Exchange Income Corporation has announced that its subsidiary, PAL Aerospace, has entered into an agreement valued at approximately $750 million Canadian dollars with SkyAlyne. The contract involves providing modification, in-service support, and training services for the Royal Canadian Air Force's CT-142Q Citadel fleet.

Under the terms of the agreement, PAL Aerospace will be responsible for the complete modification of the CT-142Q Citadel aircraft. Throughout the contract period, the company will deliver "Wing Standard" training for all Air Combat Systems Officers and Airborne Electronic Sensor Operators, while also providing in-service support for the fleet's operations. This contract is a key component of the Royal Canadian Air Force's Future Aircrew Training (FAcT) program. The FAcT program is a major 25-year defense procurement initiative worth $11.2 billion, designed to establish a modernized training system for Royal Canadian Air Force pilots and aircrew. SkyAlyne is a joint venture formed by CAE and KF Aerospace and was officially selected by the Canadian government as the primary contractor for the FAcT program in May 2024.

As part of this collaboration, PAL Aerospace will be fully integrated into the SkyAlyne team. The focus will be on delivering initial operational capability, ensuring a smooth transition from the existing training program, and maintaining the readiness of the Royal Canadian Air Force. Kevin Lemke, the General Manager of SkyAlyne, stated that PAL Aerospace's proven expertise in modification, in-service support, and training is crucial for ensuring Canadian pilots and aircrew receive the best possible training solution.

The CT-142Q Citadel is a modified aircraft based on the de Havilland Canada Dash 8-400 platform. It will replace the older CT-142 (Dash 8-100) models, which have been in service for over 30 years. The aircraft features a new "Reflect Forward" livery that blends the yellow color representing historical training aircraft with the modern air force's deep blue. Red and white stripes symbolize the Canadian flag, paying tribute to the Royal Air Force's century-long history. In line with the FAcT program schedule, this aircraft will be operated by the 402 Squadron in Winnipeg, Manitoba, to carry out aircrew training duties. Exchange Income Corporation will discuss this agreement in detail during its second-quarter earnings conference call on August 12, 2026.