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Dex Media’s prepackaged plan of reorganization confirmed

By Thryv Contributor | 07.15.16
Dex Media’s prepackaged plan of reorganization confirmed

DALLAS, July 15, 2016

Company expects to emerge from Chapter 11 within the next few weeks with $1.8 billion less total debt

Dex Media, Inc. (OTC PINK: DXMM) (or “Dex Media”), one of the largest national providers of local marketing solutions for local businesses, today announced that its prepackaged plan of reorganization (“the Plan”) was confirmed today by the U.S. Bankruptcy Court in the District of Delaware (the “Court”). This represents the final legal step before Dex Media can emerge from Chapter 11 within the next few weeks with $1.8 billion less total debt and significantly increased financial flexibility.

“Today’s confirmation of our Plan by the Court is the final legal step in securing the capital structure we need to execute our strategy and achieve long-term, sustainable growth,” said Joe Walsh, Dex Media President and CEO. “When the Plan becomes effective and we emerge from Chapter 11, we will have enhanced financial flexibility to deepen our investment in our products and services so that we remain on the cutting edge of helping local businesses thrive in today’s highly competitive and dynamic market.”

As previously disclosed, material terms of the confirmed Plan include:

  1. Dex Media’s total debt will be reduced from $2.4 billion to $600 million.
  1. Dex Media’s senior secured lenders will exchange their current $2.12 billion of claims for a new $600 million first-lien term loan; 100% of the equity of the reorganized Dex Media, subject to dilution from a management incentive plan; and a cash distribution upon emergence from bankruptcy.
  1. Dex Media’s unsecured noteholders will receive a $5 million cash payment and warrants to purchase up to 10% of the post-reorganized equity in exchange for their approximately $300 million in claims.
  1. All allowed trade vendor claims will be paid in full.
  1. Dex Media will emerge from Chapter 11 as a privately held company. All of Dex Media’s current outstanding shares of common stock will be canceled with no distribution to the existing holders.

Mr. Walsh continued: “We would like to thank our employees, clients, vendors and business partners for standing by us throughout this process and we are encouraged by the support they have given to our strategic vision. We also are grateful for the expert guidance we have received over these past many months from our trusted advisors. Together, we now look to a new era for Dex Media with a strengthened and simplified capital structure to complement the relentless drive we have to help local businesses compete and grow with value-added marketing products and services.”

Dex Media’s legal advisor in connection with the restructuring is Kirkland & Ellis LLP. Alvarez & Marsal North America, LLC serves as its restructuring advisor, and Andrew Hede from Alvarez & Marsal serves as Chief Restructuring Officer. Moelis & Company LLC is the Company’s investment banker for the restructuring. The steering committee of the ad hoc group of Dex Media’s senior secured lenders is represented by Milbank, Tweed, Hadley & McCloy LLP as legal advisor and Houlihan Lokey as financial advisor in connection with the restructuring.  JPMorgan Chase Bank, N.A. and Deutsche Bank Trust Company Americas, as agents under certain of the senior secured credit agreements, are represented by Simpson Thacher & Bartlett LLP as legal advisor to the agents.

The Plan and related Chapter 11 materials are available at http://dm.epiq11.com/DexMedia.

About Dex Media

Dex Media (OTC PINK: DXMM) is a full-service media company offering integrated marketing solutions that deliver measurable results. As the marketing department for hundreds of thousands of local businesses across the U.S., Dex Media helps them win, keep and grow their customer base. The company’s widely used consumer services include the DexKnows.com® and Superpages.com® search portals and mobile applications as well as local print directories. For more information about the company, please visit www.DexMedia.com.

Forward-Looking Statements

Some statements included in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the federal securities laws. Statements that include the words “may”, “will”, “could”, “should”, “would”, “believe”, “anticipate”, “forecast”, “estimate”, “expect”, “preliminary”, “intend”, “plan”, “project”, “outlook” and similar statements of a future or forward-looking nature identify forward-looking statements. You should not place undue reliance on these statements, as they are not guarantees of future performance. Forward-looking statements provide current expectations with respect to our financial performance and future events with respect to our business and industry in general. Forward-looking statements are based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to, the risks related to the following: the Company’s ability to obtain Court approval with respect to motions in the Chapter 11 cases; the effects of the Court rulings in the Chapter 11 cases and the duration and outcome of the Chapter 11 cases in general; risks associated with third party motions in the Chapter 11 cases, which may interfere with the ability to consummate the Plan; increased administrative and restructuring costs related to the Chapter 11 cases; the Company’s ability to maintain adequate liquidity to fund operations during the Chapter 11 cases and thereafter; the Company’s future operating and financial performance; the occurrence of any event, change, or other circumstance that could give rise to the termination of the restructuring support agreement; our ability to retain existing business and obtain and retain new business; general economic or business conditions affecting the markets we serve; our ability to attract and retain key managers; increased competition in our markets; and our ability to obtain future financing due to changes in the lending markets or our financial position. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by such cautionary statements.

If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. These forward-looking statements speak only as of the date hereof and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contacts

Abernathy MacGregor
Rivian Bell, 213-630-6550
rlb@abmac.com

or
Chuck Dohrenwend, 212-371-5999
cod@abmac.com