RDA Wins Approval of Initial Court Motions; Operations Continue Without Interruption

NEW YORK, Feb. 20, 2013 /PRNewswire/ -- RDA Holding Co., parent company of The Reader's Digest Association, Inc., announced that it has obtained U.S. Court approval of a variety of motions that will support the Company's operations as it proceeds with a financial restructuring supported by its secured lender and more than 70% of its secured noteholders.

U.S. Bankruptcy Judge Robert Drain approved the Company's $105 million debtor-in-possession financing, $11 million of which will be available immediately, on an interim basis under an agreement with a group of the Company's secured creditors. The financing will be used in conjunction with cash generated from operations to support the Company throughout the Chapter 11 process. A hearing to consider final approval of the request will convene next month.

"The relief granted is an important initial milestone in our restructuring process," said Robert E. Guth, the Company's President and Chief Executive Officer.  "We are very confident that the protections afforded us through this process, when combined with the momentum we already have in our operational transformation, will allow us to create a vibrant and strong Reader's Digest for the future."

In addition to the approval to obtain financing, the Company received approval of a variety of motions, including requests to continue paying employees and its network of freelancers without interruption and its request to continue all of its customer programs, including payments to sweepstakes winners.

As previously reported, the Company has executed a Restructuring Support Agreement with its secured lender and its secured noteholders.  The Agreement will result in, among other things, the Company converting approximately $465 million of secured notes to equity, which will strengthen the Company by significantly deleveraging its balance sheet.  It is currently anticipated that the Company will exit Chapter 11 within six months with roughly $100 million of debt, about an 80% reduction in its level of indebtedness.

For more information regarding this announcement, please visit the Restructuring link of www.rda.com.

About The Reader's Digest Association, Inc.

Reader's Digest Association (RDA) is a global media and direct marketing company that educates, entertains and connects consumers around the world with products and services from trusted brands. For more than 90 years, flagship brand Reader's Digest, the world's largest circulation magazine, has simplified and enriched consumers' lives by discovering and expertly selecting the most interesting ideas, stories, experiences and products in health, home, family, food, finance and humor. Taste of Home is the world's largest circulation food publication and is the leading multi-platform producer of information on food, cooking and entertaining. Other brands include The Family Handyman, Birds & Blooms, Country, and many other enthusiast titles in the U.S. and internationally.  The company provides content in print; online; via digital download on iPad, mobile apps, Kindle, KindleFire, Nook, Sony Reader and Zinio; books and home entertainment products; Facebook, Twitter and other social media outlets. Further information about the company can be found at www.rda.com.

Forward-looking Statements

This press release contains, and oral statements made from time to time by our representatives may contain, forward-looking statements that are based upon our current expectations and assumptions concerning future events, which are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated.  The words "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "commence," "seek," "may," "would," "could," "should," "believe," "potential," "continue," or the negative of any of those words or similar expressions is intended to identify forward-looking statements.  All statements contained in this press release, other than statements of historical fact, including, without limitation, statements about our operations, financial condition and liquidity, strategies, business initiatives, prospects, expectations regarding future events and our financial performance and the development of the industry in which we operate, are forward-looking statements that involve certain risks and uncertainties.  While these statements represent the Company's current judgment on what the future may hold, and the Company believes these judgments are based upon reasonable assumptions, these statements are not guarantees of any events or financial results, and the company's actual results may differ materially.  Important factors that could cause our actual results to be materially different from our expectations include those risks described in our annual report found on Form 10-K which was filed with the Securities and Exchange Commission on March 29, 2012.

You should not place undue reliance on the forward-looking statements contained in this press release.  These forward-looking statements speak only as of the date on which the statements were made.  The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except where expressly required by law.

SOURCE The Reader’s Digest Association, Inc.



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