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Workflow Management, Inc. Enters into Agreement to Be Acquired

Press release from the issuing company

PALM BEACH, Fla.--Feb. 2, 2004-- Workflow Management, Inc. today announced that, by vote of all of its non-management directors, it has entered into both a definitive agreement to be acquired by Perseus, L.L.C. and The Renaissance Group, LLC and an amendment and limited waiver to the Company's existing credit facility. Agreement to be Acquired Workflow Management has entered into a definitive agreement pursuant to which WF Holdings, Inc., an entity formed and controlled by Perseus, L.L.C. ("Perseus") and The Renaissance Group, LLC ("Renaissance"), will acquire the Company for $4.87 per share in cash. The Company will continue to operate as a leading provider of end-to-end print solutions throughout the United States, Canada and Puerto Rico. Perseus is a private equity firm based in Washington, D.C. and New York, New York, with over $2.0 billion of capital under management. Renaissance, an investment firm based in Denver, Colorado, was founded and is controlled by Greg Mosher, an executive with over 25 years of business experience in a wide range of industries. The transaction is subject to the approval of the Company's stockholders and the satisfaction of various closing conditions, including a financing condition and a limitation on the Company's net debt at closing. Financing commitment letters have been obtained by the purchasers with respect to all financing necessary to consummate the transaction, subject to the satisfaction of certain conditions. The transaction is expected to close as soon as possible, but not later than April 30, 2004. Gerald F. Mahoney, the Company's Chairman of the Board commented, "The Board of Directors explored numerous alternatives to address our credit facility obligations that mature in 2004, including a strategic sale, high yield debt offering and a variety of alternative financing scenarios. After considering these alternatives carefully, and after conducting a comprehensive auction process that resulted in Perseus and Renaissance submitting the highest offer to purchase the Company, the Board concluded that the opportunity presented by Perseus and Renaissance is in the best interests of our stockholders." Mr. Mosher of Renaissance stated, "Workflow Management is one of the leading providers of end-to-end print solutions in North America, with a strong brand name, enviable customer base and leading edge product and services offering. As a privately held company, and with a solid capital structure and new infusion of equity, Workflow will be able to expand upon its current business platform, better serve its customers and expand into new markets. We anticipate a seamless transition of ownership, with no interruption to our relationships with customers, vendors and other business constituents." Jefferies & Company, Inc. is acting as the Company's financial advisor and has rendered a fairness opinion in connection with the transaction. Credit Facility Amendment Workflow Management also announced today that it has entered into an amendment to its credit facility with its senior lenders that consents to the acquisition by Perseus and Renaissance, provides limited interest rate relief, defers certain fees and warrant vesting, and provides for the waiver of certain financial covenant defaults caused by the recent Chapter 11 bankruptcy filing by one of the Company's largest customers, KB Toys, Inc., which owes the Company approximately $5 million. The limited default waiver and other lender accommodations under the credit facility amendment expire automatically if the merger agreement with Renaissance and Perseus is terminated for any reason or if the transaction otherwise is not consummated by April 30, 2004, or in certain circumstances, March 31, 2004. Further, Mr. Mahoney commented, "We are very appreciative of the cooperation our lenders have provided which facilitated our agreement with Perseus and Renaissance, and in particular, their willingness to grant us the time, flexibility and waivers to financial covenants necessary to consummate the merger."