Canada Jetlines (AU, Toronto Pearson) says its plans to execute a reverse takeover of listed firm, Jet Metal Corp., have taken a step forward after the two parties entered into a definitive agreement. The transaction was first announced in February as an LOI.

With the signing of the agreement, the two firms said they are now in the process of preparing materials needed to gain approval from their respective shareholders and to secure all necessary regulatory approvals, including that of the TSX Venture Exchange.

Under the terms of the agreement, each 1.5 share of Jet Metal will convert to one share of the new company, which will list under Jet Metal's existing market ticker symbol, JET. Each Jetlines share will be treated as equal to 1.5 shares of the new entity.

The move, if successful, could see Jetlines holding an IPO on Toronto's TSX Venture Exchange as early as June.

Jetlines plans to use funds from the IPO to help cover initial start-up costs including fleet procurement.