2014

Yellow Media Q2 cash position concerns lending syndicate

TORONTO, Aug. 14, 2012 /PRNewswire/ - Further to the press release issued by McMillan LLP, counsel for and on behalf of the Agent to the Lenders to Yellow Media Inc. (the "Company") on August 1, 2012, the lending syndicate (the "Syndicate") is of the view that it would be best for the Company to withdraw its proposed Canada Business Corporations Act plan of arrangement and to enter into further negotiations with its stakeholders.  The Syndicate is of the view that certain aspects of the proposed plan can be improved upon for stakeholders.

As evidenced by the significant accumulated cash position disclosed in the Q2 results reported by the Company on August 9, 2012, the Company continues to generate significant cash flows.  The Company did not include cash flow forecasts as part of the information circular filed with the Court on August 3, 2012.

The Company's future cash flow forecasts should be disclosed to affected stakeholders so that they can better assess the merits of the Company's proposed plan.

The Syndicate's objective is to work with the other stakeholders on a more level informational playing field to develop a plan that could be lawfully implemented and that would allow the Company to pursue its business plan, while still reflecting prudent commercial lending standards and an appropriate allocation of value for senior creditors.  Such a plan could offer junior creditors and equity holders an opportunity to retain a material stake in the Company with upside in the future.

Implementation of the Company's current plan is not urgent. The Company has disclosed that it does not project any imminent cash shortfall.

PricewaterhouseCoopers Inc. ("PwC") is assisting the Syndicate in developing a response to be provided to the Company on its reorganization plan.  Interested stakeholders are invited to contact PwC to share their ideas and views.

This press release is not a request for a proxy or to execute or not execute or revoke a proxy. This press release is not intended to result in the procurement, withholding or revocation of a proxy or otherwise intended to be a solicitation of proxies from any securityholder. This is not a request for proxies and no proxies are expected following this announcement.

SOURCE McMillan LLP




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