In February 2002, the Company was not in compliance with certain financial covenants contained in the financing
agreements with Tyco Capital Corporation (formerly The CIT Group/Business Credit Inc) and Ableco Finance LLC.
The Company is currently holding discussions with these lenders to amend these covenants, and is considering
refinancing proposals from other lenders.
Cannondale motorsports products are enjoying strong sell-through at retail, with favorable editorial reviews
continuing to create interest among enthusiast consumers. Recent articles include a 4-Wheel ATV Action
comparison test of the industry's top sport quads in which the Cannondale Cannibal was voted the top machine in
three separate categories. The editors at the magazine concluded, "If you're looking to race, the top machine is the
Cannondale Cannibal, hands down."
In March, the Cannibal was also named the industry's "Best Sport ATV" by ATV Magazine, and additional favorable
exposure for Cannondale motorsports products included articles in the January issues of 4-Wheel ATV Action and
Dirt Wheels magazines, and on the web site Off-Road.com.
The Company's ATVs fared equally well in competition recently at the 4-Stroke World Championships at Glen Helen
Raceway in San Bernardino, California. Racing a Cannondale Speed ATV, Jeremy Schell unseated reigning three-time
champion Doug Eichner of Duncan Racing to be crowned the new 4-Stroke World Champion. Schell's victory
capped the near total domination of the event by Cannondale ATVs, as riders aboard the Company's Moto 440 also
captured 3
rd
, 4
th
and 5
th
places.
Cannondale's bicycles also enjoyed great success in the third quarter, including a very favorable review of the new
Gemini 1000 at NSMB.com, a web site devoted to freeriding. The review concluded that "the performance,
workmanship and price of the Gemini 1000 are excellent compared to similar full suspension models." NSMB test rider
Blaine Louis stated flatly, "if I could afford to buy any full suspension bike right now this would be it."
The Gemini made a similarly strong impression during its race debut at the Sea Otter Classic in Monterey, California,
in March. Athletes from the Company's Volvo/Cannondale team raced the Gemini in six events, resulting in six
podium appearances that included four outright wins.
The Company maintained its focus on the road cycling market in the third quarter. In January, Cannondale began
shipping models with its new CAAD7 road frame, the lightest bicycle frame ever offered by the Company. In the
following weeks, CAAD7-equipped bicycles piloted by the Saeco pro road racing team recorded three impressive
early-season wins. Another new Cannondale road model, the Company's first-ever recumbent, received an "Editor's
Choice Award" from Recumbent Cyclist News magazine in January. In the opinion of the staff, the Cannondale had
"the finest finish quality we've seen on a recumbent."
This press release contains forward-looking statements, as defined under the Private Securities Litigation Reform Act
of 1995. Actual results may differ materially from those anticipated as a result of various risks and uncertainties,
including risks and uncertainties relating to the market acceptance of the Company's products, competition, the
effectiveness of the Company's dealer networks and sales teams, the Company's motorsports operations, changes in
the level of discretionary consumer spending, and the Company's compliance with or ability to amend financial
covenants under its financing agreements or its ability to obtain refinancing, as well as those risks and uncertainties
discussed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission.
Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the
date hereof. The Company undertakes no obligation to publish revised forward-looking statements to reflect events
or circumstances after the date hereof or to reflect the occurrence of unanticipated events except as required by law.
Cannondale Corporation (Nasdaq: BIKE) is the world's leading manufacturer of high-performance bicycles, and is an
emerging player in the off-road motorsports industry. The Company's bicycles and bicycle accessories, which
include HeadShok suspension forks, cycling apparel, and cycling packs and bags, are sold in the U.S. and in more
than 60 foreign countries. The Company's line of off-road motorcycles and four-wheeled sport ATVs (All-Terrain
Vehicles) are sold in the U.S. and in selected foreign markets. All of the Company's products are marketed under the
Cannondale brand name and "Handmade in USA" logo.
