For More Information Contact:
John Swendrowski, Chairman & CEO
Northland Cranberries, Inc.
800 First Avenue South, P.O. Box 8020
Wisconsin Rapids, WI 54495-8020
Tel: 715-424-4444 Fax: 715-422-6897
www.northlandcran.com
NEWS RELEASE
For release Thursday, March 29, 2001 at 3:30 p.m. (CST)
NORTHLAND CRANBERRIES, INC. EXECUTES AMENDMENT TO FORBEARANCE AGREEMENT WITH ITS
PRIMARY LENDERS
Wisconsin Rapids, WI -- Northland Cranberries, Inc. (Nasdaq:CBRYA),
manufacturer of Northland 100% juice cranberry blends and Seneca fruit juice
products, today announced that it has successfully negotiated an amendment to
its existing forbearance agreement with its bank group that allows Northland to
continue to defer principal and certain interest payments under its $155 million
revolving credit agreement until April 30, 2001. During this period, the banks
have agreed not to exercise various remedies available to them as a result of
Northland's defaults under certain covenants and payment requirements of its
secured debt arrangements, provided Northland remains in compliance with the
terms of the amendment. Pursuant to the amendment, Northland agreed to take
certain actions including, among others, a) paying interest on a weekly basis at
a rate of 5% per annum on the principal amount outstanding under its revolving
credit facility (although interest on outstanding principal continues to accrue
at the higher default rate); b) delivering to the bank group certain additional
security agreements securing currently unencumbered assets; c) making a
principal payment on April 10, 2001; d) continuing the process of exploring
strategic alternatives; e) retaining on behalf of the bank group an independent
financial advisor to assess Northland's operations; and f) complying with
certain financial covenants set forth in the amendment.
John Swendrowski, Northland's Chairman and Chief Executive Officer, said,
"As this amendment demonstrates, we continue to work closely with our secured
creditors in an effort to satisfy our obligations under our debt agreements. The
fact that our turnaround plan now enables us to begin paying interest is a
positive indication of our progress, and we intend to continue to pursue
long-term solutions to our financial issues."
While the company has not yet finalized financial results for the first six
months of its fiscal year, Swendrowski stated "We expect the first six months
ended February 28, 2001 to show a loss of less than $1.5 million, compared to a
loss of $20.7 million for the comparable period last year. Obviously, we have
made some progress. However, we still have a significant
Northland Cranberries, Inc.
News Release, March 29, 2001
Page 2 of 2
number of challenges ahead of us to return the company to profitability. We will
continue to implement operating changes necessary to improve our results and
aggressively pursue strategic solutions to address our financial issues."
Northland is a vertically integrated grower, handler, processor and
marketer of cranberries and value-added cranberry products. The company
processes and sells Northland brand 100% juice cranberry blends, Seneca brand
fruit juice products, Northland brand fresh cranberries and other cranberry
products through retail supermarkets and other distribution channels. Northland
also sells cranberry and other fruit concentrates to industrial customers who
manufacture juice products. With 24 growing properties in Wisconsin and
Massachusetts, Northland is the world's largest cranberry grower. It is the only
publicly-owned, regularly-traded cranberry company in the United States, with
shares traded on the Nasdaq Stock Market under the listing symbol CBRYA.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain matters discussed in this press release are "forward-looking
statements," including statements about the Company's future plans, goals and
other events, which have not yet occurred. These statements are intended to
qualify for the safe harbors from liability established by the Private
Securities Litigation Reform Act of 1995. They can generally be identified
because the context of such statements will include words such as "believes,"
"anticipates," "expects," or words of similar import. Whether or not these
forward-looking statements will be accurate in the future will depend on certain
risks and factors including risks associates with (i) the development, market
share growth and continued consumer acceptance of the Company's branded juice
products, including consumer acceptance of its new 27% Solution; (ii) the
disposition of certain litigation related to the sale of the net assets of the
Company's private label juice business; (iii) the implementation of the
marketing order of the Cranberry Marketing Committee of the United States
Department of Agriculture and the cranberry purchase program adopted by the
United States Congress; (iv) agricultural factors affecting the Company's crop
and the crop of other North American growers; (v) the Company's ability to
comply with the terms and conditions of, and to satisfy its responsibilities
under, its amended credit facility, with respect to which the Company is
currently in default of certain covenants as well as certain principal and
interest payment provisions; (vi) the Company's ability to secure additional
financing and/or generate sufficient cash from operations as may be necessary to
fund working capital requirements and continue as a going concern; (vii) the
results of the previously announced exploration of strategic alternatives;
(viii) the results of the Company's internal organizational restructuring,
including, without limitation, the results of the restructuring of certain sales
and marketing functions through an agreement with Crossmark, Inc.; (ix) the
Company's ability to manage its trade payables; and (x) the Company's ability to
continue to meet the listing requirements of The Nasdaq National Market,
including, without limitation, the requirement that its Class A Common Stock
maintain a minimum bid price above $1.00 per share. Readers should consider
these risks and factors and the impact they have when evaluating these
forward-looking statements. These statements are based only on management's
knowledge and expectations on the date of this press release. The Company will
not necessarily update these statements or other information in this press
release based on future events or circumstances.
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