Avantair 8-K Entry into a Material Definitive Agreement

Avantair, Inc.

Investor

Presentation

December 6, 2012

Exhibit  99.1

SAFE HARBOR

2

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as

amended,

and

Section

21E

of

the

Securities

Exchange

Act

of

1934,

as

amended.

All

statements,

other

than

statements

of

historical fact, including, without limitation, statements regarding the Company’s expectations, beliefs, intentions or future

strategies

that

are

signified

by

the

words

“expects,”

“anticipates,”

“intends,”

“believes,”

or

similar

language.

Our

actual

results

could differ materially from the information contained in these forward-looking statements as a result of various factors, including,

but

not

limited

to,

the

factors

outlined

in

our

Annual

Report

on

Form

10-K

for

the

fiscal

year

ended

June

30,

2012,

and

the

factors

outlined in our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012, in each case, particularly

under

the

heading

“Risk

Factors.”

Additional

risks

and

uncertainties

not

currently

known

to

us

or

that

we

currently

deem

to

be

immaterial may also materially adversely affect our business, financial condition or operating results. We do not undertake, and

expressly

disclaim,

any

obligation

to

update

this

forward-looking

information,

except

as

required

by

applicable

law.

Important

factors

that

could

cause

actual

results

to

differ

materially

from

Avantair’s

expectations

as

described

in

Avantair’s

public

filings

with the Securities and Exchange Commission ("SEC") include, without limitation: (1) our inability to fund our operations and

capital

expenditures;

(2)

our

inability

to

raise

capital

or

meet

cash

flow

projections,

including

our

inability

to

raise

funds

through

the issuance of convertible notes and warrants or through other financings; (3) our inability to resume the operation of our fleet on

the timeline which we expect; (4) extensive government regulation, including, but not limited to, the operational requirements of

the FAA; (5) our inability to generate sufficient cash flows to meet our debt service obligations or other financial obligations; (6)

our

inability

to

obtain

new

or

retain

current

acceptable

program

participant

contracts;

(7)

the

loss

of

key

personnel;

(8)

our

inability

to

effectively

manage

our

growth;

(9)

our

inability

to

acquire

additional

aircraft

and

parts

from

our

single

manufacturer;

(10)

competitive

conditions

in

the

fractional

aircraft

industry;

(11)

the

failure

or

disruption

of

our

computer,

communications

or

other technology systems; (12) changing economic conditions; (13) increases in fuel and other costs; and (14) our failure to

attract and retain qualified pilots and other operations personnel.

The forward-looking statements relating to future events and the future performance of the Company in this document include,

without limitation, statements regarding: the Company's new business model, as described herein, the Company's cash forecast

assumptions described herein, and the Company's quarterly cash flow projections set forth herein, including each component

provided

in

such

projections.

Other

forward-looking

statements

are

described

in

our

public

filings

with

the

SEC.

NEW BUSINESS MODEL

3

•

Primary operating strategy is to achieve positive cash flow through continued sale of

Fractional Shares, Axis Leases, Edge Cards, and continued implementation of cost

savings initiatives

•

Intensely tracking performance and results to achieve operating strategy

•

New Finance Leadership Team has been put in place

•

Continue to promote a culture where safety and customer service remain as the

Company’s primary objectives

•

To achieve strategic goals of positive earnings and cash flows, implementing a series of

cost

savings

initiatives

having

no

impact

to

safety

and

customer

service.

Initiatives

have

been expanded in November 2012 to include:

•

Reduce fleet size by 12 aircraft by strategically eliminating more costly aircraft from

our fleet which the Company believes will reduce both fixed and variable costs

•

Increasing the overall reliability of our fleet

•

Driving increased efficiencies through outsourced maintenance and lowering our

overall costs of flight operations

•

Continuing

forward

on

broader

series

of

cost

savings

initiatives

previously

announced

PROJECTIONS

4

The Company makes no express or implied representation or warranty as to the attainability of the projected

financial information contained herein (the "Projections") or as to the accuracy or completeness of the

assumptions from which such projected information is derived.  Under no circumstances should such

information be construed as a representation or prediction that the Company will achieve or is likely to

achieve any particular results. The projected financial information is management’s projection of possible

future results, is dependent upon many factors over which the Company has no control and is necessarily

based on a number of assumptions as to future events that are inherently uncertain and subjective, and the

Company's actual results may vary materially. The Projections and the related assumptions (whether or not

described herein), as well as all of the elements taken into consideration to determine the Projections, may

not occur, and they are subject to change or modification due to the uncertainty associated with the

economic, financial and competitive environment in which the Company operates and to the risks and

uncertainties to which the Company and its business is subject, all of which may have an impact on the

Company's business activities, financial position, results of operations, and outlook, and on the realization of

the assumptions and Projections described above. The projections were not prepared in compliance with

the guidelines of the American Institute of Certified Public Accountants and have not been examined,

reviewed or compiled by the Company's independent certified public accountants or any other third party.   

The Company does not intend to update or otherwise revise the projections to reflect circumstances existing

after the date hereof or to reflect the occurrence of unanticipated events, even in the event that any or all of

the underlying assumptions are shown to be in error. Furthermore, the Company does not intend to update

or revise the projections to reflect changes in general economic or industry conditions.

PROJECTIONS (cont’d)

5

The Projections are made as of November 20, 2012 and are based on a number of assumptions, including,

but not limited to those set forth on the pages that follow. The

Projections also assume the success of the

Company’s current business strategy as well as the Company's ability to raise additional funds within

certain

time

frames

and

on

certain

terms.

The

success

of

the

strategy

and

the

ability

to

raise

such

funds

on

acceptable terms is subject to uncertainties and contingencies beyond the Company’s control, and no

assurances can be given that (A) the strategy will be effective or the anticipated benefits from the strategy

will be realized in the periods for which the Projections have been prepared, and (B) that any funds will be

raised

on

acceptable

terms

and

timeframes.

The

assumptions

described

herein

are

those

that

the

Company

believes

are

significant

to

the

Projections.

However,

not

all

assumptions

used

in

the

preparation

of

the

Projections have been set forth herein.

The Projections do not assume the occurrence of any periods of economic slowdown that might adversely

affect

demand

for

the

Company’s

products

and

services.

The

Projections

assume,

among

other

things,

that:

(i) there will be no material costs resulting from legal proceedings; (ii) there will be no material change

in the political, fiscal or economic conditions; (iii) there will be no material change in legislation or

regulations or the administration thereof that will have an unexpected effect on the business of the

Company; and (iv) there will be no labor or industrial disputes or other disturbances that would materially

affect

the

operations

or

sales

of

the

Company.

Other

important

factors

that

could

cause

actual

results

to

differ materially from Avantair’s expectations are set forth above under the caption "Safe Harbor" and in our

public

filings

with

the

SEC

under

the

caption

“Risk

Factors”

and

elsewhere.

Operational:

•

Company plan of at least 41 aircraft operational by November 21

st

•

Plan to reduce fleet by 12 aircraft (grounded and sold) in upcoming months. Criteria based on a ranking   

system

tracking

aircraft

cost/hour,

performance,

reliability

and

others.

Removed

aircraft

as

follows:

-

4 Aircraft -

owners on expired contracts no longer subject to Monthly Management Fees (MMF)

-

3 Aircraft -

owners with to near-term MMF contract expiration

-

3 Aircraft -

core aircraft financed by the Company

-

2 additional Aircraft

Receipts:

•

Built in what management believes as of November 20

th

to be a reasonable timeline for cash collections

due to operational stand down based on:

-

Monthly Management Fees (MMF), 

-

Annual Prepayments of MMF, and

-

Flight Fees

•

Forecasted cash receipts reflecting expiring MMF contracts

•

Forecasted

cash

from

lease

and

card

sales

at

reduced

levels

in

Nov

’12

–

Feb

’13 

Disbursements:

•

Payroll, maintenance, fuel and other related flight operation disbursements have been reduced based on  

12 fewer aircraft in the fleet

•

Built in timeline to achieve normalized AP levels

•

Other disbursements related to the operational stand down flow in November and December

Financing:

•

Includes the Company’s receipt of $8 million in three tranches of $3 million, $2 million and $3 million during

November, December and January, respectively

6

CASH

FORECAST

ASSUMPTIONS

7

QUARTERLY CASH FLOW PROJECTION

(in millions)

Q1

Actual

Sales receipts

10.4

$    

7.7

$          

9.0

$        

10.5

$        

37.6

$     

A/R and other receipts

30.6

$    

25.3

$       

28.2

$     

35.7

$        

119.8

$   

Total receipts

41.0

$    

33.1

$       

37.2

$     

46.2

$       

157.4

$   

Payroll

(8.9)

$     

(7.7)

$        

(5.3)

$      

(5.9)

$         

(27.9)

$    

Maintenance

(9.3)

$     

(6.5)

$        

(8.1)

$      

(8.5)

$         

(32.4)

$    

Operations

(15.8)

$   

(12.2)

$      

(13.7)

$    

(13.5)

$      

(55.2)

$    

General and admin

(4.0)

$     

(4.3)

$        

(3.6)

$      

(3.0)

$         

(15.0)

$    

lease/debt service

(3.6)

$     

(2.4)

$        

(2.4)

$      

(2.1)

$         

(10.5)

$    

Other

(3.3)

$     

(3.6)

$        

(3.1)

$      

(3.7)

$         

(13.7)

$    

Total disbursements

(44.9)

$  

(36.6)

$     

(36.1)

$   

(36.8)

$      

(154.5)

$ 

Net Cash Flow

(4.0)

$    

(3.6)

$        

1.1

$       

9.3

$         

2.8

$       

Financing

-

$      

5.0

$         

3.0

$       

-

$         

8.0

$       

Adj. Net Cash Flow

(4.0)

$    

1.4

$         

4.1

$       

9.3

$         

10.8

$     

-

Projections are subject to change and are based on assumptions in the previous slide.  Actual results

may materially differ from these projections

-

Q4 FY13 projections include estimated $5M of receipts for annual prepayment of MMF, consistent

with May 2012

FY 2013

Q2

Q3

Q4

Full Year

Projection

Projection

Projection

Projection

8

Q1

Q2

Q3

Q4

Full Year

Q4 FY12

Variance

in millions

Actual

Projection

Actuals

to Q4 FY13

Sales receipts

10.4

$             

7.7

$               

9.0

$               

10.5

$             

37.6

$         

10.4

$         

0.1

$            

A/R and other receipts

31.1

$             

29.4

$             

29.6

$             

29.7

$             

119.8

$       

27.5

$         

2.2

$            

Total receipts

41.5

$            

37.1

$            

38.6

$            

40.2

$            

157.4

$      

37.9

$         

2.3

$           

Payroll

(8.9)

$              

(7.7)

$              

(5.3)

$              

(5.9)

$              

(27.9)

$        

(9.0)

$          

3.1

$            

Maintenance

(9.3)

$              

(6.5)

$              

(8.1)

$              

(8.5)

$              

(32.4)

$        

(9.5)

$          

1.0

$            

Operations

(15.8)

$            

(12.2)

$            

(13.7)

$            

(13.5)

$            

(55.2)

$        

(14.9)

$        

1.4

$            

General and admin

(4.0)

$              

(4.3)

$              

(3.6)

$              

(3.0)

$              

(15.0)

$        

(4.2)

$          

1.2

$            

lease/debt service

(3.6)

$              

(2.4)

$              

(2.4)

$              

(2.1)

$              

(10.5)

$        

(3.0)

$          

0.9

$            

Other

(3.3)

$              

(3.6)

$              

(3.1)

$              

(3.7)

$              

(13.7)

$        

(5.4)

$          

1.7

$            

Total disbursements

(44.9)

$           

(36.6)

$           

(36.1)

$           

(36.8)

$           

(154.5)

$     

(46.0)

$       

9.2

$           

Net Cash Flow

(3.5)

$             

0.5

$               

2.4

$               

3.4

$               

2.8

$           

(8.1)

$         

11.5

$         

Financing

-

$              

5.0

$               

3.0

$               

-

$              

8.0

$           

-

$           

-

$           

Adj. Net Cash Flow

(3.5)

$             

5.5

$               

5.4

$               

3.4

$               

10.8

$         

(8.1)

$         

11.5

$         

- Projections are subject to change and are based on assumptions in a previous slide.  Actual results may materially differ from these projections.

- Annual prepayment of MMF has been allocated evenly to each month during the year to show more even quarterly cash flows.  Actual

cash projections will differ as annual prepayment dates are weighted towards the fourth quarter of the fiscal year.

- The projected improvement in net cash flow in the comparison between Q4 FY13 and Q4 FY12 reflect expected changes to the business model and as outlined

in the assumptions slide.

FY 2013

Projection

QUARTERLY

CASH

FLOW

PROJECTION

(NORMALIZED

PREPAID

MMF)

VALUE PROPOSITION

AIRCRAFT

•

Economical and high performance Piaggio Avanti P180

•

Currently

57

aircraft

in

fleet

–

North

American

exclusivity

of

Piaggio

P180

aircraft

•

Largest and quietest cabin in its category

•

Low

operating

costs

–

innovative

aerodynamic

design

&

most

fuel

efficient

in

its

class

•

Fastest

twin

turboprop

ever

built

–

light

jet

speed

COMPETITIVE PRICING

•

Award winning programs (Fractional Shares, Axis Leases, Edge Cards)

•

Simplified pricing, no fuel surcharge or hourly operating costs

•

40% less than competitive programs

PEOPLE & SERVICE

•

Approximately 500 employees including over                     

200 pilots

•

State-of-the-art, 24/7 operations center in

Clearwater, FL

•

Entire

organization

committed

to

one

aircraft

type

and industry leading customer service

9

FINANCIAL SUMMARY

•

Revenue generating flight hours

•

11,343 hours in FY13 Q1 versus 11,366 hours in FY12 Q1

•

Strong revenue growth through challenging economic environment

•

11% CAGR from FY08 -

FY12

•

Improved bottom line performance

•

($1.0) million net loss in Q1 FY13 versus ($2.2) million net loss in Q1

FY12

•

Significant improvement in Adjusted EBITDA

•

$2.2 million in Q1 FY13 versus ($0.5) million during prior year period

•

November 13, 2012 balance sheet

•

Approximately $3 million in cash, and

•

$70 million of deferred revenue

10

NON-GAAP MEASURE

OF PERFORMANCE

The following table (in thousands) reflects the reconciliation of net loss, prepared in

conformity with GAAP to the non-GAAP financial measure of Adjusted EBITDA:

The

Company

believes

that

the

non-GAAP

financial

measure

of

Adjusted

EBITDA

is

useful

to

investors

as

it

excludes

the

gain

on extinguishment of debt and other income and expense items that do not directly reflect the underlying performance of the

Company’s business operations. This measure is a supplement to accounting principles generally accepted in the U.S. used to

prepare the Company’s financial statements and should not be viewed as a substitute for GAAP measures. In addition, the

Company’s non-GAAP measure may not be comparable to non-GAAP measures of other companies.

11

2012

2011

Net Loss

(970)

$                 

(2,180)

$              

Add:

Depreciation and amortization

1,451

$               

930

$                  

Interest expense

992

$                  

1,056

$               

Stock-based compensation

154

$                  

173

$                  

Employee termination and other costs

100

$                  

-

$                   

Loss on sale of asset

477

$                  

-

$                   

Subtract:

Interest and other income

(18)

$                   

(66)

$                   

Gain on sale of asset

-

$                   

1

$                       

Gain on debt extinguishment

-

$                   

(439)

$                 

Adjusted EBITDA

2,186

$               

(526)

$                 

Three Months Ended

September 30,

AVANTAIR

(OTCBB: AAIR)