The U.S. pilot who bombed and killed four Canadian soldiers in Afghanistan struck a deal on Thursday to avoid a court martial.

Maj. Harry Schmidt will now face a non-judicial hearing by his unit's commanding officer, in which the worst outcome could be 30 days of house arrest or a loss of one month's pay of $5,600.

In a court martial, he could have lost his flying privileges, could have been kicked out of the military, and could have faced prison.

His hearing with his commanding general is scheduled for Canada Day.

The mother of one of the Canadian soldiers killed in Afghanistan says she is saddened by the conclusion of the case.

Cpl. Ainsworth Dyer was 25 when he died in the bombing. His mother Agatha Dyer said on Thursday from her home in Montreal that her heart is broken, and she believes the pilot involved in her son's death should pay.

The other three Canadians who died in the bombing were Sgt. Marc Leger, Pvte. Nathan Smith and Pvte. Richard Green.

Schmidt was facing four counts of dereliction of duty for dropping a laser-guided bomb on Canadian soldiers taking part in night exercises in Afghanistan in April 2002. Four soldiers were killed; eight were wounded.

He accepted an air force offer to face administrative punishment in exchange for the dismissal of all charges, according to a U.S. air force statement on Thursday.

Schmidt's lawyer said the air force had agreed to allow his client to remain employed with the Air National Guard, but not as a pilot.

He said Schmidt – who had a decorated career as a Navy pilot and an instructor at the Navy's "Top Gun" fighter pilot school – did not want to fly for the Air Force anymore.

Schmidt felt he had been "second guessed in a combat situation by people sitting back in the air-conditioned comfort of the Pentagon," the lawyer said.

Schmidt had originally opted for a court martial over a non-judicial hearing, saying he wanted to clear his name.

The air force in June 2003 dropped the initial charges of involuntary manslaughter and aggravated assault – which could have carried sentences of up to 64 years in prison – against Schmidt and his flight leader Maj. William Umbach.

Umbach thereafter quietly agreed to accept a reprimand and retire from the air force.

Schmidt and Umbach, both with the Illinois Air National Guard's 170th Fighter Squadron, believed the enemy was firing at them when they dropped the bomb on members of the then Winnipeg-based Princess Patricia's Canadian Light Infantry.

They were flying near Kandahar Airport in the early morning hours of April 18, 2002, when they detected ground fire. They thought it was directed at them and dropped a 225-kilogram laser-guided bomb, even though they had been ordered to hold their fire.

The soldiers on the ground, who were conducting live fire exercises, were the first Canadians to die in combat since the Korean War.