Delta, British Columbia, March 4, 2008 - Sepp's Gourmet Foods Ltd. ("Sepp's" or the "Company") announces that it has sold its Alberta division - Sepp's Fine Foods - to the Nossack Food Group ("Nossack").
Nossack, located in Red Deer, Alberta, is a manufacturer and distributor of upscale delicatessen and meat products serving the Western Canadian retail and food service markets.
Jim Pratt, CEO of Sepp's, stated: "The Sepp's Fine Foods division is an ideal fit for Nossack who have been major suppliers of this division for over 15 years. The ongoing operation of this division remains in excellent hands."
He went on to say: "The sale of this division sharpens our focus and confirms our exclusive commitment to our rapidly growing portfolio of bakery products - private label frozen waffles, pancakes, French toast and wraps."
Proceeds from the sale will be used to repay senior debt and for working capital purposes.
In other news, Sepp's announces that two shareholders of the Company have agreed to provide the Company with a subordinated, revolving credit line totaling $1,000,000. The credit line bears interest at 10.25%, is repayable by December 31, 2009 with an option to renew the agreement for an additional twelve-month term at the borrower's option. At any time prior to the expiration of the line, the lenders may convert some or all of the line into common shares of the Company at a price of $0.05 per common share. Interest is payable at the end of the term. The loan ranks behind other previously arranged senior debt financing.
Sepp's Gourmet Foods Ltd. is a producer and marketer of frozen food products for the retail grocery and food service sectors in North and South America, and Asia.