Home » The Air North Experience » Corporate Information

Corporate Information

Company Profile Vuntut Development Corporation Corporate Culture Investor Relations

Company Profile

Air North, Yukon's Airline is a regionally based carrier providing service within the Yukon and between the Yukon and British Columbia, Alberta, Northwest Territories and Alaska. Like our northern counterparts, Canadian North Airlines and First Air, we have a First Nations ownership component and we provide service from our territorial region to southern gateways. We are headquartered in the Yukon and we have most of our infrastructure, mobile assets, and our employees based here as well. Scheduled services from and to the Yukon as well as within the Yukon are the mainstay of our business with cargo being an essential component of our scheduled route traffic. Charter flying makes an important contribution to our operation in that it provides valuable incremental aircraft utilization and revenue.

Air North was founded on February 1, 1977 by Joseph Sparling and Tom Wood. The company initially operated a charter service primarily in support of the mining industry. Air North commenced operations with one Cessna 206 and over the next decade operated on wheels, floats, and skis with many aircraft types including the Cessna 150, 172, 185, 206, and 337; the Dehavilland Beaver, Otter, and Caribou; the Britten Norman Islander; the Beech 18 and 80, and the Douglas DC-3 and DC-4. Scheduled services within the Yukon and between the Yukon and Alaska were started in the mid 1980's and in 1996 the company began to replace its piston powered fleet with turbo props.

In 2002 Air North acquired two Boeing 737-200 (B737) aircraft and commenced scheduled service between the Yukon and Edmonton, Calgary, and Vancouver. Today Air North operates two Boeing 737-200 aircraft configured either in 120Y or 108Y/4J configuration, and four Hawker Siddeley 748 (HS748) turbo props each seating up to 40 passengers.

Air North, Yukon's Airline presently flies from Whitehorse to Dawson City and Old Crow in the Yukon; to Inuvik in the Northwest Territories; to Fairbanks, Alaska (seasonally); to Vancouver, British Columbia and to Edmonton and Calgary, Alberta. The company is one of the largest private sector employers in the Yukon with over 200 full and part time employees.

Air North Board of Directors

Joseph Sparling President Greg Charlie Vice President Stephen Mills Vice President Murray Leitch Vice President Kenny Tetlichi Director Tom Wood Director

Vuntut Development Corporation

The Vuntut Development Corporation (VDC) is the economic arm of the Vuntut Gwitchin First Nation. It is a for-profit company that owns a significant interest in Air North, a road and quarry construction company, several real estate holdings in Old Crow and Whitehorse, and an exciting eco-adventure company that provides for world class grizzly bear viewing opportunities in the northern Yukon.

VDC aims to balance economic development and the natural environment while respecting the traditional lifestyle and culture of the Vuntut Gwitchin. Its goal is to play a major role in the creation of a diversified, balanced, and sustainable economy in the North Yukon, an economy that provides prosperity and certainty for the future for all Vuntut Gwitchin. VDC also is a major sponsor of cultural, recreational, social, and environmental initiatives throughout the Yukon.

Corporate Culture

Our number one corporate priority at Air North is to maximize safety and to minimize the risk of accident or incident in every aspect of our operation. Our Safety Management System involves all company employees and the Safety Officer is accountable directly to the President and CEO.

Our second corporate priority is, quite simply, to respect the interests of our stakeholders, who are:

1. Our Customers
2. Our Employees
3. Our Shareholders

With respect to our customers, we strive to provide friendly and helpful service, with a personal touch, at a fair price. We operate in a relatively small community and in an extremely small market. Many of us know many of our customers personally. This is our competitive edge in the market and the way in which we differentiate our product from others. It does not cost anything to be nice. While we are not technically a public company, our performance is very visible in our small community.

With respect to our employees, it is our goal to attract and keep competent and company minded employees. Our management style, starting at the top, is to be very hands on. We endeavor to lead by example. We are very proud of our strong team of employees and we are particularly pleased to note that our turnover is extremely low.

With respect to our shareholders, it is important to note that for many, the maximization of profit is not the number one priority. The VGFN investment in the company was strategic. While it was a business decision, there are other factors which are important to the citizens of Old Crow. Air service is a lifeline to the community and its residents are always very concerned with service and pricing. Employment opportunities are also a consideration for the VGFN. Our Class C shareholders did not purchase growth shares. While they want to see their company succeed they are also keenly interested in service and pricing issues. The interests represented by our shareholders require Air North to maintain a balance between profitability and community interests.

The foregoing sets forth the vision/strategy that the Board of Directors has adopted for the operation of the airline.

Investor Relations

Air North, Yukon's Airline investors are advised to take note of the following:

Air North, Yukon's Airline Investors Update (July 27, 2008) Background On Feb 28, 2008, Air North, Yukon's Airline, received authorization from Yukon Government ("YG"), Department of Economic Development, to issue Class C shares under the Yukon Small Business Investment Tax Credit ("YSBITC") Program for six share offerings, each in the amount of $795,000.00, for each of the tax years 2008-2013 inclusive. On March 3, 4, and 5, 2008, Air North received Subscription Agreements for all 636 shares permitted under the YSBITC approval. In subsequent discussions with YG officials, it became apparent that the issuance of Class C shares prior to the year for which the tax credit applies may cause complications with respect to the tax credit. In view of this: Air North has accepted subscriptions from investors and issued 106 Class C shares with respect to the 2008 YSBITC offering; and Air North is holding subscription agreements from investors and is holding funds in trust for 106 Class C shares pertaining to the 2009 YSBITC offering. These shares will be issued in January 2009. Air North requested and received on May 12, 2008, an Order from the Yukon Superintendent of Securities to issue up to 600 Class D shares (the "Superintendent's Order") on the terms set out in the order. Class D Shares Under the terms of the Superintendent's Order, Air North may issue up to 600 Class D, Series A and Series B non-voting shares at an issue price of $7,500 each, $4,500,000 for the total offering. Class D, Series A shares are identical to the shares available under the conversion privilege attached to Class C shares previously issued by Air North under the YSBITC program in 2002 to 2004 as well as 2008 and the shares to be issued in 2009. Class D, Series B shares are identical to Class D, Series A shares, but they also carry a one time signing bonus of 8 flight dividend segments. Series B shares are available only to those investors who originally subscribed for Class C shares under the YSBITC program for 2010-2013. Class D shares (both series) have annual flight dividends identical to Class C shares – i.e. the holders of Class D shares are entitled to receive in each year ending August 31 commencing August 31, 2009¹, flight dividends for two return flights from any destination then being served by Air North to any other destination then being served by Air North. In addition, unlike the Class C shares, which must be held for five years, Class D shares are freely transferable by holders upon issue. Also, unlike Class C shares, Class D shares will not be eligible for a tax credit under the YSBITC program and will not pay 4% annual cash dividends. Contacting Interested Investors Air North has now contacted most of the investors who had originally subscribed for the 424 Class C shares under YSBITC 2010-2013. These investors have been given an opportunity to purchase Class D, Series B shares and most have elected to do so. At this time we still have a sizeable wait-list for additional shares. Under the terms of the Superintendent's Order, Air North may issue up to 600 Class D shares – 176 more than required to replace the 424 Class C shares subscribed to under YSBITC Offerings 3 thru 6. During the next several weeks, we will be contacting, (in order), our wait-listed investors, giving these individuals an opportunity to subscribe for Class D, Series A shares. We will have a total of approximately 200 Class D, Series A shares available for sale. Any inquiries with respect to this Information Notice should be made to either Joseph Sparling, President, or Murray J. Leitch, Vice-President, Administration & General Counsel. We thank you for your interest in and support for Air North, Yukon's Airline. We remain committed to providing safe and affordable air transportation for Yukoners. Joseph Sparling President

¹ From the Issue Date to August 31, 2009, each holder shall be entitled to flight dividends for four segments (two return flights) from any destination then being served by Air North to any other destination then being served by Air North. Thereafter, yearly in each year from September 1 to August 31 until conversion or redemption, each holder is entitled to flight dividends for a further four flight segments (two return flights). Each holder will receive a T5 for the value of the annual flight dividends as dividend income.