Air Canada Lease Agreement

Air Canada today announced that it has
reached a tentative restructuring agreement relating to aircraft leases for 38
Airbus aircraft consisting of 22 A319s, eight A330s, and eight A340s involving
syndicates of lenders supported by the Export Credit Agencies of the United
Kingdom, France and Germany.
Under the terms of the tentative agreement, rental payments for each
aircraft will be restructured consistent with Air Canada`s restructuring plan.
The agreement is subject to the fulfillment of various conditions and internal
credit and other approvals of interested parties. The detailed terms of the
agreement are confidential.
“Air Canada`s restructuring continues at a rapid pace,” said Calin
Rovinescu, Executive Vice-President and Chief Restructuring Officer. “While
the current focus is on raising equity capital to provide a stable financial
base for the airline upon emergence from CCAA, we are at the same time moving
forward with the claims process and working to complete the renegotiation of
aircraft leases. This agreement brings to 170 the total number of aircraft
with restructured terms. To date, 18 aircraft have been returned to lessors
and with this latest agreement we can now make clearer decisions on what
leases are to be repudiated to complete the process,” concluded Mr. Rovinescu.
Air Canada and its financial advisors are involved in intensive
negotiations with aircraft lessors and lenders on revised aircraft lease
arrangements consistent with current rates and the Company`s restructuring
plan. The Company will resume aircraft lease payments as new agreements are