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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 Friday, June 8, 2001 at 3:30 p.m. (CST)
NORTHLAND CRANBERRIES, INC. NEGOTIATES EXTENSION OF FORBEARANCE AGREEMENT WITH
ITS PRIMARY LENDERS
Wisconsin Rapids, WI -- Northland Cranberries, Inc. (Nasdaq:CBRYA),
manufacturer of Northland 100% juice cranberry blends and Seneca and Treesweet
fruit juice products, today announced that it has successfully negotiated an
amendment to its existing forbearance agreement with its bank group that extends
the forbearance period under the agreement to July 30, 2001. Until such date,
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 amended forbearance agreement. Pursuant to the amended
agreement, Northland agreed to take certain actions including, among others, a)
paying interest to the banks on a weekly basis at a rate of 7% per annum on the
principal amount outstanding under its $155 million revolving credit facility
(although interest on outstanding principal continues to accrue at the higher
default rate); b) limiting expenditures to levels set forth in a budget prepared
by the company and approved by the bank group; c) making principal payments to
the banks on scheduled dates, including June 15, 2001 and June 30, 2001; d)
continuing the process of exploring strategic alternatives and providing
evidence satisfactory to the bank group by June 15, 2001 that substantial
progress has been made in the pursuit of such alternatives; and e) entering into
a similar amendment to the company's existing forbearance agreement with an
insurance company lender.
John Swendrowski, Northland's Chairman and Chief Executive Officer, said,
"Despite the duress of a disrupted cranberry market, we are working closely with
our secured creditors in an effort to satisfy our obligations under our debt
agreements. We still have a significant 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 Cranberries, Inc.
News Release, June 8, 2001
Page 2 of 2
Northland is a vertically integrated grower, handler, processor and
marketer of cranberries and value-added cranberry products. The company
processes and sells Northland 100% juice cranberry blends, Seneca and Treesweet
brand fruit juice products, Northland 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
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Certain matters discussed in this press release are "forward-looking
statements," including statements about Northland'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 Northland'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
Northland'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 Northland's crop and
the crop of other North American growers; (v) Northland's ability to comply with
the terms and conditions of, and to satisfy its responsibilities under, its
amended credit facility, with respect to which Northland is currently in default
of certain covenants as well as certain principal and interest payment
provisions; (vi) Northland'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 Northland'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) Northland's ability to
manage its trade payables; and (x) Northland'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. Northland will not necessarily update these statements or
other information in this press release based on future events or circumstances.
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