On July 22, 2011 (the “Restructuring Date”), YRC Worldwide Inc. (“YRC”) completed its financial restructuring (the “Restructuring”) through an out of court restructuring plan (the “Restructuring Plan”) which includes, among other things, the refinancing of claims under YRC’s Credit Agreement dated as of August 17, 2007 (the “Credit Agreement”). In exchange for the Credit Agreement claims, YRC will issue a combination of new preferred stock, newly issued convertible notes, new term loans under its amended and restated Credit Agreement, and subscriptions rights to purchase other newly issued convertible notes issued by YRC. Since October 2009, through a series of amendments to the Credit Agreement, YRC deferred the payment of cash interest and fees (the “Deferred Interest Payments”). The Restructuring Plan does not provide for the payment of the Deferred Interest Payments.

Since many YRC trades were done on a “settled without accrued interest” basis in accordance with Section 5 of the LSTA’s Standard Terms and Conditions for Distressed Trade Confirmations (the “Distressed Confirm”), the Deferred Interest Payments, were allocated on a “settled without accrued interest” basis. In accordance with Section 6(b) of the Distressed Confirm, where a trade settled on a delayed basis after T+20, the seller was required to pay delayed compensation to the buyer such that the buyer was issued a credit to the purchase price for the Deferred Interest Payments accrued with respect to the purchase amount and allocable to the delay period.

Since YRC will not be making the Deferred Interest Payments under the Restructuring Plan, the repayment provision in Section 8.4 of the LSTA’s Standard Terms and Conditions for Purchase and Sale Agreement for Distressed Trades (the “PSA”) will apply. Pursuant to Section 8.4 of the PSA, upon demand by the seller, the buyer will, therefore, be required to pay the seller an amount equal to the Deferred Interest Payments that were not paid to the seller but which the seller credited to the buyer on the delayed settlement date, plus interest for each day on that amount at the Federal Funds Rate.

Please note that the LSTA is preparing market advisory recommending that immediately following the Restructuring Date, with respect to those trades done on a “settled without accrued interest” basis which settled after T+20 (and, therefore, included the calculation of delayed compensation), the sellers make demand on their respective buyers and the buyers reimburse the sellers in accordance with Section 8.4 of the PSA for the applicable amounts paid or credited to them on the delayed settlement date.

Please do not hesitate to contact us if you have any questions or comments which you would like to discuss.