Drivers

YRC Pens Deal to Secure $70 Million in Capital

February 11, 2010

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YRC Worldwide's investors have agreed to purchase $70 million in new unsecured convertible notes in a private placement. The company will use the proceeds from the issuance of these new notes to pay off its 2010
note obligations, with any leftover proceeds going to general corporate purposes.

The new notes have a term of four years with an interest rate of 6 percent, which is initially payable in shares of the company's common stock. The company expects the transaction to be fully funded into an escrow at closing to satisfy each of the company's two maturity obligations in 2010.

The closing of the sale of the new notes is subject to a number of conditions, including the conversion of the company's preferred stock into common stock. The company expects that the closing would occur shortly after shareholder approval to increase the company's authorized shares to permit the preferred stock conversion. The company is seeking this approval at the upcoming special shareholder meeting on Feb. 17.

After the deal is approved, the company will issue the new notes in two sections, a $49.8 million slice and a second $20.2 million slice.

"We are pleased to announce this important step to satisfy our remaining 2010 note obligations," said Bill Zollars, chairman and CEO of YRC Worldwide. "Upon the closing of this funding, our management team will be able to focus on operational improvements without the financial overhang related to these debt maturities that have concerned our customers in recent months. Both the company and our customers will be able to put this distraction behind us with the completion of this financing."


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