JSC  "Jekabpils  cukurfabrika"  informs  that  since  SIA "Baltic Sugar

Company"  starting  July  has  not fulfilled their contract obligations

regarding  sugar  sales,  management of JSC "Jēkabpils cukurfabrika" on

August  16,1999  submitted  request  to  JSC  "Latvijas  Unibanka" Loan

Committee  to  extend term of payment for the remnant of credit line in

the amount of LVL 1,4 million.

JSC   "Latvijas   Unibanka"   on   August  23,1999  claimed  "Jekabpils

cukurfabrika"  repayment  of  remnant  loan.  On August 24,1999 bailiff

ensured  fulfilment  of  "Latvijas  Unibanka"  claim on no contestation

basis  by  distrait  of  sugar in the amount of LVL 1,44 million in JSC

"Jekabpils cukurfabrika" warehouse.

On the August 24,1999 management of JSC "Jēkabpils cukurfabrika" in the

meeting  with  Minister  of Agriculture A.Kalvitis informed him that in

the  present  situation  it  is  impossible to begin preparation of the

factory  for  refinement  season  and  management  of  the  factory  is

considering  proclaiming insolvency if there will not be other solution

presented.  Minister  of  Agriculture  offered  Government intervention

measures in sugar market. This anticipates state purchasing sugar beets

and refining them and paying costs of refining to factory.

Minister  of Agriculture was informed that JSC "Jekabpils cukurfabrika"

has  other  creditors  besides "Latvijas Unibanka" and their actions is

hard   to   foresee  since  intervention  mechanism  does  not  foresee

fulfilment  of  factories  liabilities  towards  other  creditors.  JSC

"Jekabpils  cukurfabrika" and Minister of Agriculture agreed on meeting

on the September 2,1999 to seek solution for present situation.