat144A	prospectus.e placement in the United States to “qualified institutional buyers” pursuant to Ruf th US Siti At f 1933
	Stoc Excange (TSX) under te symbo AC.The Company has applied to list the Shares on the TSX. Listing of the Shares will besubject to the Company's fulfilment of all of the listing requirements of the TSX.**ELIGIBILITY: **The Class B Voting Shares will be eligible for RRSPs, RRIFs, RESPs, RDSPs, TFSAsand DPSPs.ACTIVE**BOOKRUNNERS: **TD Securities Inc., J.P. Morgan Securities Canada Inc. and Citigroup Global MarketsCanada Inc.

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May 26, 2020

AIR CANADA

TREASURY OFFERING OF CLASS A VARIABLE VOTING SHARES AND/OR CLASS B VOTING SHARES

UNDERWRITING FEE: 4.00%.

CLOSING: June •, 2020.

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