Exchange Income Corporation to Acquire Regional One, Inc. for US $80 million

-Acquisition provides revenue and cash flow diversification within Exchange's aviation segment

WINNIPEG, Feb. 28, 2013 /CNW/ - Exchange Income Corporation (TSX:  EIF) (the "Corporation"), announced today that it has signed a stock purchase agreement to acquire all of the shares of Regional One, Inc., a privately-owned US company that is a leading provider of aircraft and engine aftermarket parts to regional airline operators around the world. The acquisition is valued at approximately US $80 million, subject to adjustments for taxes, and will be funded through the issuance of the Corporation's common shares and debt financing. The acquisition is expected to be immediately accretive to the Corporation's earnings per share and free cash flow per share. The closing of the transaction is subject to receipt of regulatory approvals and other standard conditions. The transaction is expected to close by April 1, 2013.

"The acquisition of Regional One will provide product and geographical diversification of revenue and cash flow within our aviation segment and is strategic on a number of levels," said Mr. Mike Pyle, President and CEO of Exchange Income Corporation.  "Most notably, it provides a proxy for vertical integration into one of the major expense categories of our aviation segment.  Equally important, it can generate offsetting cash flow to mitigate price increases in aircraft and parts.  We look forward to welcoming Regional One into our operations."

Doron Marom, the founder of Regional One stated, "I am very proud of the significant growth and development of Regional One since its inception in 2004. The quality of our people and operations has enabled Regional One to become a leader in the regional aircraft and engine aftermarket parts industry and we see the sale to Exchange Income Corporation as the natural progression to further growth. The Corporation's track record with their other companies was a key driver in our decision to sell. It is a rare combination to find a buyer that has the access to capital that Exchange Income Corporation brings yet still enables us to keep our core culture and values that have driven Regional One to its current level of success. I'm looking forward to continuing to be the CEO and oversee Regional One in its next chapter."

Acquisition Highlights

• The purchase price is approximately US $80 million, subject to adjustments for taxes, which is based on an EBITDA multiple that is within the range of prior acquisitions by the Corporation.
• 25% of the purchase price will be paid through the issuance of Exchange Income Corporation common shares; the balance will be financed using the Corporation's senior credit facility. This transaction contains earn out provisions which are contingent on Regional One achieving certain performance milestones in order for the maximum purchase price to be paid.
• Regional One was founded in 2004 and has three main revenue streams being (i) direct sales of parts, aircraft, engines and other related equipment to regional airlines; (ii) consignment sales of customers' surplus parts inventory; and (iii) leasing of aircraft, engines and equipment to regional airlines.
• Regional One operates out of a 60,000 square foot office and warehouse facility in Miami, Florida.
• Regional One has customers worldwide.
• Over the last 5 years Regional One has had annual average growth of 25%.
• In 2011, Regional One generated US $31.6 million in revenue.

"Consistent with our traditional acquisition criteria, Regional One was identified because it operates in defensible markets with attractive margins," said Mr. Adam Terwin, Chief Financial Officer of Exchange Income Corporation.  "We expect that the transaction will be immediately accretive to our key financial metrics, including EBITDA, cash flows, earnings per share and free cash flow.  To sustain this performance, we have retained key members of Regional One management through long-term employment contracts."

Conference Call
Exchange will host a conference call today, February 28, 2013, at 10:00 am eastern to discuss its financial results for the three and 12-month periods ended December 31, 2012. The Corporation's management will also review the acquisition of Regional One.

All interested parties can join the conference call by dialing 1-888-231-8191 or 647-427-7450. Please dial in 15 minutes prior to the call to secure a line. The conference call will be archived for replay until Thursday, March 7, 2013 at midnight. To access the archived conference call, please dial 1-855-859-2056 and enter the encore code 10099939.

A live audio webcast of the conference call will be available at www.exchangeincomecorp.ca  and www.newswire.ca. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. An archived replay of the webcast will be available for 365 days.

About Exchange Income Corporation
Exchange Income Corporation is a diversified acquisition-oriented company, focused on opportunities in the industrial products and transportation sectors which are ideally suited for public markets except for their size. The strategy of the Corporation is to invest in profitable, well-established companies with strong cash flows operating in niche markets in Canada and/or the United States.

The Corporation is currently operating in two niche business segments: aviation and specialty manufacturing. The aviation segment consists of the operations by Perimeter Aviation, Keewatin Air, Calm Air International, Bearskin Lake Services and Custom Helicopters, and the specialty manufacturing segment consists of the operations by Jasper Tank, Overlanders Manufacturing, Water Blast Manufacturing, Stainless Fabrication and WesTower Communications. For more information on Exchange Income Corporation, please visit www.exchangeincomecorp.ca.

Additional information relating to the Corporation, including all public filings, is available on SEDAR (www.sedar.com).

Forward-Looking Information:
The statements contained in today's press release that are forward-looking are based on current expectations and are subject to a number of uncertainties and risks, and actual results may differ materially. These uncertainties and risks include, but are not limited to, the dependence of the Corporation on the operations and assets currently owned by it, the degree to which its subsidiaries are leveraged, the fact that cash distributions are not guaranteed and will fluctuate with the Corporation's financial performance, dilution, restrictions on potential future growth, competitive pressures (including price competition), changes in market activity, the cyclicality of the industries, seasonality of the businesses, poor weather conditions, and foreign currency fluctuations, legal proceedings, commodity prices and raw material exposure, dependence on key personnel, and environmental, health and safety and other regulatory requirements. Further information about these and other risks and uncertainties can be found in the disclosure documents filed by the Corporation with the securities regulatory authorities, available at www.sedar.com.

SOURCE: Exchange Income Corporation

Mike Pyle
President and CEO
Exchange Income Corporation
[phone]
[email protected]

Joe Racanelli
Investor Relations
The Equicom Group Inc.
Phone: [phone] Ext. 243
[email protected]