following sale of operating assets

TORONTO and MONTREAL, July 21 /CNW/ - Look Communications Inc. ("Look" or the "Corporation") (TSX Venture: LOK and LOK.A) today reported its financial and operating results for the third quarter of fiscal 2009, ended May 31, 2009.

Key to the quarter was the sale of the Corporation's spectrum and broadcast licence to Inukshuk Wireless Partnership ("Inukshuk") (through joint partners Rogers Communications and Bell Canada ("Bell")) for $80 million cash, announced on May 5, 2009 (the "Agreement"). The sale contributed to the Corporation recording its largest quarterly profit in its history and has resulted in Look beginning the orderly restructuring of its operations.

Under the terms of the Agreement Inukshuk made a non-refundable $30 million payment to Look on May 14, 2009 following Court approval of the transaction. The remaining $50 million will be paid upon the earlier of regulatory approval of the transfer of the spectrum and broadcast license or in two instalments, the first being a non- refundable $20 million payment due no later than December 31, 2009 and, the second, a final payment of $30 million due no later than May 14, 2012.

The Corporation has been told by Inukshuk that Inukshuk intends to complete the Agreement as soon as possible, though the spectrum will not be transferred unless and until full consideration is paid. If for any reason the full $80 million is not paid, or not paid according to the agreed-upon schedule, any payments made to the Corporation are non-refundable and the spectrum would be retained by the Corporation.

Other highlights for the third quarter ended May 31, 2009 included the

following:

- Unrestricted cash and cash equivalents at May 31, 2009 totalled $18.0

million which represents an increase of $14.5 million from August 31,

2008 as a result of the first instalment of $30 million paid to the

Corporation by Inukshuk which was partially offset by a payment of

$16 million to Bell in settlement of its outstanding payables and

litigation, discussed below;

- The income and comprehensive income from continuing operations for the

quarter ended May 31, 2009 was $46.1 million or $0.36 per share on an

undiluted basis;

- During the nine months ended May 31, 2009, the Corporation recorded

income and comprehensive income from the discontinued operation of the

web hosting and domain name business of $4.5 million, or $0.04 per

share on an undiluted basis;

- Operating expenses for the quarter, excluding the $2.5 million non-

cash charge for the impairment of property and equipment, decreased by

$0.4 million or 9.6% (quarter ended May 31, 2008 - $4.2 million);

- Service and sales revenue from continuing operations for the quarter

ended May 31, 2009 was $3.1 million compared to $4.1 million for the

quarter ended May 31, 2008; and

- EBITDA, as defined below, for the quarter ended May 31, 2009 was

negative $2.3 million.

- A condition precedent to the Agreement was the resolution of all

litigation between the Corporation and Bell which was resolved in the

following manner:

(a) Bell and the Corporation providing each other with mutual full

and final releases from any and all current litigation;

(b) The Corporation paying Bell $16 million as full and final

settlement, to be paid contemporaneously with the initial

$30 million non-refundable payment from Inukshuk as part of the

Agreement. The amount includes approximately $10 million in trade

payables carried by the Corporation plus an additional $6 million

payment;

(c) As the Corporation restructures its operations, it will pay to

Inukshuk all revenues collected from its DSL Internet subscribers

on Bell's network for services provided during the restructuring

period net of all applicable taxes in lieu of any and all future

charges from Bell; and

(d) All contracts between Bell and the Corporation will end without

penalty.

The Corporation recorded a $78.2 million gain on the sale of the spectrum and broadcast licence to Inukshuk along with a loss on the settlement of the Bell litigation of $5.8 million and restructuring charges of $20.4 million.

Restructuring charges include, among other things, site restoration charges, lease commitments, human resources restructuring and equity cancellation payments relating to the cancellation of all outstanding options and share appreciation rights as of May 31, 2009. All equity cancellation payments, amounting to approximately $9 million, are contingent on the Corporation receiving the second non-refundable instalment of $20 million from Inukshuk as noted above. In the event of a change of control, the equity cancellation payments become payable within three business days following the effective date of the change of control.

Upon providing for the sale of the spectrum and broadcast licence, the Corporation completed a review of the carrying amount of its property and equipment. The Corporation determined that certain network-related property and equipment was carried at an amount greater than its net recoverable amount and accordingly recorded a non-cash write-down of $2.5 million.

The Corporation has disclosed all publicly-available documents related to its Plan of Arrangement and disposition of assets on its website:

www.look.ca/en/maximizingshareholdervalue.