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FOR IMMEDIATE RELEASE |
Contact: Len Mayer
Tel: 707-725-6182 X3030
HUMBOLDT CREAMERY, LLC, ANNOUNCES IT HAS FILED FOR PROTECTION UNDER CHAPTER 11
[Fortuna, CA April 21, 2009] - Humboldt Creamery, LLC, announced today that it has filed for protection under Chapter 11 of the Bankruptcy Code with the United States Bankruptcy Court in Santa Rosa, California. The bankruptcy filing was necessitated by its impaired financial condition, which was discovered after the resignation of its former Chief Executive Officer, Richard Ghilarducci. Mr. Ghilarducci had been the President and Chief Executive Officer of Humboldt Creamery since 1997, and resigned on February 20, 2009.
Since that resignation Humboldt has appointed Mr. Len Mayer as its Chief Executive Officer, and conducted an investigation as to the background of these matters. While the investigation is ongoing, Mr. Mayer and Humboldt have concluded that the core ongoing operations of Humboldt are profitable and will be preserved.
The major secured lenders to Humboldt are CoBank and American AgCredit. These lenders have cooperated with Humboldt in negotiating the terms of a debtor in possession loan agreement providing an additional $3 million facility for Humboldt, which will allow Humboldt to reorganize its business in Chapter 11. CEO Len Mayer stated as follows:
"We have today concluded a new debtor in possession financing arrangement with our lenders. This loan agreement will allow us to pay on a current basis all of our suppliers for goods, supplies and services delivered to us after the filing of the bankruptcy case, and to at the same time find a strategic buyer who can continue the operations of this business that was started in 1929."
Humboldt has a brand name that is well known and carries a significant market share. Humboldt has engaged the investment banking firm of Duff & Phelps to work with it in selling the business as a going concern. With the support of its existing lenders, Humboldt expects to find a new partner who will work with it to continue the business and solve the problems caused by the former lack of financial reporting. The reorganization will be for the benefit of the employees, local dairy farmers, and creditors and suppliers of the company.
Humboldt is based in Fernbridge (Humboldt County), California and has additional facilities in Stockton and Los Angeles.
Founded in 1929, Humboldt Creamery is the oldest independent dairy cooperative in California and specializes in pasture based and organic dairy farming. It is owned and operated by approximately 50 family farmers and produces high quality fluid milk products, ice cream, and milk powder shipped nationally and internationally.
Any questions should be directed to:
Len Mayer: 707-725-6182
Counsel: Michael Ahrens, (415) 434-9100