On 12 August 2010 Icelandair Group hf. announced that the company had concluded the financial restructuring of the company. The documentation process took longer then originally envisaged, but all contracts relating to the financial restructuring were signed this morning. The financial restructuring is based on three components: + Firstly, investors have invested ISK 5.5 billion in new shares at the price of ISK 2.5 per share corresponding to a subscription of 2.2 billion new shares in Icelandair Group. The new share capital will be paid once the company has published a prospectus regarding the share issuance on OMX Nasdaq Iceland. + Secondly, the Group's largest creditors will convert debts in the amount of ISK 3.6 billion into shares based on a share price of ISK 5, which corresponds to a subscription to 720 million new shares. The total increase in share capital will amount to ISK 2.9 billion in nominal value. + Thirdly, the financial restructuring of the Company will reduce its interest bearing debt by over ISK 10 billion through the transfer and sale of certain assets which formerly formed a part of the company's core business. The sales and purchase contracts relating to these assets contain standard reservations regarding the approval of relevant authorities. Capital gain on the above asset sale amounts to ISK 3.2 billion but after taxes and currency translation difference equity will increase of ISK 0.5 billion In total, the Group will lower its interest bearing liabilities by ca. ISK 14 billion and total interest bearing liabilities of Icelandair Group will be ca. ISK 26 billion following the signing today. There are plans to invite investors and the public to inject approximately ISK 2.5 billion in new share capital into the Company in subsequent share offering. The exact timing and structure of such offering will be announced in due course. Icelandair Group has disclosed that it will publish its third quarter results in week 44. This date has been postponed to 15 November 2010. The operations of Icelandair Group have been strong this year and the company has outperformed its original financial forecast for the year. To reflect that, Icelandair Group has revised its EBITDA forecast for the year from ISK 8.5 billion to 9.5 billion for the full year. For further information, please contact: Björgólfur Jóhannsson, CEO Icelandair Group, Tel (+354) 896-1455 Bogi Nils Bogason, CFO Icelandair Group, Tel (+354) 665-8801