Transat A.T. Inc. has entered into an agreement with National Bank of Canada regarding the remaining $143.5 million of its funds blocked in asset-backed commercial paper (ABCP) holdings.

Based on the agreement announced today, NBC will provide Transat three-year credit facilities for up to $107.6 million, or 75% of the nominal amount of Transat’s ABCP holdings, through a mix of limited recourse and full recourse credit facilities, renewable annually at the discretion of NBC thereafter up to 4 times.

An aggregate amount of $68.4 million of the credit facilities are limited recourse to the ABCP, with the balance of the credit facilities, namely $39.2 million, being full recourse against Transat.

The agreement is subject to usual conditions and to the definitive and final approval of the restructuring plan of the ABCP market before the courts and its effectiveness and to the execution of a complete, final and unconditional release in favour of NBC against any claim related to the ABCP.

Transat has agreed to support the restructuring plan of the ABCP market and to discontinue its appeal of the judgement approving the restructuring plan.

This agreement is in addition to the credit facilities put in place in November 2007 with NBC, which include a five-year, $150 million unsecured revolving credit facility and a five-year $60 million secured revolving letter of credit facility.