GOL and Delta Air Lines Announce Strategic Alliance

North American Company makes investments of $ 100 million in GOL's Capital

Material Fact

São Paulo, December 7, 2011 – GOL Linhas Aéreas Inteligentes S.A. (Bovespa: GOLL4 and NYSE: GOL), (S & P / Fitch: BB-/BB-, Moody's: B1) (the "Company"), the largest low-cost and low-fare airline in Latin America, in compliance with CVM Instruction 358/2002 ("CVM Instruction 358"), hereby informs its shareholders and the market in general that it signed a binding agreement involving the acquisition by the U.S. company, Delta Air Lines, Inc. (NYSE: DAL) of a strategic minority interest of US$100 million of GOL´s preferred shares.

About the Investment

Delta Airlines Inc. (“Delta”)  will invest US$100 million in exchange for ADSs representing  GOL’s preferred shares through the issuance of preferred share with an issue price of R$22.0 per share. The total capital increase will be up to R$280 million (US$150 million), including the subscription rights for all GOL´s shareholders. GOL’s Board will deliberate on December 21, 2011 to resolve on the capital increase.

In the context of the investment, GOL’s controlling shareholder agreed to elect a Delta representative to the Company’s Board of Directors as long as Delta holds at least 50% of the ADSs acquired in the investment, among other conditions. Delta agreed, for a period of 12 months,  not to sell the acquired ADSs (lockup) and not to acquire any further GOL shares , including in the form of ADSs (standstill), without GOL’s consent.

Brazilian law limits the maximum number of preferred shares that can be issued by GOL to 50% of the Company’s total capital. As a result, Delta’s investment is structured as follows:

·    GOL’s controlling shareholder will sell ADSs representing GOL´s preferred shares to Delta against payment of US$100 million. At the same time, GOL’s controlling shareholder will undertake to reinvest this amount in a capital increase to be simultaneously approved by the Company; and

·    The amount of the capital increase will be up to R$280 million, equivalent to the issuance of preferred share with an issue price of R$22.0 per share given that the amount of capital increase to be subscribed by the controlling shareholder, according to its pre-emptive rights, is an amount of US$100 equivalent in dollar, less taxes and other charges incurred by the controlling shareholder in the context of the transfer of the ADSs to Delta . GOL’s controlling shareholder will use the proceeds from the sale of the ADSs to Delta to subscribe the Company’s shares issued on the capital increase.

The controlling shareholder will not receive any economic benefit from the transaction. Pre-emptive rights in regard to the capital increase will be granted to all GOL shareholder, including ADSs holders. More detailed information on the capital increase, including the issued price for the preferred shares and ADSs, the terms and mechanisms for the exercise of pre-emptive rights, and the record date will be disclosed promptly after the GOL Board of Directors’ Meeting to be held on December 21, 2011.

About the Commercial Agreements

In the context of the investment, Delta and GOL entered into a long- term commercial agreement with exclusivity provisions designed to strengthen the operational cooperation and synergies between the two companies, including:

·    an increase in the scope of the code-share agreement (flight sharing), subject to the relevant approvals, allowing Delta to use its code for more GOL flights in Brazil, the Caribbean and South America, and GOL to add its code for Delta’s flights between Brazil and the United States, and from the U.S. to other destinations, thereby increasing the number of flight options for clients of both airlines and expanding their geographical reach;

·    the optimization of connecting services in order to increase the attractiveness of the companies joint services, facilitating flight connections and cargo and passenger movement among the nearly 400 destinations in over 70 countries served by GOL and Delta;

·    The increase in passenger comfort by aligning services and benefits for members of both the SMILES and SkyMiles mileage programs;

·    joint commercial and promotional activities, encouraging both airlines’ sales forces to cooperate in Brazil, the United States and, eventually, in other countries;

·    the exploration of synergies in passenger services, maintenance, VIP lounges and logistical support;

·    the transfer of the lease of the two remaining Boeing 767 aircraft in GOL´s fleet and their spare parts to Delta.

The transaction does not envisage GOL’s adherence to a Global Alliance, and it is aligned with the Company's goal of seeking out long-term strategic partnerships and strengthening its capital structure, with a focus on creating value for its shareholders. Delta handles more than 160 million passengers per year, has a fleet of more than 700 aircraft and flies to 350 destinations in almost 70 countries spread through six continents. It is the largest airline in the world in terms of passenger-kilometers transported and has more international routes than any other U.S. airline.

The experience and knowledge of global aviation acquired by Delta in more than 81 years of operations in the most developed market in the world, combined with the growth potential of Brazilian commercial aviation, provides an opportunity for both companies to increase their return on capital employed in the coming years.

The alliance with Delta is in line with GOL´s strategy of creating international partnerships with leading global players that add value to its services through the joint accumulation/redemption of miles in the airlines’ mileage programs combined with the opportunity of long-distance flights for GOL passengers. The agreement also capitalizes GOL, strengthening its balance sheet and making it better prepared to achieve its objectives and to explore new markets and sources of revenue. GOL also expects that partnering with a global player will result in operational synergies with a strong potential for reducing operating costs, thereby reinforcing the Company’s low-cost, low-fare DNA.

There will be a conference call with a presentation on this material fact, whose details are shown below:   

Participants are requested to connect 10 minutes prior to the conference call.

Speakers:

Constantino de Oliveira Junior - CEO

Leonardo Porciúncula Gomes Pereira - CFO

Edmar Prado Lopes Neto - Financial and IR Officer

Press Conference in São Paulo (TO BE UPDATE):

The Companies will hold a press conference to provide Brazilian journalists and foreign correspondents based in Sao Paulo the opportunity to interview executives from both companies about the content of this material fact:

Local: Sheraton Hotel (Paranaguá Room)

Adress:12559, Nações Unidas Avenue – Brooklin Novo| São Paulo-SP

Date: Wednesday, December 7^th, 2011

Time: 12h00 (BR time)/9h00 (US time)

Journalists should confirm their participation with:

S2 Publicom Media Relations

Luciana Sgarbi

Phone.: (+5511) 3027-0284 or (+5511) 3531-4967

E-mail: luciana.sgarbi@s2publicom.com.br 

Leandro Buarque

Phone.: (+5511) 3027-0277 or (+5511) 3531-4952

E-mail: leandro.buarque@s2publicom.com.br 

The offer and sale of the preferred shares and ADSs referred to in this release have not been registered with the U.S. Securities and Exchange Commission, and they will not be offered or sold absent registration or an applicable exemption from the registrations requirements.