Exhibit 99.1

                          PART I. FINANCIAL INFORMATION

ITEM I. FINANCIAL STATEMENTS

<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiary - Agrilink Foods, Inc.
Consolidated Statements of Operations, Net Proceeds and Comprehensive Income
(Unaudited)

(Dollars in Thousands)
<CAPTION>
                                                                          Three Months Ended              Nine Months Ended
                                                                     March 24,        March 25,        March 24,        March 25,
                                                                       2001             2000             2001             2000
                                                                   -----------      -----------      -----------      -----------
<S>                                                                <C>              <C>              <C>               <C>
Net sales                                                          $  298,584       $   296,245      $  975,732        $  966,455
Cost of sales                                                        (203,468)         (205,368)       (678,107)         (661,054)
                                                                   ----------       -----------      ----------        ----------
Gross profit                                                           95,116            90,877         297,625           305,401
Selling, administrative, and general expense                          (74,400)          (67,315)       (221,570)         (222,782)
Income from joint venture                                                 316               543           1,540             2,238
Gain on sale of assets                                                      0                 0               0             2,293
                                                                   ----------       -----------      ----------        ----------
Operating income                                                       21,032            24,105          77,595            87,150
Interest expense                                                      (20,853)          (22,114)        (64,794)          (64,598)
                                                                   ----------       -----------      ----------        ----------
Income before taxes, dividends, and allocation of net proceeds            179             1,991          12,801            22,552
Tax provision                                                            (720)           (1,066)         (4,884)           (6,744)
                                                                   ----------       -----------      ----------        ----------
Net (loss)/income                                                  $     (541)      $       925      $    7,917        $   15,808
                                                                   ==========       ===========      ==========        ==========

Allocation of net proceeds:
   Net (loss)/income                                               $     (541)      $       925      $    7,917        $   15,808
   Dividends on common and preferred stock                             (1,945)           (1,838)         (6,155)           (5,544)
                                                                   ----------       -----------      ----------        ----------
   Net (deficit)/proceeds                                              (2,486)             (913)          1,762            10,264
   Allocation from/(to) earned surplus                                  2,486               913          (1,520)           (4,531)
                                                                   ----------       -----------      ----------        ----------
   Net proceeds available to members                               $        0       $         0      $      242        $    5,733
                                                                   ==========       ===========      ==========        ==========
Net proceeds available to members:
   Estimated cash payment                                          $        0       $         0      $       61        $    1,433
   Qualified retains                                                        0                 0             181             4,300
                                                                   ----------       -----------      ----------        ----------
   Net proceeds available to members                               $        0       $         0      $      242        $    5,733
                                                                   ==========       ===========      ==========        ==========

Net (loss)/income                                                  $     (541)      $       925      $    7,917        $   15,808
Other comprehensive income:
   Unrealized loss on hedging activity                                 (1,068)                0            (178)                0
                                                                   ----------       -----------      ----------        ----------
Comprehensive (loss)/income                                        $   (1,609)      $       925      $    7,739        $   15,808
                                                                   ==========       ===========      ==========        ==========
<FN>
The accompanying notes are an integral part of these consolidated financial
statements.
</FN>
</TABLE>


<PAGE>

<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiary - Agrilink Foods, Inc.
Consolidated Balance Sheets
(Dollars in Thousands)                                        ASSETS                      March 24,      June 24,        March 25,
                                                                                            2001           2000            2000
                                                                                         (Unaudited)                    (Unaudited)
                                                                                        ------------     ---------      -----------
<S>                                                <C>          <C>           <C>       <C>             <C>            <C>
Current assets:
   Cash and cash equivalents                                                            $    6,571      $    4,994     $    8,452
   Accounts receivable, trade, net                                                         104,018         101,065        107,601
   Accounts receivable, co-pack activity and other                                          10,616          10,488          7,555
   Income taxes refundable                                                                       0           9,869              0
   Current deferred tax asset                                                               11,657          12,176         16,160
   Inventories                                                                             347,508         341,931        387,645
   Current investment in CoBank                                                              5,233           2,927          4,355
   Prepaid manufacturing expense                                                            13,431          26,364         12,933
   Prepaid expenses and other current assets                                                16,262          19,688         19,885
                                                                                        ----------      ----------     ----------
            Total current assets                                                           515,296         529,502        564,586
Investment in CoBank                                                                        10,757          16,203         15,750
Investment in joint venture                                                                  8,410           6,775          9,013
Property, plant, and equipment, net                                                        308,259         348,359        352,491
Assets held for sale, at net realizable value                                                  403             339            339
Goodwill and other intangible assets, net                                                  251,228         258,545        257,613
Other assets                                                                                25,144          27,543         28,225
                                                                                        ----------      ----------     ----------
            Total assets                                                                $1,119,497      $1,187,266     $1,228,017
                                                                                        ==========      ==========     ==========
                            LIABILITIES AND SHAREHOLDERS' AND MEMBERS' CAPITALIZATION
Current liabilities:
   Notes payable - Agrilink Foods                                                       $   78,000      $    5,700     $   79,600
   Notes payable - AgriFrozen Foods                                                              0          44,100         46,000
   Current portion of obligations under capital leases                                         218             218            208
   Current portion of long-term debt                                                        15,596          16,583         16,580
   Accounts payable                                                                         80,951          91,672         48,838
   Income taxes payable                                                                        427               0          1,608
   Accrued interest                                                                         12,873          11,398         13,959
   Accrued employee compensation                                                             8,545          11,216         11,372
   Other accrued expenses                                                                   50,541          66,397         84,004
   Dividends payable                                                                            24              41             27
   Amounts due Class A members                                                              12,942          21,696         17,797
                                                                                        ----------      ----------     ----------
            Total current liabilities                                                      260,117         269,021        319,993
Obligations under capital leases                                                               520             520            568
Long-term debt                                                                             635,356         679,205        685,111
Deferred income tax liabilities                                                             32,262          36,825         23,072
Other non-current liabilities                                                               29,327          33,852         30,071
Non-controlling interest in AgriFrozen Foods                                                     0           8,000          8,000
                                                                                        ----------      ----------     ----------
            Total liabilities                                                              957,582       1,027,423      1,066,815
                                                                                        ----------      ----------     ----------
Commitments and contingencies
Class B cumulative redeemable preferred stock, liquidation
   preference $10 per share; authorized - 500,000 shares, issued and
     outstanding 23,664, 23,664, and 26,061 shares, respectively                               237            237             261
Class A common stock, par value $5; authorized - 5,000,000 shares
                                                   March 24,     June 24,      March 25,
                                                     2001          2000          2000
                                                   ---------    ---------     ----------
   Shares issued                                   2,259,174    2,132,981     2,136,820
   Shares subscribed                                 107,783      233,977       233,977
                                                   ---------    ---------     ---------
            Total subscribed and issued            2,366,957    2,366,958     2,370,797

   Less subscriptions receivable in installments    (107,783)    (233,977)     (233,977)
                                                   ---------    ---------     ---------
            Total issued and outstanding           2,259,174    2,132,981     2,136,820     11,296          10,665         10,684
                                                   =========    =========     =========
Class B common stock, par value $5; authorized -
   1,600,000 shares, issued and outstanding 723,229, 723,229, and
     723,229 shares, respectively                                                                0               0              0
Shareholders' and members' capitalization:
   Retained earnings allocated to members                                                   10,881          16,591         17,446
   Non-qualified allocation to members                                                           0             300            300
   Non-cumulative preferred stock, par value $25; authorized -
     5,000,000 shares, issued and outstanding 32,669,
       34,400, and 37,529 shares, respectively                                                 817             860            938
   Class A cumulative preferred stock, liquidation preference
     $25 per share; authorized - 10,000,000 shares, issued and
       outstanding 4,495,082, 4,249,007 and 4,245,878 shares, respectively                 112,377         106,225        106,147
   Special membership interests                                                                  0               0              0
   Earned surplus                                                                           27,010          25,490         26,189
   Accumulated other comprehensive income:
     Unrealized loss on hedging activity                                                      (178)              0              0
     Minimum pension liability adjustment                                                     (525)           (525)          (763)
                                                                                        ----------      ----------     ----------
            Total shareholders' and members' capitalization                                150,382         148,941        150,257
                                                                                        ----------      ----------     ----------
            Total liabilities and capitalization                                        $1,119,497      $1,187,266     $1,228,017
                                                                                        ==========      ==========     ==========
<FN>
The accompanying notes are an integral part of these consolidated financial statements.
</FN>
</TABLE>


<PAGE>
<TABLE>
Pro-Fac Cooperative, Inc. and Consolidated Subsidiary - Agrilink Foods, Inc.
Consolidated Statements of Cash Flows
(Dollars in Thousands)
(Unaudited)
<CAPTION>

                                                                                                        Nine Months Ended
                                                                                                 March 24,               March 25,
                                                                                                   2001                    2000
                                                                                               -----------            ------------
<S>                                                                                            <C>                    <C>
Cash flows from operating activities:
     Net income                                                                                $     7,917            $    15,808
     Estimated cash payments due to Class A members                                                    (61)                (1,433)
     Adjustments to reconcile net income to net cash used in operating activities:
       Gain on sale of assets                                                                            0                 (2,293)
       Depreciation                                                                                 24,146                 24,364
       Amortization of goodwill and other intangible assets                                          7,414                  6,551
       Interest in-kind on subordinated promissory note                                              1,231                  1,174
       Amortization of debt issue costs and amendment costs and
         discount on subordinated promissory notes                                                   4,182                  3,579
       Equity in undistributed earnings of joint venture                                            (1,540)                (2,238)
       Equity in undistributed earnings of CoBank                                                      (96)                  (412)
       Change in assets and liabilities, net of effects of business dispostions
         Accounts receivable                                                                        (8,959)               (17,430)
         Inventories and prepaid manufacturing expense                                             (45,226)               (93,041)
         Income taxes refundable                                                                     6,252                 12,903
         Accounts payable and other accrued expenses                                               (25,193)               (36,381)
         Amounts due Class A members                                                                (8,754)                (2,248)
         Other assets and liabilities                                                               (1,176)                 8,201
                                                                                               -----------            -----------
Net cash used in operating activities                                                              (39,863)               (82,896)
                                                                                               -----------            -----------

Cash flows from investing activities:
     Purchase of property, plant and equipment                                                     (20,981)               (22,152)
     Proceeds from disposals                                                                         5,068                 53,538
     Proceeds from investment in CoBank                                                              2,926                  2,403
                                                                                               -----------            -----------
Net cash (used in)/provided by investing activities                                                (12,987)                33,789
                                                                                               -----------            -----------

Cash flows from financing activities:
     Net proceeds from issuance of short-term debt                                                  74,400                 70,700
     Payments on long-term debt                                                                    (12,659)               (11,773)
     Cash paid for debt issuance costs                                                              (1,707)                (2,624)
     Cash portion of non-qualified conversion                                                          (83)                  (445)
     Issuance of common stock, net                                                                     631                    705
     Cash dividends paid                                                                            (6,155)                (5,544)
                                                                                               -----------            -----------
Net cash provided by financing activities                                                           54,427                 51,019
                                                                                               -----------            -----------
Net change in cash and cash equivalents                                                              1,577                  1,912
Cash and cash equivalents at beginning of period                                                     4,994                  6,540
                                                                                               -----------            -----------
Cash and cash equivalents at end of period                                                     $     6,571            $     8,452
                                                                                               ===========            ===========
<FN>
The accompanying notes are an integral part of these consolidated financial
statements.
</FN>
</TABLE>


<PAGE>

                            PRO-FAC COOPERATIVE, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Cooperative:  Pro-Fac Cooperative, Inc. is an agricultural cooperative which
processes  and  markets  crops grown by its  members  through  its  wholly-owned
subsidiary Agrilink Foods, Inc. ("Agrilink Foods"), and until February 15, 2001,
through  a  former  subsidiary,  PF  Acquisition  II,  Inc.  in  which  it had a
controlling  interest. PF Acquisition II, Inc. conducted business under the name
AgriFrozen  Foods  ("AgriFrozen").  See  NOTE 3 to the  "Notes  to  Consolidated
Financial   Statements."  Unless  the  context  otherwise  requires,  the  terms
"Cooperative"  and  "Pro-Fac"  refer  to  Pro-Fac  Cooperative,   Inc.  and  its
subsidiary.

Agrilink Foods has four primary  product lines  including:  vegetables,  fruits,
snacks,  and canned meals.  AgriFrozen had vegetables as its one primary product
line. The majority of each of the product lines' net sales are within the United
States. In addition,  all of the Cooperative's  operating facilities,  excluding
one in Mexico, are within the United States.

Basis  of  Presentation:   The  accompanying  unaudited  consolidated  financial
statements have been prepared in accordance with accounting principles generally
accepted  in the  United  States  of  America  ("GAAP")  for  interim  financial
information and with the instructions to Form 10-Q and Article 10 of Regulations
S-X.  Accordingly,  they do not include all of the information  required by GAAP
for complete financial statement presentation. In the opinion of management, all
adjustments  (consisting only of normal recurring  adjustments)  necessary for a
fair  presentation  of the results of operations  have been included.  Operating
results  for the three  months  and nine  months  ended  March 24,  2001 are not
necessarily  the results to be expected  for other  interim  periods or the full
year.  These  financial  statements  should  be read  in  conjunction  with  the
financial   statements  and   accompanying   notes   contained  in  the  Pro-Fac
Cooperative, Inc. Form 10-K for the fiscal year ended June 24, 2000.

New  Accounting  Pronouncements:  In December  1999, the Securities and Exchange
Commission  (the  "SEC")  issued  Staff  Accounting  Bulletin  ("SAB")  No. 101,
"Revenue Recognition in Financial  Statements." SAB No. 101 provides guidance on
the  recognition,  presentation  and  disclosure  of  revenue  in the  financial
statements  filed with the SEC. SAB No.101 outlines the basic criteria that must
be met to recognize  revenue and provides  guidance  for  disclosure  related to
revenue recognition  policies.  The Cooperative is required to adopt SAB No. 101
during the fourth  quarter of fiscal 2001.  Management  believes the adoption of
this  pronouncement  will  not  have a  material  impact  on  the  Cooperative's
financial statements or results of operations.

In  July  2000,  the  Emerging  Issues  Task  Force  ("EITF")  of the  Financial
Accounting  Standards  Board  ("FASB")  reached  a  consensus  on  Issue  00-14,
"Accounting  for  Certain  Sales   Incentives."  The  consensus   addresses  the
recognition,   measurement,   and  income  statement  classification  for  sales
incentives that a company offers to its customers.  The  Cooperative  must adopt
EITF  Issue  00-14 in the  fourth  quarter of fiscal  2001.  Accordingly  coupon
expense, now classified as selling,  general and administrative expense, will be
reclassified  as a reduction  of gross sales and all prior  periods will also be
reclassified to reflect this  modification.  The adoption of EITF Issue 00-14 is
not expected to materially impact the Cooperative's  financial  statements.  The
Cooperative  estimates  that its coupon  expense is  approximately  $6.5 to $7.5
million per year.

In  July  2000,  the  EITF  also  reached  a final  consensus  on  Issue  00-10,
"Accounting  for Shipping and Handling  Fees and Costs." The EITF  addresses the
income  statement  classification  for shipping and handling costs and revenues.
Issue  00-10 will become  effective  during the fourth  quarter of fiscal  2001.
Accordingly,  freight  expense,  currently  classified  as a reduction  to gross
sales,  will be  classified  as component of cost of sales and all prior periods
will be reclasssified to reflect this  modification.  The adoption of EITF Issue
00-10 is not expected to have a material affect on the  Cooperative's  financial
statements and results of operations.

In January 2001,  the EITF reached a consensus on Issue 00-22,  "Accounting  for
Points and Certain Other Time-Based or Volume-Based Sales Incentives Offers, and
Offers for Free  Products  or  Services to Be  Delivered  in the  Future"  which
address the  recognition,  measurement and income statement  classification  for
certain sales incentives  (e.g.,  volume purchase rebates and free or discounted
goods).  These guidelines became effective for the Cooperative  during the third
quarter of fiscal 2001 and had no impact on the Cooperative's financial position
or results of operations.

Consolidation: The consolidated financial statements include the Cooperative and
its  subsidiary,  Agrilink  Foods,  and until  February  15,  2001,  its  former
subsidiary,  AgriFrozen.  The  financial  statements  are after  elimination  of
inter-company  transactions  and balances.  Investments in affiliates owned more
than 20 percent  but not in excess of 50 percent are  recorded  under the equity
method of accounting.

Reclassification:  Certain  items for  fiscal  2000 have  been  reclassified  to
conform with the current period presentation.

<PAGE>


NOTE 2. ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

On June 25, 2000, Agrilink Foods adopted FASB Statement of Financial  Accounting
Standards ("SFAS") No. 133,  "Accounting for Derivative  Instruments and Hedging
Activities."  SFAS No. 133 requires the recognition of all derivative  financial
instruments as either assets or liabilities in the balance sheet and measurement
of  those  instruments  at fair  value.  Changes  in the  fair  values  of those
derivatives will be reported in earnings or other comprehensive income depending
on the use of the derivative and whether it qualifies for hedge accounting.  The
accounting for gains and losses  associated  with changes in the fair value of a
derivative and the effect on the consolidated  financial  statements will depend
on its hedge  designation and whether the hedge is highly effective in achieving
offsetting  changes  in the fair  value or cash flow of the  asset or  liability
hedged.  Under the  provisions of SFAS No. 133, the method that will be used for
assessing the effectiveness of a hedging derivative,  as well as the measurement
approach  for  determining  the  ineffective  aspects  of  the  hedge,  must  be
established at the inception of the hedge.

The  Cooperative,  as a result of its  operating and  financing  activities,  is
exposed to changes in foreign currency exchange rates, certain commodity prices,
and interest  rates,  which may adversely  affect its results of operations  and
financial  position.  In seeking to minimize the risks  and/or costs  associated
with such activities, the Cooperative may enter into derivative contracts.

The adoption of SFAS No. 133 did not materially affect the Cooperative's results
of operations or financial position.

Foreign  Currency:  Agrilink  Foods  manages its foreign  currency  related risk
primarily through the use of foreign currency forward  contracts.  The contracts
held by Agrilink Foods are denominated in Mexican pesos.

Agrilink  Foods has entered into foreign  currency  forward  contracts  that are
designated  as cash flow  hedges of  exchange  rate risk  related to  forecasted
foreign  currency-denominated  inter-company sales. During fiscal 2000, Agrilink
Foods  entered  into cash flow hedges for the Mexican peso with  maturity  dates
ranging  from  July  2000 to  April  2001.  Agrilink  Foods  also  entered  into
additional  cash flow hedges  during  fiscal 2001 for 132 million  Mexican pesos
with maturity dates through May 2002.

At March 24, 2001, the fair value of the open contracts was an after-tax gain of
approximately $0.2 million recorded in accumulated other comprehensive income in
shareholder's equity. Amounts deferred to accumulated other comprehensive income
will be reclassified into cost of goods sold. During the third quarter of fiscal
2001,  approximately  $0.1 was reclassified from other  comprehensive  income to
cost of goods sold.  For the nine months  ending March 24,  2001,  approximately
$0.2 million has been  reclassified from other  comprehensive  income to cost of
goods sold. Hedge ineffectiveness was insignificant.

Commodity  Prices:  Agrilink Foods is exposed to commodity price risk related to
forecasted  purchases of soybean oil, an ingredient in the  manufacture of salad
dressings and  mayonnaise.  To mitigate  this risk,  Agrilink  Foods  designates
soybean oil forward contracts as cash flow hedges of its forecasted  soybean oil
purchases.   Agrilink  Foods  maintained   soybean  oil  contracts  that  hedged
approximately 70 percent of its planned soybean oil  requirements  during fiscal
2001.  These contracts were either sold or expired during the fiscal year and an
immaterial loss has been recorded in cost of goods sold.

Agrilink  Foods is also  exposed to commodity  price risk related to  forecasted
purchases of flour in its manufacturing process. To mitigate this risk, Agrilink
Foods  designates a swap agreement as a cash flow hedge of its forecasted  flour
purchases.  Agrilink Foods maintained flour contracts that hedged  approximately
59 percent of its planned flour  requirements  during fiscal 2001. The contracts
expired during fiscal 2001, and an immaterial loss was recorded in cost of goods
sold.

Agrilink  Foods is also  exposed to commodity  price risk related to  forecasted
purchases of corrugated (unbleached kraftliner) in its manufacturing process. To
mitigate this risk,  Agrilink  Foods  designates a swap agreement as a cash flow
hedge of its forecasted corrugated purchases.  At March 24, 2001, Agrilink Foods
had an open swap  hedging  approximately  80 percent of its  planned  corrugated
requirements.  This  agreement had no value at March 24, 2001.  The  termination
date for the agreement is June 2001.

Interest  Rates:  Agrilink  Foods is exposed  to  interest  rate risk  primarily
through its  borrowing  activities.  The majority of Agrilink  Foods'  long-term
borrowings  are  variable  rate  instruments.  Agrilink  Foods  entered into two
interest rate swap contracts  under which Agrilink Foods agrees to pay an amount
equal to a specified fixed rate of interest times a notional  principal  amount,
and to  receive  in return  an  amount  equal to a  specified  variable  rate of
interest times the same notional  principal amount.  The notional amounts of the
contract are not  exchanged  and no other cash  payments are made.  Two interest
rate swap  contracts  were entered into with a major  financial  institution  in
order to minimize credit risk.



<PAGE>

The first  interest  rate swap  contract  required  payment  of a fixed  rate of
interest  (4.96  percent)  and the  receiving  of a  variable  rate of  interest
(three-month  LIBOR of 6.29  percent  as of  March  24,  2001)  on $150  million
notional amount of indebtedness.  Agrilink Foods had a second interest rate swap
contract to pay a fixed rate of interest  (5.32  percent) and receive a variable
rate of interest  (three-month  LIBOR of 6.29  percent as of March 24,  2001) on
$100 million  notional amount of  indebtedness.  Approximately 60 percent of the
underlying debt is being hedged with these interest rate swaps.

Agrilink  Foods  designates  these  interest  rate swap  contracts  as cash flow
hedges. At March 24, 2001, the fair value of the contracts was an after-tax loss
of $0.4 million,  which is recorded in accumulated other comprehensive income in
shareholder's  equity.  To the  extent  that  any of  these  contracts  are  not
considered  effective  in  offsetting  the  change in the value of the  interest
payments  being hedged,  any changes in fair value  relating to the  ineffective
portion of these contracts are immediately  recognized in income.  However,  the
net  gain or  loss on the  ineffective  portion  of  these  interest  rate  swap
contracts was not material during the third quarter and the first nine months of
fiscal 2001. Amounts deferred to other comprehensive income will be reclassified
into interest  expense over the life of the swap contracts.  For the three-month
and nine-month periods ended March 24, 2001, approximately $0.7 million and $2.9
million, respectively, have been reclassified from other comprehensive income to
a reduction of interest  expense.  In addition,  the value of the interest  rate
swap contracts  decreased by $1.9 million during the  three-month  period ending
March 24, 2001.

NOTE 3. CLOSINGS AND DISPOSITIONS

AgriFrozen Closings: On January 22, 2001, AgriFrozen Foods announced that it was
closing its frozen vegetable business  facilities in Woodburn,  Oregon and Walla
Walla and Grandview, Washington. AgriFrozen employed approximately 600 full time
employees at its various  locations.  There were  approximately  150 growers who
historically supplied crops to AgriFrozen. The closings were due to the decision
by AgriFrozen's board not to plant or process crops for the 2001 growing season.
The  combination of current  industry  trends showing a decline in private label
and industrial  frozen vegetable sales and pricing,  and the highly  competitive
nature of the food business were the basis behind this action.

At the request of AgriFrozen's  lenders,  Agrilink Foods submitted a proposal to
purchase  the  inventory  of  AgriFrozen.  The  acquisition  of  the  AgriFrozen
inventory was completed on February 16, 2001. Refer to NOTE 5, "Inventories" for
additional  detail of the  purchase.  There  will be no  further  production  at
AgriFrozen  facilities,  however,  repacking operations at the Woodburn facility
are expected to continue  through April 2001 and  warehousing  operations at the
Woodburn and Walla Walla facilities are expected to continue through June, 2001.
Additionally,   certain  administrative  functions  will  continue  through  the
transition period.

Effective  February  15,  2001,  Pro-Fac  abandoned  its  ownership  interest in
AgriFrozen.   Neither  Pro-Fac  nor  Agrilink  Foods  guaranteed  the  debts  of
AgriFrozen or otherwise  pledged any of their respective  properties as security
for AgriFrozen's  indebtedness.  All of AgriFrozen's  indebtedness was expressly
without  recourse to Pro-Fac and  Agrilink  Foods.  See  further  discussion  at
"Credit  Agreement and  Subordinated  Note Agreement of AgriFrozen" at NOTE 6 to
the "Notes to Consolidated Financial Statements".

Sale of Pickle  Business:  On June 23,  2000,  Agrilink  Foods  sold its  pickle
business  based in Tacoma  Washington  to Dean  Pickle  and  Specialty  Products
Company.  Agrilink  Foods received  proceeds of $10.3  million,  $4.0 million of
which was applied to the term loan  facility and $6.3  million to the  revolving
credit facility. This business included pickle, pepper, and relish products sold
primarily  under the  Nalley  and  Farman's  brand  names.  Agrilink  Foods will
continue to contract  pack Nalley and Farman's  pickle  products for a period of
two years,  beginning on June 23, 2000, at the existing Tacoma  processing plant
which Agrilink Foods will operate.

In a related  transaction,  on July 21, 2000,  Agrilink Foods sold the machinery
and equipment  utilized in the production of pickles and other related  products
to Dean Pickle and Specialty  Products Company.  No significant gain or loss was
recognized on this transaction. Agrilink Foods received proceeds of $5.0 million
which  were  applied to bank  loans,  $3.2  million of which was  applied to the
Agrilink  Foods term loan  facility and $1.8 million of which was applied to the
Agrilink Foods revolving credit facility.

Sale of Midwest Private Label Canned  Vegetable  Business:  On November 8, 1999,
Agrilink Foods completed the sale of its private label canned vegetable business
to Seneca  Foods.  Included in this  transaction  was the  Arlington,  Minnesota
facility.  Agrilink Foods received proceeds of approximately $42.4 million which
were applied to borrowings  outstanding  under Agrilink Foods'  revolving credit
facility.  In addition,  Seneca  Foods  issued to Agrilink  Foods a $5.0 million
unsecured  subordinated  promissory note due February 8, 2009. This  transaction
did not include  Agrilink Foods' retail branded canned  vegetables,  Veg-All and
Freshlike. No significant gain or loss was recognized on this transaction.


<PAGE>



On  December  17,  1999,  Agrilink  Foods  completed  the  sale of its  Cambria,
Wisconsin  processing  facility to Del Monte. The sale included an agreement for
Del Monte to produce a portion of Agrilink  Foods' product needs during the 2000
packing season.  Agrilink Foods received proceeds of approximately $10.5 million
which were  applied to bank  loans.  A gain of  approximately  $2.3  million was
recognized on this transaction.

NOTE 4. AGREEMENTS WITH AGRILINK FOODS AND AGRIFROZEN

Agrilink Foods: The contractual  relationship between Pro-Fac and Agrilink Foods
is defined in the Pro-Fac  Marketing and  Facilitation  Agreement  (the "Pro-Fac
Marketing  Agreement").  Under the Pro-Fac Marketing  Agreement,  Agrilink Foods
pays  Pro-Fac the  commercial  market  value  ("CMV") for all crops  supplied by
Pro-Fac.  CMV is defined as the weighted  average price paid by other commercial
processors  for similar  crops sold under  preseason  contracts  and in the open
market in the same or competing  market area.  Although CMV is intended to be no
more than the fair market value of the crops purchased by Agrilink Foods, it may
be more or less than the price  Agrilink  Foods  would pay in the open market in
the absence of the Pro-Fac Marketing Agreement.

Under the Pro-Fac Marketing Agreement, Agrilink Foods is required to have on its
board of directors some persons who are neither  members of nor affiliated  with
Pro-Fac ("Disinterested  Directors"). The number of Disinterested Directors must
at least equal the number of  directors  who are members of  Pro-Fac's  board of
directors.  The volume and type of crops to be purchased by Agrilink Foods under
the Pro-Fac  Marketing  Agreement are  determined  pursuant to its annual profit
plan, which requires the approval of a majority of the  Disinterested  Directors
of Agrilink Foods. In addition, in any year in which Agrilink Foods has earnings
on products, which were processed from crops supplied by Class A Pro-Fac members
("Pro-Fac  Products"),  Agrilink  Foods pays to Class A members of  Pro-Fac,  as
additional  patronage income, up to 90 percent of such earnings,  but in no case
more than 50 percent of all pretax  earnings  (before  dividing with Pro-Fac) of
Agrilink  Foods.  In years in which Agrilink Foods has losses on Class A Pro-Fac
Products, Agrilink Foods reduces the CMV it would otherwise pay to Pro-Fac by up
to 90  percent  of such  losses,  but in no case by more than 50  percent of all
pretax  losses  (before  dividing with  Pro-Fac) of Agrilink  Foods.  Additional
patronage  income is paid to Pro-Fac for  services  provided to Agrilink  Foods,
including the provision of a long term,  stable crop supply,  favorable  payment
terms for crops and the sharing of risks in losses of certain  operations of the
business.  Earnings and losses are determined at the end of the fiscal year, but
are accrued on an estimated basis during the year.  Under the Pro-Fac  Marketing
Agreement, Pro-Fac is required to reinvest at least 70 percent of the additional
patronage income in Agrilink Foods.

Amounts  received by Class A members of Pro-Fac from Agrilink Foods for the nine
months ended March 24, 2001 and March 25, 2000, include: commercial market value
of crops delivered $67.1 million and $69.4 million, respectively; and additional
proceeds  from  profit  sharing  provisions,  $6.4  million  and $11.3  million,
respectively.

AgriFrozen:  The  contractual  relationship  between  Pro-Fac and  AgriFrozen is
defined  in  a  Marketing  and  Facilitation   Agreement   between  Pro-Fac  and
AgriFrozen. Under the agreement,  AgriFrozen purchased raw products from Pro-Fac
and processed and marketed the finished  products.  AgriFrozen would pay Pro-Fac
CMV for the  crops  supplied  by  Pro-Fac.  In  addition,  in any  year in which
AgriFrozen has earnings AgriFrozen would distribute such earnings to Pro-Fac for
distribution to Class B members of Pro-Fac. In the event AgriFrozen  experiences
any losses on  products,  AgriFrozen  would deduct the losses from the total CMV
payable.  As a result of the closing of  AgriFrozen  facilities  as discussed in
NOTE 3 to the "Notes to Consolidated  Financial Statements," it is expected that
the Marketing and Facilitation  Agreement between Pro-Fac and AgriFrozen will be
terminated at some point after June 30, 2001. It is not expected that there will
be any further CMV payments or any  additional  earnings  distributed to Class B
members.

The board of directors of AgriFrozen resigned effective February 15, 2001.

Amounts  received  by Class B members of Pro-Fac  from  AgriFrozen  for the nine
months ended March 24, 2001 and March 25, 2000, for the commercial  market value
of crops  delivered was $9.4 million and $13.9  million,  respectively.  CMV was
reduced at June 24, 2000 by the $3.0 million loss incurred by AgriFrozen for the
fiscal year then ended.  As of March 24, 2001,  the  estimated  loss,  excluding
gains and  losses,  is  approximately  $13.3  million.  In  accordance  with the
agreement,  the loss at the  fiscal  year-end  will  reduce  the CMV  payable to
members.



<PAGE>


NOTE 5.       INVENTORIES

The major classes of inventories are as follows:

(Dollars in Thousands)
                                March 24,     June 24       March 25,
                                  2001         2000           2000
                              -----------   ----------     ----------
Finished goods                $  319,431    $  290,195     $ 343,614
Raw materials and supplies        28,077        51,736        44,031
                              ----------    ----------     ---------
     Total inventories        $  347,508    $  341,931     $ 387,645
                              ==========    ==========     =========

On February  16,  2001,  Agrilink  Foods  completed  the  purchase of the frozen
vegetable  inventory of  AgriFrozen.  AgriFrozen's  lender sold the inventory to
Agrilink  Foods  pursuant to a private  sale under the uniform  commercial  code
after  AgriFrozen  voluntarily  surrendered  the  inventory  to the lender.  The
purchase  price was $31.6  million of which $10.0 million was paid to the lender
on April 1, 2001,  and the remaining  balance is payable on August 1, 2001.  The
$31.6  million is included in accounts  payable.  In  addition,  under a related
agreement  between  Agrilink  Foods and  AgriFrozen,  Agrilink  Foods  will fund
certain  operating  costs and expenses of  AgriFrozen,  primarily in storing and
converting the purchased inventory to finished goods, during a transition period
ending on June 30, 2001.  These  expenses are estimated at $5.5 to $6.5 million.
Funding is net of  reimbursement  by AgriFrozen  of the proceeds from  available
receivables not pledged to the lender. To date,  Agrilink Foods incurred fees of
approximately  $0.7  million  related to this  transaction  which were  expensed
during the quarter.

NOTE 6. DEBT

<TABLE>
Summary of Long-Term Debt:

(Dollars in Thousands)
<CAPTION>

                                                                    March 24,       June 24,      March 25,
                                                                       2001          2000           2000
                                                                   ----------     ----------     ----------

<S>                                                                <C>            <C>            <C>
Term Loan Facility - Agrilink Foods                                $  417,000     $  428,300     $  435,000
Term Loan Facility - AgriFrozen                                             0         30,000         30,000
Senior Subordinated Notes                                             200,015        200,015        200,015
Subordinated Promissory Notes (net of discount) - Agrilink Foods       28,460         26,144         25,447
Subordinated Promissory Notes (net of discount) - AgriFrozen                0          4,493          4,364
Other                                                                   5,477          6,836          6,865
                                                                   ----------     ----------     ----------
     Total debt                                                       650,952        695,788        701,691
Less current portion                                                  (15,596)       (16,583)       (16,580)
                                                                   ----------     ----------     ----------
     Total long-term debt                                          $  635,356     $  679,205     $  685,111
                                                                   ==========     ==========     ==========
</TABLE>
Amendments  to Term Loan  Facility:  The  Agrilink  Foods'  term  loan  facility
contains  customary  covenants and  restrictions  on Agrilink  Foods' ability to
engage in certain activities,  including, but not limited to: (i) limitations on
the incurrence of indebtedness  and liens,  (ii)  limitations on  sale-leaseback
transactions,   consolidations,  mergers,  sale  of  assets,  transactions  with
affiliates and  investments  and (iii)  covenants  require Pro-Fac to maintain a
minimum level of consolidated EBITDA, a minimum  consolidated  interest coverage
ratio,  a  minimum   consolidated   fixed  charge   coverage  ratio,  a  maximum
consolidated leverage ratio, and a minimum level of consolidated net worth.

During the first quarter of fiscal 2001,  Agrilink Foods negotiated an amendment
to the covenants  outlined under the credit facility.  In consideration for this
amendment, Agrilink Foods incurred a fee of approximately $1.7 million. This fee
is being  amortized  over  the  life of the  credit  facility.  Pursuant  to the
amendment,  the interest rates were modified and the credit  facility  currently
bears  interest,  at  Agrilink  Foods'  option,  at the  Administrative  Agent's
alternate base rate or the London Interbank Offered Rate ("LIBOR") plus, in each
case,  applicable  margins of: (i) in the case of alternate base rate loans, (x)
1.25  percent  for loans  under the  Revolving  Credit  Facility  and the Term A
Facility,  (y) 3.00  percent  for loans  under the Term B Facility  and (z) 3.25
percent for loans under the Term C Facility and (ii) in the case of LIBOR loans,
(x) 3.00 percent for loans under the  Revolving  Credit  Facility and the Term A
Facility,

<PAGE>


(y) 4.00  percent for loans under the Term B Facility  and (z) 4.25  percent for
loans under the Term C Facility.  The  Administrative  Agent's  "alternate  base
rate" is defined as the greater of: (i) the prime  commercial  rate as announced
by the  Administrative  Agent or (ii) the Federal  Funds rate plus 0.50 percent.
Pro-Fac and Agrilink Foods are in compliance  with all covenants,  restrictions,
and requirements under the terms of the credit facility as amended.

Agrilink Foods' Subordinated  Promissory Note: As partial  consideration for the
Dean Foods Vegetable Company ("Dean Foods")  acquisition,  Agrilink Foods issued
to Dean Foods a Subordinated Promissory Note for $30 million aggregate principal
amount due November 22, 2008.  Interest on the  Subordinated  Promissory Note is
accrued quarterly in arrears  commencing  December 31, 1998, at a rate per annum
of 5 percent until November 22, 2003, and at a rate of 10 percent thereafter. As
the rates on the Note are below  market  value,  Agrilink  Foods has imputed the
appropriate  discount  utilizing an effective  interest rate of 11-7/8  percent.
Interest  accruing  through  November  22,  2003 is  required to be paid in kind
through the issuance by Agrilink  Foods of  additional  subordinated  promissory
notes identical to the  Subordinated  Promissory Note.  Interest  accruing after
November 22, 2003 is payable in cash. The  Subordinated  Promissory  Note may be
prepaid at Agrilink Foods' option without premium or penalty.

The  Subordinated  Promissory  Note  is  expressly  subordinate  to  its  Senior
Subordinated Notes and the credit facility and contains no financial  covenants.
The Subordinated Promissory Note is guaranteed by Pro-Fac.

On December 1, 2000, Dean Foods sold the  Subordinated  Promissory Note to Great
Lakes  Kraut  Company,  LLC, a joint  venture  between  the  Agrilink  Foods and
Flanagan Brothers, Inc. This sale did not affect the terms of the note.

Credit Agreement and Subordinated Note Agreement of AgriFrozen:  With respect to
AgriFrozen's  Credit  Facility,  AgriFrozen  is not in  compliance  with certain
financial tests and ratios,  and certain  restrictions  and  limitations,  which
constitute  defaults  under the loan  agreement.  Accordingly,  the  lender  has
accelerated  the  payment of all  obligations,  and it will not  extend  further
credit to AgriFrozen.  AgriFrozen  has,  therefore,  surrendered  certain of its
assets to the lender.

AgriFrozen's obligations are not guaranteed by Pro-Fac or Agrilink Foods and are
expressly  nonrecourse as to Pro-Fac and Agrilink  Foods.  In addition,  neither
Pro-Fac  nor  Agrilink  Foods  pledged  any of their  respective  properties  as
security for AgriFrozen's  indebtedness.  As such, the current  circumstances of
AgriFrozen's  debt and liquidity  are not expected to have a material  affect on
the business of Pro-Fac or Agrilink  Foods.  In addition,  on February 15, 2001,
Pro-Fac  abandoned its ownership  interest in AgriFrozen and,  accordingly,  has
eliminated  all balances  related to  AgriFrozen,  including debt effective that
date. In conjunction with this action, Pro-Fac recognized a loss of $1,000 which
represented its investment in AgriFrozen.

NOTE 7. OPERATING SEGMENTS

The  Cooperative  is  organized by product line for  management  reporting  with
operating   income   being  the  primary   measure  of  segment   profitability.
Accordingly,  no items below operating  earnings are allocated to segments.  The
Cooperative's  four  primary  operating  segments  are as  follows:  vegetables,
fruits, snacks, and canned meals.

The vegetable product line consists of canned and frozen vegetables, chili beans
and various other  products.  Branded  products  within the  vegetable  category
include Birds Eye, Birds Eye Voila!, Freshlike,  Veg-All,  McKenzies, and Brooks
Chili  Beans.  The fruit  product  line  consists  of canned and  frozen  fruits
including  fruit  fillings  and  toppings.  Branded  products  within  the fruit
category  include  Comstock and  Wilderness.  The snack product line consists of
potato chips,  popcorn and other corn-based snack items. Branded products within
the snacks category include Tim's Cascade Chips,  Snyder of Berlin,  Husman,  La
Restaurante,  Erin's, Beehive, Pops-Rite, and Super Pop. The canned meal product
line includes  canned meat products such as chilies,  stew,  soups,  and various
other  ready-to-eat  prepared  meals.  Branded  products  within the canned meal
category  include  Nalley.  The  Cooperative's   other  product  line  primarily
represents salad dressings. Branded products within the "other" category include
Bernstein's and Nalley.
<PAGE>

<TABLE>
The following table illustrates the Cooperative's operating segment information:

(Dollars in Millions)
<CAPTION>

                                                                         Three Months Ended                 Nine Months Ended
                                                                     March 24,        March 25,        March 24,        March 25,
                                                                       2001             2000             2001             2000
                                                                     ---------        ---------        ----------       ---------
<S>                                                                  <C>              <C>              <C>              <C>
Net Sales:
   Vegetables                                                        $  224.6         $   202.3        $  697.5         $   611.0
   Fruits                                                                20.4              19.8            91.1              88.7
   Snacks                                                                21.6              20.8            68.3              64.2
   Canned Meals                                                          16.1              14.9            49.6              49.9
   Other                                                                 11.2              13.1            34.9              41.0
                                                                     --------         ---------        --------         ---------
     Continuing segments                                                293.9             270.9           941.4             854.8
   Businesses sold or closed1                                             4.7              25.4            34.3             111.7
                                                                     --------         ---------        --------         ---------
       Total                                                         $  298.6         $   296.3        $  975.7         $   966.5
                                                                     ========         =========        ========         =========

Operating income:
   Vegetables2                                                       $   17.1         $    16.8        $   48.7         $    56.7
   Fruits                                                                 0.9               1.8            11.9              11.4
   Snacks                                                                 0.6               1.2             4.2               4.1
   Canned Meals                                                           1.2               1.6             5.9               6.1
   Other                                                                  0.4               0.9             1.6               2.4
                                                                     --------         ---------        --------         ---------
     Continuing segments                                                 20.2              22.3            72.3              80.7
   Businesses sold or closed1                                             0.8               1.8             5.3               4.1
                                                                     --------         ---------        --------         ---------
       Subtotal                                                          21.0              24.1            77.6              84.8
Gain on sale of assets                                                    0.0               0.0             0.0               2.3
                                                                     --------         ---------        --------         ---------
Total consolidated operating income                                      21.0              24.1            77.6              87.1
Interest expense                                                        (20.8)            (22.1)          (64.8)            (64.6)
                                                                     --------         ---------        --------         ---------
Income before taxes, dividends, and allocation of net proceeds       $    0.2         $     2.0        $   12.8         $    22.5
                                                                     ========         =========        ========         =========

<FN>
1    Includes the private label canned  vegetable and pickle  businesses sold in
     fiscal 2000, and the results of AgriFrozen Foods closed in fiscal 2001. See
     NOTES 3, 4, and 5 to the "Notes to Consolidated Financial Statements."

2    The vegetable  product line includes  earnings derived from Agrilink Foods'
     investment  in Great Lakes Kraut  Company of $0.3  million and $0.5 million
     for the three months ended March 24, 2001 and March 25, 2000,  respectively
     and $1.5  million and $2.2 million for the nine months ended March 24, 2001
     and March 25, 2000, respectively.
</FN>
</TABLE>

NOTE 8. SUBSIDIARY GUARANTORS

Kennedy  Endeavors,   Incorporated  and  Linden  Oaks  Corporation  wholly-owned
subsidiaries of Agrilink Foods ("Subsidiary  Guarantors"),  and the Cooperative,
have jointly and severally,  fully and unconditionally  guaranteed,  on a senior
subordinated  basis,  the  obligations of Agrilink  Foods' 11-7/8 percent Senior
Subordinated Notes due 2008 (the "Notes") and the Credit Facility. The covenants
in the  Notes  and the  Credit  Facility  do not  restrict  the  ability  of the
Subsidiary Guarantors to make cash distributions to Agrilink Foods.

Separate  financial  statements and other disclosures  concerning the Subsidiary
Guarantors  are not  presented  because  management  has  determined  that  such
financial  statements and other disclosures are not material.  Accordingly,  set
forth below is certain summarized  financial  information derived from unaudited
historical financial  information for the Subsidiary  Guarantors,  on a combined
basis.



<PAGE>

<TABLE>
(Dollars in Millions)
<CAPTION>

                                           Three Months Ended          Nine Months Ended
                                        March 24,     March 25,      March 24,     March 25,
                                          2001          2000           2001          2000
                                        ---------     --------      --------    ------------
<S>                                     <C>            <C>           <C>        <C>
Summarized Statement of Operations:
   Net sales                            $  18.3        $  17.3       $  59.7    $   56.5
   Gross profit                         $  14.2        $  13.7       $  47.5    $   45.5
   Income from continuing operations    $  15.7        $  14.2       $  51.2    $   45.9
   Net income                           $  10.2        $   9.2       $  33.3    $   29.8

Summarized Balance Sheet:
   Current assets                       $   3.3        $   2.9
   Non-current assets                   $ 207.2        $ 212.7
   Current liabilities                  $   8.6        $   6.3
</TABLE>

NOTE 9. OTHER MATTERS

Restructuring:  During the third  quarter of fiscal 1999,  Agrilink  Foods began
implementation of a corporate-wide restructuring program. The overall objectives
of the plan  were to  reduce  expenses,  improve  productivity,  and  streamline
operations.  The total  restructuring  charge  amounted to $5.0  million and was
primarily comprised of employee  termination  benefits.  Efforts have focused on
the  consolidation  of operating  functions and the elimination of approximately
five percent of the work force. Reductions in personnel included operational and
administrative positions and have improved annual earnings by approximately $8.0
million. As of March 24, 2001, the restructuring charge was fully liquidated.

Dividends:  Subsequent  to its  quarter  end,  the  Cooperative  declared a cash
dividend  of $.43 per share on the Class A  Cumulative  Preferred  Stock.  These
dividends approximate $1.9 million and were paid on April 30, 2001.