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Workflow Management, Inc. Granted Temporary Credit Facility Waiver

Tuesday, May 28, 2002

Press release from the issuing company

PALM BEACH, Fla.--May 24, 2002-- Workflow Management, Inc. a leading outsourcer of graphic services, announced today that it has entered into an agreement with its lenders that waives the Company's previous covenant defaults under its secured revolving credit facility that were announced on April 26, 2002. Under the terms of the agreement, in addition to waiving the covenant defaults, the lenders have agreed to certain amendments to the Credit Facility for a limited period of time in order to allow the Company to pursue alternative financing sources or otherwise generate cash to reduce borrowings under the Credit Facility. The amendments include increasing the Company's total leverage ratio covenant from 3.75 to 1 to 4.15 to 1 effective April 30, 2002 through July 30, 2002. Tom D'Agostino, Sr., Chairman, President and CEO stated, "Our business this past year has been significantly impacted by the uncertain economic environment. We are pleased that we have been able to negotiate this arrangement with our lender. The new agreement will allow the Company to remain in compliance with the Credit Facility while it assesses and pursues its strategic alternatives." If the Company is not able to procure alternative financing or otherwise generate cash to significantly reduce borrowings under the Credit Facility in the near future, then the lenders and the Company have agreed in principle to enter into a new credit facility ("New Credit Facility"). The agreement contemplates that the New Credit Facility would bear interest at 12%, mature on October 31, 2003, and provide access to working capital based on a borrowing base formula. The New Credit Facility would also have financial covenants typical of asset based financing facilities. These covenants, and other terms and conditions of the New Facility, would be subject to negotiation by the parties. The Company believes that the agreement reached with its lenders will provide the Company with the flexibility necessary to conduct its operations in the ordinary course of business for the foreseeable future.




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