AgriBioTech, Inc. today amounced that it has reached an agreement in principle to sell substantially all of its turfgrass seed assets and Specialty Division creating a value of approximately $65 million, plus assumption of liabilities. As part of the transaction, the purchaser is expected to assume the Company's obligations under contracts with its growers and other contracts. The growers' contracts call for the Company to purchase existing turfgrass seed inventory in the growers' possession.

"The sale of these assets represents a major step forward in the Company's reorganization under Chapter 11," stated Bradley Sharp of Development Specialists, Inc., a court-appointed reorganization consultant to the Company. "We are optimistic that the necessary approvals can be obtained, and the other conditions to completion of the transaction can be satisfied, within the next several weeks."

The purchasers are Kenneth R. Budd and J.R. Simplot Company. Mr. Budd is a former president and chief operating officer of ABT. Completion of the transaction is subject to Bankruptcy Court and other governmental approvals, completion of a business and Iegal due diligence review by the purchaser, agreement on definitive documents, final approval of the purchaser's board of directors, and the absence of any material adverse change in the purchased assets.

"The sale is consistent with the Comppany's previously announced strategy of selling its assets in one or more going-concem sales as efficiently and expeditiously as possible to preserve the value of the bankruptcy estate. As part of this strategy, the Company is actively pursuing, and is close to completing, other agreements in principle to sell its forage seed business as well as other residual assets. Despite the level of interest and the bids received thus far, Management is doubtful that the sale of the Company's assets will generate funds sufficient to permit any distribution to the Company's shareholders," said William A. Brandt, Jr., the Company's bankruptcy court-appointed responsible person.

On February 15, 2000, the Bancruptcy Court approved Mr. Brandt as the Company's responsible person and approved the Company's retention of Development Specialists, Inc. as reorganization consultants. Mr. Brandt is a principal of DSI.

The Company has been subject to Chapter 11 proceedings since January 25, 2000. For further information regarding AgriBioTech's bankruptcy case, see the www.agribiotech.com website and/or theSEC's website (www.sec.gov) filings for the latest 10-Q.

Company news release
N2665