RNS Number:9897U
IWP International PLC
01 December 2005





IWP INTERNATIONAL PLC



Announcement


Capital restructuring to reduce the group's debt, waive the current covenant
defaults and provide a cash-out alternative to shareholders of 3.5 cent per
ordinary share.



1st December 2005



IWP International plc ("IWP" or the "Company") announces that it has concluded a
non-binding indicative heads of terms (the "Heads of Terms") with its principal
secured creditors, representing approximately 97% of secured indebtedness, which
sets out the principles for the financial restructuring (the "Restructuring") of
IWP and its subsidiaries (the "Group"). In addition, IWP has been granted a
waiver from all of the secured creditors of any existing covenant breaches to
31st March 2006. The continuation of this waiver is subject to one of the
secured creditors, representing approximately 3% of the secured indebtedness,
being acquired by another existing secured creditor or a person who becomes a
secured creditor and supports the Restructuring within 20 days from this date.
This is anticipated to conclude within this period.

The key points of the Restructuring are set out below.


Joe Moran, Chairman, IWP, said:


"The Restructuring of IWP will enable the Group to continue trading with a
strengthened balance sheet and with the support of its secured creditors.
Completion of the Restructuring will preserve the ongoing business operations of
the Group and the rights of customers, suppliers and employees.


IWP has spent the last number of months in difficult negotiations with its
secured creditors in relation to the financial restructuring of the Group and we
continue to focus on concluding this complex process as soon as possible. The
Heads of Terms reflects the position of 97% of the secured creditors and will
enable the ordinary shareholders of IWP to receive cash of 3.5 cent per share or
retain their shares in IWP should they so elect.


As announced on 10th June 2005, Jim Murphy decided that he did not wish to move
to the UK following the planned head office relocation and would therefore step
down from his position as Chief Executive. Having assisted the Company in
concluding the Heads of Terms, Mr Murphy has decided that it is now appropriate
for him to leave the Company. On behalf of the Board, I would like to thank Mr
Murphy for his contribution over the past two difficult years and wish him every
success in the future."


The key points of the Restructuring are as follows:


* The secured creditors will convert circa Euro56m of their existing debt
to equity resulting in them owning 90% of the enlarged ordinary share capital of
the Company

* The Restructuring will significantly reduce IWP's gross secured
indebtedness (including swaps close out cost, makewhole due under the notes and
all deferred interest) from circa Euro121 million to Euro65 million.

* 10% of the enlarged ordinary share capital of the Company will be
retained by the existing ordinary shareholders.

* A Cash-Out Alternative will be offered to existing ordinary
shareholders at a price of 3.5 cent per existing ordinary share.

* Ordinary shareholders who wish to retain their shares in the Company
may elect to do so. The secured creditors will waive any rights they may have to
compulsorily acquire shares held by existing ordinary shareholders if the
shareholder elects not to take the Cash-Out Alternative.

* Preference shareholders will have the opportunity to obtain cash for
their shares at nominal value plus accumulated unpaid dividend, amounting in
aggregate to Euro82,423.

* The Company will apply for its shares to be delisted from the Irish
and London Stock Exchanges as part of the Restructuring.

* The claims of all general unsecured creditors of the Group will not be
involved in and will not be compromised by the Restructuring.

* Post the Restructuring, the Euro65 million debt remaining within the
Group will be consolidated into two tranches of Euro35,000,000 ("Tranche A") and
Euro30,000,000 ("Tranche B"), respectively.

-        Tranche A will be repayable 5 years following completion of the
Restructuring and Tranche B will be repayable on the same date as Tranche A
provided that such date shall be automatically extended by successive 60 day
periods in the event that the Group still holds all or any portion of its
investment in Jeyes Holdings Limited or Jeyes Group Limited (the "Jeyes
Investment"). Tranche B will be repayable only out of amounts received by the
Group from the Jeyes Investment.

-        Tranche A will carry an interest rate of LIBOR + 2.25% p.a., payable
quarterly in arrears and Tranche B will carry an interest rate of 12.00% p.a.
payable in kind and rolled up quarterly.

* An executive chief restructuring officer is to be appointed as soon as
reasonably practicable.

* A new Board of directors of the Company satisfactory to the secured
creditors, which will include the current finance director, Paul O'Brien, is to
be appointed. The Company will enter into termination arrangements with all
directors who resign upon completion of the Restructuring on terms and
conditions satisfactory to the secured creditors.

* A compromise agreement has been reached in relation to the termination
of the lease at 19 Fitzwilliam Square (the Company's head office) so that it is
capable of being terminated with three months notice and a final termination and
dilapidation settlement of Euro240,000.

* All outstanding share options are to be cancelled. Post the
Restructuring the Company will implement an executive incentive plan based on
successful implementation of the Company's business plan.

* The Restructuring will be subject to customary business and market
material adverse change clauses.

* The completion of the Restructuring will be conditional on:

-        the completion of further legal and financial due diligence by the
secured creditors;

-        securing adequate working capital facilities from April 2006;

-        the receipt of all necessary Board and secured creditors committee
         approvals;

-        the receipt of all necessary applicable regulatory approvals (including
         approvals from the Irish Takeover Panel, any listing authorities, 
         competition authorities, pension regulators or any other relevant 
         authority or regulator);

-        the receipt of all necessary shareholder approvals;

-        the negotiation, execution and delivery of definitive documentation.

* The Restructuring is targeted to be completed in the first quarter of
2006.

In due course, a Circular will be issued by the Company for the purpose of
convening separate class meetings of the ordinary and preference shareholders
for the purpose of seeking the necessary approvals for the Restructuring and the
other matters mentioned in this announcement.



L J Ring

Company Secretary


Tel : +353 1 6611958




The issue of ordinary shares in the Restructuring will not be registered or
qualified under the securities laws of any jurisdiction other than Ireland and,
if necessary, England and Wales and will be subject to compliance with
applicable securities laws. The ordinary shares will not be registered under the
US Securities Act of 1933 as amended (the "US Securities Act") and will not be
offered or sold to persons in the United States except pursuant to an available
exemption from the registration requirements under the US Securities Act.







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