The Board of Directors of Icelandair Group hf. decided earlier today, September 3rd 2007, to call upon a Shareholders' Meeting in the Company on September 12th 2007. The business of the meeting is the Boards' motion on the decrease of the number of board members from seven to five. Should the motion be accepted by the shareholders, the meeting will proceed with the election of board members. The Board will also present its' motion on remuneration for reserve board members. The Chairman of the Board of Directors, Finnur Ingólfsson, announced at the Board Meeting his decision on stepping down from the Board of Directors of the Company on the aforementioned Shareholders' Meeting, which has now been called upon. Following is the announcement of the Shareholders' Meeting. Shareholders' Meeting of Icelandair Group hf. September 12th 2007 The Board of Directors of Icelandair Group hf. hereby calls upon a Shareholders' Meeting on September 12th 2007 at 16 pm. The meeting will be held at Nordica Hotel, Reykjavik. The business is as following: 1. The Motion on amendments to the Articles of Association regarding the decrease of board members from seven to five. 2. Election of members of the Board of Directors, should the motion under part 1 above be approved. 3. Proposal on remuneration of the reserve members of the Board of Directors: 4.Other business, lawfully submitted. The Board of Directors of Icelandair Group hf. submits the following proposals to the company‘s Shareholders' Meeting on September 12th 2007. The proposed changes are as follows: Motion on amendments to the Articles of Association: The Board proposes that Article 18, paragraph 1 of the Articles of Association will be amended in the way that the number of board members will be decreased from seven to five. Should the motion be approved, the Article will read as follows: “The Board of Directors of the Company shall be composed of five members and three alternate members elected at the Annual General Meeting for a term of one year. The eligibility of members of the Board is subject to statutory law. Elections to the Board shall always be by ballot if the number of nominations exceeds the number of Members to be elected.” Proposals on members of the Board of Directors for the term of one year: With the reservation that the motion on the decrease of the number of board members will be approved, which unavoidably calls for a new election of board members, all announcements of candidacy for the Board of Directors or the reserve board shall be delivered in writing to the Company's head quarters at Reykjavíkurflugvöllur before 16:00 on Friday, September 7th 2007. The announcement shall indicate, as well as the name of the candidate, the candidates' social security number and address, information on main occupation, other board participation, education, experience and share ownership in the Company. The announcement shall also contain information on connections of interest with the Companys' main business associates and the Companys' competitors, as well as information on connections to other shareholders in the company which hold a share of 10% or more. Proposal on remuneration of reserve board members of the Board of Directors: The Board proposes that reserve board members will receive the same remuneration as other board members for the period from the date of the Company's Annual General Meeting held in March 2007 until the date of this meeting. For the period as from the date of this Shareholders' Meeting until the Companys' next Annual General Meeting, the Board proposes that a reserve board member will receive ISK 100.000,- for each attended Board Meeting. The business of the meeting and finalized motions will be accessible at the Companys‘ head quarters at Reykjavíkurflugvöllur for the inspection of shareholders as from September 4th 2007. Tickets for entrance, meeting papers and voting ballots will be handed out to shareholders or their proxy at the place of the meeting from 15:30 on the date of the meeting, Wednesday, September 12th 2007. Respectfully, The Board of Directors of Icelandair Group hf.