UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1998
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period From __________ To __________
Commission file number: 1-13858
BT OFFICE PRODUCTS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3245865
- ---------------------------------------- ---------------------------------
(State of incorporation or organization) (IRS Employer Identification No.)
2150 E. Lake Cook Road
Buffalo Grove, Illinois 60089-1877
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(847) 793-7500
--------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO _____
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date:
Class of Common Stock Shares Outstanding as of August 3, 1998
- -------------------------------------- ---------------------------------------
Common stock, par value $.01 per share 33,504,470
-1-
<PAGE>
BT Office Products International, Inc.
Quarterly Report on Form 10-Q
For the Quarter Ended June 30, 1998
Index of Information Included in Report
Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 9
Part II. Other Information 12
-2-
<PAGE>
Part I. Financial Information
BT Office Products International, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands)
June 30 December 31
1998 1997
--------- ---------
Assets
Current assets:
Cash and cash equivalents $ 12,823 $ 19,466
Accounts receivable, less allowances of
$9,909 in 1998 and $9,753 in 1997 238,296 219,118
Other receivables 24,581 33,429
Inventories 125,269 123,324
Other current assets 35,322 29,524
--------- ---------
Total current assets 436,291 424,861
Other assets 30,036 26,786
Property, plant and equipment 168,139 152,137
Accumulated depreciation and amortization 73,643 64,212
--------- ---------
Net property, plant and equipment 94,496 87,925
Intangibles, net of accumulated amortization of
$58,490 in 1998 and $53,726 in 1997 242,911 224,129
--------- ---------
Total assets $ 803,734 $ 763,701
========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable $ 20,990 $ 24,591
Accounts payable 134,373 140,780
Current portion of long-term obligations 201,290 200,816
Other current liabilities 75,176 70,688
--------- ---------
Total current liabilities 431,829 436,875
Long-term obligations 69,093 31,837
Other liabilities 23,815 21,276
Commitments and contingencies
Stockholders' equity:
Common stock 335 335
Additional paid-in capital 270,437 270,132
Retained earnings 23,303 17,137
Accumulated other comprehensive loss (15,078) (13,891)
--------- ---------
Total stockholders' equity 278,997 273,713
--------- ---------
Total liabilities and stockholders' equity $ 803,734 $ 763,701
========= =========
The accompanying notes are an integral part of the condensed consolidated
financial statements
-3-
<PAGE>
<TABLE>
BT Office Products International, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
<CAPTION>
Three months ended Six months ended
June 30 June 30
------------------------------- ---------------------------------
1998 1997 1998 1997
-------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Net sales $ 434,435 $ 390,668 $ 878,658 $ 792,230
Costs and expenses:
Costs of products sold 314,722 278,219 639,196 564,230
Selling and administrative expenses 104,169 93,331 205,635 190,374
Depreciation and amortization 4,736 3,869 9,229 8,075
Amortization of intangibles 2,427 2,619 4,818 5,302
------------ ------------ ------------ ------------
426,054 378,038 858,878 767,981
Operating income 8,381 12,630 19,780 24,249
Other income (expense):
Interest income and other 628 658 1,295 1,309
Interest expense (4,076) (3,888) (8,109) (7,940)
------------ ------------ ------------ ------------
(3,448) (3,230) (6,814) (6,631)
Income before income taxes and extraordinary item 4,933 9,400 12,966 17,618
Income tax expense 2,100 4,425 5,800 8,275
------------ ------------ ------------ ------------
Income before extraordinary item 2,833 4,975 7,166 9,343
Extraordinary item - going private costs, net of tax (1,000) - (1,000) -
------------ ------------ ------------ ------------
Net income $ 1,833 $ 4,975 $ 6,166 $ 9,343
=========== =========== ============ ============
Basic earnings per share:
Income before extraordinary item $ 0.08 $ 0.15 $ 0.21 $ 0.28
Extraordinary item (0.03) - (0.03) -
------------ ------------ ------------ ------------
Net income $ 0.05 $ 0.15 $ 0.18 $ 0.28
=========== =========== ============ ============
Diluted earnings per share:
Income before extraordinary item $ 0.08 $ 0.15 $ 0.21 $ 0.28
Extraordinary item (0.03) - (0.03) -
------------ ------------ ------------ ------------
Net income $ 0.05 $ 0.15 $ 0.18 $ 0.28
=========== =========== ============ ============
Average shares outstanding, basic 33,485 33,471 33,478 33,471
=========== =========== ============ ============
Average shares outstanding, diluted 33,852 33,491 33,752 33,481
=========== =========== ============ ============
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
-4-
<PAGE>
<TABLE>
BT Office Products International, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
<CAPTION>
Six months ended
June 30
----------------------------------
1998 1997
-------------- --------------
<S> <C> <C>
Operating Activities
Net income $ 6,166 $ 9,343
Adjustments to reconcile net income to cash provided by
operating activities:
Depreciation and amortization 9,931 8,934
Amortization of intangibles 4,818 5,303
Other 1,977 1,716
Changes in operating assets and liabilities, net of effects of
business acquisitions:
Receivables (10,265) (6,194)
Inventories 3,522 5,230
Other current assets 5,658 3,469
Accounts payable and other current liabilities (12,099) 1,401
------------ ------------
Net cash provided by operating activities 9,708 29,202
Investing activities
Purchases of property, plant and equipment (15,367) (11,181)
Acquisitions of businesses, less cash acquired (32,098) (5,383)
Other 998 (1,155)
------------ ------------
Net cash used for investing activities (46,467) (17,719)
Financing activities
Net repayments of notes payable (3,655) (10,168)
Net borrowings(repayments) under long-term obligations 32,358 (1,795)
Proceeds from stock options exercised including related tax benefits 305 -
------------ ------------
Net cash provided by (used for) financing activities 29,008 (11,963)
Effect of exchange rate changes on cash and cash equivalents 1,108 851
------------ ------------
Net increase (decrease) in cash and cash equivalents (6,643) 371
Cash and cash equivalents at beginning of period 19,466 20,163
------------ ------------
Cash and cash equivalents at end of period $ 12,823 $ 20,534
============ ============
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
-5-
<PAGE>
BT Office Products International, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements present
information in accordance with generally accepted accounting principles for
interim financial information and applicable rules of Regulation S-X.
Accordingly, they do not include all information or footnotes required by
generally accepted accounting principles for complete financial statements.
Management believes the financial statements include all normal accrual
adjustments necessary for a fair presentation. Operating results for the three
month and six month periods ended June 30, 1998 do not necessarily reflect the
results that may be expected for the full year. For further information, refer
to the consolidated financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997.
2. Business Acquisitions
In June 1998, the Company acquired the Werprasent AG group of companies
("Werprasent"), an office products distributor in Austria, in a purchase
transaction for approximately $26.3 million in cash, subject to adjustment as
provided in the purchase agreement. The transaction resulted in goodwill of
$21.4 million.
The pro forma unaudited results of operations for the six month period ended
June 30, 1998 and June 30, 1997, assuming the above-described acquisition had
been consummated as of January 1, 1997 and translated at historical rates, is as
follows (in thousands, except per share amounts):
Six months ended Six months ended
June 30, 1998 June 30, 1997
------------- -------------
Sales $ 896,658 $ 817,030
Income before extraordinary item 7,191 9,393
Net Income 6,191 9,393
Basic earnings per share
Income before extraordinary item $ 0.21 $ 0.28
Net Income $ 0.18 $ 0.28
Diluted earnings per share
Income before extraordinary item $ 0.21 $ 0.28
Net Income $ 0.18 $ 0.28
Average shares outstanding, basic 33,478 33,471
Average shares outstanding, diluted 33,752 33,481
The Company also acquired other smaller office products businesses in 1998 and
1997. These acquisitions did not have a significant impact on the consolidated
results for the six month periods ended June 30, 1998 and 1997.
-6-
<PAGE>
BT Office Products International, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
3. Long-term Obligations
On August 2, 1996, the Company entered into a $250 million syndicated bank
Competitive Advance and Revolving Credit Facility Agreement (the "Bank Credit
Agreement"). The Bank Credit Agreement is being used for working capital needs
and general corporate purposes, including acquisitions.
In August 1998, the Bank Credit Agreement was amended to provide covenant
relief, specifically the leverage and interest coverage ratios, for the period
ended June 30, 1998. The Bank Credit Agreement, as amended, contains various
loan covenants including a maximum leverage ratio based on total debt to pro
forma EBITDA calculated based on a four quarter rolling period (3.75 to 1
through March 31, 1998; 4.0 to 1 as of June 30, 1998; and 3.25 to 1 after June
30, 1998), a minimum interest coverage ratio based on EBITDA less capital
expenditures to interest costs calculated based on a four quarter rolling period
(2.50 to 1 through March 31, 1998; 2.0 to 1 as of June 30, 1998; and 3.0 to 1
after June 30, 1998), a maximum subsidiary debt level requirement, and a minimum
net worth requirement. In addition, under a change of control clause, an event
of default would occur if any person or group, other than Buhrmann NV
("Buhrmann"), formerly known as NV Koninklijke KNP BT, or its affiliates, shall
own more than 50% of the voting shares of the Company. As a result of the August
1998 amendment, the Company is in compliance with the financial covenants under
the Bank Credit Agreement as of June 30, 1998. The Company does, however, expect
that one or more defaults or events of default under the Bank Credit Agreement
may arise during the remainder of 1998 as a result of breaches of existing
financial covenants. Accordingly, indebtedness under the Bank Credit Agreement
has been classified as current portion of long-term obligations in the financial
statements at June 30, 1998. Similar breaches of financial covenants were
expected during 1998 and, accordingly, the long-term obligations were reported
as current portion of long-term obligations in the financial statements at
December 31, 1997.
The Company's majority shareholder, Buhrmann, has advised the Company that it
will support the Company during 1998 and use its best efforts to prevent any
default or event of default that may arise under the Bank Credit Agreement. As
described in Note 8, the Company has announced that Buhrmann and the Company
have entered into an agreement pursuant to which Buhrmann would acquire in a
cash merger the outstanding minority interest in the Company subject to approval
by a majority of the Company's public stockholders. Buhrmann has advised the
Company it intends to reduce or eliminate its existing indebtedness under the
Bank Credit Agreement and/or otherwise cause such indebtedness to be refinanced.
4. Income Taxes
The difference between the effective income tax rate and the U.S. statutory tax
rate is primarily due to the effects of foreign and state income taxes and
non-deductible goodwill amortization.
5. Earnings Per Share
Basic earnings per share is computed by dividing net income by the
weighted-average number of common shares outstanding during the period. Diluted
earnings per share is computed by dividing net income by the weighted-average
number of common shares outstanding during the period, adjusted for the dilutive
common share equivalents attributed to outstanding options to purchase common
stock (367,000 shares and 20,000 shares for the three months ended June 30, 1998
and 1997 and 274,000 shares and 10,000 shares for the six months ended June 30,
1998 and 1997, respectively).
6. Contingencies
The Company is involved in various legal actions arising in the normal course of
business. Management, after taking into consideration legal counsel's evaluation
of such actions, is of the opinion that the ultimate resolution of these matters
over and above previously established accruals will not have a material adverse
effect on the financial position, net cash flows or results of operations of the
Company.
-7-
<PAGE>
BT Office Products International, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
7. Comprehensive Income (Loss)
During 1998, the Company adopted the provision of Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income." As of June 30,
1998 and December 31, 1997, accumulated other comprehensive loss, as reflected
on the condensed balance sheet, was comprised entirely of the foreign currency
translation adjustment. Total comprehensive income(loss) for the three month and
six month periods ended June 30, 1998 and 1997 were as follows:
<TABLE>
<CAPTION>
Three Months Ended June 30 Six Months Ended June 30
-------------------------- ------------------------
1998 1997 1998 1997
---------- --------- ----------- ---------
<S> <C> <C> <C> <C>
Net income $ 1,833 $ 4,975 $ 6,166 $ 9,343
Other comprehensive loss:
Unrealized currency translation gain (loss) 1,917 (2,946) (1,187) (9,842)
---------- --------- ----------- ---------
Total comprehensive income (loss) $ 3,750 $ 2,029 $ 4,979 $ (499)
========= ========= =========== =========
</TABLE>
8. Going Private Transaction
On January 22, 1998, Buhrmann, the Company's 70% stockholder, announced that it
was prepared to make an offer to acquire the approximately 30% of the Company's
stock that is publicly traded for a cash purchase price of $10.50 per share. The
Company formed an independent committee of its Board of Directors (the "Special
Committee") to represent the interests of the minority stockholders. The Special
Committee, together with independent financial and legal advisors it retained,
evaluated the proposal. On May 7, 1998, the Company announced that Buhrmann has
reached an agreement in principle with the Special Committee of the Board of
Directors to acquire in a cash merger the outstanding minority interest in the
Company for $13.75 per share. The agreement is subject to definitive
documentation, final board approval by the Company's Board of Directors, and
approval by a majority of the Company's public stockholders. On June 2, 1998,
the Board of Directors of the Company unanimously approved and adopted an
Agreement and Plan of Merger that was entered into with Buhrmann on such date
(the "Merger Agreement") and resolved that the Merger Agreement be recommended
to the Stockholders of the Company for consideration and adoption at a Special
Meeting of Stockholders. A preliminary proxy statement was filed with the
Securities and Exchange Commission (the "SEC") on June 17, 1998.
The total amount of funds required to pay the merger consideration is estimated
to be approximately $138.5 million. In addition, approximately $6.5 million will
be required to pay holders of outstanding options upon cancellation of such
options. While no final decisions have been reached, Buhrmann intends to provide
the necessary funds by means of a contribution of capital, intercompany debt, or
as a combination of both. After the consummation of the transaction, Buhrmann
will own 100% of the Company.
The Company was served with several class action complaints that have been filed
in the Court of Chancery of the State of Delaware relating to the going private
transaction. The actions allege breach of fiduciary duties and related claims
against Buhrmann, the Company and certain of its directors in connection with
the January 22, 1998 announcement. On May 7, 1998, the Company also announced
that Buhrmann has reached an agreement in principle to settle the class action
lawsuits that were filed challenging the transaction. This settlement is subject
to Court approval. The fees and expenses associated with such settlement are not
expected to be material to the financial condition of the Company.
9. Extraordinary Item - Going private costs
Expenses of the "going private" transaction described in Note 8 have been
recorded as an extraordinary item. As of June 30, 1998, the Company had incurred
approximately $1.0 million in costs consisting mainly of fees for legal and
financial advisors. The total costs for these and other filing costs are
estimated to be $2.6 million. The Company has determined that these expenses are
not deductible for income tax purposes and accordingly no tax effect has been
recorded.
The Merger Agreement calls for an acceleration of the vesting schedule for all
options outstanding under the Company's stock option plan. Under the provisions
of APB No. 25 "Accounting for Stock Issued to Employees," the portion of options
which has accelerated vesting privileges is deemed compensation expense. As
such, additional compensation expense of $1.3 million, net of related tax
benefits, will be treated as an extraordinary item if the transactions
contemplated by the Merger Agreement are consummated.
-8-
<PAGE>
BT Office Products International, Inc.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations
Net sales increased to $434.4 million in the second quarter of 1998 from $390.7
million in the comparable period last year, an increase of $43.7 million or
11.2%. The increase in sales was led by an increase in sales from existing
locations of 8.0% and growth from acquisitions of 4.2%, offset by currency
translation which had a negative impact of 1.0%. Net sales increased to $878.7
million in the first six months of 1998 from $792.2 million in the comparable
period last year, an increase of $86.5 million or 10.9%. The increase in sales
was led by an increase in sales from existing locations of 9.2% and growth from
acquisitions of 3.6%, offset by currency translation which had a negative impact
of 1.9%.
Net sales in the United States increased to $301.4 million in the second quarter
of 1998 from $278.7 million in the comparable period last year, an increase of
$22.7 million or 8.1%. Net sales in the United States increased to $614.0
million in the first six months of 1998 from $567.1 million in the comparable
period last year, an increase of $46.9 million or 8.3%. The Company believes the
principal factors contributing to its internal growth were increased sales to
existing customers and new accounts. Net sales in the United States continue to
be negatively impacted by increasing competitive market conditions and lower
paper prices.
Net sales in Europe increased to $133.0 million in the second quarter of 1998
from $112.0 million in the comparable period last year, an increase of $21.0
million or 18.8%. The incremental impact of the Company's 1997 and 1998
acquisitions accounted for 14.8% of the European sales growth in the second
quarter of 1998. Excluding the effects of foreign currency depreciation against
the U.S. dollar of 3.4%, sales growth at existing locations increased 7.4% for
the second quarter, compared to the same period last year. Net sales in Europe
increased to $264.6 million in the first six months of 1998 from $225.1 million
in the comparable period last year, an increase of $39.5 million or 17.6%. The
incremental impact of the Company's 1997 and 1998 acquisitions accounted for
12.5% of the European sales growth in the first six months of 1998. Excluding
the effects of foreign currency depreciation against the U.S. dollar of 6.5%,
sales growth at existing locations increased 11.6% for the first six months,
compared to the same period last year. Europe's internal growth was driven by
the continued double digit growth from the late 1996 acquisitions in Sweden and
the Netherlands, the addition of new, large accounts in Germany and, to a lesser
extent, two new sales offices in Germany.
Gross profit as a percentage of net sales was 27.6% in the second quarter of
1998 as compared to 28.8% in the comparable period last year, a decrease of
1.2%. Gross profit as a percentage of net sales was 27.3% in the first six
months of 1998 as compared to 28.8% in the comparable period last year, a
decrease of 1.5%. These decreases were attributable primarily to highly
competitive market conditions resulting in lower product margins in the United
States and Europe and a shift in product mix in Europe.
Selling and administrative expenses, expressed as a percentage of net sales,
were 24.0% in the second quarter of 1998 as compared to 23.9% in the comparable
period last year, an increase of 0.1%. Selling and administrative expenses,
expressed as a percentage of net sales, were 23.4% in the first six months of
1998 as compared to 24.0% in the comparable period last year, a decrease of
0.6%. With the recent sales growth, the Company has leveraged its operating and
logistics costs while at the same time invested in additional personnel to
support the business. The Company continues to focus on initiatives to improve
its cost structure.
In December 1997, the Company announced its U.S. plan to implement an
enterprise-wide system solution, known as Project Millennium, which is designed
to standardize business processes, centralize certain business functions, and
enhance customer service capabilities. As part of the first phase of the
project, customers will gradually transition from the various legacy systems to
the national sales and order management system. The operating costs associated
with the design and implementation of Project Millennium and the enhanced
national sales and order management system in the second quarter of 1998 and the
comparable quarter last year totaled $4.1 million and $1.3 million,
respectively. Similar operating costs in the first six months of 1998 and the
comparable period last year included $7.5 million and $3.2 million,
respectively.
Operating income, expressed as a percentage of net sales, was 1.9% in the second
quarter of 1998 as compared to 3.2% in the comparable period last year.
Excluding the Project Millennium costs described above, operating income as a
percentage of sales would have been 2.9% in the second quarter of 1998 and 3.6%
in the comparable period in the prior year. Operating income in the United
States, excluding the costs of Project Millennium described above, would have
been $10.5 million, or 3.5% in the second quarter of 1998 and $12.0 million, or
-9-
<PAGE>
4.3% in the same period last year. Operating income as a percentage of net sales
in Europe in the second quarter of 1998 and 1997 was 1.4% and 1.8%,
respectively. Operating income as a percentage of net sales was 2.3% in the
first six months of 1998 as compared to 3.1% in the comparable period last year.
Excluding the Project Millennium costs described above, operating income as a
percentage of sales would have been 3.1% in the first six months of 1998 and
3.5% in the comparable period in the prior year. Operating income in the United
States, excluding the costs of Project Millennium described above, would have
been $22.9 million, or 3.7% in the first six months of 1998 and $23.9 million,
or 4.2% in the same period last year. Operating income as a percentage of net
sales in Europe in the first six months of 1998 and 1997 was 1.6%.
An extraordinary expense was recorded in the second quarter of 1998 related to
expenses associated with the "going private" transaction described in Note 8. As
of June 30, 1998, the Company had incurred approximately $1.0 million of costs
consisting mainly of fees for legal and financial advisors. The total costs for
these and other filing costs are estimated to be $2.6 million. The Company has
determined that these expenses are not deductible for income tax purposes and
accordingly no tax effect has been recorded.
Net income decreased to $1.8 million in the second quarter of 1998 from $5.0
million in the comparable period last year. Net income decreased to $6.2 million
in the first six months of 1998 from $9.3 million in the comparable period last
year. Lower gross margins and additional costs associated with Project
Millennium offset the favorable experience of higher sales and operating cost
reductions.
Liquidity and Capital Resources
Cash provided by operating activities in the first six months of 1998 of $9.7
million was the result of $22.9 million of net income, depreciation,
amortization and other non-cash items offset by $13.2 million of net increases
in working capital. Cash provided by financing activities included $28.7 million
for net borrowings of notes payable and long-term obligations. Significant cash
requirements in the first six months of 1998 included $15.4 million for capital
expenditures, of which $7.8 million related to Project Millennium, and $32.1
million related to acquisitions of businesses.
As a result of the August 1998 amendment, the Company is in compliance with the
financial covenants under the Bank Credit Agreement as of June 30, 1998. The
Company does, however, expect that one or more defaults or events of default
under the Bank Credit Agreement may arise during the remainder of 1998 as a
result of breaches of existing financial covenants. Accordingly, indebtedness
under the Bank Credit Agreement has been classified as current portion of
long-term obligations in the financial statements at June 30, 1998. Similar
breaches of financial covenants were expected during 1998 and, accordingly, the
long-term obligations were reported as current portion of long-term obligations
in the financial statements at December 31, 1997.
The Company's majority shareholder, Buhrmann, has advised the Company that it
will support the Company during 1998 and use its best efforts to prevent any
default or event of default that may arise under the Bank Credit Agreement. As
described in Note 8, the Company has announced that Buhrmann and the Company
have entered into an agreement pursuant to which Buhrmann would acquire in a
cash merger the outstanding minority interest in the Company subject to approval
by a majority of the Company's public stockholders. Buhrmann has advised the
Company it intends to reduce or eliminate its existing indebtedness under the
Bank Credit Agreement and/or otherwise cause such indebtedness to be refinanced.
The Company continues to actively pursue acquiring established quality office
products distributors in Europe and, to a lesser extent, in the United States as
an integral part of its long term strategy. The Company anticipates significant
future acquisition funding, to the extent required, will necessitate obtaining
additional debt and/or equity capital resources. There can be no assurance that
the Company could obtain such additional resources. The Company continues to
examine and evaluate several alternatives.
Euro Currency Matters
By June 1998, eleven of the fifteen members of the European Union agreed to
adopt fixed conversion rates on January 1, 1999 between their national currency
and the Euro currency. The respective national currencies will also remain legal
tender until January 1, 2002. The Company operates in three countries--The
Netherlands, Germany and Austria--that will adopt the Euro currency as their
common currency on January 1, 1999. The Company is not certain when, or if, its
other European operations in the United Kingdom and Sweden (also members of the
European Union) will be subject to Euro currency conversion. The Company's
European operations currently use the local currency as the functional currency
in translating the financial statements. The introduction of the Euro currency
-10-
<PAGE>
requires that the Company's systems have the ability to transact in
dual-currencies. However, a change in the functional currency is not anticipated
until the local currency is no longer legal tender.
The Company has completed its initial assessment of their systems in
anticipation of the dual currencies starting January 1, 1999 or later. These
changes are being coordinated with other system changes required to be Year 2000
compliant (see discussion below). Full system conversion to the Euro is not
required until at least January 1, 2002. However, to the extent the Company does
not have the ability to invoice customers in the Euro, or that customers would
be unable to order product or pay invoices in the Euro, the Company's business
could be materially adversely affected.
Year 2000 Issues
The Company has completed its initial assessment of the impact of the Year 2000
issue on the majority of its systems and is addressing the issues identified.
The Company currently believes it will be able to modify or replace its affected
systems in time to minimize any detrimental effects on operations. During the
first six months of 1998, the Company expensed $0.4 million for consulting fees
in conjunction with the initial assessment of the Year 2000 impact. Management
currently expects that full implementation of this project will involve a
commitment of internal and external resources of approximately $7 million to $10
million over the next 18 months. While it is not possible, at present, to know
the actual cost of this work, the Company expects that such costs may be
material to the Company's results of operations in one or more fiscal quarters
or years. The Company is unable to ascertain whether its customers' and vendors'
systems are, or will be, Year 2000 compliant. However, to the extent that
customers would be unable to order products or pay invoices, vendors would be
unable to manufacture and ship products, or the Company is unable to achieve
Year 2000 compliance, the Company's business could be materially adversely
affected.
Other
In June 1997, the FASB issued Statement No. 131 ("SFAS 131"), "Disclosure about
Segments of an Enterprise and Related Information." This statement, effective
for financial statements for periods beginning after December 15, 1997, requires
that a public business enterprise report financial and descriptive information
about its reportable operating segments. Generally, financial information is
required to be reported on the basis that it is used internally for evaluating
segment performance and deciding how to allocate resources to segments. The
Company is evaluating the effects of this pronouncement.
On June 15, 1998, the FASB issued Statement No. 133 ("SFAS 133"), "Accounting
for Derivative Instruments and Hedging Activities." SFAS 133 is effective for
all fiscal years beginning after June 15, 1999. SFAS 133 requires that all
derivative instruments be recorded on the balance sheet at their fair value.
Changes in the fair value of derivatives are recorded each period in current
earnings or other comprehensive income, depending on whether a derivative is
designated as part of a hedge transaction and, if it is, the type of
transaction. The Company anticipates that, due to its limited use of derivative
instruments, the adoption of SFAS 133 will not have a significant effect on the
Company's results of operations or its financial position.
Forward Looking Statements
Various statements made within this Management's Discussion and Analysis of
Financial Condition and Results of Operations and elsewhere in this Quarterly
Report on Form 10-Q constitute "forward looking statements" for purposes of the
Securities and Exchange Commission's "safe harbor" provisions under the Private
Securities Litigation Reform Act of 1995 and Rule 3b-6 under the Securities
Exchange Act of 1934, as amended. Investors are cautioned that all forward
looking statements involve risks and uncertainties, including those detailed in
the Company's filings with the Securities and Exchange Commission. There can be
no assurance that actual results will not differ from the Company's
expectations. Factors which could cause materially different results include,
among others, uncertainties related to the introduction of the Company's
products and services; the ability to finance and successfully complete and
integrate future acquisitions; mix of sales by product category and country;
continual competitive pressure on pricing and margins; delays in implementing
the technological and operational changes planned under Project Millennium; Year
2000 implementation costs, the volatility of paper prices; the fluctuation in
interest rates; and the expansion into international markets, including currency
exchange rates and general market conditions.
-11-
<PAGE>
Part II. Other Information
BT Office Products International, Inc.
Item 1. Legal Proceedings
The Company was served with several class action complaints that have been filed
in the Court of Chancery of the State of Delaware. The actions allege breach of
fiduciary duties and related claims against Buhrmann, the Company and certain of
its directors in connection with the January 22, 1998 announcement relating to
the going private transaction. On May 7, 1998, the Company announced that
Buhrmann has reached an agreement in principle to settle the class action
lawsuits that were filed challenging the transaction. This settlement is subject
to Court approval. The fees and expenses associated with such settlement are not
expected to be material to the financial condition of the Company.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Amendment No. 3 dated August 13, 1998 to the Competitive Advance
and Revolving Credit Facility Agreement
10.2 Collective bargaining agreement between BT Office Products
International, Inc. Pittsburgh Division and General Teamsters,
Chauffeurs, and Helpers Local Union No. 249 dated August 10, 1998
10.3 Collective bargaining agreement between BT Office Products
International, Inc. Washington Division and Graphic Communications
Union, Local 449-S dated May 25, 1998
27.1 Financial Data Schedule
(b) Reports on Form 8-K
On June 8, 1998, the Company filed a Current Report on Form 8-K to
report that the Company has signed a definitive merger agreement with Buhrmann
(formerly known as NV Konkinklijke KNP BT) as of June 2, 1998.
-12-
<PAGE>
BT Office Products International, Inc.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BT OFFICE PRODUCTS INTERNATIONAL, INC.
/s/ Francis J. Leonard
-----------------------------------------------
Francis J. Leonard
Vice President-Finance and Chief Financial Officer
(Principal Financial Officer and Duly Authorized Officer)
Date: August 13, 1998
-13-
<PAGE>
BT OFFICE PRODUCTS INTERNATIONAL, INC.
INDEX TO EXHIBITS
Filed with the Quarterly Report on Form 10-Q
for the Quarterly Period Ended June 30, 1998
Exhibit No. Description
10.1 Amendment No. 3 dated August 13, 1998 to the Competitive Advance
and Revolving Credit Facility Agreement
10.2 Collective bargaining agreement between BT Office Products
International, Inc. Pittsburgh Division and General Teamsters,
Chauffeurs, and Helpers Local Union No. 249 dated August 10,
1998
10.3 Collective bargaining agreement between BT Office Products
International, Inc. Washington Division and Graphic
Communications Union, Local 449-S dated May 25, 1998
27.1 Financial Data Schedule
-14-
AMENDMENT NO. 3 dated as of August 13, 1998
(this "Amendment") among BT OFFICE PRODUCTS
INTERNATIONAL, INC., the BORROWING SUBSIDIARIES (as
defined in the Credit Agreement referred to below),
the GUARANTORS (as defined in the Credit Agreement
referred to below), the LENDERS (as defined below)
and THE CHASE MANHATTAN BANK, a New York banking
corporation, as administrative agent for the Lenders
(in such capacity, the "Agent").
A. Reference is made to the Competitive Advance and Revolving
Credit Facility Agreement dated as of August 2 1996 (as amended by Amendment No.
1 dated as of December 20, 1996 and Amendment No. 2 dated as of May 28, 1997,
the "Credit Agreement") among the Borrowers (as defined in the Credit
Agreement), the financial institutions from time to time party thereto (the
"Lenders"), the Agent and ABN AMRO Bank, N.V., as documentation agent.
Capitalized terms used and not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.
B. The Borrowers wish to obtain, and the undersigned Lenders,
the Agent and the Co-Agents are willing to grant, upon the terms and subject to
the conditions set forth herein, an amendment of certain definitions and
Sections 6.08 and 6.09 of the Credit Agreement.
Accordingly, for and in consideration of the premises and
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrowers, the Agent and the Lenders hereby agrees as follows:
SECTION 1. Amendment of Section 1.01 of the Credit Agreement.
Section 1.01 is hereby amended by amending the definitions of "Applicable
Margin" and "Facility Fee Percentage" to read in their entireties as follows:
"Applicable Margin" shall mean on any date, with respect to
Eurocurrency Standby Loans, the applicable percentage set forth below based upon
the Consolidated Leverage Ratio as set forth below:
<PAGE>
Consolidated Applicable
Leverage Margin
Ratio
- ------------ --------------
Category 1
- ----------
Less than or equal to 2.0 .225%
Category 2
- ----------
Greater than 2.0 but less than or equal to 3.0 .225%
Category 3
- ----------
Greater than 3.0 .325%
Except as set forth below, the Consolidated Leverage Ratio utilized for purposes
of determining the Applicable Margin shall be that in effect as of the last
Financial Statement Delivery Date. From the date hereof until the initial
delivery of financial statements pursuant to Section 5.01(a) or (b), the
Applicable Margin shall be determined by reference to Category 2. Each change in
the Applicable Margin resulting from a change in the Consolidated Leverage Ratio
shall be effective with respect to all Loans and Commitments outstanding on and
after the date of such change. Notwithstanding the foregoing, (i) at any time
when the Company has failed to deliver the financial statements required by
Section 5.01(a) or (b) and a certificate pursuant to Section 5.01(c), the
Applicable Margin shall be determined by reference to Category 3 and (ii) at all
times during which the Consolidated Leverage Ratio is greater than 3.25, the
Applicable Margin Percentage shall be 0.450%.
"Facility Fee Percentage" shall mean on any date the
applicable percentage set forth below based upon the Consolidated Leverage Ratio
as set forth below:
Consolidated Facility
Leverage Fee
Ratio
- ------------ --------------
Category 1
- ----------
Less than or equal to 2.0 .125%
Category 2
- ----------
Greater than 2.0 but less than or equal to 3.0 .175%
Category 3
- ----------
Greater than 3.0 .225%
Except as set forth below, the Consolidated Leverage Ratio utilized for purposes
of determining the Facility Fee Percentage shall be that in effect as of the
last Financial Statement Delivery Date. From the date hereof until the initial
delivery of financial statements pursuant to Section 5.01(a) or (b) and a
certificate pursuant to Section 5.01(c), the Facility Fee Percentage shall be
determined by reference to Category 2. Each change in the Facility Fee
Percentage resulting from a change in the Consolidated Leverage Ratio shall be
effective with respect to all Loans and Commitments outstanding on and after the
date of such change. Notwithstanding the foregoing, (i) at any time when the
Company has failed to deliver the financial statements required by Section
5.01(a) or (b) and a certificate pursuant to Section 5.01(c), the Facility Fee
Percentage shall be determined by reference to Category 3, and (ii) at all times
during which the Consolidated Leverage Ratio is greater than 3.25, the Facility
Fee Percentage shall be 0.300%.
SECTION 2. Amendment of Section 6.08 of the Credit Agreement.
Section 6.08 of the Credit Agreement is hereby amended as of the Amendment
Effective Date to read in its entirety as follows:
"SECTION 6.08. Consolidated Leverage Ratio. The Consolidated
Leverage Ratio will not at any time (i) prior to June 30, 1998 exceed
3.75 to 1.0, (ii) on June 30, 1998 exceed 4.0 to 1.0 and (iii) after
June 30, 1998 exceed 3.25 to 1.0."
SECTION 3. Amendment of Section 6.09 of the Credit Agreement.
Section 6.09 of the Credit Agreement is hereby amended as of the Amendment
Effective Date to read in its entirety as follows:
"SECTION 6.09. Consolidated Interest Coverage Ratio. The
Consolidated Interest Coverage Ratio will not at any time be less than
at any time (i) on or after September 30, 1996 and prior to June 30,
1998, 2.5 to 1.0, (ii) on June 30, 1998, 2.0 to 1.0 and (iii) after
June 30, 1998, 3.0 to 1.0."
SECTION 4. Representations and Warranties. By its execution
and delivery hereof, each Borrower represents and warrants to the Lenders and
the Agent, on and as of the Amendment Effective Date:
(a) This Amendment has been duly authorized, executed and
delivered by such Borrower, and each of this Amendment and the Credit
Agreement, after giving effect to by this Amendment, constitutes the
legal, valid and binding obligation of such Borrower enforceable in
accordance with its terms (subject, as to the enforcement of remedies,
to applicable bankruptcy, reorganization, insolvency, moratorium and
similar laws affecting the enforcement of creditors' rights generally
and to general principals of equity);
(b) The representations and warranties contained in Article IV
of the Credit Agreement, after giving effect to this Amendment, are
true and correct on and as of the Amendment Effective Date as though
made by such Borrower on and as of the Amendment Effective Date, except
to the extent that such representations and warranties expressly relate
to an earlier date; and
(c) No Default or Event of Default has occurred and is
continuing or would result from the execution and delivery of this
Amendment.
SECTION 5. Effectiveness. This Amendment shall become
effective as of that date (the "Amendment Effective Date") that (a) the Agent
shall have received counterparts of this Amendment which, when taken together,
bear the authorized signatures of each Borrower, the Agent and the Required
Lenders and (b) the Agent shall have received, for the ratable benefit of the
Lenders, an amendment fee in an amount equal to .05% of the Commitments.
SECTION 6. Expenses. Each Borrower agrees to pay on demand all
costs and expenses of the Agent in connection with the preparation, execution
and delivery of this Amendment (including, without limitation, the reasonable
fees and out-of-pocket expenses of Cravath, Swaine & Moore, counsel for the
Agent).
SECTION 7. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND SHALL BE
BINDING UPON EACH BORROWER, THE AGENT AND THE LENDERS AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.
SECTION 8. Counterparts. This Amendment may be executed in any
number of counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. Delivery of an executed
counterpart of a signature page of this Amendment by telecopy shall be effective
as delivery of a manually executed counterpart of this Amendment.
SECTION 9. Limited Effect of Amendment. Except as expressly
set forth herein, this Amendment shall not by implication or otherwise limit,
impair, constitute a Amendment of, or otherwise affect the rights and remedies
of the Lenders and the Agent under the Credit Agreement, or alter, modify, amend
or in any way affect any of the terms, conditions, obligations, covenants or
agreements contained in the Credit Agreement, all of which are ratified and
affirmed in all respects and shall continue in full force and effect. This
Amendment shall apply and be effective only with respect to the provisions of
the Credit Agreement specifically referred to herein.
IN WITNESS WHEREOF, the parties hereto by their officers
thereunto duly authorized, have executed this Amendment as of the day and year
first above written.
BT OFFICE PRODUCTS INTERNATIONAL, INC.,
by /s/ Francis J. Leonard
__________________________________
Name: Francis J. Leonard
Title: Vice President-Finance and
Chief Financial Officer
Borrowing Subsidiaries
KELLY PAPER COMPANY,
by /s/ Edward A. Pearson
__________________________________
Name: Edward A. Pearson
Title: President
BT OFFICE PRODUCTS INTERNATIONAL HOLDINGS, INC.,
by /s/ Francis J. Leonard
__________________________________
Name: Francis J. Leonard
Title: Vice President, Treasurer and
Assistant Secretary
BT OPE HOLDINGS, INC.,
by /s/ Francis J. Leonard
__________________________________
Name: Francis J. Leonard
Title: Vice President, Treasurer and
Assistant Secretary
BT OFFICE PRODUCTS SWEDEN AB,
by /s/ Janhein H. Pieterse
__________________________________
Name: Janhein H. Pieterse
Title: President
THE CHASE MANHATTAN BANK, individually and as
Administrative Agent,
by /s/ Jonathon E. Twichell
__________________________________
Name: Jonathon E. Twichell
Title: Vice President
ABN AMRO BANK N.V., individually and as
Documentation Agent,
by /s/ Bernard J. McGuigan
__________________________________
Name: Bernard J. McGuigan
Title: Group Vice President & Director
by /s/ David E. Collignon
__________________________________
Name: David E. Collignon
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION,
by /s/ Richard Kerbis
__________________________________
Name: Richard Kerbis
Title: Managing Director
BAYERISCHE VEREINSBANK AG, NEW YORK BRANCH,
by /s/ Alex Blodi
__________________________________
Name: Alex Blodi
Title: Vice President
by /s/ Carolyn Gutbrod
__________________________________
Name: Carolyn Gutbrod
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO,
by /s/ Richard L. Janisse
__________________________________
Name: Richard L. Janisse
Title: First Vice President
THE FUJI BANK LIMITED,
by /s/ Peter Chinnici
__________________________________
Name: Peter Chinnici
Title: Joint General Manager
MELLON BANK,
by /s/ Apryl Eshelman
__________________________________
Name: Apryl Eshelman
Title: Vice President
THE BANK OF TOKYO-MITSUBISHI, LTD., CHICAGO BRANCH,
by /s/ Hajime Watanabe
__________________________________
Name: Hajime Watanabe
Title: Deputy General Manager
CREDIT LYONNAIS, NEW YORK BRANCH,
by /s/ Olivier Perrain
__________________________________
Name: Olivier Perrain
Title: First Vice President
FIRST NATIONAL BANK OF MARYLAND,
by /s/ Roy S. Lewis
__________________________________
Name: Roy S. Lewis
Title: Vice President
NORTHERN TRUST COMPANY,
by /s/ Michelle M. Teteak
__________________________________
Name: Michelle M. Teteak
Title: Vice President
A G R E E M E N T
BT OFFICE PRODUCTS INTERNATIONAL
and
GENERAL TEAMSTERS, CHAUFFEURS, AND HELPERS
LOCAL UNION NO. 249
1998 - 2001
<PAGE>
-i-
TABLE OF CONTENTS
Page
UNION RECOGNITION............................................................1
TRANSFER OF COMPANY TITLE OR INTEREST........................................2
UNION SECURITY AND CHECKOFF..................................................3
JOB CLASSIFICATION AND WAGE RATES............................................4
ADDITIONAL HOUR AND WAGE REGULATIONS.........................................5
HOLIDAY COMPENSATION.........................................................9
VACATIONS....................................................................12
SENIORITY....................................................................13
MANAGEMENT RIGHTS............................................................15
SUSPENSION AND DISCHARGE.....................................................16
GRIEVANCE PROCEDURE..........................................................16
SHOP STEWARDS................................................................19
PROTECTION OF RIGHTS.........................................................19
LEAVE OF ABSENCE.............................................................19
ALLOWANCE FOR TIME OFF FOR DEATH IN THE FAMILY...............................20
ALLOWANCE FOR JURY SERVICE...................................................21
RESPONSIBILITIES OF THE PARTIES..............................................21
GENERAL PROVISIONS...........................................................22
INSURANCE....................................................................24
PROFIT SHARING AND PAYROLL SAVINGS PLANS.....................................25
CASUAL/NON-REGULAR EMPLOYEES.................................................25
TERMINATION..................................................................27
<PAGE>
AGREEMENT
Made and entered into between BT OFFICE PRODUCTS INTERNATIONAL
of Pittsburgh, Pennsylvania, hereinafter referred to as the Employer, and the
GENERAL TEAMSTERS, CHAUFFEURS AND HELPERS, LOCAL UNION NO. 249, affiliated with
the INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS
OF AMERICA, hereinafter referred to as the Union.
This Agreement is in place of all other agreements, oral or
written, between the Union and the Company or its predecessor; the Union agrees
to save the Company harmless from any claim made or purported to be made under
any Agreement between the Union and the Company or its predecessor, prior to the
date of this Agreement.
WITNESSETH:
WHEREAS, the parties hereto are desirous of entering upon an
Agreement as to wage rates, hours and other conditions of employment, and to do
away with the possibility of strikes, boycotts, lockouts and the like.
NOW, THEREFORE, the Employer and the Union acting by and
through their duly authorized agents hereby agree as follows:
ARTICLE I
UNION RECOGNITION
(a) The Employer recognizes and acknowledges that the Local
Union is the sole and exclusive representative of all employees in the
classifications of work covered by this Agreement for the purpose of collective
bargaining as provided by the National Labor Relations Act.
ARTICLE II
TRANSFER OF COMPANY TITLE OR INTEREST
(a) This Agreement shall be binding upon the parties hereto,
their successors, administrators, executors and assigns. In the event an entire
operation or any part thereof is sold, leased, transferred or taken over by
sale, transfer, lease, assignment, receivership or bankruptcy proceedings, such
operation shall continue to be the subject to the terms and conditions of this
Agreement for the life thereof. It is understood by this Section that the
parties hereto shall not use any leasing device to a third party to evade this
Contract.
(b) The Employer shall give notice of the existence of this
Agreement to any purchaser, transferee, lessee, assignee, and etc., of the
operations covered by this Agreement or any part thereof. Such notice shall be
in writing with a copy to the Union at the time the seller, transferor or lessor
executes a contract of transaction as herein described.
(c) In the event the Employer fails to give the notice herein
required, the Employer shall be liable to the Union and to the employees covered
for all damages sustained as a result of such failure to require assumption of
the terms of this Contract.
ARTICLE III
UNION SECURITY AND CHECKOFF
(a) Union Security. All present employees who are members of
the Local Union on the effective date of this subsection or on the date of
execution of this Agreement, whichever is the later, shall remain members of the
Local Union in good standing as a condition of employment. All present employees
who are not members of the Local Union and all regular employees who are hired
hereafter shall become and remain members in good standing to the Local Union as
a condition of employment on and after the ninetieth (90th) work day following
their hire or the effective date of this Agreement, whichever is the later. This
provision shall be made and become effective as of such time as it may be made
and become effective under the provisions of the National Labor Relations Act,
but not retroactively.
(b) The failure of any person to become a member of the Union
at the required time shall obligate the Employer, upon written notice from the
Union to such effect and to the further effect that Union membership was
available to such person on the same terms and conditions generally available to
other members, to forthwith discharge such person. Further, the failure of any
person to maintain his Union membership in good standing as required herein
shall, upon written notice to the Employer by the Union to such effect, obligate
the Employer to discharge such person.
(c) In the event of any change in the law during the term of
this Agreement, the Employer agrees that the Union will be entitled to receive
the maximum Union Security which may be lawfully permissible.
(d) No provision of this Article shall apply in any state to
the extent that it may be prohibited by state law. If under applicable state
law, additional requirements must be met before any such provision may become
effective, such additional requirements shall first be met.
(e) If any provision of this Article is invalid under the law
of any state wherein this Agreement is executed, such provision shall be
modified to comply with the requirements of state law or shall be renegotiated
for the purpose of adequate replacement. If such negotiation shall not result in
a mutually satisfactory Agreement, the Union shall be permitted all legal
recourse.
(f) When the Employer needs additional workers, he shall give
the Local Union equal opportunity with all other sources to provide suitable
applicants, but the Employer shall not be required to hire those referred by the
Local Union.
(g) Checkoff. The Employer agrees to deduct from the pay of
all regular employees covered by this Agreement, the dues, initiation fees
and/or uniform assessments of the Local Union and agrees to remit to said Local
Union all such deductions prior to the end of the month for which the deduction
is made. Written authorization by the employees shall be furnished.
ARTICLE IV
JOB CLASSIFICATION AND WAGE RATES
(a) The following are the job classifications of employees in
the bargaining unit covered by this Agreement and the basic hourly rate of
compensation to be paid to the employees in their respective classifications. It
is understood, however, that no compensation in this Agreement shall be
construed as other than a minimum and no maximum wage shall be set up for any
classification or employee.
Effective March 1, January 15, January 15, January 15,
1998 1999 2000 2001
Upon Hire 8.25 8.35 8.45 8.55
After Probation 8.75 8.85 8.95 9.05
After 12 Months 9.80 10.00 10.10 10.20
Continuous Service
(b) Employees hired on or before March 1, 1992 will continue
to receive their current rate through the life of this Agreement. In addition,
each employee hired on or before May 1, 1992 and covered by this Agreement who
remains in the active employ of the Company as of the execution of this
Agreement will receive a bonus of $250.00 on the first pay period after March 1,
1998. Thereafter, each employee hired on or before May 1, 1992 and covered by
this Agreement who remains in the active employ of the Company as of January 15
of each succeeding year during the term of this contract will receive a bonus of
$250 on the first pay period after January 15, 1999, 2000, and 2001.
ARTICLE V
ADDITIONAL HOUR AND WAGE REGULATIONS
(a) The regular guaranteed work week for all regular employees
hired before March 2, 1992 covered by this Agreement shall consist of five (5),
eight (8) hour days of forty (40) hours work, Monday through Friday. The regular
work week for all regular employees hired on or after March 2, 1992 shall
consist of eight (8) hour days, Monday through Friday.
(b) The Union and the Company understand that competitive
wages and benefits, as well as job security, are dependent upon BT OPI's ability
to satisfy its customers. To help BT OPI, every employee agrees to work
productively and to provide a fair day's work for a fair day's pay.
(c) All time worked by regular employees outside the regular
posted work schedule shall be considered as overtime and shall be paid for at
time and one-half (1 1/2) the regular hourly rate. This shall include, but not
be limited to, work during scheduled lunch period or for hours worked prior to
the regular scheduled daily starting time.
(d) All hours worked on shifts commencing at or after 11:00
p.m. and before 6:00 a.m.shall receive a shift differential of thirty-five cents
($.35) per hour. All hours worked on shifts commencing at or after 1:00 p.m. but
before 11:00 p.m. shall receive a shift differential of twenty-five cents ($.25)
per hour.
(e) The Employer agrees to provide no less than one (1) week
notice of any shift change.
(f) All regular work performed on Sundays shall be paid at the
rate of double time or twice the regular rate of pay, unless the work performed
is part of the employee's regular Monday morning shift and no more than two
hours of that shift is worked on the previous Sunday night.
(g) A split shift shall not be permitted at any time. All
hours worked on any workday must be consecutive.
(h) All regular employees covered by this Agreement shall
receive one-half (1/2) hour for lunch each day without pay.
(i) For all time worked, in excess of eight (8) hours in any
regular workday, time and one-half (1 1/2) shall be paid and/or for all time
worked in excess of forty (40) hours in any week, the rate of pay shall be time
and one-half (1 1/2) the regular rate.
(j) No employee shall be laid off before his regular scheduled
daily quitting time or during any regular weekly work schedule for the purpose
of offsetting any overtime the employee has worked during the same workweek or
any pay period.
(k) 1. Any regular employee who is scheduled or notified to
report and does report for work shall be provided with and assigned to at least
eight (8) hours of work on the job for which he was scheduled or notified to
report, or, the event such work is not available, shall be assigned or
reassigned to another job at the same rate or pay. In the event that when he
reports for work no work is available, he shall be released from duty and
credited with a reporting allowance of eight (8) times his regular basic hourly
rate of pay. An employee who starts to work and is released from duty before he
works at least eight (8) hours shall be paid for hours worked and credited with
a reporting allowance equal to his regular basic hourly rate of pay multiplied
by the unutilized portion of the eight (8) hour minimum.
2. The provisions of this Section shall not apply in the event
that:
(a) Strikes, work stoppages in connection with labor
disputes, failure of utilities beyond the control of
Management, or acts of God interfere with work being
provided; or
(b) An employee is not put to work, or is laid off after
having been put to work, either at his own request or
due to his own fault;
(c) An employee refuses to accept an assignment or
reassignment within the first eight (8) hours as
provided in Paragraph 1 above; or
(d) In the event the Employer desires to alter starting or
closing times, the employees must be notified of such
change at least one (1) week preceding the workweek
such schedule changes are to become effective.
(l) An employee shall not be paid both daily and weekly
overtime compensation for same hours so worked and in no case shall overtime
compensation be duplicated or pyramided.
(m) Employees covered by this Agreement shall be paid
bi-weekly.
(n) During the term of this Agreement, each full-time
nonprobationary employee will be eligible for monthly bonuses based on warehouse
thruput and warehouse quality. The bonuses will be paid according to the
following table:
THRUPUT BONUS QUALITY BONUS
Aug. Mo'ly Thruput Mo'ly Payment Mo'ly Error Rate Mo'ly Payment
23.7 $25.00 .32% $25.00
24.2 $29.16 .27% 29.16
24.7 $33.33 .24% 33.33
25.2 $37.50 .21% 37.50
25.7 $41.66 .16% 41.66
26.2 $45.83 .13% 45.83
26.7 $50.00 .10% 50.00
Warehouse thruput will be measured by total splitcase lines
plus total bulk lines divided by total paid hours including direct and indirect
activity and any other factors used in making thruput calculations for reports
generated for corporate headquarters. The warehouse error rate will be
calculated based on management designated quality checks, with a minimum of
10,000 lines checked per month. Total warehouse thruput and error rate will be
posted weekly. Employees must work at least 120 hours during a month to be
eligible for the bonus. Paid vacation time, paid sick days and paid holidays
will count as hours worked for the purposes of meeting this requirement.
(o) Year-end Catch-up Bonus
During the life of this Agreement, at the end of each calendar
year, total annual thruput average for that year will be calculated. The monthly
payment corresponding to that number from the table in Section (n) will then be
multiplied by twelve. If that total exceeds the amounts already paid out during
the year under the productivity bonus, eligible employees will receive the
difference by the end of January in the following year. Similarly, the average
annual error rate will be calculated. If the corresponding monthly payment
multiplied by twelve exceeds the amount already paid in the monthly bonuses, the
difference will be paid by the end of January in the following year.
(p) The Union shall have the right to audit company
productivity and quality records to ensure the accuracy of the figures used.
Audit requests shall be made in good faith and shall extend only to those
records necessary to verify proper payment.
ARTICLE VI
HOLIDAY COMPENSATION
(a) The following and any other additional days the employer
deems desirable to observe as holidays shall be recognized as regular holidays:
New Year's Day Labor Day
Good Friday Thanksgiving Day
Decoration Day Day after Thanksgiving
Independence Day Christmas Day
Day after Christmas
In addition to the above nine holidays, there shall
be two personal days granted for each full year worked. In the
year an employee is hired, the employee will receive two
personal days if hired on or before April 1 and one personal
day if hired on or before October 1. An employee hired after
October 1 will not receive a personal day in the year hired.
(b) Employees shall receive eight (8) hours of straight time
pay for each of the above-enumerated holidays.
(c) Should any of the above holidays fall on a Saturday or
Sunday, the preceding Friday or the following Monday shall be considered and
observed as a holiday.
(d) If a holiday occurs within a normal scheduled workweek,
such holiday, whether worked or not, shall be considered as hours worked for the
purpose of computing weekly overtime.
(e) When one (1) of the holidays falls during the regular
vacation of an employee entitled to holiday pay, such employee shall receive an
additional day off with pay. Such additional vacation days ("loose days") must
be scheduled one (1) week in advance for all months, except December. To be used
in December, loose days must be scheduled four (4) weeks in advance.
(f) Double time shall be paid for all hours worked on the
holidays named in paragraph (a) hereof. It is understood that no employee shall
receive more than a total of double time for the hours worked on such holidays.
(g) As used in this Article, an eligible employee is one who:
(1) Has worked at least fifteen (15) turns since his last
hire; and
(2) Performs work in the pay period during which the
holiday is observed; and
(3) Works as scheduled or assigned both on his last
scheduled workday prior to and his first scheduled
workday following the day on which such holiday is
observed, unless his failure to work is because of his
sickness or death in his immediate family, and unless
specific written permission is given by the Employer.
A doctor's certificate may be required by the
Employer.
(h) Regular employees hired shall be entitled to one (1) sick
day for each three (3) month period between their first anniversary date and the
next January 15, at which time said employee shall be entitled to four (6) sick
days per year thereafter. Sick days will not be used prior to or after a
compensated holiday. The employer may require proof of sickness. Sick days over
and above twenty (20) that are not used during the preceding year, shall be
redeemed by the employer at the employee's prevailing hourly rate at the end of
each contract year. Upon retirement or other termination without cause, BT OPI
will buy back all unused and accumulated sick days at the employee's current
rate of pay. At the end of each contract year, unused sick days from that year
shall be paid at 100% of the employee's hourly rate. Sick days taken during the
months of October through February shall be paid at 90% of the employee's hourly
rate. Sick days taken from March through September shall be paid at 100% of the
employee's hourly rate. The fifth and sixth sick days in any year shall be worth
four hours' pay instead of eight, whether used as a sick day, reimbursed at the
end of a year, or bought back upon retirement. For employees hired before March
2, 1992, the fifth sick day each year shall be worth eight hours' pay.
ARTICLE VII
VACATIONS
(a) Each eligible employee who on January 15 of any year has
completed as least six (6) months continuous service with the Employer shall be
entitled to a vacation with pay during that year of one (1) week.
(b) Each eligible employee who on January 15 of any year has
completed at least one (1) year's continuous service with the Employer shall be
entitled to a vacation with pay during that year according to the following
schedules:
Length of Continuous Service Vacation
Less than one year 3.6 hours per month
One (1) Year - Three (3) Years One (1) Week
Four (4) Years - Ten (10) Years Two (2) Weeks
Eleven Years or More Three (3) Weeks
(c) As used in this Article, a week of vacation means forty
(40) hours, made up of five (5) normal working days of eight (8) hours each
during a seven (7) day period.
(d) An eligible employee for purposes of this Article is one
who:
(1) has actually worked at least 1,200 hours during the
twelve (12) calendar months preceding the January 15
of the vacation year; (2) has not quit or been
discharged prior to January 15 of the vacation year.
Employees who quit or are discharged prior to January 15 of the vacation year
will receive payment for pro-rated vacation.
The remainder of Article VII is unchanged except that a new subsection (h) will
be added:
(e) Vacation pay shall be based upon the employee's applicable
straight time hourly rate of pay.
(f) Vacations shall as far as possible be granted at times
most desired by employees between June 1 and September 1, but the final right to
allotment of a vacation period is exclusively reserved to the Employer in order
to ensure orderly operations. Exceptions can be made upon mutual agreement.
(g) One week of vacation may be scheduled in single days.
However, those single days must be scheduled before March 1. Additional days and
single days may be used by employees, at the company's discretion, to cover
absences where an unforeseen emergency deprives employee of opportunity to call
off in advance and where all sick days have been used.
(h) Employees hired on or before January 9, 1986 shall continue
to receive vacation entitlement according to the schedule in the previous labor
agreement.
ARTICLE VIII
SENIORITY
(a) Seniority is defined as an employee's length of continuous
service with this Employer.
(b) In all cases of promotion or increase or decrease of
forces, the following factors shall be considered:
(1) Ability to perform the work;
(2) Seniority.
Where both factor (1) and (2) are relatively equal among the
employees involved, seniority shall be the determining factor.
(c) A layoff of less than five (5) consecutive working days
shall not be considered a decrease in force under this Article, nor shall the
working of overtime be considered an increase in forces.
(d) Continuous service shall be broken, and an employee shall
lose all seniority by:
(1) Voluntarily quitting the service of the Employer;
(2) Discharge or termination of service with the Employer;
(3) Failure to report for work or notify the Employer within
ten (10) working days after notice is given to return to
work by Registered mail;
(4) If an employee misrepresents his reason for a leave of
absence; and
(5) Layoff in excess of twelve (12) consecutive months.
(e) Absence due to a compensable disability incurred during
the course of employment shall not break continuous service, provided such
individual is returned to work within thirty (30) days after final payment of
statutory compensation for such disability or after the end of the period used
in calculating a lump sum payment.
(f) If an employee shall be absent due to a physical
disability, he shall continue to accumulate service during such absence for a
continuous period equal to his seniority at the time of such disability but not
to exceed three (3) years.
(g) New employees and those hired after break in continuity of
service will be regarded as probationary employees for the first ninety (90)
work days and will receive no continuous service credit during such period.
Probationary employees may file and process grievances under this Agreement but
may be laid off or discharged as exclusively determined by Management.
Probationary employees continued in the service of the Employer subsequent to
the first ninety (90) work days shall receive full continuous service credit
from date of original hiring.
(h) To protect his seniority, each employee will keep the
Employer informed of his current home address and telephone number. At the time
of layoff, such employees will be given an opportunity to write his correct home
address and telephone number over his signature on an Employer form furnished
for that purpose and he will receive a copy of such form.
(i) The Management reserves the right to continue operations
as in the past, including the use of Parcel Post and the contracting out of work
to such companies as United Parcel Service, etc. Extra deliveries may be
obtained from the Local Union 249 Extra List and/or other outside sources, etc.
ARTICLE IX
MANAGEMENT RIGHTS
(a) Except as explicitly limited by a specific provision of
this Agreement, the Employer shall continue to have the exclusive right to take
any action it deems appropriate in the management of its operations and
direction, control, and discipline of the work force in accordance with its
judgment, including, but not limited to the right to hire, suspend or discharge
for cause, transfer, and to relieve employees from duty because of lack of work
or for other legitimate reasons. All management functions and prerogatives which
the Employer has not expressly modified or restricted by a specific provision of
this Agreement are retained and vested exclusively in the Employer and are not
subject to arbitration under this Agreement.
(b) The Employer shall have the right in its sole judgment to
permanently close or discontinue any department of its operations or the entire
office supply division and to transfer same to any other geographic location so
long as such action is not taken for the sole and exclusive purpose of
discriminating against the Union or employee-members of this Union.
ARTICLE X
SUSPENSION AND DISCHARGE
(a) The Employer retains the right to discharge any regular
employees for just cause. The Employer agrees that it will notify the Union in
writing within twenty-four (24) hours.
(b) In case of a suspension, the Employer agrees to have a
meeting within seventy-two (72) hours with the Business Agent of the Union.
ARTICLE XI
GRIEVANCE PROCEDURE
(a) A grievance is hereby jointly defined to be any
controversy, complaint, misunderstanding or dispute.
(b) Any grievance arising between the Employer and the Union
or any employee represented by the Union shall be settled in the following
manner:
Step One. The aggrieved employee or employees must present the
grievance to the Shop Steward within five (5) working days after the reason for
the grievance has occurred, except, no time limit shall apply in case of
violation of wage provisions of this Agreement. If a satisfactory settlement is
not effected with the foreman within three (3) working days, the Shop Steward
and the employee shall submit such grievance, in writing, to the Union's
Business Representative.
Step Two. The Business Representative shall then take the
matter up with a representative of the Employer with authority to act upon such
grievance. A decision must be made within five (5) working days.
Step Three. In order for the grievance to be considered
further, it must be appealed by written notice given the Warehouse Manager by
the Business Agent of the Union within ten (10) days of the date the Warehouse
Manager's answer is given in Step Two. Within fifteen (15) days following such
written notice, the Employer and the Union, by their representatives designated
for this purpose, shall try to mutually agree upon a single Impartial Arbitrator
to hear and determine the matter. Failing mutual agreement within such period,
the Employee and the Union shall address a joint request to the Federal
Mediation and Conciliation Service to furnish a list of seven (7) competent
arbitrators. The Union Representative shall strike three (3) names from such
list whereupon the Employer Representative shall strike three (3) of the
remaining names. The seventh (7th) individual not so stricken shall be the
Impartial Arbitrator to hear and determine the matter. Expenses and fees
incident to service of the Arbitrator shall be shared equally by the Employer
and the Union.
The award of the Arbitrator on any matter properly before him
under this Agreement shall be final and binding. The Arbitrator shall have no
authority to add to, detract from or to alter any of the provisions of this
Agreement.
Awards of the Arbitrator may or may not be retroactive as the
equities of particular cases may demand, but the following limitations shall be
observed in any case where the Arbitrator's award is retroactive.
The effective date for adjustment of grievances relating to:
(1) Seniority cases shall be the date of the occurrence or
nonoccurrence of the event upon which the grievance is based, but in no event
earlier than thirty (30) days prior to the date on which the grievance is filed.
(2) Rates of pay (other than new or changed jobs or
incentives), overtime, holidays, allowed time and vacations shall be the date of
the occurrence or nonoccurrence of the event upon which the grievance is based.
(c) General Provision Relating To Grievance Procedure. In the
event no appeal is taken at any one of the several steps in the manner or within
the time specified herein, then the grievance shall be considered settled on the
basis of the last decision given, and shall not be subject to further appeal or
processing. Grievances shall be discussed promptly at a time mutually
satisfactory to the parties.
(d) Power and Authority of Arbitrator. The power and authority
of the Arbitrator shall be strictly limited to determining the meaning and
interpretation of the explicit terms of this Agreement as herein expressly set
forth. He shall not have authority to add to, subtract from, alter or modify any
of said terms or to limit or impair any right that Article IX reserves to
Management or to establish or change any wage or rate of pay.
ARTICLE XII
SHOP STEWARDS
(a) The Employer recognizes the right of the Union to
designate Shop Stewards and Alternates.
(b) Stewards shall be permitted to investigate, present and
process grievances on or off the property of the Employer without loss of pay or
time. Such time spent in handling grievances shall be considered working hours
in computing daily and/or weekly overtime. Stewards shall not be entitled to
more than one (1) hour per grievance.
ARTICLE XIII
PROTECTION OF RIGHTS
(a) Picket Lines. It shall not be a violation of this
Agreement, and it shall not be cause for discharge or disciplinary action in the
event an employee refuses to enter upon any property involved in a primary labor
dispute or refuses to go through or work behind any primary picket line,
including the primary picket line of Union's party to this Agreement, and
including primary picket lines at the Employer's place of business.
ARTICLE XIV
LEAVE OF ABSENCE
(a) Any employee desiring a leave of absence from his
employment shall secure written permission from both the Union and the Employer.
The maximum leave of absence shall be for ninety (90) days and may be extended
for like periods. Permission for same must be secured from both the Union and
the Employer. During the period of absence, the employee shall not engage in
gainful employment in the same industry. Failure to comply with this provision
shall result in the complete loss of seniority rights for the employees
involved.
(b) The employee must make suitable arrangements for
continuation of the Insurance Payments before the leave may be approved by
either the Local Union or the Employer.
(c) The Employer shall provide for family and medical leaves
consistent with the Family and Medical Leave Act.
ARTICLE XV
ALLOWANCE FOR TIME OFF FOR DEATH IN THE FAMILY
(a) In the event of death in the immediate family of an
employee (parents, children, brothers, sisters, present spouse present
mother-in-law, present father-in-law and grandparents of the employee), the
employee shall be entitled to time off with pay at his regular basic rate for a
period not to exceed three (3) consecutive calendar days starting with the day
following the death and, if the death should occur while the employee is at
work, the balance of the employee's scheduled workday, to arrange the affairs of
the deceased and attend the funeral. In the event of the death of a grandparent
of present spouse, an employee shall be granted the day of the funeral off with
pay, provided the employee attends the funeral. To be entitled to such
allowance, the employee must notify the Employer as promptly as possible of the
days on which he intends to be absent for this purpose.
ARTICLE XVI
ALLOWANCE FOR JURY SERVICE
(a) An employee who has performed work in the two (2) day
period previous to being called for jury service shall be excused from work for
the days on which he serves and he shall receive for each such day of jury
service on which he otherwise would have worked the difference between eight (8)
times his average straight time hourly earnings as computed for holiday
allowance and the payment he receives for jury service, however, Employer
compensated service shall be limited to a maximum of ten (10) days per calendar
year. The employee will present proof of service and the amount of pay received
therefor.
ARTICLE XVII
RESPONSIBILITIES OF THE PARTIES
(a) Each of the parties hereto acknowledges the rights and
responsibilities of the other party and agrees to discharge its responsibilities
under this Agreement.
(b) The Union (its officers and representatives at all levels)
and all employees are bound to observe the provisions of this Agreement. The
Employer (its officers and representatives at all levels) is bound to observe
the provisions of this Agreement. In addition to the responsibilities that may
be provided elsewhere in this Agreement, the following shall be observed:
(1) There shall be no intimidation or coercion of employees
into joining the Union or continuing membership therein.
(2) There shall be no Union activity on Employer time.
(3) There shall be no strikes, work stoppages or interruption
or impeding of work nor shall the Employer be obligated to bargain with the
Union concerning employees engaged in such activities so long as they continue.
No officer or representative of the Union shall authorize, instigate, aid or
condone any such activities. Any employee participating in any such activity may
be disciplined or discharged by the Employer.
(4) The applicable procedures of this Agreement will be
followed for the settlement of all grievances.
(5) There shall be no interference with the right of the
employees to become or continue to be members of the Union.
(6) There shall be no discrimination, restraint or coercion
against any employee because of membership in the Union.
(7) It is the continuing policy of the Employer and the Union
that the provisions of this Agreement shall be applied to all employees without
regard to sex, race, color, religious creed, national origin or age.
ARTICLE XVIII
GENERAL PROVISIONS
(a) The Employer agrees that it will not enter into any
written or oral agreement with any employees covered by this Agreement which is
inconsistent with or which in any way may modify or waive any of the provisions
of this Agreement.
(b) The Employer agrees that it will not hold any of its
employees who are covered by this Agreement financially responsible for any
damages resulting from any accident that may occur in the line of duty or
require said employees to contribute to any fund to pay for damages done to
equipment while working.
(c) If uniforms are required by the Employer, the Employer
will furnish them without cost to the employees. Such uniform shall bear the
Union Label and shall be kept in good condition and replaced from time to time
by the Employer.
(d) The Employer shall make reasonable provisions for the
safety of its employees and will provide all protective and safety devices
necessary without cost to the employees.
(e) The Union will use its efforts to see that all employees
covered by this Agreement obey all reasonable rules and regulations of
employment which are consistent with this Agreement.
(f) In the event that the Employer introduces new job
classifications, the wage rates and working conditions of such new job
classifications shall be subject to negotiations between the parties.
(g) Authorized agents of the Union shall have access to the
Employer's establishment during working hours for the purpose of adjusting
disputes, investigating working conditions, collection of dues and ascertaining
that the Agreement is being adhered to, provided, however, that there is no
interruption of the Employer's working schedule.
(h) The Employer agrees that it will not assign any unitwork
to nonbargaining unit employees or supervisors, except as provided in Article
III(f) and if the Union is unable to supply necessary personnel.
(i) Also, for the purpose of preserving work and job
opportunities for the employees within the bargaining unit, the Employer agrees
not to subcontract, lease, assign, transfer, in whole or in part, to any other
nonbargaining unit employees without consent of the Local Union.
(j) Employees required to serve in summer duty shall lose no
loss of pay; i.e., he shall be reimbursed the difference between what he
received from Government and his regular pay. Also, the Employer is prohibited
from applying this as vacation period.
(k) If either party desires, representatives of BT Office
Products International and the Union will meet to discuss productivity and
quality issues and their effect on the bonus program. Other labor management
issues such as discipline and grievances will not be discussed. Meetings will be
held at reasonable times on BT Office Products International premises so as not
to interfere with operations. The Union and Company will each endeavor to make
the meetings productive.
ARTICLE XIX
INSURANCE
(a) Effective March 2, 1992, and for the duration of this
Agreement, the Employer will provide and pay the cost for the Keystone HMO Plan
for all regular full-time employees who have successfully completed six (6)
months of full-time service. Employees who wish to remain on the Blue Cross/Blue
Shield Indemnity Plan will be required to pay the difference in premiums between
that plan and the HMO plan. During the term of this Agreement, there will be no
reduction of benefits. The Company shall have the right to change insurance
carriers and benefit plans to maintain consistency with BT Office Products
International benefit plans so long as employees receive the same benefits at
the same cost as they enjoy under the BT OPI Blue Cross/Blue Shield Keystone
Plan.
(b) The program shall be in substitution for any and all
Insurance Benefits or Payments to or in behalf of Employee's death, accidental
death and dismemberment, weekly sickness and accident, hospitalization, medical
and surgical services provided by the Employer in whole or in part.
(c) In the event of a layoff of any regular full-time
employees, the Employer will continue his insurance benefits only for the month
of the layoff.
(d) It is intended by the Employer and the Union that the
provisions for insurance benefits which are included in this program of
insurance benefits shall comply with and be in substitution for provisions for
similar benefits which are or shall be provided for by any law or laws.
(e) In the event of disabling illness or injury, the Employer
agrees to continue the employee's insurance benefits for twelve (12) months
beyond the month of which the employee is disabled.
ARTICLE XX
PROFIT SHARING AND PAYROLL SAVINGS PLANS
(a) The existing 401(k) Savings Plans shall be continued
during the term of this Agreement.
ARTICLE XXI
CASUAL/NON-REGULAR EMPLOYEES
(a) It is agreed that the Employer may use Casual/Non-Regular
employees. When a Casual/Non-Regular employee works more than sixty (60) work
days within a one hundred and twenty (120) work day period, the
Casual/Non-Regular employee, on his/her sixty-first (61st) day, shall begin
his/her probationary period subject to the probationary employee language of the
Contract.
(b) Days worked during the months of January, July, August and
December or in place of employees who are injured or otherwise unavailable,
except for vacations and Holidays, will not count as days worked within any one
hundred twenty (120) day period. None of the benefits or other provisions listed
in this Agreement apply to Casual/Non-Regular employees unless they are
specifically included.
(c) When the Employer has a need to fill a regular full-time
position, the Employer will make that need known and fill the position as a
full-time position. Casual status employees will not be used to delay the hiring
of a full-time employee where the Company determines that there is a need for a
full-time employee.
<PAGE>
ARTICLE XXII
TERMINATION
(a) This Agreement shall continue in full force and effect
from 12:01 a.m. March 1, 1998 until 11:59 p.m. January 15, 2002. The Agreement
shall be automatically renewed from year to year thereafter without change until
such time as at least sixty (60) days' notice in writing is given prior to the
expiration date.
(b) IN WITNESS WHEREOF, each party has caused this Agreement
to be executed by the hands of its proper officers and its corporate seal to be
affixed hereto this 10th day of August, 1998.
FOR THE COMPANY: FOR THE UNION:
-------------------------------
/s/ Joseph A. Aiello
______________________________ President
Joseph A. Aiello
Vice President
-------------------------------
Vice President
- ------------------------------
-------------------------------
Secretary-Treasurer
/s/ Michael A. Ogden
-------------------------------
Michael A. Ogden
Business Agent
<PAGE>
Productivity Cents/hr. Error Rate Cents/hr.
24.0 $0.05 0.0024 $0.15
24.5 0.10 0.0022 0.20
25.0 0.15 0.0020 0.25
25.5 0.20 0.0018 0.27
26.0 0.25 0.0016 0.30
26.5 0.30 0.0014 0.32
27.0 0.35 0.0012 0.34
27.5 0.40 0.0010 0.35
28.0 0.45 0.0008 0.36
28.5 0.50 0.0006 0.37
29.0 0.55 0.0004 0.38
30+ 0.60 0.0002 0.39
0.0000 0.40
Premium Paid out per month for hours worked
Any ONE of the following will eliminate all monthly bonus:
1. Productivity less than 22
2. Error Rate above .0030
AGREEMENT
Preamble
WHEREAS, the Union has been the sole and exclusive bargaining
representative for the warehouse and delivery employees of the Company.
Parties
Section 1. This Agreement is made and entered into by and between BT Office
Products, International, 9301 Largo Drive, West, Springdale Maryland 20774 (and
the subsequent locations within the greater Metropolitan Washington Area to
which the Company may relocate during the life of this Agreement) hereinafter
called "The Company" or "The Employer", party of the first part and the Graphic
Communications Union, Local 449-S, affiliated with Graphic Communications
International Union, hereinafter called "the Union" or "the Local", party of the
second part.
No Discrimination
Section 2. The Union and the Company will not discriminate against any employee
because of race, color, religion, sex, age, national origin, or disability.
Nothing in this Agreement shall be construed as a barrier to a reasonable
accommodation to a qualified applicant or employee with a disability.
Recognition
Section 3. The Company recognizes Graphic Communications Union, Local 449-S as
the exclusive bargaining representative for full-time and part-time employees as
set forth in Addendum A, including working supervisors, but excluding all other
management, supervisory, and clerical personnel. Only members of the bargaining
unit shall perform work set forth under this bargaining agreement.
Union Shop
Section 4. It shall be a condition of employment that all employees of the
Company covered by this Agreement who are members of the Union in good standing
on the effective date of this Agreement shall remain members in good standing,
and those who are not members on the effective date of this Agreement shall, on
the thirty-first day following the effective date of this Agreement, become and
remain members in good standing in the Union. It shall also be a condition of
employment that all employees covered by this Agreement and hired on or after
its effective date shall, on the thirty-first day following the beginning of
such employment, become and remain members in good standing in the Union,
subject, however, to the provisions of the National Labor Relations Act and the
Labor Management Relations Act of 1947, as now or hereafter amended, for the
remainder of the terms of this Agreement and any extension thereof. The Union
agrees to give the Company at least ten (10) days notice in writing of any
demand that any employee covered hereunder be discharged under the provisions of
this Section within which ten (10) days the employee shall have the right to
cure the default in payment of such dues, initiation fees, or uniformly levied
assessments by tender of same to the Union.
Union Dues Deduction
Section 5. The Company agrees to deduct from an employee's pay union dues,
initiation fees and lawful assessments uniformly levied of Union members in the
employ of the Company on the second payday of each month after receipt from such
employees of written authorization for such payroll deduction which complies
with the requirements of the National Labor Relations Act and the Labor
Management Relations Act of 1947, as heretofore and hereafter amended during the
term of this Agreement or any extension thereof. All amounts so deducted from
employees' pay shall be remitted by the last day of the month in which they are
due to the Officer or Agent designated by the Union in writing to receive such
Funds.
Union Cooperation
Section 6. The Union believes that the common well-being of both parties to this
Agreement will best be served when the employees give their full support to the
Management of the Company in discharging its responsibilities to its customers.
The Union and the Company both recognize that in order to provide maximum
opportunities for continued employment, the Company must conduct its work
efficiently and at the lowest possible cost. To accomplish this it is necessary
that the employees must be willing, capable and physically fit to perform their
assigned tasks. The Union, therefore, agrees to cooperate with the Company to
reduce poor attendance, tardiness, and poor workmanship.
Union Activity
Section 7. Service performed by an employee at the direction of the Union shall
not be cause for discharge or for any discrimination against the employee.
Whenever reasonably possible, the employee shall notify the Company at least
forty-eight (48) hours in advance if the employee is going to be absent due to
Union service. Employees elected or appointed to a full-time position with the
Union shall be granted leave of absence without pay by the employer to perform
such duties, so long as proper notice is provided to the Company. Employees
performing full-time service with the Union shall retain seniority with the
Employer while on such leave of absence.
The Company agrees that there shall be no discrimination against any
employee because of Union activities or membership in the Union, and the Union
agrees that neither it nor its members nor employees represented by it shall
carry on any Union activity not authorized or covered by this Agreement during
working hours in or on the premises of the Company or intimidate any employee in
regard to his or her work.
Section 8. It is recognized that the Shop Stewards are the Union's
representatives of the employees. Either the Shop Stewards or the President of
the Union or both shall represent the Union in all disagreements arising under
this Agreement. The President of the Union shall be notified of the Employer's
intention to discharge the Shop Stewards and shall be given a reasonable
opportunity to confer with the Employer before the discharge is final.
Bulletin Board
Section 9. The Employer agrees to furnish a bulletin board on the outside wall
of the dispatch office. The Union shall have the right to post official union
notices on the bulletin board. Such notices will be signed by the Shop Stewards
or the Union Local President.
Union Access
Section 10. The President or any Union officer designated by the President may
enter the Company only after obtaining the permission of the Company to do so.
Written Notification
Section 11. The Company Human Resources Department agrees to notify the Shop
Steward in writing of all additions and deletions (including lay offs) to the
bargaining unit within ten (10) days.
Section 12. The Union will, at all times, keep the Company advised in writing of
the names of all persons authorized to act on behalf of the Union. If, and as
changes are made, the Union will immediately notify the Company in writing of
such changes in personnel.
Supervisors
Section 13. The Company may designate Managers and Working Supervisors for each
shift. The Company will keep a current list of designated Managers and Working
Supervisors posted on the Company Bulletin Board.
Seniority
Section 14. Definitions
a. Seniority as used in this Agreement refers to the length of
continuous employment in the bargaining unit since the last date of employment
by the Company.
Section 15. New Employees. There shall be no seniority among probationary
employees. New full-time employees shall be considered probationary employees
until they have been in the employment of the Company for ninety (90) calendar
days from date of hire. New part-time employees shall be considered probationary
employees until they have been in the employment of the Company for ninety (90)
days. At the end of such period, the employee shall be considered a regular
employee and shall acquire seniority from the date hired. The employer shall
maintain and keep posted up-to-date seniority lists of all regular employees --
both part-time and full-time. The Company in its discretion may transfer,
reassign, discharge, or terminate the employment of any probationary employee.
Section 16. Employee Rights. The Company agrees to respect the seniority of its
employees and will give them preference in matters of job openings, layoffs and
recalls.
When filling a job opening as provided in this Section, the Company
will post a notice of same on the bulletin board within the warehouse to invite
the employees to apply for the job. Job vacancies will be posted for three (3)
working days.
Employees shall have an opportunity to bid for jobs that may become
vacant, provided that the employee seeking the job demonstrates the proper
fitness for the job and has the necessary training, experience, ability and
physical fitness to perform the work required. Jobs will be awarded to the
senior qualified bidder, except as provided below.
When filling a job opening in the driver or warehouse job
classifications, all bidders demonstrating the proper fitness, training,
experience, ability and physical fitness to perform the work will be given the
opportunity to take the Company's qualifying test for the open position. The
senior employee who passes the qualifying test shall be awarded the position.
The successful applicant will be announced no later than three (3)
working days after the posting expires. The successful candidate will be placed
in the position within ten (10) working days from the time the position is
awarded, unless extended by mutual agreement.
Employees working on one shift may request a transfer to the same job
on another shift. Only one transfer between shifts will be permitted in any
twelve (12) month period, within the same job. The restriction, in no way, is
intended to deprive an employee of an opportunity to apply for another job as it
arises, regardless of shift, through the procedure outlined above.
Section 17. Trial Period. An employee transferred to a new job shall serve a
trial period of four (4) weeks on the new job. During this period, the Company
may disqualify the employee for demonstrated inability to properly perform the
work required. If disqualified, the employee may return to his or her old job.
Section 18. Job Coverage. Any employee may be temporarily assigned to work other
than the employee's regular assignment for a period not to exceed four (4)
weeks. Should an employee be temporarily assigned to a job that exceeds four (4)
weeks, the Company must show just cause for continuing the employee in the
temporary assignment. The least senior qualified employee will be utilized, when
possible, when the transfer is made to another classification.
Section 19. Loss of Seniority. Seniority may be broken by:
1. Discharge
2. Voluntary quitting.
3. After 120 continuous calendar days of layoff (which shall be deemed
a permanent layoff).
4. Failure to respond and be available for work within forty-eight (48)
hours after having been recalled from layoff, provided the Employer shall have
attempted to contact the employee by telephone and if unsuccessful, by telegram
or certified letter to the employee's last known address.
5. Absence because of illness or non-occupational injury in excess of
one year or occupational injury in excess of two (2) years, except as otherwise
provided by law.
Section 20. Layoffs. When it becomes necessary to layoff employees, decrease the
size of a job classification, or eliminate a job classification, the Company
will determine the timing, the number of employees, and in which job
classifications layoffs will be effected. The employee with the least seniority
in the job classification(s) shall be laid off first.
The employee to be laid off can claim the work of the employee with the
least seniority in another job classification, if the bumping employee has more
seniority than the employee to be bumped and passes the Company's qualifying
test.
An employee claiming other work to avoid layoff or decrease shall not
be exempt from discharge if deemed incompetent by the Company.
Section 21. Layoff Notice. If a regular employee is to be laid off, at least
five (5) days prior notice thereof shall be given where practicable, and no
employee subject to this Agreement shall quit the service of the Company without
five (5) days notice of the employee's purpose to do so. The day the notice is
received shall be counted as one of the five (5) days notice.
Subcontracting
Section 22. The Employer will not subcontract warehouse work which has been
traditionally and regularly performed by bargaining unit personnel unless:
(1) A sufficient number of employees from present and/or laid off
employees with recall rights are not available to perform the work within the
time required; or
(2) Bargaining unit personnel lack the qualifications or skills to
perform the work.
Section 23. The Employer will not subcontract deliveries which have been
traditionally and regularly performed by bargaining unit personnel unless:
(1) Such deliveries are in locations which because of lack of volume or
distance from the warehouse cannot be economically serviced by bargaining unit
drivers from the distribution center, or
(2) An emergency spot delivery must be made to satisfy the needs of a
customer which can be made quicker by an outside carrier or delivery service, or
(3) Bargaining unit drivers lack the qualifications (including security
clearances) to make the delivery in an economical fashion.
Wages
Section 24(a). Wages for Full Time Employees.
o Effective May 1, 1998, each employee's base hourly rate will be
increased by four percent (4%).
o Effective May 1, 1999, each employee's base hourly rate will be
increased by four percent (4%).
o Effective May 1, 2000, each employee's base hourly rate will be
increased by four percent (4%).
Section 24(b). Wages for New Hires. Newly hired employees shall be paid at a
minimum as follows:
o Delivery: $ 8.50 floor
$ 9.00 after six months
$ 9.50 after twelve months
$ 10.00 after eighteen months
o Warehouse: $ 8.50 floor
$ 9.00 after six months
$ 9.50 after twelve months
$ 10.00 after eighteen months
o After completion of eighteen months the employee will be eligible for
the next annual base hourly rate increases pursuant to Section 24(a).
Section 24(c). Wages For Part-time Employees:
o Delivery: $ 8.50 floor
$ 9.00 after six months
$ 9.50 after twelve months
$ 10.00 after eighteen months
o Warehouse: $ 8.50 floor
$ 9.00 after six months
$ 9.50 after twelve months
$ 10.00 after eighteen months
o After completion of eighteen months the employee will be eligible for
the next annual base hourly rate increases pursuant to Section 24(a).
Section 24(d). The second shift and the third shift shall receive five percent
(5%) above the day shift during all years of this agreement.
Section 24(e). Any shift starting between 5:00 a.m. and 11:00 a.m. shall be the
Day Shift. Any shift starting between 11:01 a.m. and 7:59 p.m. shall be the
Second Shift. Any shift starting between 8:00 p.m. and 4:59 a.m. shall be the
Third Shift.
The Company will establish starting times for each employee and no
change can be made in an employee's starting time except upon at least
twenty-four (24) hours notice.
Section 24(f). Payment of wages shall be made weekly and not more than seven (7)
days shall elapse between paydays. Payment of wages shall be by check. Paychecks
shall be distributed to all employees at the beginning of their shift on payday
except that employees working on the second or third night shift (before
midnight) shall receive their paychecks at the end of the shift on Thursday
(when available).
Section 25. When any holiday listed in this contract falls on payday, employees
shall be paid the previous work day.
Section 26. Employees laid off or discharged shall be entitled to and shall
receive whatever sum may be due them within three (3) working days after
termination and/or layoff.
Discharge or Suspension
Section 27. Employees may be disciplined, discharged or suspended for the
following reasons:
1. Just cause.
2. Violations of Work Rules (which shall not violate the terms of
this Agreement, and which shall be conspicuously posted and
which shall, in no way, abridge the civil and/or legal rights
of employees).
The employee will receive written notice within two (2) working days
after the work discipline, discharge or suspension. The written notice shall
state the specific reason for such work discipline, discharge or suspension and
a copy shall be forwarded to the Union office and a copy given to the Shop
Chairman. All warning notices received by an employee which are over twelve (12)
months old will be canceled.
Safety and Health
Section 28. Both the Company and the Union recognize their mutual obligation in
the prevention, correction and elimination of all unsafe and unhealthy working
conditions and practices. To this end, the Company will comply with the
requirements of the Occupational Safety and Health Act of 1970, as amended, as
it shall apply to the Company's operation; and the employees must do all things
necessary to enable the Company to comply with said Act, such as, but not
limited to:
1. Handling all equipment with care and caution.
2. Using proper methods of lifting.
3. Care in loading and unloading stock.
4. Care in stocking merchandise in warehouse and pulling
merchandise for delivery.
5. Immediately reporting all accidents and injuries of any kind
or nature to the Manager and filling out such forms as are necessary in
connection therewith.
6. Immediately reporting to the Manager all defects in any
operating equipment.
7. Putting all trash, empty cartons, broken skids and pallets,
strappings and wrappings in trash and waste containers or other appropriate
areas.
8. Keeping the locker room and toilets neat, well lit and in good
working order.
9. Using all protective equipment provided by the Company.
Failure to comply with the above rules may result in discipline, up to
and including discharge.
Section 28(a). No employee shall be required to pay for loss of or damage to
cargo, machinery, equipment or stock. If such loss or damage is the result of an
employee's negligence or improper act, the Company may discipline or discharge
the employee. It is incumbent on the employee to handle all equipment in a
manner so as not to endanger his own safety or that of other employees. The
employee shall operate all equipment so as not to cause damage to the equipment
or the Employer's property. Each employee shall exercise all prudent care of
equipment used in their work and shall report any loss or damage to the Company
at once. Failure to report accidents of any kind can result in discipline, up to
and including discharge.
Section 29. In accidents where the police refuse to issue tickets, the employee
must get the Company's approval to leave the area. Failure to report accidents
is grounds for disciplinary action. Failure to practice roadside safety
procedures when broken down or involved in an accident is grounds for
discipline, up to and including discharge.
On The Job Injuries
Section 30. An employee who is injured during the performance of his or her
duties, and requires immediate treatment by a physician, will be protected
against loss of pay for any portion of that day used in obtaining necessary
treatment. Following an injury, the Employer may, at its own expense, require
any employee to pass a physical examination to determine the employee's physical
fitness to perform the work required. Employees returning from worker's
compensation leave shall notify the Company as far in advance as possible. It is
recognized that it is the responsibility of the Company to pay for all time lost
for subsequent visits due to on-the-job injuries, if an employee is not paid in
full, by the insurance carrier, within thirty (30) days after the final visit.
Uniforms
Section 31. The Company will provide five (5) summer uniforms and rain gear and
five (5) winter uniforms for all regularly assigned truck drivers. One winter
coat and vest will be provided. The Company will provide one (1) apron and one
(1) pair of gloves to warehouse employees upon request. Each employee shall be
responsible for maintaining the uniform. Employees who refuse to wear or
maintain their uniforms in the manner prescribed by their employer shall be
subject to disciplinary action. Upon termination of employment, the employee
must return all uniforms in his or her possession to the Company or the cost of
any missing articles shall be deducted from the employee's final wages. Any
employee assigned a uniform who reports to work without wearing the uniform will
not work or be paid for that day. Employees shall be liable for lost or stolen
uniforms. The Company shall replace worn items of the uniform which are returned
to the Company.
Hours
Section 32. The regular workweek will consist of five (5) eight (8) hour days
Monday through Friday, or Tuesday through Saturday by mutual agreement, for a
total of forty (40) hours per week. The Company can substitute a weekly work
schedule consisting of four (4) ten (10) hour days for a total of forty (40)
hours per week.
Section 33. A thirty (30) minute lunch period shall be provided for each shift
between the 4th and 6th hours of work.
Section 34. Employees shall not use the Company time for changing clothes and
washing.
Picket Line
Section 35. It shall not be a violation of this Agreement and it shall not be a
cause for discharge or disciplinary action in the event an employee refuses to
cross a picket line as the result of a labor dispute if the employee is
threatened with bodily harm. It is understood that the employee shall
immediately report to or phone the Employer concerning the situation. Providing
the aforementioned conditions are met, such actions shall not be deemed a breach
of this contract and the Company shall not discipline, discharge or otherwise
discriminate against such employee.
Unauthorized Activity
Section 36. The Union agrees that there will be no strikes, walkouts, slowdowns,
boycotts, picketing, or any other cessation of work or interference with work
during the term of this Agreement. The Company agrees that there will be no
lockouts during the term of this Agreement.
In the event of any unauthorized activity referred to above, it is
understood and agreed that the Union shall, upon receiving notice thereof,
direct its members to return to work if there should be a work stoppage; and
just as soon as practical, address a letter to the Company and the employee
members notifying the Company and employees that the action of the Union members
is unauthorized. In the event any unauthorized activity referred to above is not
remedied by the employees upon notification to the Union, the Company may
discharge the employee(s) involved.
Reporting to work
Section 37. When an employee reports for work on a regularly scheduled work day,
the employee shall receive pay for his/her regularly scheduled hours. If the
Company notifies the employees through the procedure set forth in Section 37(a),
the Employee shall receive no pay for the day. This guarantee does not cover
employees who report late to work for any reason, are discharged for cause, or
are excused at their own request; nor shall it apply when operations are
interrupted for reasons beyond the control of the Employer such as fire,
explosion, windstorm, tornado, flood, power failure, riot, strike, civil
insurrection, war or government regulations.
Section 37(a). In the event that inclement weather requires the Company to
terminate its operations or is prevented from the commencement of operations, a
recorded announcement will be placed on the Company telephone system. This
action will take place promptly, without delay following its determination. All
employees are to call the Company to ascertain operating information when
inclement weather prevails. Should an employee be at work when operations are
terminated due to inclement weather, such employees will be paid for a full day.
Should the Company determine that inclement weather conditions exist, discipline
for absences and tardiness will be suspended. The Company will notify employees
by telephone and/or telephone recording no less than one (1) hour prior to the
start of his or her shift. This does not relieve the Employer from
responsibility of a full day's pay if the Employer has not complied with the
provisions above and the employee submits proof of reporting to work.
Section 38. If an employee is unable to report for work, the employee shall
notify the employee's supervisor, as far in advance of the employee's starting
time as possible but no less than one-half hour before the starting time.
Calling in does not automatically excuse the employee from his or her obligation
to report to work. Any employee failing to abide by this Section shall be
subject to disciplinary action. Repeated absences and/or lateness are grounds
for disciplinary action under the Company's work rules.
Overtime
Section 39. Regular Workweek
a. For all employees, the first forty (40) hours per week worked or
paid for shall be paid at the employee's regular straight time rate. Overtime
beyond forty (40) hours per week worked or paid for shall be paid at time and
one-half.
b. Overtime. When overtime is required and cannot be filled on a
voluntary basis, all employees will be expected to work up to one (1) hour
beyond their regular work day. Absent an emergency, notification shall be made
before the employee's scheduled lunch period. Employees who refuse to work the
required one (1) hour of overtime will face disciplinary action under the
Company's work rules. If an emergency arises during a delivery in progress which
necessitates overtime work, the delivery personnel must work until the delivery
is completed.
Overtime shall be rotated as equitably as practicable among the
employees. Non-working supervisory personnel shall not work overtime when by
doing so regular employees are deprived of working an equitable amount of
overtime. However, non-working supervisory personnel may work overtime when they
confine their activities to their regularly assigned duties.
Section 40. Saturday. When it is necessary for the Company to schedule work on
Saturday, employees performing such work shall receive time and one-half for the
first eight (8) hours of work and double-time thereafter until work ceases. The
employee shall receive not less than four (4) hours work at time and one-half
the straight time hourly rate.
Section 41. Sunday. when it is necessary for the Company to schedule work on
Sunday, employees performing such work shall be paid double time and shall be
guaranteed at least four (4) hours work.
Section 42. The guarantee of four (4) hours work provided in Sections 40 and 41
above shall not apply when operations are interrupted for reasons beyond the
control of the Company such as fire, explosion, windstorm, tornado, flood, power
failure, riot, strike, civil insurrection, snow, war or government regulations.
Section 43. If the needed overtime cannot be filled pursuant to Section 39(b) or
thereafter voluntarily by competent bargaining unit employees, a sufficient
number of employees may be secured from any source to perform the work,
including managers and non-working supervisors.
Holidays
Section 44. Labor Day, Thanksgiving Day, Day After Thanksgiving, Christmas Day,
New Year's Day, M.L. King's Birthday, George Washington's Birthday, Memorial Day
and July 4 shall be paid holidays subject to the following: All employees
employed for thirty (30) calendar days immediately preceding the above holidays
who have worked the first straight-time day immediately preceding the holiday
and the first straight-time day immediately following the holiday, unless
excused by the Company, shall be paid their individual straight-time day's pay
for such holidays. If a holiday falls on a part-time employees regularly
scheduled workday, that employee shall receive his/her individual straight time
pay for such holiday for the number of hours that the employee would have been
scheduled to work in the absence of such holiday.
Section 44(a). Each employee will be permitted three (3) personal days during
each calendar year. All employees shall be paid their individual straight-time
day's pay for such personal days. To utilize personal days, the employee must
notify his/her supervisor in advance pursuant to the procedure set forth in
Section 53(e). Personal holidays may not be used for any period of less than one
(1) full workday and may not be carried over into the next year. The Company
reserves the right to substitute Christmas Eve and New Years Eve for personal
days in any calendar year. If substitution is to occur, that decision will be
posted during the first week of January of that calendar year.
Section 44 (b). Any work performed on a holiday shall be compensated for, in
addition to the employee's regular pay for that day, at one and one-half times
the straight-time hourly rate of pay for the first eight (8) hours worked, and
double-time thereafter until work ceases.
Section 45. Should a paid holiday provided in Section 44 fall on a Sunday, the
Monday immediately following the holiday shall be the day observed as such
holiday, and should any such holiday fall on a Saturday, then the preceding
Friday shall be the day observed as such holiday or as specified by the Federal
Government. Provided, however, that if by operation of this clause, two paid
holidays would be celebrated on the same day, then the holidays will be so
arranged as to be celebrated on different days. The days selected to celebrate
the two holidays will be determined by the employer as production schedules
require. Notice to the employees of the days selected shall be posted two (2)
weeks prior to the holidays.
Section 46. Should a paid holiday fall within the period of an employee's
vacation, the employee shall receive an additional day of paid vacation or pay
for the holiday.
Sick Leave
Section 47. Each full time employee shall be credited with twelve (12) hours of
sick leave on January 1 of each year of this Agreement and twelve (12) hours of
sick leave on July 1 of each year. Part-time employees shall be credited with
fifty (50) percent of the hours of sick leave provided to full time employees.
Section 47(a). An employee may carry over up to forty-eight (48) hours of unused
sick leave from year to year. The employee shall receive pay at the employee's
straight time rate in effect at the end of each calendar year for any unused
sick leave accumulated beyond forty-eight (48) hours.
Section 47(b). If an employee becomes sick while at work, the employee shall
notify his or her supervisor immediately. The employee will receive sick pay at
the employee's straight time rate for the remainder of the employee's shift.
Sick leave may not be used to account for hours missed due to an employee's
unexcused tardiness, no matter what the reason for the employee's unexcused late
arrival.
Severance Pay
Section 48. When an employee with one or more years of continuous employment
with the Employer, covered by this Agreement, is permanently laid off, the
employee shall be paid, in addition to sums otherwise due the employee, two (2)
weeks wages at such individual's straight-time rate of pay.
Section 49. Loss of employment or layoffs caused by the suspension of operations
because of fire, explosion, windstorm, tornado, flood, riot, strike, civil
insurrection, snow, war or government regulations shall not be compensable under
the provisions of Section 48.
Funeral Leave
Section 50. All Employees will be permitted up to three (3) consecutive days of
paid funeral leave commencing the day immediately following the death of a
parent, spouse, child, mother-in-law, father-in-law, brother or sister,
providing the days fall on the employee's regularly scheduled work days. One of
the three days may be the date of the funeral, provided the employee actually
attends the funeral. Proof of death must be furnished to the Company by the
employee.
Section 50(a). It is agreed that no leave will be granted for Saturdays, Sundays
or paid holidays (unless the employee is otherwise scheduled to work) or if the
employee is on vacation or is not actively working because of illness, leave of
absence, layoff, or any other reason.
Jury Duty
Section 51. Any employee required to be absent from employment to serve on a
jury shall be paid the employee's regular wages minus any pay earned as such
juryman for such time as the employee is required to be absent, and such absence
shall be supported by a statement signed by the Clerk of the Court, certifying
as to each day of jury duty. First shift employees dismissed by the jury at
twelve (12) noon or before shall be required to report to work for the balance
of the day.
Vacations
Section 52.
a. All employees covered by the terms of this Agreement who have been
continuously employed by the Company for one year or more shall be eligible for
a paid vacation. Except as otherwise provided below; the amount of vacation to
which an employee shall be entitled during any calendar year shall be determined
by the number of years of continuous service completed by the employee as of
January 1 in the year in which vacation is to be taken, as follows:
Years of Continuous Service Days of Vacation
1 - 5 years 10 days
6 - 11 years 15 days
12 years or more 20 days
Continuous service shall be broken by a layoff of 120 days or any other
event where seniority is lost as set forth in Section 19. In the case of
individuals who are on leave or workers compensation in excess of 120 days but
are still on the payroll, they shall receive vacation on a pro rata basis
determined by the hours worked in the previous year.
b. Part-time employees shall accrue vacation credit at fifty (50)
percent of that accrued by full-time employees.
Section 53. Vacation pay shall be paid not later than the last working day
preceding the employee's vacation at the individual's straight-time hourly rate.
Such vacations shall be taken, at the discretion of each employee; provided,
however, that ten (10) days notice of intent to take vacation shall be filed
with the Company and further provided, that no more than ten percent (10%) of
all such employees (rounded off to the nearest whole person) in any
classification or shift shall take vacations at any one time except with the
consent of the employer. Vacation periods shall be established for employees in
order of their seniority standing with the Company. A vacation calendar shall be
posted during the first week of each calendar year. Management shall promptly
post dates selected for vacations and ten (10) days after posting, if
uncontested by an employee with higher seniority, shall become final and may not
be changed except by mutual consent of the employer and all employees involved.
The first week of vacation shall be taken in whole. Remaining vacation
may be taken with the mutual consent of the employer and employee as follows:
(a) Forty (40) hours (5 days) at a time;
(b) Three (3) weeks consecutively subject to the provisions of Section
53;
(c) In units of one (1) or more days at a time;
(d) The employee may work up to five (5) days of such vacation and be
paid in lieu thereof;
(e) Employees may take up to five (5) days of vacation (40 hours) in
full vacation days only with prior notification, as soon as possible, but no
later than before the end of the preceding day, subject to the ten percent (10%)
rule set forth in Section 53. The above days shall not be posted more than ten
(10) days in advance. The above five (5) days may be taken as emergency leave.
However, documentation for such emergency leave may be requested by the Company.
Emergency leave does not require prior notification, however an employee on
emergency leave must inform the Company as soon as possible but within three (3)
days.
Section 54. No employee will be allowed to forego vacation or any part thereof
in any vacation year for the purpose of adding to the length of vacation in any
succeeding year. Vacation credits may be taken only in the vacation year
following the year in which they are earned. When employment ceases for any
reason, total accrued vacation credits shall be paid upon such cessation or
suspension of employment. Such vacation credits shall be paid upon request as
soon as possible, but in no event later than forty (40) working hours following
the date of termination of employment. Vacation credits shall be allowed as days
worked for absences due to jury duty, holidays, vacations, funeral leave and
paid sick leave.
Section 55. A member entering the Military Service shall be paid such accrued
vacation on the last working day before entering service. After return from
Military Service such employee shall be paid vacation credits for each day
worked between return and the employee's next anniversary date. The Company
agrees to comply with all applicable requirements of federal laws dealing with
Military Service.
Section 56. In case employment ceases because of death of the employee, the
value of accrued vacation credits shall be paid to the legal representative of
the deceased upon presentation of legal proof of death and of the qualification
of such representative.
Family and Medical Leave
Section 56(a). The Company will provide up to 12 weeks of unpaid, job protected,
leave for certain family and medical reasons. Employees are eligible if they
have worked 1,250 hours over the previous 12 months. The Company may require
that any and all paid leave, including sick, personal, vacation and disability
time, be taken before any unpaid leave is used, and that thirty (30) days'
notification be given to the Company by the employee whenever practicable.
Family leave consists of an annual maximum of twelve (12) weeks leave
inclusive of any paid time granted to the employee by the Company. In other
words, if all sick, vacation, personal and disability time equals four (4)
weeks, the Company is obligated to extend no more than eight (8) weeks unpaid
leave for covered purposes to that individual for that year. For tracking
purposes, a year under the FMLA will begin on the first FMLA date the employee
takes family leave time. For example, if an employee begins taking family leave
time on April 1, 1994, he/she has until March 31, 1995 to exhaust his/her twelve
(12) weeks of family leave time. Family leave may also be taken on an
intermittent or reduced schedule leave basis. However, certification from a
physician is required to explain that the employee is needed to care for a
family member or themselves on an intermittent basis, the date the condition
began, the duration of the condition, and the amount of time that leave on that
basis will be necessary. All medical certifications must be produced within
fifteen (15) days of the request for leave. Recertification may be requested by
the Company on a reasonable basis (every 4 - 6 weeks). Leave may be denied to
anyone not in compliance with these rules.
The Company is obligated to maintain any medical insurance policies
held by the employee while on family leave. However, all employee contributions
to the medical premium must continue to be paid by the employee during the time
unpaid family leave is taken. Anyone choosing not to return from leave remains
obligated to BT Office Products International for any unpaid medical premiums
incurred while on leave.
Listed below are the reasons warranting leave under The Family Medical
Leave Act:
1. Birth of a child and to care for the newborn child.*
2. Placement with the employee of a child for adoption or
foster care.*
3. To care for the employee's spouse, child or parent with a
serious health condition.
4. The employee's own serious health condition that renders
the employee unable to perform his or her job functions.
* Leave may be taken for these purposes within one year after
the birth or placement of the child, not beyond.
Welfare Fund
Section 57. The Company shall provide health, hospitalization and vision
benefits to all full-time employees. This coverage shall be provided and
maintained by the employer for the life of this contract at no cost to the
employee. The Company shall contribute towards the premium costs of such a plan
and there shall be no deductible or self pay by employees for premiums
associated with the plan. The summary plan description is incorporated herein by
reference. The specific provisions of the plan shall govern in the event of any
inconsistencies between the summary plan description and the plan itself. A copy
of the plan has been provided to the union and all employees will be provided a
copy of the plan upon request.
(a) The Company may elect to change carriers but the plan benefits
shall be equivalent to those as described above and shall not entail any
additional costs or deductibles to the employee.
(b) The obligation to provide health care and vision benefits, as
described above, shall not be altered by any National or state health care plan
or mandate. In that event, the employer shall pay for such coverage and if the
coverage does not equal the plan benefits described above, supplemental benefits
shall be provided at no cost to the employee.
(c) Employees may elect dental coverage under the employer's plan on a
contribution basis. If an employee elects dental coverage, as described in the
Company's summary plan description, incorporated herein by reference, the
employee shall have the appropriate contribution rate deducted from the
employee's pay check.
(d) An employee may choose not to have Company medical coverage
provided that the employee has equivalent medical coverage from another source,
for example, through a spouse's employer. An employee choosing "no coverage"
must provide proof of other medical coverage each year to be eligible for the
medical opt-out provision. Employees choosing "no coverage" shall receive a $600
annual bonus for each year that he or she has chosen to have "no coverage."
Persons opting out shall be permitted to return to the Company plan provided
that the employee requests enrollment within 30 days after other coverage ends.
If an employee has a new dependent as a result of marriage, birth, adoption or
placement for adoption, the employee may be able to enroll himself/herself and
dependents, provided that the employee requests enrollment within 30 days after
the marriage, birth, adoption or placement for adoption.
(e) Life Insurance: The Company shall provide, at no cost to the
employees, life insurance to full-time employees equal to one (1) times the
employee's annual base salary. In addition, full-time employees will have the
option to purchase supplemental life insurance.
(f) Long Term Disability: The Company will provide long-term disability
insurance to full-time employees at no cost to the employees. Following a six
(6) month disability, the long-term disability provided by Hartford (or
equivalent insurance at no cost to the employees by another carrier) will pay
the employee sixty (60) percent of the employee's base pay if the employee
remains disabled as determined under the terms of the insurance policy.
(g) Short Term Disability: A short term disability insurance policy
shall cover full-time employees at no cost. All full time employees who
experience an off-the-job injury or illness will be eligible for benefits. After
sick leave is exhausted, an injured or ill employee will receive fifty (50%)
percent of the employee's base pay for up to six (6) months.
(h) Part-time Employees: Part-time employees (employees who work less
than thirty (30) hours per week) will be given the option to participate in the
Company's medical plan, provided the part-time employee's regular schedule
consists of at least twenty (20) hours per week. The employer shall contribute
fifty percent (50%) towards the medical premium for such employees. However,
part-time employees who do not opt to participate in the medical plan, shall not
be eligible for the opt-out "non coverage" annual bonus and part time employees
who opt out need not provide proof of alternative coverage.
Pension Fund
Section 58. The Company shall pay the following amounts for each full-time
employee covered by the Agreement in the employ of the Company for thirty (30)
days or more into the Graphic Arts Industry Joint Pension Plan:
Effective May 1, 1998 ....$ .73 per straight-time hour worked or paid for.
Effective May 1, 1999 ....$ .75 per straight-time hour worked or paid for.
Effective May 1, 2000 ....$ .77 per straight-time hour worked or paid for.
The Company shall pay the following amounts for each part-time employee
covered by the Agreement:
First Year of Service ....$.00 per straight-time hour worked or paid for.
Second Year of Service ....$.35 per straight-time hour worked or paid for.
Third Year of Service ....$.71 per straight-time hour worked or paid for.
Grievance and Arbitration
Section 59. Any dispute arising between the parties concerning the application,
interpretation, or performance of this Agreement shall be subject to the
following three-step grievance procedure.
Step 1: The aggrieved employee and/or the Shop Steward shall orally
present the grievance to the manager of the operational division in
which the employee works. Nothing herein shall prevent an employee from
discussing a matter directly with his/her manager. Grievances of a
serious nature which necessitate immediate resolution may be presented
during work hours. No grievance will be considered unless it is
presented in this Step 1 within forty-eight (48) hours of the event out
of which the grievance arose. The manager must give his/her answer to
the grievant within two (2) working days after having the oral
grievance presented. In the event the Union or the aggrieved employee
is not satisfied with the manager's answer, the Union, through the Shop
Steward or Union President, may submit the grievance in writing on a
grievance form within the five (5) working days next following the
receipt of the manager's Step 1 answer. Working days, for the purpose
of all three steps of the grievance procedure, will be Monday through
Friday, inclusive.
Step 2: Step 2 grievances will be reviewed in a conciliation meeting
attended by the Shop Steward or Union President, grievant, Lead Manager
and Human Resources Manager. The grievance shall be discussed, and the
Human Resources Manager will give his/her answer within five (5)
working days after the grievance is heard. If the matter is not settled
as a result of this meeting, the grievance may be submitted to Step 3
within the five (5) working days next following the Human Resources
Manager's answer as given in this Step 2.
Step 3: If the matter was not settled at Step 2, it shall be
immediately submitted for conciliation to the President of the Union
and the Human Resources Manager, who may schedule a meeting which shall
include all persons involved in the previous meetings, if possible.
Such meeting shall be scheduled within thirty (30) days of the
submission of the grievance to Step 3 conciliation. The grievance shall
be discussed and, if an understanding cannot be reached within ten (10)
working days after the final Step 3 meeting, the grievance may then be
submitted to arbitration.
BT Office Products International and Graphic Communications Union,
Local 449-S desire to establish time limits to streamline the processing of
grievances and to prevent the presentation of stale grievances. The parties
agree as follows:
(a) Absent mutual agreement, all three Steps of the grievance procedure
must be followed before a grievance will be deemed ripe for arbitration.
(b) After the third step meeting, the grieving party shall have six
months to make a written demand for arbitration. Failure to meet this six-month
time limit shall result in the grievance being considered withdrawn.
(c) The time limits of this Agreement can be extended or waived for
particular grievances by mutual written agreement of the parties.
(d) At any stage of the grievance procedure, the parties are free to
meet in an attempt to resolve the grievance outside the formal mechanisms
provided for in this Section.
Section 60. The arbitrator shall be selected in accordance with the voluntary
arbitration procedure of the Federal Mediation and Conciliation Service. The
arbitrator shall render a decision within thirty (30) calendar days after all
the testimony has been presented. This decision shall be final and binding on
both parties.
Section 61. Testimony shall be presented in any form the arbitrator may direct.
In the event that either party fails to appear or to submit testimony in the
form required within ten (10) full working days after due notice has been given,
the Arbitrator shall proceed to settle the case and render a decision in
accordance with the evidence presented.
Section 62. The decision of the Arbitrator shall not be governed by strict legal
rules, but must be based on any logical evidence presented to the Arbitrator
which the Arbitrator deems to have probative value. Pending final decision by
the Conciliators or Arbitrator, the conditions prevailing prior to the dispute
shall be maintained until the dispute is settled and work shall continue without
interruptions.
Section 63. All expenses attendant upon the settlement of any dispute shall be
borne equally by the parties to this Agreement.
Entire Agreement
Section 64. The union agrees that this Agreement is intended to cover all
matters affecting wages, hours and other terms and all conditions of employment,
and that during the term of this Agreement neither the Company nor the Union
will be required to negotiate any further matter affecting these and other
subjects not specifically set forth in this Agreement, except by mutual
agreement of the parties hereto.
Management Rights
Section 65. The management of the business, the supervision and control of all
operations and the direction of the employees of the Company including, but not
limited to:
a. the right to hire, suspend, or discharge for just cause;
b. to enlarge, combine, decrease, divide, transfer, rearrange or
alter the operational divisions or functions performed therein;
c. to make and enforce reasonable shop rules;
d. to relieve employees from duty because of lack of work or other
legitimate reasons;
e. to designate the type of product to be handled, and the
schedules and methods of handling same;
f. to designate the method and routing of deliveries both to
specific customers and within specific areas;
g. to contract out delivery work or warehouse work consistent with
Section 22; and
h. to manage its business generally,
shall be vested in, and reserved to, the Company. All other management rights,
except to the extent specifically limited by the terms of this Agreement, are
vested exclusively in and reserved to the Company.
Part-time Employees
Section 66. Part-time employees may be hired and will be covered by this
agreement in all respects, except where provided to the contrary. It is
understood and agreed that part-time employees shall not be used to undermine or
be a substitute for the use of full-time bargaining unit positions. Part-time
employees shall be laid off before full-time employees.
The parties agree that the use of part-time employees is not intended
to undermine or be a substitute for the use of full-time employees. The parties
agree that a restriction as to numbers or percentages of such employees as
compared to full-time employees is not appropriate until the parties have time
to see how, in fact, such employees are used and their impact on the bargaining
unit. If the union contends that the use of such employees is undermining or
being used as a substitute for the bargaining unit, a grievance can be filed
requesting the arbitrator for appropriate relief including reasonable limitation
on the numbers or utilization of part-time employees.
Separability
Section 67. Each and every clause of this contract shall be deemed separable
from each and every other clause of this contract to the end that in the event
that any clause or clauses shall be finally determined to be in violation of any
law, then and in such event such clauses only, to the extent only that any may
be so in violation, shall be deemed of no force and effect an unenforceable
without impairing the validity and enforceability of the rest of the contract
including any and all provisions of the remainder of any clause, sentence, or
paragraph in which the offending language may appear.
Duration of Agreement
Section 68. This Agreement is to become effective on May 25, 1998 and shall
terminate on April 30, 2001.
Signed by the respective parties at Washington, D.C. the _____ day of
June, 1998.
FOR THE UNION FOR THE COMPANY
/s/ Robert D. Barber
- ------------------------- --------------------
Robert D. Barber LaVerne Bonelli
/s/ Tyrone M. Wise, Sr. /s/ Kevin Mullen
- ------------------------- ---------------------
Tyrone M. Wise, Sr. Kevin Mullen
/s/ Marsha Stevenson
- -------------------------
Marsha Stevenson
<PAGE>
Addendum A
DIVISION I -- DELIVERY PERSONNEL
CLASSIFICATION I: Delivery Driver
Defined by management as an employee who performs customer delivery.
DIVISION II -- WAREHOUSE PERSONNEL
Defined by management as any full-time position that requires the
employee to use large material handling equipment (e.g., Fork Lifts, Order
Pickers, and any future material handling equipment designated and used in this
division). All employees in this classification will be trained and licensed to
use such equipment. The employees in this classification will be required to
take refresher courses on proper use and safety of the large material handling
equipment and to successfully complete competency tests, at least on an annual
basis during the term of this Agreement. In addition to operating the large
material handling equipment, these employees will be expected to perform a wide
array of tasks within the warehouse division. Employees in this classification
will also perform such current functions including, but not limited to, order
filling, checking, putaway, returns processing, and bulk order filling. This
position shall also include all other former job classifications traditionally
represented by the Union. Employees who are unable to demonstrate a solid
ability to operate equipment in a correct and efficient manner will be
disqualified from the position.
The Company will not require an employee to operate large material handling
equipment (e.g., Fork Lifts, Order Pickers, and any future material handling
equipment designated and used in this division), if it is determined that the
employee is physically unable to operate such equipment.
<PAGE>
SUPPLEMENTAL AGREEMENT BETWEEN
GRAPHIC COMMUNICATIONS UNION,
LOCAL 449-S AND
BT OFFICE PRODUCTS INTERNATIONAL INC.
This Supplemental Agreement made and entered into by and between the Graphic
Communications Union Local 449-S and BT Office Products International Inc.,
shall be attached to and become a part of the Agreement between the parties
dated May 1, 1994 through April 30, 1998.
It is the parties' understanding that pursuant to the vacation provisions of the
Agreement and the Supplemental Agreement relating thereto, the Company, on or
about December 31, 1994, paid out all of the vacation accrued by unit employees
under the 1991-1994 agreement. It was the intent of the parties to "wipe the
slate clean" for the 1994-1998 Agreement, under which unit employees would no
longer be permitted to "carry over" vacation accrued in one year for the purpose
of extending vacation in another year. In addition, the parties agreed that unit
personnel would be encouraged to use the vacation accrued in each calendar year
to promote happy, healthy employees. To this end the parties agreed that
employees could only receive a year-end pay-out for five (5) or fewer vacation
days that had been accrued but not used in a given calendar year. All other
vacation accrued was to be used during the year accrued or lost.
It has come to the attention of the parties that certain unit employees were
confused by the 1994 vacation pay-out and believed the Company would continue to
pay-out all vacation accrued but not used at the end of each calendar year.
Consequently, several unit employees have more than five (5) accrued vacation
days remaining for the year 1995. To ensure that no unit employees are injured
in 1995 by any such misunderstanding, the Company agrees to pay unit employees
for all 1995 accrued vacation days, even if more than five (5) days have been
accrued but not used.
The parties agree that this 1995 pay-out does not establish a past practice and
that for the year 1996 and all subsequent years, the Company will only pay-out
five (5) days or fewer of accrued but not used vacation. Any other vacation
accrued but not used will be lost at the end of each calendar year.
The parties agree that they will assist one another in educating unit personnel
with regard to the vacation provisions and encourage unit employees to use all
vacation days in the year accrued.
FOR THE UNION: FOR THE COMPANY:
Bobby Gentry
Tyrone M. Wise
dated 1/18/96
<PAGE>
SUPPLEMENTAL AGREEMENT
BETWEEN
GRAPHIC COMMUNICATIONS UNION, LOCAL 449-S
AND
BT OFFICE PRODUCTS INTERNATIONAL, INC.
This Supplemental Agreement, made and entered into by and between
Graphic Communications Union, Local 449-S and BT Office Products International,
Inc., shall be attached to and become a part of the Agreement between the
parties dated May, 1998 through April 30, 2001.
Pursuant to Section 57 of the 1998-2001 collective bargaining
agreement, the Company agrees to provide, at a minimum, the following health and
welfare benefits to the bargaining unit employees:
Welfare Fund
The Company will administer a Healthcare Program for the bargaining
unit employees. The coverage the Company will provide and maintain will include
Medical and Vision Care and shall be no less than the package of benefits
presently provided for in the U.S. Healthcare Plan, which is incorporated by
reference into this Agreement. This Plan has no deductible. The Plan is a
Managed Care Health Plan that allows the employee and/or family member to
receive quality care from private practice physicians. Optional Dental Coverage
is available at an additional contributory cost to the employee. The employer
may change carriers during the life of this Agreement, but the package of
benefits provided by the new plan shall not be less than is presently available
under the U.S. Healthcare Plan, and the new plan shall entail no cost or
deductible to the employees.
Part-time employees will be given the opportunity to participate in the
Health Care benefit plan. The Company will contribute fifty percent (50%)
towards the medical premium for such employees.
Life Insurance
The Company will provide, at no cost to the employee, a base life
insurance policy equal to one (1) times the employee's annual salary. The
employees will also be afforded the opportunity to purchase supplemental life
insurance on a contributory basis. The Supplemental Life Insurance policy may be
purchased for coverage up to $250,000.00. Employee rates are based on the
employee's age. These rates are subject to change as the rates increase from the
Life Insurance Carrier.
<PAGE>
Supplemental Life Insurance Rates:
Age: Rate: Age: Rate:
Under 30 $ .196 50-54 $ 1.197
30-34 $ .216 55-59 $ 1.785
35-39 $ .275 60-64 $ 2.295
40-44 $ .412 65-69 $ 4.002
45-49 $ .726 70-74 $ 7.591
Rates are per pay period and based on $10,000.00 increments. Maximum coverage is
$250,000.00.
Dependent Life Insurance
The Company will provide the employees the opportunity to purchase
Dependent life Insurance Coverage. The employees may purchase an additional
policy for their spouse and/or their child(ren). Rates are subject to change as
the rates increase the Life Insurance Carrier.
Current Rates:
Spouse only: $.167 weekly ($ 5,000)
Coverage)
Child(ren): $.118 per child ($ 2,000)
Coverage)
Long Term Disability
The Company will provide Long Term Disability to full-time employees at
no cost to the employee. This coverage is available to employees who have been
disabled for over 26 weeks. The Disability Insurance will provide the employee
with sixty (60) percent of his or her wages at the time of the disability, under
the terms of the Insurance Policy.
Short Term Disability
The Company will provide Short Term Disability to full-time employees
at no cost to the employee. This coverage is available to employees who are
disabled with an off-the-job injury or illness. Sick leave benefits must be
exhausted before eligibility for benefits is considered.
<PAGE>
Short Term Disability is paid at fifty percent (50%) of the employee's wages.
The insurance is limited to twenty-six (26) weeks. Doctor's documentation is
required for all extended absences.
FOR THE UNION FOR THE COMPANY
/s/ Robert D. Barber /s/ LaVerne Bonelli
- --------------------------- --------------------------
Robert D. Barber, President LaVerne Bonelli, Manager
GCU, Local 449-S Human Resources
/s/ Tyrone M. Wise, Sr. /s/ Kevin Mullen
- --------------------------- --------------------------
Tyrone M. Wise, Sr. Kevin Mullen
/s/ Marsha Stevenson
- ---------------------------
Marsha Stevenson
<PAGE>
SUPPLEMENTAL AGREEMENT BETWEEN
GRAPHIC COMMUNICATIONS UNION,
LOCAL 449-S AND
BT OFFICE PRODUCTS INTERNATIONAL, INC.
This Supplemental Agreement made and entered into by and between
Graphic Communications Union Local 449-S and BT Office Products International,
Inc., shall be attached to and become a part of the Agreement between the
parties dated May 25, 1998 through April 30, 2001.
The Company and the Union hereby agree to negotiate and implement a
probable cause and pre-hire drug and alcohol testing policy which shall include
mandatory testing for those employees involved in accidents, but shall not
include random testing.
FOR THE UNION
/s/ Robert D. Barber
- --------------------------
Robert D. Barber
President
/s/ Tyrone M. Wise, Sr.
- --------------------------
Tyrone M. Wise, Sr.
/s/ Marsha Stevenson
- --------------------------
Marsha Stevenson
FOR THE COMPANY
/s/ LaVerne Bonelli
- --------------------------
LaVerne Bonelli
/s/ Kevin Mullen
- --------------------------
Kevin Mullen
<PAGE>
SUPPLEMENTAL AGREEMENT
BETWEEN
GRAPHIC COMMUNICATIONS UNION,
LOCAL 449-S AND
BT OFFICE PRODUCTS INTERNATIONAL, INC.
In a sincere effort to address the needs of both parties, signatory
hereto, it is agreed that the following procedure for instituting a method of
communication on the work rules, discharges, suspensions and other matters
related to the employee-employer relationship, shall be introduced to
accommodate a format between the employer and the union. It is recognized that
this method is not a substitute for or waiver of any right to pursue rights or
remedies under Section 59, Grievance and Arbitration.
The parties agree that they shall establish a Quarterly Review
Committee, which either party may request by notification to the other through
the Shop Steward or the Human Resources Manager. Such notice must be in writing,
stipulating the topics to be addressed. Within a reasonable time thereafter, no
later than five (5) days or longer by mutual consent, a meeting shall be
arranged.
The Union shall be represented by the Chief Steward, all assistant
stewards and three (3) additional bargaining unit members. If requested, the
Business Manager of Local 449 may be included at any given time. The Employer
shall be entitled to equal representation so designated by the Human Resources
Manager to include all appropriate operations management.
If the committee should become deadlocked over an issue, then the issue
shall be submitted to binding arbitration as provided for in Section 60 of the
Agreement, providing all steps of the Grievance Procedure have been held or
mutually waived.
The parties shall address themselves to the problems for which the
meeting was called and proceed with due diligence to resolve the issues to the
satisfaction and best interest of both parties, to that end which serves the
community of interests to which both parties have a concern.
FOR THE UNION FOR THE COMPANY
/s/ Robert D. Barber /s/ LaVerne Bonelli
- -------------------------- -----------------------
Robert D. Barber LaVerne Bonelli
President
/s/ Tyrone M. Wise, Sr. /s/ Kevin Mullen
- -------------------------- -----------------------
Tyrone M. Wise, Sr. Kevin Mullen
/s/ Marsha Stevenson
- --------------------------
Marsha Stevenson
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from BT Office
Products International, Inc. Form 10-Q for the quarterly period ended
June 30, 1998 and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-END> Jun-30-1998
<CASH> 12,823
<SECURITIES> 0
<RECEIVABLES> 248,205
<ALLOWANCES> (9,909)
<INVENTORY> 125,269
<CURRENT-ASSETS> 436,291
<PP&E> 168,139
<DEPRECIATION> (73,643)
<TOTAL-ASSETS> 803,734
<CURRENT-LIABILITIES> 431,829
<BONDS> 69,093
<COMMON> 335
0
0
<OTHER-SE> 278,662
<TOTAL-LIABILITY-AND-EQUITY> 803,734
<SALES> 434,435
<TOTAL-REVENUES> 434,435
<CGS> (314,722)
<TOTAL-COSTS> (426,054)
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (4,076)
<INCOME-PRETAX> 4,933
<INCOME-TAX> (2,100)
<INCOME-CONTINUING> 2,833
<DISCONTINUED> 0
<EXTRAORDINARY> (1,000)
<CHANGES> 0
<NET-INCOME> 1,833
<EPS-PRIMARY> 0.05
<EPS-DILUTED> 0.05
</TABLE>
