Skymark Airlines Inc. (“Skymark”), Integral Corporation and associated investment funds established by Integral Corporation (collectively referred to as “Integral”), ANA HOLDINGS INC. (“ANAHD”) and UDS Airlines Investment Limited Partnership (“UDS”) have agreed and hereby announce that Integral, ANAHD and UDS will jointly support Skymark, a company currently undergoing a civil rehabilitation proceeding. The parties have signed a sponsorship agreement (the “Sponsorship Agreement”) and Integral, ANAHD and UDS have signed a shareholders’ agreement regarding the management of Skymark (the “Shareholders’ Agreement”).

Background for the Execution of the Sponsorship Agreement and the Shareholders’ Agreement Following the commencement order of the civil rehabilitation proceeding announced on February 4, 2015, Skymark has signed a basic rehabilitation support agreement with Integral on February 5, 2015 and has been working to quickly revitalize its business with Integral’s support, and Skymark has implemented a sponsor selection process in an attempt to maintain and develop the value of Skymark’s business and on April 22, 2015, Skymark reached an agreement with Integral and ANAHD on principal conditions with respect to support for Skymark and executed a memorandum of understanding (the “Memorandum”).

Since then, Skymark, Integral and ANAHD have, under the supervision of the Tokyo District Court and a supervisor of the civil rehabilitation proceeding, had ongoing discussions based on the Memorandum and have reached an agreement between Skymark, Integral, ANAHD and UDS with respect to certain conditions regarding support for Skymark and have executed the Sponsorship Agreement and the Shareholders’ Agreement, under which UDS is added as an additional sponsor of Skymark.

UDS is an investment fund established by the Development Bank of Japan Inc. (“DBJ”) and Sumitomo Mitsui Banking Corporation (“SMBC”), in which DBJ and SMBC have invested equally. The fund will support Skymark and is managed by DBJ and its subsidiary, DBJ Corporate Mezzanine Partners Co., Ltd. DBJ has experience in the rehabilitation of airline companies such as Skynet Asia Airways Co., Ltd. and AIRDO Corporation while SMBC has a worldwide top-tier aircraft leasing company in the broader SMBC Group and it has achieved the top ranking in aircraft finance businesses among the Japanese banks. It is a desirable outcome for Skymark that DBJ and SMBC will mutually cooperate in providing support for the rehabilitation of Skymark.

Overview of the Sponsorship Agreement and the Shareholders’ Agreement
The Sponsorship Agreement stipulates the conditions of the joint sponsorship of Skymark by

Integral, ANAHD and UDS in order to achieve the revitalization of its business as an independent corporation, with a goal of Skymark re-listing on the stock market within 5 years. The parties share the common recognition that developing corporate value is the basic policy of Skymark’s business operation while maintaining its independence by utilizing the experience of Integral, ANAHD and UDS. Moreover, the parties respect and wish to maintain and develop the unique value, quality, status and role of Skymark in the airline industry.

The Shareholders’ Agreement stipulates the operation and capital policy of Skymark as agreed by Integral, ANAHD and UDS, who will become the shareholders of Skymark in accordance with the Sponsorship Agreement.

The key points of both agreements are as follows;

(1) Financing and Payment of Debts
It is stipulated in a proposed rehabilitation plan which was submitted to the Tokyo District Court today (hereinafter, the "Proposed Rehabilitation Plan”) that Skymark will perform a 100% capital reduction. After a confirmation of the Proposed Rehabilitation Plan becoming final and binding, Skymark will perform a capital increase through allocation of new shares and Integral, ANAHD and UDS will subscribe to these new shares and become new shareholders.

The total amount of investment is planned to be 18 billion JPY. The details of the investment of each shareholder are as follows;

New Shareholders / Number of shares subscribed / Amount of investment(JPY)
Integral 2 Limited Partners / 812,028 / 8,120,280,000
Integral Fund II (A)L.P. / 89,772 / 897,720,000
UDS / 601,200 / 6,012,000,000
ANAHD / 297,000 / 2,970,000,000

Part of the 18 billion JPY shall be used for the payment of common benefit claims and the like to the extent that Integral, ANAHD and UDS agree. The remainder shall be used for the payment of rehabilitation claims in accordance with the Proposed Rehabilitation Plan.
In addition, Skymark is planning to have a commitment line with financial institutions to ensure necessary working capital for Skymark’s business operations.

(2) Directors
The number of board of directors of Skymark will be 6 and of these 6 directors, 3 will be appointed by Integral, 2 will be appointed by ANAHD and 1 will be appointed by UDS. It is planned that one of the directors appointed by Integral will be the Chairman and Representative Director and the director appointed by UDS will be the President and Representative Director.

(3) Employment of Employees
The employment of Skymark’s employees will, as a general principle, be maintained.

(4) Code Sharing with ALL NIPPON AIRWAYS CO., LTD.
It is planned that Skymark will code share with ALL NIPPON AIRWAYS CO., LTD. (“ANA”), a wholly owned subsidiary of ANAHD on the assumption that all of the necessary conditions (such as permission by relevant governmental authorities) have been satisfied. The details of the code sharing (including the routes) will be finally decided after discussions.