November 18, 2009
Dear Valued TWI Customer,
Because you are a valued customer of Taylor-Wharton International or one of its operating units, I wanted you to hear directly from me about an important action the Company is taking to strengthen its balance sheet and reduce its debt.
Today the Company announced that it has reached an agreement with its lenders to reduce its burdensome debt levels, significantly improve its capital structure and create financial flexibility. The restructuring is a necessary and positive step, which, in today's challenging environment, will re-align the Company's capital structure with current business operations. Under the terms of the agreement, the Company's debt obligations will be reduced by 50%, the Company will receive improved terms from its lenders and the Company will benefit from a new equity investment by its current equity sponsors.
To implement the restructuring, TWI and its domestic operations filed voluntary Chapter 11 petitions in the U.S. Bankruptcy Court. Our operations outside of the United States will continue their business operations without supervision from the U.S. courts and will not be subject to the Chapter 11 requirements of the Bankruptcy Code.
The Company has already reached agreements in principle with its lenders and expects to move through the restructuring process quickly. We will work with key stakeholders over the next few months to expeditiously implement this plan.
During the restructuring period and beyond, all of our offices, plants and service centers will continue to operate normally. Furthermore, our Company remains fully committed to serving our customers with quality products that meet their needs, are delivered on schedule, and are priced competitively throughout the restructuring period and beyond.
I want to assure you that we have adequate cash to continue paying for the day-to-day goods and services we need to operate and serve our customers. We have received commitments for up to $20 million in debtor-in-possession financing from a group of lenders led by GE Capital. The proceeds from the DIP financing together with cash generated from daily operations and cash on hand will be used to fund post-petition operating expenses, including supplier obligations and employee wages, salaries and benefits.
We will keep you informed as we reach important milestones in this process. In the meantime, if you have questions, please contact me or your regular representative or our toll-free restructuring information hotline at 866-431-8288.
Our commitment to providing you with the world-class products and services that you have come to expect from TWI is as strong as ever. Thank you for your continued support.
Sincerely,
Bill Corbin
Chairman and Chief Executive Officer