GOL to File Proposed Chapter 11 Plan in the U.S.

DALLAS — This week, GOL Linhas Aéreas Inteligentes (G3), Abra Group, the majority investor in G3, and Avianca Group, announced G3’s filing of an initial proposed Chapter 11 plan of reorganization with the U.S. Bankruptcy Court.

This follows the November 6, 2024, Plan Support Agreement between G3, Abra, and certain affiliates and the committee of unsecured creditors appointed in GOL’s Chapter 11 cases. The key reasons for this decision include:

• Financial restructuring: G3 aims to significantly reduce its financial liabilities by converting or extinguishing up to US$1.7 billion of debt and up to US$850 million of other financial obligations.
• Deleveraging balance sheet: The airline plans to convert a substantial portion of its debt into equity, improving its financial position.
• New capital injection: G3 intends to raise up to US$1.85 billion in new capital to boost liquidity and support its growth strategy following emergence from Chapter 11.
• Restructuring aircraft leases: The company has negotiated agreements with lessors covering 139 aircraft leases and 58 engines, which will be assumed under the restructured terms.
• Operational improvements: The Chapter 11 process allows GOL to continue operating normally while addressing its financial and operational challenges.

The filing of the Plan represents an important milestone toward the successful completion of G3's financial and operational restructuring and implements a significant investment of new capital to support GOL's business.

Highlights of the Plan

• GOL will significantly deleverage its balance sheet by converting into equity, or otherwise extinguishing, up to US$1.7 billion of its prepetition funded debt and up to US$850 million of other obligations.
• In its quarterly financial statements for the nine-month period ended September 30, 2024, GOL reported a total net debt of R$27.6 billion and a net loss of R$830 million for the quarter. Accordingly, as the conversion will be executed based on the economic value of GOL's shares prior to the conversion, in compliance with applicable law, it is expected to result in significant dilution of GOL's existing equity (subject to shareholders' preemptive rights under Brazilian law).
• As part of a multi-faceted agreement with GOL and GOL's Unsecured Creditors Committee, Abra has agreed, in satisfaction of the US$2.8 billion of debt claims it has asserted, to receive approximately US$950 million of new equity and possibly more equity, based upon the resolution of certain unresolved issues, as well as US$850 million of take-back debt. Of the Abra take-back debt, US$250 million is mandatorily convertible into new equity as set forth in the Plan on or after the 30-month anniversary of GOL's emergence from Chapter 11 based on GOL achieving certain valuation metrics.
• GOL intends to raise up to US$1.85 billion of new capital to provide incremental liquidity to support the execution of its growth strategy following emergence, of which up to US$330 million may be in the form of new equity financing from third-party investors.
• GOL will assume its restructured aircraft leases in accordance with agreements with its lessors that have already been negotiated and agreed.

Disclosure Statement

The Company also files a disclosure statement with the Bankruptcy Court summarizing the Plan, which includes information regarding the treatment of the various groups of GOL creditors in the Chapter 11 cases, consistent with the provisions of the previously announced PSA, and certain related G3 disclosures.

The primary purpose of the disclosure statement is to enable G3's creditors that are entitled to vote on the Plan to make an informed decision on whether to vote to accept or reject the Plan.

GOL will be seeking Bankruptcy Court approval of the disclosure statement and the commencement of voting on the Plan at a hearing before the Bankruptcy Court currently scheduled for January 15, 2025. Notice of the hearing will be made available on the website administered by the Company's claims agent, Kroll Restructuring Administration LLC ("Kroll"), at https://cases.ra.kroll.com/GOL. The hearing may be adjourned from time to time.

The parties say that, if, and when, the disclosure statement is approved by the Bankruptcy Court, G3 "will commence a process to solicit votes on the Plan, through Kroll as voting agent, to obtain sufficient votes for confirmation of the Plan." Once approved by the Bankruptcy Court, the procedures for voting on the Plan and relevant dates and information will be made available on Kroll's website and disclosed to the market in accordance with applicable legislation.

The filing of the Plan and related disclosure statement today positions G3 to stay on track for a timely emergence from Chapter 11.