Norwegian Air shares plummeted again on Tuesday, and are now trading down around 97% from their 2015 peak, with the airline's survival depending on creditors accepting a rescue plan proposed last week.

The shares slumped as much as 62.5% as markets reopened after the Easter holidays. It was the first time they had traded since the airline outlined its rescue plan on April 8, which would convert US$4.3 billion of debt into shares and raise some new equity - wiping out much of the remaining value of the company's current stock.

The shares later regained some ground to close at 4.6 crowns, down 44%.

After the bourse closed, Norwegian Air said it would ask bondholders to a meeting on April 30 to approve the terms of the debt-to-equity proposal.

"The proposal remains subject to discussions with other stakeholders, and the issuer (Norwegian Air) intends to present the full details of the proposals, including conversion rates and subscription prices, to bondholders by 27 April 2020 at the latest," Norwegian Air said in a statement.

The company will hold a conference call with bondholders on April 27 to answer their questions, it added.

Even before the outbreak of the coronavirus, Norwegian Air faced financial problems after becoming overburdened with debt following a fast expansion in recent years.

"Norwegian is at the end of the line. Yet there is hope for the airline and, pending creditor agreement, it may continue to fly," analysts at brokerage Bernstein said, adding the company needed at least 2.7 billion crowns of equity.

"Rounded to the nearest Krone (crown), existing shares are all but worthless," the brokerage said.

The budget carrier has grounded most of its fleet due to the impact of the coronavirus outbreak on travel and on March 16 announced the temporary layoff of 7,300 staff, about 90% of its workforce.

In order to stay in business, it must also convince bondholders to accept the proposed conversion of debt, Bernstein said.

"If they do not, then we expect operations to cease, bankruptcy proceedings to start, and shareholders to get nothing," it added.

If creditors approve the rescue plan, it will be put to a shareholders' vote on May 4.

Before Tuesday's fall, Norwegian's shares were down 78% this year, underperforming other major European airlines, which were down between 30% and 60%.

The Oslo stock exchange said on Tuesday trading in Norwegian's shares would be subject to special observation until there was further clarification of the airline's situation.

Special observation is used under circumstances that may make the valuation of a security particularly uncertain, according to the market operator's guidelines.