OFIS - US Office Products Amends Credit Agreement
WASHINGTON, Jan 29, 2001 (BUSINESS WIRE) -- US Office Products Company (OTC
Bulletin Board: OFIS) today announced that it has reached an agreement with its
lenders to amend its credit facility. The amendment gives the Company additional
time to negotiate and close asset sale transactions in order to reduce
outstanding debt.
"We greatly appreciate the continued support of our lenders as we pursue our
strategy of reducing debt through the sale of certain businesses and improving
the operations of the North American Office Supplies and middle-market furniture
businesses," said Warren D. Feldberg, president and chief executive officer of
US Office Products.
The amended credit agreement will give the Company access to $20 million in
additional liquidity, by permitting it to retain $10 million from the proceeds
of each of the Company's next two asset sales. In conjunction with the revised
credit agreement, The Chase Manhattan Bank is permitted to extend a $10 million
revolving credit line to US Office Products, if necessary, which will be
available to the Company until its next asset sale has been completed.
The amendment waives all financial covenants relating to earnings contained in
the credit agreement through June 1, 2001. The waiver will be subject to the
Company negotiating and completing a sale of a business unit by March 15, 2001,
and generating net cash proceeds from asset sales of at least $250 million by
April 28, 2001.
US Office Products is one of North America's leading providers of office
supplies, office furniture, and office coffee and vending services. The Company
also owns Mail Boxes Etc., the world's largest franchiser of business,
communications and postal service centers, with more than 4,300 locations in 29
countries around the world. In addition, US Office Products' Blue Star
subsidiary owns commercial printing and retail book and stationery operations
throughout New Zealand and Australia, and the Company also holds a 49% interest
in Dudley Stationery Limited, a leading U.K. contract stationer. The Company's
corporate web site address is www.usofficeproducts.com.
This press release includes "forward-looking statements," within the meaning of
the federal securities laws, that involve uncertainties and risks. These include
statements regarding the impact of amendments to the Company's credit facility
and of asset sales on the Company's future liquidity. A number of risks and
uncertainties could cause actual results, events, and developments to differ
from expectations. These include: 1) competition, market conditions, turnover
among employees, and the impact of the Company's high level of leverage on its
ability to attract and retain customers and employees and to receive customary
terms from vendors could adversely affect the Company's business, results, or
cash flow and liquidity; (2) the Company may not be able to negotiate agreements
to sell assets on acceptable terms or to complete such sales within the time
frame specified in the credit agreement; and (3) failure by the Company to repay
its 2001 Convertible Notes when due would be a default under the revised credit
agreement. Please refer to the Company's Quarterly Report of Form 10-Q for the
quarter ended October 28, 2000, as well as the Company's 2000 Annual Report of
Form 10-K, as amended, and its other filings with the SEC for a complete
discussion of these and other important factors that could cause actual results
to differ materially from those projected by these forward-looking statements.
CONTACT: US Office Products Company
Laura Smith, Investor Relations
202/339-6713 / 800/330-6347 |
