Interim CEO Heads Workflow Management
PALM BEACH, FL—Former Mail-Well Chairman and CEO Gerald Mahoney has assumed the role of interim CEO for Workflow Management. Mahoney was already a member of the company's board of directors.
Tom D'Agostino Sr. is stepping aside from his duties as CEO and president of Workflow Management to assume the role of non-executive chairman, effective immediately.
The decision for D'Agostino to step down came in connection with the company's announcement that it had secured a new credit agreement.
Mahoney characterized the change in management as good for the company at this time. "It was time for a change and I think that the banks were more comfortable with a change. Tom thought it was a tough year and that it was time to step down," Mahoney remarks. He adds that the board does intend to honor the terms of D'Agostino's contract. D'Agostino has approximately 15 more months on his contract and then has a long-term consulting contract in place, as well.
The company's board of directors has appointed a search committee and has retained Heidrick & Struggles International to assist in the search for a permanent CEO.
D'Agostino says he plans to continue to focus on the long-term initiatives of the company. "I am proud of our accomplishments and have every confidence in the team we have assembled. Jerry Mahoney brings valuable industry experience, and I look forward to working with him ."
As one of the founders of Mail-Well, Mahoney says he realizes that he has a reputation in the industry as "the deal guy." "But I am first and foremost an operations guy. My focus going forward is to continue to cut costs. I'm not going to slash and burn, but we do need to take out some additional costs.
New Credit Agreement
"I will also be working with a number of Wall Street investment firms to restructure the balance sheet to bring in additional cash and start paying down the banks," Mahoney adds.
Workflow's new credit agreement consists of three separate facilities: a 30-month revolving credit facility of approximately $100 million; a 30-month, $30 million senior term loan that will be paid down over its term; and a one-year, $50 million term loan. The blended LIBOR-based interest rate on the new facilities will be approximately nine percent.
The new credit agreement is an outgrowth of Workflow's business plan that was delivered to the banks in accordance with the terms of the company's most recent credit facility amendment.
In addition, Steve Gibson, executive vice president of Workflow and president of the printing division, has elected to pursue other opportunities and has resigned as an officer and board member.