Northland Cranberries, Inc. (Nasdaq: CBRYA), manufacturer of Northland 100% juice cranberry blends and Seneca fruit juice products, today announced that it has successfully entered into a forbearance agreement with its bank group. Under the forbearance agreement, the banks have allowed Northland to defer principal and interest payments under its $155 million revolving credit agreement until February 12, 2001. During this period, the banks also 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 as long as Northland is in compliance with the terms and conditions of the forbearance agreement. Northland agreed with the banks to perform certain actions, among them (1) paying the banks a forbearance fee; (2) obtaining a forbearance agreement and waivers from certain other creditors and third parties; (3) moving certain company accounts to the agent bank; and (4) promptly supplying the banks with certain financial and other information about the company and its assets.

John Swendrowski, Northland’s Chairman and Chief Executive Officer, said, “This is a very positive development for Northland. The forbearance agreement demonstrates our bank group’s confidence in our very positive recent financial results and our ability to work closely with our creditors to satisfy our credit agreement obligations. We are also actively seeking refinancing of our existing bank debt, and we expect to receive refinancing proposals from several alternative financial institutions and organizations before the end of the forbearance period.

“We are working hard to return the company to profitability in the near term. The forbearance agreement helps us in pursuing that goal by allowing us to defer principal and interest payments until February 12, 2001 and by securing the agreement of our banks not to call our loans due and payable during the forbearance period, as long as we are in compliance with the terms of the agreement. We have been further encouraged by the cost savings realized from the reorganization of our manufacturing and marketing functions, which have allowed us to recently experience improved overall results of operations consistent with our expectations. We are also very pleased with the initial response from the trade to the previously announced introduction of our ‘27% Solution’ product line.”

Mr. Swendrowski noted that compliance with the forbearance agreement allows Northland to effectively defer, until at least February 12, 2001, approximately $5.2 million in interest payments and approximately $5.0 million in principal payments that are past due and approximately $3.1 million in interest payments that would otherwise have become due prior to that date.

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 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.


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.