Air Canada Responds To Court Approval Of Canadian Airlines Debt Restructuring - Delighted With Outcome

Air Canada was informed today that the Alberta Court of Queen's Bench has approved Canadian Airlines Corporation's Plan of Compromise and Arrangement under the Companies' Creditors Arrangement Act (CCAA). Madame Justice Marina Paperny delivered her decision in court earlier in the day.

The Court ruled that the Plan was fair, reasonable and equitable. It furthermore found that the Plan represents a solid chance for the continued existence of Canadian, maintains over 16,000 jobs, protects consumers and preserves the integrity of our national transportation system while we move towards a new regulatory framework.

``We are delighted with this outcome. This decision provides Canadian Airlines with the stability necessary to continue its business operations in conjunction with Air Canada,'' said Robert Milton, President and Chief Executive Officer of Air Canada.

The decision clears the way for Canadian Airlines Corporation to complete the closing process for the Plan. Canadian Airlines International Limited will become a wholly-owned subsidiary of Air Canada, once all eligible creditors have been paid.

``Our focus remains firmly fixed on a successful integration of the two carriers for our customers, employees, and all of Canada. Today marks an important milestone in this process,'' concluded Mr. Milton.