September 6, 2007
Dear Valued Customer of International Wholesale Tile Inc.:
The housing industry has experienced a significant downturn over the past year, which is expected to continue for some time. This downturn resulted in International Wholesale Tile’s (IWT) management, and its parent company, IWT Tesoro Corporation (Tesoro), taking preemptive action in order to maintain its operations.
Tesoro’s and IWT’s Boards of Directors have decided to seek protection by filing a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code. The Boards believe this reorganization is in the best interest of the Tesoro and IWT, and their employees, customers, creditors, and shareholders. Tesoro’s CEO, Henry J. Boucher, Jr. has said, “After considering a wide range of alternatives, it became clear that this course of action was a necessary and responsible step to preserve Tesoro’s viability and longevity as we address our financial challenges and work to secure our future.”
As part of the reorganization, Tesoro’s and IWT’s primary lender, Bank of America, has agreed to continue to provide financing to Tesoro and IWT. The financing will include post-petition funds to acquire inventory, pay operating expenses and the costs of the Chapter 11 activities. We want to stress; Tesoro and IWT are NOT ceasing operations and expect to continue business as usual. In particular, IWT expects to:
- Continue normal business operations today and throughout the reorganization process
- Honor its customer service policies; ship and deliver orders as usual
- Pay vendors, suppliers and other business partners for goods and services provided post-petition
During the reorganization process, Tesoro will be assisted in part by KMA Capital Partners. Tesoro, IWT and KMA Capital expect to co-sponsor a reorganization and refinancing plan so that we will continue to operate assuming the Court certifies the plan. KMA Capital is an experienced merchant banking company with the same objectives of Tesoro’s management – to focus on restructuring IWT as a renewed leader in the industry, which you have come to expect from IWT. KMA Capital will be aiding us in the financial restructuring of the Company. During the interim period, KMA will also assist the company in its effort to increase the flow of product. Additionally, Tesoro and IWT are exploring other plans, as alternative possibilities.
We appreciate your support as we work our way through this reorganization process. If you have any questions, you should contact your sales representative or:
Forrest Jordan - fjordan@iwttesoro.com (800) 340-8453 ext. 246
Grey Perna – gperna@iwttesoro.com (800) 340-8453 ext. 252
Bruce De Pasquale – bdepasquale@iwttesoro.com (800) 340-8453 ext. 244
Sincerely,
Paul Boucher,
President
International Wholesale Tile, Inc.
3500 SW 42nd Avenue
Palm City, FL 34990
772-223-5151
772-223-9744
www.internationalwholesaletile.com
www.tesorothecollection.com
www.iwttesoro.com
