Business News

Valassis Amends Credit Agreement Allowing it to Repurchase Term Loans Below Par

Tuesday 27. January 2009 - Revolving Loan Commitment Reduced by $20 Million

Valassis (NYSE:VCI), one of the nation’s leading media and marketing services companies, announced today that it has entered into an amendment to its senior secured credit facility to, among other things, permit Valassis to use up to $125 million to repurchase its outstanding term loans under the senior secured credit facility at prices below par through one or more “modified Dutch” auctions during 2009. The amendment does not obligate Valassis to make any such repurchases. In addition, Valassis agreed to voluntarily reduce the availability under the revolving credit portion of its senior secured credit facility from $120 million to $100 million in exchange for the ability to keep $20 million of revolving loans outstanding at the time it commences any modified Dutch auction. As of Sept. 30, 2008, Valassis had $612.3 million of term loans outstanding under its credit facility. There can be no assurance that Valassis will repurchase any such loans.

The credit agreement amendment also permits Valassis to exclude from the definition of Consolidated Interest Expense swap breakage costs in connection with any repurchases or payments on outstanding loans, including pursuant to a modified Dutch auction.

“Coming on the heels of the payoff and cancellation of our 6 5/8% Senior Secured Notes that matured on Jan. 15, 2009, we believe that this credit agreement amendment will be credit enhancing and will mark the next step in our continuing efforts to deleverage our balance sheet,” said Robert L. Recchia, Valassis Executive Vice President and Chief Financial Officer.

Valassis will file a copy of the credit agreement amendment on Form 8-K with the Securities and Exchange Commission.