If approved, the plan would dilute existing shareholders' stakes to just 5.2 percent.
A pioneer in no-frills long-haul flights, Norwegian, Europe's third-biggest low-cost airline, has racked up losses in the past three years, as its debt ballooned under an ambitious expansion policy.
Added to that the current coronavirus pandemic, which has dealt a heavy blow to the entire airline industry, has left the company teetering on the brink of bankruptcy.
Currently, 95 percent of Norwegian's fleet is grounded, and only seven aircraft are still in use on domestic routes in Norway.
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In order to qualify for state aid of 2.7 billion kroner (236 million euros, $256 million) — which Oslo has offered on the condition the airline reduces its debt ratio — the company is currently in talks with its creditors about a debt conversion and restructuring.
It also plans to raise 400 million kroner in new capital.
The rescue plan must be approved by bondholders who are due to meet on April 30, leasing companies who meet on May 3, and shareholders who will gather for an extraordinary general assembly on May 4.
If it survives the crisis, Norwegian said it hopes to return to its normal activities in 2022.
Last week, it announced four of its subsidiaries in Sweden and Denmark had filed for bankruptcy, affecting 4,700 pilots and crew.
Norwegian's share price was down by 5.86 percent in mid-afternoon trading on the Oslo stock exchange.
It has shed just over 85 percent of its value since the start of the year.