Thursday, December 31, 2009

YRC Succeeds In Its Bid For Survival

Last Minute Exchanges Preserve Company Future
Shipping News Feature

US – The much documented debt for equity exchange which has gone on for several months ended in the early hours of this morning when YRC Worldwide, the Kansas based less than truck load haulier managed to obtain enough support to continue trading.

A company press release today stated “$470 million in par value, representing approximately 88% of the company's outstanding notes, including $105 million, or 70%, of its 8 1/2% Notes, $217 million of its 5.0% Notes, and $148 million of its 3.375% Notes, representing 94% of aggregate total of the 5.0% and 3.375% Notes. Under the terms of the transaction the company will issue to tendering note holders approximately 37 million shares of common stock and 4.346 million shares of Class A convertible preferred stock which, together on an as-if converted basis, will represent approximately 94% of the company's total issued and outstanding common stock.

“As part of the previously announced amendments to its credit agreement, the company will be able to defer approximately $19 million of fourth quarter lender interest and fees and will have access to the $159.8 million revolver reserves under the applicable terms of its $950 million revolver. As of December 31, 2009, the company had not used any portion of the revolver reserves. The company expects to defer additional lender interest and fees of $20 to $25 million per quarter during 2010 depending upon its usage level of the credit agreement and asset-backed securitization facility.

“The company will begin the settlement process today after receiving electronic confirmation of a portion of the notes that were submitted for tender after business hours last night, and the company anticipates that the settlement of all tendered notes will be completed on or before Tuesday, January 5, 2010.”

Bill Zollars, Chairman and CEO commented:

"The success of this note exchange marks a major turning point for YRC Worldwide -- with our significantly restructured balance sheet and enhanced liquidity, we will move forward from a more solid financial foundation.

"Our comprehensive plan could not have been accomplished without the collective cooperation and continued support of our many stakeholders, including our lenders, our noteholders, and our employees. We remain focused on delivering on our promise of Confidence Delivered for our customers."

Settlement will come as a great relief to all the staff who have given support to the company during what has been a very difficult period for all concerned.