King Seed Inc. dba Kaystar Seed has recently finalized negotiations with Pannar Seed Inc., in terms of which Pannar Seed Inc. has acquired the greater part of the Kaystar Seed business, including most of its seed related business assets, from King Seed Inc. King Seed Inc, will continue with certain agreed activities in certain species and products which have been excluded from the acquisition by Pannar. It is expected that the remaining formalities relating to this acquisition will be completed before the end of January 2001.

Pannar Seed Inc. is a newly formed South Dakota corporation, which is a subsidiary of the Pannar Group, a privately owned group headquartered in Greytown, South Africa. The Pannar Group's main activities are in the seed business, and encompass plant breeding, product evaluation, seed production, and the marketing of a wide range of crop seeds, pasture seeds, and vegetable seeds. In South Africa Pannar has a dominant market share, and is the leading seed group. It also has operations in various African countries, Europe, and Argentina, and has conducted research and testing activities in the U.S.A. for a number of years in corn, grain sorghum, and sunflower.

Kaystar , based in Huron SD USA, has functioned as a regional seed supplier for many years, and is particularly well-known, and respected, for its marketing activities in corn, sunflower, and soybeans, throughout the Great Plains States.

Kaystar Seed and Pannar have enjoyed an excellent business relationship for a number of years. Both partners are extremely excited about the synergies that will be brought into the new operation, and which will be of immense long-term benefit to Kaystar Seed customers. These will result in increased research and plant breeding activities, and an expansion of the product range and the current marketing area.

The emphasis will be on continuity, and building on the solid and successful market position that Kaystar Seed has achieved over the years. Ken King will continue as President and Chief Executive Officer of Kaystar Seed, and will also serve as a Director of Pannar Seed Inc. The current management and staff of Kaystar Seed will join the new corporation and continue with the Kaystar Seed business. The existing relationships with licensors and suppliers will be respected, maintained, and where appropriate, expanded.

We are confident that our employees and customers will benefit from the exciting challenges and opportunities that lie ahead.