LINCOLNSHIRE, Ill.--(BUSINESS WIRE)--Dec. 15, 2008--ACCO Brands Corporation (NYSE: ABD), a world leader in select categories
of branded office products, today announced that it has received
necessary lender approval for an amendment to its senior secured credit
agreement. Terms of the amendment include the following:
- The financial covenants have been changed to reflect an increase in the
maximum permitted leverage ratio to 5.50x until December 30, 2009; 5.25x
for the following twelve-month period; 5.00x for the next following
twelve-month period; 4.50x for the period between December 31, 2011 and
June 29, 2012; and, 4.00x for the period beginning June 30, 2012 and
thereafter. The minimum permitted ratio of EBITDA to interest expense
has been decreased to 2.25x until December 30, 2010; 2.50x for the
following twelve month period; 2.75x for the period between December 31,
2011 and June 29, 2012; and, 3.00x for the period beginning June 30,
2012 and thereafter.
- An increase in the interest rate margin applicable to all loans under
the credit agreement to a variable rate of LIBOR plus 450 basis points,
or, the base rate as defined in the credit agreement plus 350 basis
points, and establishes a LIBOR base rate floor of 3.25% and a base rate
floor of 4.25%.
- An increase in the unused revolver commitment fee rate to 75 basis
points per year, or 50 basis points per year for any period in which the
total leverage ratio is less than 2.5 to 1.0.
- Eliminates the company's ability to prepay its subordinated notes.
"Given current negative conditions in the general economy and the office
products industry, and the resulting impact on the company's future
performance, we felt it prudent to ensure we maintained our financial
flexibility," said ACCO Brands Chairman and Chief Executive Officer
Robert J. Keller. "We appreciate the leadership of Citi as
administrative agent, and the continued support of our bank group."
Forward-Looking Statements
This press release contains statements which may constitute
"forward-looking" statements as that term is defined in the Private
Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to certain risks and
uncertainties, are made as of the date hereof and the company assumes no
obligation to update them. ACCO Brands' ability to predict results or
the actual effect of future plans or strategies is inherently uncertain
and actual results may differ from those predicted depending on a
variety of factors, including but not limited to fluctuations in cost
and availability of raw materials; competition within the markets in
which the company operates; the effects of both general and
extraordinary economic, political and social conditions, including
continued volatility and disruption in the capital and credit markets;
the dependence of the company on certain suppliers of manufactured
products; the effect of consolidation in the office products industry;
the risk that targeted cost savings and synergies from the previous
business combinations may not be fully realized or take longer to
realize than expected; disruption from business combinations making it
more difficult to maintain relationships with the company's customers,
employees or suppliers; the results of the strategic review being made
by the company of its Commercial Laminating Solutions business and
whether any transaction will be completed, or any other action taken by
the company, as a result thereof; future goodwill and/or impairment
charges; foreign exchange rate fluctuations; our ability to remain in
compliance with our financial ratio covenants; the development,
introduction and acceptance of new products; the degree to which higher
raw material costs, and freight and distribution costs, can be passed on
to customers through selling price increases and the effect on sales
volumes as a result thereof; increases in health care, pension and other
employee welfare costs; as well as other risks and uncertainties
detailed from time to time in the company's SEC filings.
About ACCO Brands Corporation
ACCO Brands Corporation is a world leader in select categories of
branded office products. Its industry-leading brands include Day-Timer(R),
Swingline(R), Kensington(R), Quartet(R), GBC(R), Rexel, NOBO and Wilson Jones(R),
among others. Under the GBC brand, the company is also a leader in the
professional print finishing market.
CONTACT: ACCO Brands Corporation
Rich Nelson
Media Relations
(847) 484-3030
or
Jennifer Rice
Investor Relations
(847) 484-3020
Source: ACCO Brands Corporation
