ZVUE Announces Restructuring

The Company Streamlines Its Website Operations and Completes
Transactions With Key Stakeholders

Amendment to eBaumsWorld Agreements and Financing for Media Player
Business Realign Operations, Earn-Outs and Financing With Business and
Financial Objectives
SAN FRANCISCO--(Business Wire)--
ZVUE Corporation (NASDAQ:ZVUE), a global digital entertainment
company, announced today that it has completed a significant
restructuring which includes renegotiation of several key agreements
aimed at better positioning the Company for future growth and
maximizing shareholder value.

Specifically, the Company restructured several agreements with
Eric Bauman and his affiliates, from whom the Company purchased
ebaumsworld.com from on October 31, 2007, in order to accomplish
several operational, financial and strategic enhancements. The Company
also secured financing for current and future purchase order
agreements, as well as completed several cost saving initiatives.

Under the terms of the agreements:

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1) The Company has centralized operations of all PopSauce network
websites in Rochester, NY, under the management of Eric Bauman. In
conjunction, it has discontinued its San Francisco and overseas
web operations. As a result of centralizing its web operations,
the Company expects to yield improved performance across the
PopSauce network, enabling growth in revenue as well as realizing
annual cost savings of approximately $1.4 million.
2) The performance earn out related to the Company's 2007 acquisition
of eBaumsworld, which previously called for cash payments of up to
$417,000 per quarter up to a maximum of $2.5 million based on
successful completion of certain development projects, has been
amended to have payouts based on achievement of mutually agreed
business or financial targets. The Company's current potential
cash obligation of $417,000 has been settled for $250,000 payable
immediately with an additional $150,000 payable over five months.
The maximum remaining performance earnout payout has been reduced
from approximately $1.25 million to $1.05 million and is now
payable in cash or the stock at the Company's option, based on the
achievement of business targets for operations.
3) The financial earn out related to the 2007 acquisition of
eBaumsworld has been modified to be based strictly on cash flows
from website operations, whereas the previous arrangement was
based on pageviews achieved by ebaumsworld.com. Under the new
deal, no financial earn out will be due until the websites
generate more than $3 million dollars in cash flow. The maximum
potential payout has been increased from $27.5 million to $32.7
million, and the earnout period has been extended until 2012.
4) Certain existing agreements related to stock held in escrow
pursuant to the Company's 2007 acquisition of eBaumsworld have
been modified, whereby receipt of the escrowed stock has either
been deferred or tied to accomplishment of specific performance
objectives including substantially increased revenue targets.
5) In consideration for the amendments and increased responsibility
that they have assumed for the PopSauce Network, the Company
issued a total of 500,000 fully vested shares to Eric and Neil
Bauman at closing.
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In addition to the cost savings expected from the restructuring of
the website operations, over the last several months the Company has
also eliminated another $400,000 of costs from its corporate overhead
structure.

Additionally, the Company announced that it has completed a
secured financing for ZVUE Products, its media player business. The
financing, which closed July 15, 2008, allows the company to draw up
to $1.0 million to finance purchase order commitments associated with
the sale of MP3 and Video MP3 players with mass market retailers. The
lender is the Company's CTO, who is also a director and beneficial
owner of more than 10% of the company's common stock. The financing
carries a prime plus seven percent interest rate and matures on
September 30, 2008. As part of the financing, the Company also issued
to 350,000 fully vested 3 year warrants with an exercise price of
$0.16 to the lender.

"Today's announcements show significant progress toward building
our business. We have streamlined our web operations and reduced our
operating costs. We have realigned our business objectives and have
received financing to fund growth in our product business, which gives
us additional flexibility as that business grows and frees up cash for
our entire operation. These new agreements in combination with the
standstill agreement that we completed earlier this month with YA
Global Investments LLP, demonstrate real commitments from all three of
our major stakeholders," stated Oscodar.

"I am excited to lead the entire PopSauce network," stated Eric
Bauman. "We see tremendous opportunity to drive revenue growth with
the network. Our dedicated team in Rochester has a ten-year track
record of delivering what our audience wants to see, while maintaining
an extremely efficient cost structure. We look forward to bringing our
talents to the entire network and extracting its true value."

About ZVUE Corporation

ZVUE Corporation (NASDAQ:ZVUE) is a global digital entertainment
company. Its Popsauce Network(TM) (comprised of eBaumsWorld.com,
Putfile.com, Holylemon.com, UnOriginal.co.uk, YourDailyMedia.com,
Dorks.com, FunMansion.com and ZVUE.com) is consistently among the
top-five companies providing user-generated video online. ZVUE(TM)
personal media players are mass-market priced and currently available
for purchase online and in Wal-Mart stores throughout the U.S. For
more information, visit www.zvue.com.

ZVUE, HandHeld Entertainment, popsauce network, eBaum's World,
ZVUE Networks, eBaumsWorld.com, Putfile.com, HolyLemon.com,
UnOriginal.co.uk, YourDailyMedia.com, Dorks.com, FunMansion.com, and
ZVUE.com are trademarks of ZVUE Corporation. All other trademarks are
property of their respective owners.

"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995

Statements made in this release that are not historical in nature
constitute forward-looking statements within the meaning of the Safe
Harbor Provisions of the Private Securities Litigation Reform Act of
1995. Forward-looking statements can be identified by the use of words
such as "expects," "plans" "will," "may," "anticipates," "believes,"
"should," "intends," "estimates," and other words of similar meaning.
These statements are subject to risks and uncertainties that cannot be
predicted or quantified and consequently, actual results may differ
materially from those expressed or implied by such forward-looking
statements. Such risks and uncertainties include, without limitation,
risks and uncertainties associated with: (i) future financial results
and financing requirements; (ii) development of new products and
service offerings; (iii) the company's ability to monetize, grow users
and obtain synergies from acquired user-generated content providers;
(iv) the company's ability to integrate acquisitions; (v) the
effectiveness, profitability, and marketability of the company's
current and prospective products and services; (vi), the impact of
current, pending, or future legislation and regulation on the
company's industry; and (vii) the impact of competitive products,
services, pricing or technological changes. More detailed information
about the company and the risk factors that may affect the realization
of forward-looking statements is set forth in the company's filings
with the Securities and Exchange Commission, including the company's
Reports under the Securities Exchange Act of 1934, as amended, and the
company's Registration Statement on Form S-3/A, as amended, which was
declared effective by the SEC on February 12, 2008. Such documents may
be read free of charge on the SEC's web site at www.sec.gov. All
forward-looking statements included in this release are made as of the
date of this press release, and the company assumes no obligation to
update any such forward-looking statements.

For ZVUE Corporation
Hank Kim, 917-647-0500 (Media)
hank@hankkimconsulting.com
Howard Gostfrand/David Sasso, 305-918-7000 (Investor)
info@amcapventures.com

Copyright Business Wire 2008