THE ARCTIC GROUP INC. ENTERS INTO A "MULTI YEAR" SUPPLY AGREEMENT WITH KMART CORPORATION

Winnipeg, Manitoba - The Arctic Group announced today that it has entered into a multi year supply agreement with Kmart Corporation to provide packaged ice to all of Kmart's grocery, retail and convenience stores. Kmart Corporation, with annual sales of over $37 billion is one of the leading retailers in North America, Puerto Rico and The Virgin Islands.

Under the terms of this supply agreement, The Arctic Group, with its corporate facilities, Licensees and co-packers will be the exclusive provider of packaged ice for Kmart in all of their more than 2,100 locations throughout the United States, Puerto Rico and the Virgin Islands. The Arctic Group, through its sales and marketing department will administer the ice program for Kmart Corporation throughout these territories. The Arctic Group has partnered with a group of independent quality ice manufacturers to act as co-packers in the United States, Puerto Rico and The Virgin Islands to ensure a seamless supply of ice products to all participating Kmart locations.

The Arctic Group is a leading North American producer, marketer and distributor of high-quality packaged ice products to consumers in Canada, United States under the brand name of Arctic Glacier Premium Ice. The Arctic Group is committed to creating shareholder value through prudent management and growing penetration of its branded ice products in key target markets.

For further information, call The Arctic Group, Inc., TOLL FREE at 1.888.573.9237 or visit The Arctic Group web site at http://www.arcticgroup.com.

(Signed)
On behalf of the Management and the Board of Directors of The Arctic Group Inc.,
Robert Nagy, Chairman and CEO.

The Toronto Stock Exchange does not approve or disapprove of the adequacy or accuracy of this release.