ECOSCIENCE CORP/DE, S-1/A, 1999-06-11

ECOSCIENCE CORP/DE
S-1/A, 1999-06-11
AGRICULTURAL CHEMICALS

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As Filed with the Securities and Exchange Commission on June 11, 1999

Registration No. 333-77959

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------------------

AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------

ECOSCIENCE CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 0182 04-2912632
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
</TABLE>

10 Alvin Court
East Brunswick, New Jersey 08816
(732) 432-8200
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
-----------------------------

Michael A. DeGiglio
President and Chief Executive Officer
EcoScience Corporation
10 Alvin Court
East Brunswick, New Jersey 08816
(732) 432-8200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------------

Copies of all communications to:
Philip D. Forlenza, Esq.
Giordano, Halleran & Ciesla, P.C.
125 Half Mile Road, P.O. Box 190
Middletown, New Jersey 07748
(732) 741-3900
--------------------------------

Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement as the
Selling Stockholders may decide.

If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box. [X]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462
(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

<PAGE>

The information in this Prospectus is not complete and may be changed. We may
not sell these securities until the Registration Statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an offer
to sell these securities, and it is not soliciting offers to buy these
securities in any state where the offer or sale is not permitted.

Subject to Completion, Dated June 11, 1999

PROSPECTUS

1,633,273 SHARES

ECOSCIENCE CORPORATION

COMMON STOCK

The selling stockholders identified in this prospectus are offering
1,633,273 shares of EcoScience Corporation's Common Stock. EcoScience's Common
Stock is traded on the Nasdaq SmallCap Market under the symbol "ECSCE." The last
reported sale price for the common stock on the Nasdaq SmallCap Market on June
__, 1999 was $___ per share. EcoScience will not receive any of the proceeds
from the sale of shares by the selling stockholders and is not offering any
shares for sale under this prospectus. See "Plan of Distribution" for a
description of sales of the shares by the selling stockholders.

--------------------

INVESTING IN THE COMMON STOCK INVOLVES RISKS.

SEE "RISK FACTORS" BEGINNING ON PAGE 6.

--------------------

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

The date of this Prospectus is June __, 1999.

<PAGE>

TABLE OF CONTENTS

Page
----

Prospectus Summary................................................... 3
Risk Factors......................................................... 6
Market for Common Stock and Dividend Policy.......................... 14
Selected Financial Data.............................................. 14
Management's Discussion and Analysis of Financial Condition and 16
Result of Operations............................................
Pro forma Condensed Consolidated Financial Information............... 33
Business............................................................. 38
Management........................................................... 53
Principal and Selling Stockholders................................... 58
Certain Relationships and Related Transactions....................... 59
Plan of Distribution................................................. 60
Description of Securities............................................ 61
Shares Eligible for Future Sale...................................... 62
Legal Matters........................................................ 63
Experts.............................................................. 63
Available Information................................................ 63
Index to Consolidated Financial Statements........................... F-1

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS.
WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM
THAT CONTAINED IN THIS PROSPECTUS. THE SELLING STOCKHOLDERS ARE OFFERING TO
SELL, AND SEEKING OFFERS TO BUY, SHARES OF COMMON STOCK ONLY IN JURISDICTIONS
WHERE OFFERS AND SALES ARE PERMITTED. THE INFORMATION CONTAINED IN THIS
PROSPECTUS IS ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE
TIME OF DELIVERY OF THIS PROSPECTUS OR OF ANY SALE OF THE COMMON STOCK. IN THIS
PROSPECTUS, REFERENCES TO "ECOSCIENCE," "WE," "US" AND "OUR" REFER TO ECOSCIENCE
CORPORATION AND ITS SUBSIDIARIES.

FORWARD LOOKING STATEMENTS

This Prospectus contains forward looking statements that have been made
pursuant to the provisions of the Private Securities Litigation Reform Act of
1995. Such forward-looking statements are not historical facts but rather are
based on current expectations, estimates and projections about our industry, our
beliefs, and assumptions. Words such as "anticipates," "expects," "intends,"
"plans," "believes," "seeks," "estimates" and variations of such words and
similar expressions are intended to identify such forward-looking statements.
These statements are not guarantees of future performance and are subject to
certain risks, uncertainties and other factors, some of which are beyond our
control, that are difficult to predict and could cause actual results to differ
materially from those expressed or forecasted in such forward-looking
statements. Such risks and uncertainties include those described in "Risk
Factors" and elsewhere in this Prospectus. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect our
management's view only as of the date of this Prospectus. We undertake no
obligation to update such statements or publicly release the result of any
revisions to these forward-looking statements that we may make to reflect events
or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.

2
<PAGE>

Because this is only a summary, it does not contain all the information
that may be important to you. You should read the entire Prospectus, especially
"Risk Factors" and the Consolidated Financial Statements and Notes, before
deciding to invest in EcoScience Common Stock. Unless this Prospectus indicates
otherwise (i) all historical financial information contained in the Prospectus
has been restated to account for our acquisition of Agro Power Development, Inc.
pursuant to a merger transaction that was completed on September 30, 1998 and
accounted for as a pooling of interests, (ii) all historical share information
contained in this Prospectus has been adjusted to reflect a one-for-five reverse
split of our Common Stock which occurred on September 30, 1998, (iii) references
to the period ended January 3, 1999 mean the period beginning on July 1, 1998
and ending on January 3, 1999 and (iv) dollar amounts contained in this
Prospectus are presented in thousands (except per share data).

PROSPECTUS SUMMARY

The Company

We are primarily engaged in the production, marketing and sale of
branded premium grade tomatoes grown in intensive greenhouse facilities. In
addition, we market, sell, develop and commercialize products for the
agricultural and biological insect and disease control industries. Our products
include:

o Premium greenhouse grown tomatoes which we produce at large scale
greenhouse facilities that we develop and operate, as well as fresh
tomatoes produced by other greenhouse growers;

o sophisticated growing systems that we sell to participants in the
intensive farming, horticultural and nursery industries;

o coatings and disease control products used to protect fruits and
vegetables in storage and transit; and

o termite control products which we sell to marketers for resale to
household and industrial consumers.

We currently generate a majority of our revenues from the sale of
greenhouse grown vegetables. We entered into this business in September 1998
through a merger transaction with Agro Power Development, Inc. As a result of
the merger transaction, Agro Power Development, Inc. is now our wholly owned
subsidiary. In terms of total acreage controlled by one company, Agro Power
Development, Inc. is the largest producer of greenhouse grown tomatoes in the
United States.

Through Agro Power Development, Inc., we operate seven greenhouses in
Texas, Virginia, Pennsylvania and New York. Until recently, Cogentrix Delaware
Holdings, Inc. was a 50% partner in four of the greenhouses that we operate. In
December 1998, we acquired Cogentrix's interest in these four greenhouses for a
purchase price that consisted of a $20,600 secured note and 1,000,000 shares of
our Common Stock. On March 12, 1999, Cogentrix agreed to extend the maturity
date of the note from March 15, 1999 to June 30, 1999. In connection with the
extension, we issued Cogentrix an additional note in the principal amount of
$1,000 that also becomes due on June 30, 1999. Cogentrix is offering the
1,000,000 shares of Common Stock issued to it for sale by this Prospectus. We
are currently attempting to raise the money necessary to pay Cogentrix the
$21,600 plus accrued interest that becomes due under the notes on June 30, 1999
through a private offering of equity and/or debt securities. If we cannot raise
the funds needed to pay Cogentrix under the notes, Cogentrix could choose to
exercise its rights against us, including taking control of or selling the stock
of Agro Power Development, Inc.

Our executive officers are located at 10 Alvin Court, East Brunswick,
New Jersey. Our phone number is (732) 432-8200.

3
<PAGE>

The Offering

<S> <C>
Common Stock offered by the Selling Stockholders.... 1,633,273 shares.

Use of Proceeds..................................... We will not receive any proceeds from
the sales of the Common Stock by the
selling stockholders.

Nasdaq Small Cap Market Symbol...................... ECSCE.

Risk Factors........................................ The Common Stock offered hereby
involves a high degree of risk. These
risks are described in the section of
this Prospectus captioned "Risk
Factors."
</TABLE>

Summary Consolidated Historical Information
(Amounts in thousands, except per share data)

<TABLE>
<CAPTION>
Three
Six Months Transition Months Thirteen
Year Ended Year Ended Ended Period Ended Ended Weeks Ended
June 30, June 30, December 31, January 3, March 31, April 4
1997 1998 1997 1999 1998 1999
---- ---- ---- ---- ---- ----
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Statement of Operations Data(1):
Net revenues........................ $39,862 $46,177 $17,835 $26,194 $12,291 $18,264
Gross profit........................ 7,583 4,330 3,160 957 4,298 5,425
Operating (loss) income............. 573 (6,471) (1,029) (7,589) 1,514 1,795
Interest and other expense, net..... (1,911) (3,404) (941) (3,086) (995) (2,584)
Income (loss) before income taxes
and minority interest............ (1,338) (9,875) (1,970) (10,675) 519 (789)
Net (loss) income................... 520 (4,237) (680) (8,487) 98 (730)
Earnings (loss) per share:
Basic............................ .05 (0.36) (0.06) (0.73) .01 (0.06)
Diluted.......................... .05 (0.36) (0.06) (0.73) .01 (0.06)
</TABLE>

As of April 4,
1999
----

Selected Balance Sheet Data(1):
Cash equivalents, and ........................................ $ 660
short-term investments
Property, plant and equipment, net ........................... 63,947
Intangible assets including goodwill, net .................... 13,375
Total assets ................................................. 97,793
Debt and capital leases ...................................... 84,586
Stockholders' equity (deficit) ............................... (5,791)

- --------
(1) The summary historical consolidated financial information reflects the
acquisition of Agro Power Development, Inc. pursuant to a merger
transaction which was completed on September 30, 1998 and accounted for as
a pooling of interests. The information is presented as if such transaction
had occurred at the beginning of the earliest period

4
<PAGE>

presented above. In addition, the summary historical consolidated financial
information has been restated to give effect to the one-for-five reverse
split of Common Stock which occurred on September 30, 1998.

<PAGE>

RISK FACTORS

An investment in the shares of Common Stock offered by the Prospectus
is very risky. You should carefully consider the following risk factors before
purchasing the Common Stock.

We Have a History of Losses

We have incurred net losses in recent periods, including net losses of
$730 in the thirteen weeks ended April 4, 1999, $8,487 in the transition period
ended January 3, 1999 and $4,237 in the fiscal year ended June 30, 1998. At the
end of fiscal 1995, we began to implement a restructuring program which was
designed to shift the corporate focus from research and development to
commercial operations. The purpose of the restructuring program was to reduce
operating losses and conserve cash resources. We cannot, however, assure
investors that we will become profitable in the future.

The Recent Merger with APD Presents Integration Issues

We are continuing to integrate the operations of Agro Power
Development, Inc. into our operations, including financial reporting,
information systems and administrative functions. The integration of these
functions requires expenditures of funds and management time.

We Will Require Additional Financing

Our future capital requirements will depend on many factors, including
cash flow from operations, competing technological and market developments and
our ability to market our products successfully. We plan to finance our cash
needs with existing cash reserves, revenues from product sales, bank loans and
private offerings of debt and equity securities. We need to raise additional
capital in order to support our operations during the fiscal year ending January
2, 2000. Additional financing may not be available to us on acceptable terms, if
at all.

We Have Substantial Debt and are in Default Under Certain Loan Agreements

We have a substantial amount of indebtedness. As of April 4, 1999, we
had borrowings of $84,086 outstanding. We had total cash and cash equivalents,
and short-term investments of $660 as of April 4, 1999. The high level of
indebtedness could have important consequences to holders of the Common Stock
including, but not limited to, the following: (i) our ability to obtain
additional financing in the future for working capital, capital expenditures,
acquisitions or general corporate or other purposes may be limited; (ii) a
substantial portion of our cash flow from operations will be dedicated to the
payment of the principal of , and interest on, our indebtedness; (iii) the
agreements governing our long-term indebtedness contain certain restrictive
financial and operating covenants that could limit our ability to compete and
expand; and (iv) our substantial leverage may make us more vulnerable to
economic downturns, limit our ability to withstand competitive pressures and
reduce our flexibility in responding to changing business and economic
conditions.

We are experiencing a significant liquidity problem as a result of the
startup and crop cycle of our four new greenhouse operations. As a result, we
have delayed payments to significant vendors and suppliers of goods that are
vital to our business activities. In addition,

6
<PAGE>

due to cash flow constraints, we were unable to make, on a timely basis, certain
principal and interest payments due under a $60,000 credit facility which is
secured by substantially all of the assets of Agro Power Development, Inc.
Although we subsequently made these payments, we are also in default of certain
financial covenants contained in our loan agreements. As a result of these
defaults, our lenders have the right to accelerate our obligation to repay an
aggregate of approximately $61,574 of indebtedness and approximately $1,923 owed
as of April 4, 1999 under a revolving credit agreement is past due. Furthermore,
the $21,600 owed to Cogentrix becomes due on June 30, 1999 and we will need to
raise funds prior to that date in order to make the payment to Cogentrix. We can
give no assurance that we will be able to raise the funds necessary to repay the
Cogentrix notes or that our lenders will not demand payment of the amounts owed
to them and attempt to enforce their legal remedies. These uncertainties raise
substantial doubts about our ability to continue as a going concern.

The Markets In Which We Operate are Highly Competitive

We face competition from both domestic and foreign producers in the
sale of greenhouse tomatoes to retail supermarkets and distributors. A few large
companies and several smaller companies compete with the Company in the sale of
growing systems to greenhouses and nurseries in North America. Competition in
the fruit and vegetable coatings market is similarly intense. Fruit and
vegetable coating products are developed and marketed primarily by several large
corporations which are better established in the industry, have substantial
technical and financial resources and offer a full range of products, including
products which compete directly with our Bio-Save PostHarvest BioProtectant
products. In addition, several corporations which are smaller in size than us
offer a limited range of fruit and vegetable coating products which compete with
our products.

Competition in the pesticide industry also is intense. We compete with
large manufacturers of synthetic chemical pesticides and other biopesticide
companies. The pesticide industry is dominated by large chemical companies
located in the United States, Japan and Europe. These companies have substantial
financial and technical resources, extensive sales and distribution
capabilities, varied product registration experience and the ability to
manufacture products efficiently. We believe that the commercial success of our
biological pest control products will depend upon the development of cost
effective products which compete with synthetic chemical pesticides on the basis
of effectiveness, safety and ecological benefit. In addition, product line
profitability will depend upon cost effective production and strong sales and
distribution networks for our products.

<PAGE>

Our Share Price May Be Volatile

The market price of our Common Stock (as reported by the Nasdaq Stock
Market and adjusted to reflect the one-for-five reverse stock split which became
effective on September 30, 1998) has during the past two years ranged from a low
of $1-1/4 per share to a high of $9-11/16 per share. Factors such as
announcements of technological innovations or new products by us or our
competitors, government regulatory action, public concern as to the safety of
products developed by us or our competitors, patent or proprietary rights
developments and market conditions in general could have a significant impact on
the future market price of the Common Stock.

Our Business is Subject to Extensive Government Regulation

The manufacture, processing, packaging, storage, distribution and
labeling of food products are subject to extensive federal, state and foreign
laws and regulations. In the United States, our business is subject to
regulation by the Food and Drug Administration, the United States Department of
Agriculture and various state and local agricultural and public health
authorities. The FDA and USDA regulators charged with enforcing these laws and
regulations have broad powers to protect public health, including the power to
inspect produce and our facilities, to order the shut down of a facility or the
suspension of delivery of our produce, as well as the power to impose
substantial fines. We are also subject to various federal and state regulations
relating to workplace safety and worker health, including the Fair Labor
Standards Act, Occupational Safety and Health Act and laws and regulations
governing such matters as minimum wages, overtime and working conditions. We are
subject to various federal, state and local environmental regulations.

Certain of our products and products under development are classified
as pesticides and must meet rigorous testing and registration requirements of
the U.S. Environmental Protection Agency, state regulatory authorities and other
domestic regulatory agencies. The pesticide registration process in many
developed countries is as complex and detailed as it is in the United States.
Most developed countries conduct their own evaluation of data, may require
registration of pesticides before sales are allowed, and may require data
different from or in addition to that required in the United States. The fact
that a particular pesticide product is already registered in the United States
may not result in more rapid approval for that product in another country.
Compliance with regulatory procedures is expensive and can be lengthy. We
estimate that the period between submission of applications for EPA registration
and approval is two years, although that period can extend for a longer time and
there can be no assurance that such registrations or approvals will be obtained.
Failure to obtain such approvals could adversely impact our business.

We may become subject to additional laws or regulations administered by
the FDA, the USDA or other federal, state, foreign or local regulatory
authorities, the repeal of laws or regulations or more stringent interpretations
of current laws or regulations. We cannot predict the nature of any new laws,
regulations or interpretations, or what effect they might have on its business.
Changes in these laws could require the reconfiguration of our production,
processing and transportation methods or increased compliance costs, and could
require us to make significant capital expenditures or incur higher operating
costs. Any failure by us to comply with

8
<PAGE>

applicable laws and regulations could subject us to civil penalties, including
fines, injunctions, greenhouse or pack house closings, recalls or seizures, as
well as potential criminal sanctions, any of which could have a material adverse
effect on us.

Our Patent Position is Uncertain and Our Success Depends on Our Proprietary
Rights

We own or have rights to certain proprietary information, including
patents and patent applications, which relate to our technology and products. We
believe that patents and trade secret protection for certain of our biological
and agricultural products is important to the ultimate success of certain
aspects of our business. We cannot assure that our pending patent applications,
or any defense of any challenged patents, will be successful. Furthermore, we
cannot assure that we will be able to maintain the secrecy of any of our
proprietary technology or trade secrets or that other companies will not develop
independently substantially equivalent or better information and technologies.
In addition, issued patents may not provide adequate protection for the
technology to which they relate and patents may be infringed upon by others.
Defense and prosecution of patent infringement claims can be expensive and time
consuming, even if the outcome is favorable to us.

We Face Manufacturing Risks

We attempt to maintain flexibility in deciding whether to manufacture
products internally or contract with third party manufacturers. The primary
factors that we consider in making this determination include the availability
and cost of third party sources, the anticipated manufacturing volume and our
ability to manufacture profitably. We manufacture our fruit and vegetable
coatings internally at our Orlando, Florida facility. We have entered into
manufacturing agreements with third party manufacturers for the manufacture of
our BioSave postharvest disease control products and the active ingredient in
our BioBlast termiticide product. There can be no assurance that any
manufacturing done by us can be achieved on a cost-effective basis. Furthermore,
delays in locating third party manufacturing sources, or inadequate performance
by any third party manufacturer could have a material adverse impact on certain
aspects of our business.

We Depend on Key Personnel

Our future success is dependent, in part, on the efforts of our senior
management. The loss of the services of one or more of these individuals may
have a material adverse effect upon us. We do not have employment agreements or
non-competition agreements with any of our executive officers for a specific
term. The recruitment and retention of skilled management personnel is important
to our success and competition for such personnel is intense. There can be no
assurance that we will be able to continue to attract and retain such personnel.

Because of the nature of our greenhouse tomato business, we will be
dependent upon our ability to attract and retain qualified personnel to operate
our various greenhouse operations, including growers/managers. There is
significant competition for such qualified personnel, and there is no assurance
that we will be successful in recruiting and retaining such personnel. An
inability to attract and retain qualified personnel, and in the event of labor
unrest, an inability to find qualified replacement personnel rapidly, could
adversely affect the production of our existing greenhouses and our plans to
expand our greenhouse operations.

9
<PAGE>

We Face Potential Delisting by the Nasdaq Stock Market

The Nasdaq Stock Market has notified us that we do not currently meet
its continued listing standards and that due to the merger transaction with APD,
we are required to meet the requirements for a new listing. As a result, the
Nasdaq Stock Market has advised us that it intends to delist our Common Stock.
We appealed the Nasdaq delisting decision at a hearing with Nasdaq
representatives held on June 3, 1999. Nasdaq has not yet advised us of the
appeal decision. Although delisting has been stayed pending the decision, we can
give no assurance that our appeal will be successful.

We Face Uncertainty with Year 2000 Compliance

We have initiated an in-house assessment of our Year 2000 issues as
they relate to our information technology and non-information technology
systems. We have completed an assessment of all of our computer hardware. We
have determined that approximately 95% of our hardware is currently free of Year
2000 problems. Our assessment of software applications relating to communities
with our business partners is 50% complete. We have sent a questionnaire to all
of our critical vendors and customers to determine their Year 2000 compliance.
We have received questionnaires from approximately 15% of these vendors and
customers. Our primary risks relating to Year 2000 compliance are our dependence
on computer hardware and software, our highly computerized greenhouse facilities
and our dependence upon various transportation vendors to move our products to
market. The potential risks to us related to computerized greenhouse operations
are extensive. Our greenhouse facilities use computers to control water,
sunlight, carbon dioxide and temperature. We are currently working with the
vendors of these systems to assess and correct any Year 2000 problems. We expect
that all Year 2000 issues will be addressed by the end of the second quarter of
1999; however, we cannot assure that the Year 2000 issue will not have a
material adverse impact on us. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Year 2000."

We May Face Product Liability Claims

Our business exposes us to potential product liability risks associated
with the testing, manufacturing, sale and distribution of our technology and
products. We maintain product liability insurance, but we cannot assure that we
will be able to maintain such insurance on acceptable terms, that the insurance
will provide adequate coverage, or that we will otherwise be able to avoid
significant liability exposure.

<PAGE>

Our Charter Contains Anti-Takeover Provisions

Our charter provides for staggered terms for the members of the Board
of Directors and certain provisions of the by-laws may be amended only with an
80% stockholder vote. These charter and by-law provisions may discourage
transactions involving an actual or potential change in control which might be
beneficial to us or our stockholders.

We May Issue Preferred Stock

We may issue shares of our Preferred Stock in the future without
stockholder approval and upon such terms as the Board of Directors may
determine. The rights of holders of Common Stock will be subject to, and may be
adversely affected by, the rights of the holders of any Preferred Stock that may
be issued in the future. The issuance of Preferred Stock by us, while providing
desirable flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of discouraging a person from
acquiring a majority of our outstanding Common Stock. We have no present plans
to issue any shares of Preferred Stock.

We Do Not Intend to Pay Dividends

We have never paid any cash dividends on our Common Stock (although our
financial statements reflect the payment of dividends by Agro Power Development
to its shareholders in periods prior to the merger transaction which took place
on September 30, 1998). Our Board of Directors anticipates that for the
foreseeable future our earnings, if any, will be retained for use in our
business and that no cash dividends will be paid on the Common Stock.

Our Operating Results May Fluctuate Significantly

The timing of our operating revenues may vary as a result of the
seasonal nature of our business. In particular, price fluctuations and tomato
market supply have a direct effect on our financial results. Tomato prices, as
well as prices for produce in general, are influenced by changes in supply and
demand as well as general economic conditions and tend to fluctuate
significantly throughout the year. Typically, in the winter months, the reduced
supply of tomatoes, due primarily to the lack of field grown tomatoes, results
in higher market prices. Through the spring and summer months, the supply of
field grown tomatoes increases, resulting in lower market prices. In addition,
the nature of the cycle from crop planting to harvesting creates a period where
no revenues are generated by a particular greenhouse. As a result of these
factors, we expect that our profitability will continue to be subject to
significant seasonal variations, and the results for any particular quarter are
not necessarily indicative of results for subsequent quarters or the full year.

We May be Affected by Crop Disease and Pestilence; We Sell Perishable Goods

Crop disease and pestilence can be unpredictable and can have a
devastating effect on crops, and can result in the loss of all or a major
portion of the crop expected at a particular greenhouse or group of greenhouses
for that harvest season. Even when only a portion of the crop is damaged, the
profits we could have made on the crop will be severely diminished because the
full costs to plant and cultivate the entire crop will have been incurred
although only

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a portion of it can be sold. While some crop diseases and pestilence are
preventable or treatable, the costs of prevention or treatment may be high which
can result in reduced profitability.

Our greenhouse vegetables are subject to all the risks of any
perishable food, including spoilage. Delays in shipments could result in the
loss of the shipment due to spoilage.

Weather and Other Events Could Affect our Production

Although we grow our produce in protected, climate controlled
environments, the size and level of production of each of our greenhouses can be
affected by low sun light levels. In addition, other weather related events,
such as hail, severe storms, tornadoes and earthquakes could damage greenhouse
structures and adversely affect our production.

In June 1998, a tornado damaged approximately 10% of our greenhouse
located in Mt. Carmel, Pennsylvania, resulting in significant structural
damages. Although damage to the structure was covered by insurance, we were not
insured for the related crop damage. We sold the Mt. Carmel greenhouse in June
1999.

We are Sensitive to Price Increases in Raw Materials

Increases in the cost of raw materials essential to our operations,
particularly tomato plant seedlings, bees, rockwool, carbon dioxide, fertilizer,
insecticides and packaging materials, would increase our costs of production,
which we may be unable to recoup through higher sales prices. A scarcity of
these raw materials could require us to curtail production, which also would
have a material adverse effect on our results of operations. We generally do not
enter into agreements for the supply of any raw materials for longer than one
year.

We Lease Some of Our Greenhouse Facilities

We lease three of our greenhouse facilities which collectively
represent 34% of our greenhouse acreage. These leases expire in 2003, 2007 and
2008, respectively. We cannot assure that these leases can be renewed at rents
or upon other terms that are as favorable as the existing terms. If we were not
able to renew the leases, or if we were to renew the leases on less favorable
terms, we could be adversely impacted.

We Depend on Certain Corporate Relationships

We enjoy relationships with other companies which have contributed, and
in some cases continue to contribute, to our success. Our future success will
depend, in part, on developing new relationships and continuing the existing
relationships with these companies. None of our customers is required under
contract or other arrangements to continue to purchase products from us. During
the transition period ended January 3, 1999, approximately 68% of our net
revenues was derived from tomato sales to our ten largest customers. If any of
such customers elected to terminate its relationship with us, such termination
could have a material adverse effect on us.

12
<PAGE>

We have entered into a distribution agreement with Grodania A/S, a
Danish company, pursuant to which we have obtained exclusive rights to
distribute in the United States, Canada, Mexico and the Caribbean, the Grodan(R)
brand of Stonewool, an inert growing medium, manufactured by Grodania. The term
of the agreement expires on December 31, 2000, at which time the agreement will
automatically extended for successive one year terms, unless either party shall
terminate the agreement in accordance with the termination provisions thereof.
Termination of this agreement could have a material adverse effect on our
business, financial condition and results of operations.

Our Growth Strategy Presents Risks

We have experienced substantial growth in our production capabilities
over the past two years, which has placed greater demands on our operating,
administrative and financial resources. Our future growth will depend on a
number of factors, including the timely construction of additional greenhouses,
our ability to control production costs and market our products effectively, our
ability to maintain the quality of our produce and the recruitment and retention
of qualified personnel. Sustaining profitable growth will also require the
implementation of fully integrated enterprise systems and will require
additional management, operating and financial personnel. We cannot assure that
we will be able to manage our expanding operations effectively or that we will
be able to implement our growth plan, and any failure to do so is likely to have
a materially adverse effect on our business, results of operations and financial
condition.

Our Directors and Executive Officers Own a Significant Percentage of Our Capital
Stock

Our directors and executive officers own, in the aggregate,
approximately 73% of our outstanding Common Stock. These stockholders, if acting
together, will be able to control the vote of substantially all matters
requiring approval by our stockholders. Such matters include the election of
directors and the approval of mergers or other business combination
transactions. We may be adversely impacted by the control that such stockholders
will have with respect to matters affecting us.

Substantial Sales of Shares May Impact the Market Price of Our Common Stock

If our stockholders sell substantial amounts of our Common Stock,
including shares issued upon the exercise of outstanding options and warrants,
the market prices of our Common Stock may fall. Such sales also might make it
more difficult for us to sell equity or equity-related securities in the future
at a time and price that we deem appropriate.

Certain holders of our Common Stock are entitled to certain demand and
piggyback registration rights with respect to registration of their shares under
the Securities Act. If such holders, exercising their registration rights, cause
a large number of securities to be registered and sold in the public market,
such sales may have an adverse effect on the market price of our stock. If we
were to initiate a registration and include shares held by these holders
pursuant to the exercise of their piggyback registration rights, such sales may
have an adverse effect on our ability to raise capital.

<PAGE>

MARKET FOR COMMON STOCK; DIVIDEND POLICY

Our Common Stock trades on The Nasdaq Stock Market under the symbol
"ECSCE". As of May 1, 1999, there were approximately 269 holders of record of
the Company's Common Stock. We effectuated a one-for-five reverse stock split
effective at the close of business on September 30, 1998. On June 9, 1999, the
reported closing price of the Common Stock was $1-1/2 per share.

The table below sets forth, for the fiscal quarters indicated, the
reported high and low closing sales prices (reflecting the reverse split at
September 30, 1998) of our Common Stock as reported by the Nasdaq Stock Market
based on published financial sources.

High Low
---- ---
1999
----
Fiscal Quarter ending June 30, 1999
(through June 9, 1999) $2-5/8 $1-1/4
Fiscal Quarter ending March 31, 1999 4-5/8 2-5/8

1998
----
Fiscal Quarter ended January 3, 1999 9 -1/16 5
Fiscal Quarter ended September 30, 1998 9-11/16 6-3/32
Fiscal Quarter ended June 30, 1998 9-1/16 5
Fiscal Quarter ended March 31, 1998 9-11/16 6-3/32

1997
----
Fiscal Quarter ended December 31, 1997 10 5
Fiscal Quarter ended September 30, 1997 7-3/16 5-5/16
Fiscal Quarter ended June 30, 1997 8-3/4 4-7/32
Fiscal Quarter ended March 31, 1997 12-1/2 5

We have not paid any dividends on our Common Stock and we do not
anticipate doing so in the foreseeable future. Certain provisions of our loan
agreements prohibit the payment of dividends.

SELECTED FINANCIAL DATA

The selected financial data presented below has been derived from (i)
the Company's audited consolidated financial statements for the transition
period ended January 3, 1999 and for each year in the five year period ended
June 30, 1998 and (ii) the Company's unaudited consolidated financial statements
for the six months ended December 31, 1997. The information below should be read
in conjunction with Management's Discussion and Analysis of Financial Condition
and Results of Operations and the Consolidated Financial Statements and related
notes which appear elsewhere in this Prospectus.

<PAGE>

<TABLE>
<CAPTION>
Consolidated Statements of Operations Data Transition Six Months
(in thousands, except per share amounts) Period Ended Ended Years Ended June 30,
January 3, December 31, -------------------------------------------------------
1999 1997 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenues ................................... $ 26,194 $ 17,835 $ 46,177 $ 39,862 $ 24,668 $ 20,251 $ 15,535
Cost of revenues ............................... 25,237 14,675 41,847 32,279 18,603 16,617 12,639
-------- -------- -------- -------- -------- -------- --------
Gross profit ................................... 957 3,160 4,330 7,583 6,065 3,634 2,896
-------- -------- -------- -------- -------- -------- --------
Operating expenses:
Selling, general and administrative.......... 8,307 3,987 10,336 6,879 6,394 7,317 7,302
Research and development .................... 239 202 465 508 1,018 4,483 8,156
Asset valuation and restructuring
(reversal) charges ......................... -- -- -- (377) (1,550) 6,000 5,800
-------- -------- -------- -------- -------- -------- --------
Total operating expenses .................... 8,546 4,189 10,801 7,010 5,862 17,800 21,258
-------- -------- -------- -------- -------- -------- --------
Operating (loss) income ........................ (7,589) (1,029) (6,471) 573 203 (14,166) (18,362)
-------- -------- -------- -------- -------- -------- --------
Other (expense) income:
Interest, net ............................... (2,928) (841) (3,289) (1,923) (611) (682) 599
Other, net .................................. (158) (100) (115) 12 136 158 796
-------- -------- -------- -------- -------- -------- --------
Total other (expense) income ............ (3,086) (941) (3,404) (1,911) (475) (524) 1,395
======== ======== ======== ======== ======== ======== ========
Loss before taxes, minority interest
and extraordinary item minority interest ... (10,675) (1,970) (9,875) (1,338) (272) (14,690) (16,967)
Provision for income taxes ..................... 67 21 21 78 116 91 48
-------- -------- -------- -------- -------- -------- --------
Loss before minority interest
and extraordinary item ..................... (10,742) (1,991) (9,896) (1,416) (388) (14,781) (17,015)
Minority interest .............................. 2,255 1,311 5,659 1,936 274 -- --
-------- -------- -------- -------- --------
(Loss) income before extraordinary item ........ (8,487) (680) (4,237) 520 (114) (14,781) (17,015)
Extraordinary item ............................. -- -- -- -- 241 -- --
-------- -------- -------- -------- -------- -------- --------
Net (loss) income .............................. ($ 8,487) ($ 680) ($ 4,237) $ 520 $ 127 ($14,781) ($17,015)
======== ======== ======== ======== ======== ======== ========
(Loss) earnings per share:
- --------------------------
Basic
- -----
Income (loss) before extraordinary item ..... ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 ($ 0.01) ($ 1.31) ($ 1.54)
Extraordinary item .......................... -- -- -- -- 0.02 -- --
-------- -------- -------- -------- -------- -------- --------
Net (loss) income ........................... ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 $ 0.01 ($ 1.31) ($ 1.54)
======== ======== ======== ======== ======== ======== ========
Weighted average basic share outstanding .... 11,641 11,605 11,619 11,548 11,334 11,288 11,070
======== ======== ======== ======== ======== ======== ========
Diluted
- -------
Income (loss) before extraordinary item ..... ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 ($ 0.01) ($ 1.31) ($ 1.54)
Extraordinary item .......................... -- -- -- -- 0.02 -- --
-------- -------- -------- -------- -------- -------- --------
Net (loss) income ........................... ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 $ 0.01 ($ 1.31) ($ 1.54)
======== ======== ======== ======== ======== ======== ========
Weighted average diluted shares outstanding . 11,641 11,605 11,619 11,583 11,381 11,288 11,070
======== ======== ======== ======== ======== ======== ========
</TABLE>

<TABLE>
<CAPTION>
Consolidated Balance Sheet (in thousands June 30,
January -------------------------------------------------------------
1999 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Unrestricted and restricted cash, cash equivalents,
short-term investments and marketable securities ... $ 1,222 $ 4,222 $ 6,787 $ 6,151 $ 8,036 $ 20,542
Total assets ....................................... 101,864 79,508 70,592 36,249 20,465 35,251
Debt and capital leases ............................ 85,797 55,274 43,483 19,460 8,580 8,287
Stockholder's equity (deficit) ..................... $ (5,094) $ (118) $ 4,046 $ 3,010 $ 2,625 $ 17,974
</TABLE>
15
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

EcoScience Corporation ("EcoScience" or the "Company") and its wholly
owned subsidiaries are primarily engaged in the production, marketing and sale
of branded premium grade tomatoes. In addition, the Company markets, sells,
develops and commercializes products for the agricultural and biological insect
and disease control industries. As used herein, the term "Company" refers to
EcoScience and its subsidiaries, unless the context indicates otherwise.

References contained herein to "the period ended January 3, 1999" mean
the period commencing July 1, 1998 and ending January 3, 1999.

The Company's two reportable segments are comprised of (i) greenhouse
tomatoes and (ii) biological and agricultural products.

The Company experienced significant and unprecedented growth during the
first six months of calendar year 1998, particularly in the greenhouse tomato
segment represented by Agro Power Development, Inc. ("APD"). See "Merger with
Agro Power Development, Inc." below. During this period, APD completed
construction and started up approximately 101 additional acres of greenhouse
production in beefsteak (42 acres) and cluster on-the-vine (59 acres) tomatoes.
This increase in acreage represented an approximate 135% increase in production
capacity over the 75 acres of production capacity for calendar year 1997. In
addition, APD began construction on an additional 41 acre greenhouse to grow and
sell colored bell peppers (the "Presidio Phase I Project"). The first 26 acres
of this greenhouse went into operation in October 1998, thereby increasing
production capacity by approximately 169% for calendar 1998 as compared to
calendar 1997. To accommodate this growth, the Company also expanded its sales
and marketing organization and its financial and greenhouse management
operations. Increases in sales and revenues and the achievement of economies of
scale generally lag increases in production capacity, but expenses for startup,
infrastructure and personnel occur in advance of revenues. The operating results
for the period ended January 3, 1999 reflect a significant portion of these
expenses in advance of anticipated revenues from the three new greenhouse
projects.

As described below under "Results of Operations," operating results for
the period ended January 3, 1999 were adversely affected by abbreviated growing
cycles and delays in crop planting at certain of the Company's greenhouse
facilities. In addition, in April 1999, management determined that in view of
unfavorable pricing trends in the pepper market, it would convert the Presidio
Phase I Project from peppers to tomatoes, thereby shortening the harvest period
for the then current pepper crop by approximately three months. As a result,
certain significant expenditures made by the Company to plant the pepper crop
will not be recoverable and were charged to earnings in the three month period
ending January 3, 1999. The Company believes that, with the exception of the
Presidio facility, its greenhouse operations are now approaching their optimal
production schedules for the first time in its history, compared with results in
calendar 1998 when three of seven operations (101 of the 176 acres in operation)
were out of the harvest cycle necessary to achieve optimal production and
pricing due to start-up factors. The Company began to realize the benefits of
the increased production capacity added

16
<PAGE>

during 1998, through its increased production and sales, in the quarter ended
January 3, 1999 and expects this trend to generally continue during 1999.

During the period ended January 3, 1999, the Company incurred
non-recurring expenses of approximately $1,500 as a result of the merger
transaction with APD.

Change of Fiscal Year

The Company has amended its by-laws to change its fiscal year from the
twelve month period ended June 30 to a 52-53 week fiscal year ending on the
Sunday nearest December 31 of each year. For the transition period, the fiscal
year end date will be January 3, 1999.

Merger with Agro Power Development, Inc.

On September 30, 1998, the Company issued 9,421,487 shares of Common
Stock to the holders of the common stock of Agro Power Development, Inc., a
privately held New York corporation ("APDNY") pursuant to the Merger Agreement,
which provided for the merger of APDNY with and into a newly formed, wholly
owned subsidiary of the Company which, at the effective time of the merger,
changed its name to Agro Power Development, Inc. The Merger was structured as a
tax free reorganization under Section 368(a) of the Internal Revenue Code.
Pursuant to the Merger Agreement, the stockholders of APDNY received 30,619.067
shares of the Company's Common Stock for each outstanding share of common stock
of APDNY. In addition, on September 30, 1998, the Company issued 99,000 shares
of Common Stock to certain stockholders of APDNY for their entire 50% interest
in Village Farms of Morocco, S.A., a Moroccan company, as provided for in the
Merger Agreement. The shares of Common Stock issued to the stockholders of APDNY
pursuant to the Merger Agreement represented approximately 80% of the
outstanding shares of the Company, on a fully diluted basis, at the effective
time of the Merger. The Merger has been accounted for as a pooling of interests
and accordingly, the historical consolidated financial statements have been
restated to reflect the business combination as if it had occurred at the
beginning of the earliest period presented.

Acquisition

On December 30, 1998, the Company acquired from Cogentrix all of the
outstanding capital stock of each of Cogentrix Greenhouse Investments, Inc.;
Cogentrix of Fort Davis I, Inc.; Cogentrix of Pocono, Inc.; Cogentrix of Marfa,
Inc. and Cogentrix of Buffalo, Inc. (collectively the "Acquired Companies")
which were 50% partners with the Company in limited partnerships that operate
four of the Company's greenhouse operations. The purchase price of the Acquired
Companies consisted of 1,000,000 shares of EcoScience common stock and a $20,600
note bearing interest at a rate of 11.25% per annum, which was originally due
and payable on March 15, 1999. On March 12, 1999, Cogentrix agreed to extend the
maturity date of the note to June 30, 1999. In connection with the extension,
the Company issued Cogentrix an additional note in the principal amount of
$1,000 which has terms similar to the original note and becomes due on June 30,
1999. The notes are secured by all of the outstanding capital stock of APD and
the Acquired Companies. EcoScience is currently seeking additional debt and
equity financing to fulfill this obligation. If the Company is not successful in
refinancing the $21,600 aggregate principal amount of notes, it will seek an
extension of the due date or a restructuring of the notes. There can be no
assurances that EcoScience will be successful in these efforts.

17
<PAGE>

As a condition to the acquisition, EcoScience agreed to register the
1,000,000 shares of common stock for public sale. In the event the stock is not
registered by June 15, 1999, EcoScience may be required, at the election of
Cogentrix, to repurchase the 1,000,000 shares from Cogentrix at a price equal to
the greater of $4.00 or the market price on the day prior to the repurchase
demand, as provided.

Additional consideration given in the transaction is as follows: (i)
termination of an option agreement with Cogentrix, pursuant to which APD granted
to Cogentrix certain rights to participate in future projects involving the
development, acquisition, owning of or operating by APD of any greenhouse
facility at which fruit or vegetables are to be grown, as defined; (ii)
Cogentrix assigned and contributed its note receivable of $643 along with
accrued interest ($65), due from APD to Cogentrix Greenhouse Investment, Inc.
and (iii) one of the greenhouse limited partnerships cancelled its note
receivable due from Cogentrix in the amount of $1,838, along with accrued
interest ($191). Following the cancellation and the acquisition of the Acquired
Companies by EcoScience, Cogentrix Greenhouse Investment, Inc. issued a
promissory note payable to that greenhouse limited partnership in the same
amount.

Sale of Postharvest Equipment Division

Sales of this division were $3,532 in the period ended January 3, 1999
and $3,557, $4,967 and $2,830 in the fiscal years ended June 30, 1998, 1997 and
1996, respectively. The Company concluded that the long term outlook of the
postharvest equipment distribution business was no longer consistent with its
future strategic direction. This transaction will not result in a material gain
or loss and will not have a material impact on the Company's financial position
or results of operations.

Results of Operations

Thirteen Weeks Ended April 4, 1999 vs.
Three Months Ended March 31, 1998

The Company's net revenues increased by $5,973 or 49% to $18,264 for
the thirteen weeks ended April 4, 1999 from $12,291 for the three months ended
March 31, 1998. This increase was primarily due to the increases in product
sales in the greenhouse tomato market of $7,784, partially offset by decreases
in the biological and agricultural products market of $1,811.

The following table sets forth the Company's net revenues by market for
the thirteen weeks ended April 4, 1999 and the three months ended March 31,
1998:

April 4, March 31,
1999 1998 Increase
---- ---- --------
Tomatoes ............................... $15,159 $ 7,375 $ 7,784
Biological and Agricultural
Products .............................. 3,105 4,916 (1,811)
------- ------- -------
Consolidated ........................... $18,264 $12,291 $ 5,973
======= ======= =======

18
<PAGE>

Net revenues increases for the greenhouse tomato market were primarily
due to increased capacity. The Company's Buffalo, New York, Virginia, Marfa,
Texas and Presidio, Texas facilities (representing 127 acres) became operational
in 1998 and recorded product sales in the thirteen weeks ended April 4, 1999.

Product sale decreases for the biological and agricultural products
market were primarily due to the sale of its Postharvest equipment division on
February 2, 1999. Sales of this division decreased $1,847 or 85% to $316 for the
thirteen weeks ended April 4, 1999 from $2,163 for the three months ended March
31, 1998.

Cost of revenues increased $4,846 or 61% to $12,839 for the thirteen
weeks ended April 4, 1999 from $7,993 for the three months ended March 31, 1998,
primarily due to net revenues increases.

Gross profit on net revenues increased $1,127 or 26% to $5,425 for the
thirteen weeks ended April 4, 1999 from a gross profit of $4,298 for the three
months ended March 31, 1998, primarily as a result of the increase in net
revenues from the tomato segment. Gross profit percentage on net revenues
decreased to 30% for the thirteen weeks ended April 4, 1999 from 35% for the
three months ended March 31, 1998, due primarily to some remaining start-up
costs and the abbreviated crop cycle at the Presidio facility resulting from the
conversion from peppers to tomatoes. Management decided during the thirteen
weeks ended April 4, 1999 to end the crop prematurely in April 1999 due to
unfavorable market prices.

Selling, general and administrative expenses increased $834 or 31% to
$3,513 for the thirteen weeks ended April 4, 1999 from $2,679 for the three
months ended March 31, 1998, primarily due to increased expenses attributable to
the Company's four new greenhouse facilities, and the expansion of the Company's
sales, marketing, finance and greenhouse management operations.

Research and development expenses increased $12 or 11% to $117 for the
thirteen weeks ended April 4, 1999 from $105 for the three months ended March
31, 1998,due primarily to an increase in expenses associated with field trials.

Operating income increased $281 or 19% to $1,795 for the thirteen weeks
ended April 4, 1999 compared to $1,514 for the three months ended March 31,
1998. The increase in operating income resulted primarily from an increase of
$1,127 in gross profit for the thirteen weeks ended April 4, 1999, attributable
primarily to the greenhouse tomato segment and partially offset by a $846
increase in operating expenses.

Other expenses increased by $1,589 to $2,584 for the thirteen weeks
ended April 4, 1999, compared to $995 for the three months ended March 31, 1998,
primarily due to increased interest expenses. Interest expense, net, increased
by $1,576 for the thirteen weeks ended April 4, 1999 compared to the three
months ended March 31, 1998 due to $625 in interest incurred on the $21,600 in
promissory notes issued in connection with the Cogentrix acquisition, $587 in
default interest recorded on the CoBank facility due to certain technical
defaults and increased

19
<PAGE>

indebtedness incurred in connection with the development of the greenhouse
facilities added in 1998.

The Company's net income decreased $828 or $0.07 per basic and diluted
share to a net loss of $730 or $.0.06 per diluted share for the thirteen weeks
ended April 4, 1999 compared to net income of $98 or $0.01 per diluted share for
the three months ended March 31, 1998.

The Company's EBITDA increased $1,544 or 77% to $3,539 for the thirteen
weeks ended April 4, 1999 from $1,995 for the three months ended March 31, 1998.
EBITDA is net income (loss) excluding interest income, interest expense,
depreciation and amortization expense. While EBITDA should not be constructed as
a substitute for income (loss) from operations, net income (loss) or cash flows
from operating activities in analyzing the Company's operating performance,
financial condition or cash flows, the Company is reporting EBITDA because it is
commonly used by certain users of the Company's financial statements to analyze
and compare companies on the basis of operating performance, leverage and
liquidity and to determine a company's ability to service debt.

Transition Ended January 3, 1999 vs.
Six Months Ended December 31, 1997

The Company's net revenues increased by $8,359 or 47% to $26,194 for
the period ended January 3, 1999 from $17,835 for the same period in 1997. This
increase was primarily due to the increases in product sales in the greenhouse
tomato market of $6,797, and the biological and agricultural products market of
$1,562.

<PAGE>

The following table sets forth the Company's net revenues by market for
the period ended January 3, 1999 and the six months ended December 31, 1997:

January 3, December 31,
1999 1997 Increase
---- ---- --------
Tomatoes ................................ $15,453 $ 8,656 $ 6,797
Biological and Agricultural
Products ............................... 10,741 9,179 1,562
------- ------- -------
Consolidated ............................ $26,194 $17,835 $ 8,359
======= ======= =======

Net revenues increases for the greenhouse tomato market were primarily
due to increased capacity. The Company's Buffalo, New York, Virginia and Marfa,
Texas facilities (representing 101 acres) became operational in the first half
of 1998 and recorded product sales in the period ended January 3, 1999. The
Company's Presidio facility (representing 26 acres) became operational in the
six month period ended January 3, 1999.

Net revenues increases for the biological and agricultural products
market were primarily due to approximately $1,236 in Postharvest equipment sold
in the period ended January 3, 1999 that was delayed from the first half of 1998
due to a fire damage sustained at the manufacturer's facility. The remaining
increases related to increased selling efforts.

Cost of revenues increased $10,562 or 72% to $25,237 for the period
ended January 3, 1999 from $14,675 for the same period in 1997, primarily due to
net revenues increases. For tomatoes, cost of revenues sold increased $9,067 or
116% to $16,903 for the period ended January 3, 1999 from $7,836 for the same
period in 1997, primarily due to the significant growth in production (169%)
during 1998 associated with the three new facilities in Virginia, Marfa, Texas
and Buffalo, New York, which combined for substantially all of the increase in
cost of revenues.

Gross profit on net revenues decreased $2,203 to $957 for the period
ended January 3, 1999 from a gross profit of $3,160 for the same period in 1997,
while gross profit percentage on net revenues decreased to 4% for the period
ended January 3, 1999 from 18% for the same period in 1997. Gross profit on net
revenues decreased $2,270 for the tomato greenhouse market to a gross loss of
$1,450 from a gross profit of $820 for the period ended January 3, 1999, while
gross profit percentage decreased to (9%) from 9% in the same period. The
decrease was primarily due to start-up costs and delays at the Company's
Buffalo, New York and Virginia greenhouse facilities and the poor results of its
pepper crop at the Presidio greenhouse facility.

The facilities in Buffalo, New York and Virginia recorded $2,285 in
gross losses because the timing of the construction completion and startup did
not coincide with the optimal cropping cycle (seed, plant, grow, harvest) of
these facilities during the first year of operations. The costs incurred at
these facilities were naturally spread across lower production and sales due to
the abbreviated growing cycle and, therefore, significantly lowered gross
profits of these facilities.

21
<PAGE>

abbreviated crop cycle or harvest period. In addition, the crop cycle of the
Company's 42 acre Virginia greenhouse was adversely impacted by the delay of the
lessor of the facility in obtaining the approval of its lenders required for the
conversion and expansion of the facility. As a result, the Company was not able
to begin planting in the Virginia greenhouse until late in the growing cycle
which delayed tomato production beyond the favorable spring pricing period. As a
result, this facility was unable to produce sufficient yield to cover costs. In
addition, the Company subsequently determined that light levels in Virginia were
sufficient to produce tomatoes in the winter and thus elected to cut short the
already abbreviated growing cycle at the Virginia greenhouse and begin a new
crop that would come into initial harvest in December 1998 when the higher
winter pricing is available in the marketplace. Also, the Buffalo, New York
greenhouse had construction delays and was late in installing infrastructure and
required systems, thereby delaying the start of the normal crop cycle and
further impacting operating performance. These delays increased operating costs
during the period ended January 3, 1999.

The Company's Presidio facility in Texas began pepper production in the
second half of 1998. Management decided, subsequent to January 3,1999, to end
the crop prematurely in April 1999 due to unfavorable market prices. This
resulted in a write down of inventory resulting in $1,784 of negative gross
margin. The Company is currently converting the facility for tomato production
and plans to begin harvesting these tomatoes in June 1999.

Selling, general and administrative expenses increased $4,320 or 108%
to $8,307 for the period ended January 3, 1999 from $3,987 for the same period
in 1997, primarily due to non-recurring merger costs of $1,500, increased
expenses attributable to the Company's four new greenhouse facilities, the
expansion of the Company's sales, marketing, finance and greenhouse management
operations, and post-merger transaction costs, including severance compensation
to former officers and professional fees.

Research and development expenses increased $37 or 18% to $239 for the
period ended January 3, 1999 from $202 for the same period in 1997, due
primarily to increases in personnel and related costs.

Operating loss increased $6,560 to $7,589 for the period ended January
3, 1999 compared to a $1,029 operating loss for the same period in 1997. The
increase in operating loss resulted primarily from a $2,203 decrease in gross
profit for the period ended January 3, 1999 compared to the same period in 1997,
and a $4,357 increase in operating expenses.

Other expenses increased by $2,145 to $3,086 for the period ended
January 3, 1999, compared to $941 for the same period in 1997, primarily due to
increased interest expenses attributable to indebtedness incurred in connection
with the development of the new greenhouse facilities. Interest expense, net,
increased by $2,087 reflecting the higher level of debt outstanding during the
period ended January 3, 1999 compared to the same period in 1997.

The Company's net loss increased $7,807 or $0.67 per diluted share to
$8,487 or $0.73 per diluted share for the period ended January 3, 1999 compared
to a net loss of $680 or $0.06 per diluted share for the same period in 1997.

<PAGE>

Year Ended June 30, 1998 vs.
Year Ended June 30, 1997

The Company's net revenues increased $6,315 or 16% to $46,177 in 1998
from $39,862 in 1997 primarily due to increases in tomatoes product sales of
$6,908, partially offset by a decrease in biological and agricultural product
sales of $593. The following table sets forth the Company's net revenues by
market for 1998 and 1997:

Years Ended
June 30,
----------------------------------
Increase
1998 1997 (Decrease)
---- ---- ----------
Tomatoes ............................... $28,871 $21,963 $ 6,908
Biological and Agricultural
Products .............................. 17,306 17,899 (593)
------- ------- -------
Consolidated ........................... $46,177 $39,862 $ 6,315
======= ======= =======

Net revenues increases for the greenhouse tomato market were primarily
due to increased capacity. The Company's Buffalo, Virginia and Marfa, Texas
facilities (representing 101 acres) became operational in the first half of 1998
and recorded net revenues in 1998.

Net revenues decreases for the biological and agricultural products
market were primarily due to the delayed shipment and installation of equipment
orders as a result of fire damage sustained at the manufacturer's facility. This
decrease was partially offset by increases in the sales of other product lines.
The result of the postponement of shipments caused by the fire had an adverse
effect on the Company's operating results for the fourth quarter of fiscal 1998.

Cost of revenues increased $9,568 or 30% to $41,847 in 1998 from
$32,279 in 1997, primarily due to product sales increases. For tomatoes, cost of
revenues increased $9,705, or 50% to $29,015 in 1998 from $19,310 in 1997,
primarily due to the growth in production during 1998 associated with the three
new facilities in Buffalo, Virginia and Marfa, Texas.

Gross profit on net revenues decreased $3,253 or 43% to $4,330 in 1998
from $7,583 in 1997, while gross margin percentage on product sales decreased to
9% in 1998 from 19% in 1997. For tomatoes, gross profit decreased $2,797 to a
gross loss of $144 in 1998 from a gross profit of $2,653 in 1997, while gross
margin percentage decreased to 0% in 1998 from 12% in 1997 due to the
abbreviated crop cycles, resulting in production costs being spread over lower
sales, in the Buffalo and Virginia facilities and growing system problems at the
Company's Fort Davis, Texas facility which have subsequently been corrected. For
biological and agricultural products, gross profit decreased $456 or to $4,474
in 1998 from $4,930 in 1997, while gross margin percentage decreased to 26% in
1998 from 28% in 1997, due to decreased sales and a shift in product mix towards
certain typically lower margin product lines.

The facilities in Buffalo, New York and Virginia recorded $1,567 in
combined gross losses because the timing of the construction completion and
startup did not coincide with the optimal cropping cycle (seed, plant, grow,
harvest) of these facilities during the first year of operations. The costs
incurred at these facilities were naturally spread across lower production

23
<PAGE>

and sales due to the abbreviated growing cycle and, therefore, significantly
lowered gross profits of these facilities.

The timing of the 101 additional acres that started up between January
and April of 1998 came at a time when market prices were on a seasonal decline
going into the summer season and the crop cycle was coming to an end (to ready
greenhouses for the next and normal starting cycle), thereby preventing the
Company from recovering the up front crop expenditures in an abbreviated crop
cycle or harvest period. In addition, the crop cycle of the Company's 42 acre
Virginia greenhouse was adversely impacted by the delay of lessor of the
facility in obtaining the approval of its lenders required for the conversion
and expansion of the facility. As a result, the Company was not able to begin
planting in the Virginia greenhouse until late in the growing cycle which
delayed tomato production beyond the favorable spring pricing period. As a
result, this facility was unable to produce sufficient yield to cover costs. In
addition, the Company subsequently determined that light levels in Virginia were
sufficient to produce tomatoes in the winter and thus elected to cut short the
already abbreviated growing cycle at the Virginia greenhouse and begin a new
crop that would come into initial harvest in December 1998 when the higher
winter pricing is available in the marketplace. Also, the Buffalo, New York
greenhouse had construction delays and was late in installing infrastructure and
required systems, thereby delaying the start of the normal crop cycle and
further impacting operating performance. These delays increased operating costs
during the quarter ended June 30, 1998.

The facility at Fort Davis, Texas experienced significant production
problems, resulting in lower production, thereby raising costs relative to
sales. This resulted in the recording of $558 in negative gross profit.

Selling, general and administrative expenses increased $3,457 or 50% to
$10,336 in 1998 from $6,879 in 1997, primarily due to start-up costs
attributable to the Company's three new greenhouse facilities and the expansion
of the Company's sales, marketing, finance and greenhouse management operations.

Research and development expenses decreased $43 or 8% to $465 in 1998
from $508 in 1997, primarily due to reductions in personnel and related costs.

In June 1997, the Company reversed $300 of accrued restructuring costs
no longer deemed necessary for facilities consolidation and relocation, which
relate to accrued restructuring costs originally recorded in 1995. In August
1996, the Company and a finance company reached a lease settlement agreement
under which the Company paid $880 to satisfy the remaining lease obligation of
approximately $1,248 of principal and $17 of accrued interest, and returned
certain leased equipment with a net book value of $308 to the finance company,
which resulted in a reversal of a restructuring charge of $77 in 1997. The
Company charged costs and expenses totaling $109 and $273 against the
restructuring accruals during 1998 and 1997, respectively.

Operating income decreased $7,044 to an operating loss of $6,471 for
1998 compared to operating income of $573 for 1997. The decrease in operating
income resulted from a $3,791 increase of total operating expenses in 1998
compared to 1997, in addition to a $3,253 decrease in gross profit. The
operating loss for 1998 was $6,471, a decrease in operating income of $6,667,
compared to operating income of $196 for 1997, when the $377 in restructuring

24
<PAGE>

reversals are excluded. Operating expenses increased $3,414 or 46% to $10,801
for 1998 compared to $7,387 for 1997 when the restructuring reversals are
excluded.

Other income (expense) increased $1,493 or 78% to $3,404 net expense in
1998 compared to $1,911 net expense in 1997. The increase in other, net was
primarily attributable to increased interest expense. Interest expense increased
by $1,366 reflecting the higher level of debt incurred in connection with the
development of the new greenhouse facilities.

The Company's net loss increased $4,757 or $0.41 per share basic and
diluted to a net loss of $4,237 or $0.36 per share basic and diluted for 1998
compared to net income of $520 or $0.05 per share basic and diluted for 1997.
Excluding the $377 reversal of restructuring charges in 1997, the net income for
1997 was $143 or $0.01 per share basic and diluted.

Year Ended June 30, 1997
Compared to Year Ended June 30, 1996

The Company's net revenues increased $15,194 or 62% to $39,862 in 1997
from $24,668 in 1996 primarily due to increases in tomato sales of $10,873, and
biological and agricultural product sales of $4,321. The following table sets
forth the Company's net revenues by market for 1997 and 1996:

Years Ended
June 30
--------------------
1997 1996 Increase
---- ---- --------
Tomatoes ................................ $21,963 $11,090 $10,873
Biological and agricultural
products ............................... 17,899 13,578 4,321
------- ------- -------
Consolidated ............................ $39,862 $24,668 $15,194
======= ======= =======

Net revenues increases for the greenhouse tomato market were primarily
due to increased capacity. The Company's Fort Davis, Texas and Pocono,
Pennsylvania facilities (representing 53 acres) became operational in 1997 and
recorded product sales in 1997.

Net revenues increases for the biological and agricultural products
market were primarily due to increased selling efforts and market penetration
for its substrate, postharvest equipment and irrigation systems product lines.

Cost of revenues increased $13,676 or 74% to $32,279 in 1997 from
$18,603 in 1996, primarily due to product sales increases. For tomatoes, cost of
revenues increased $10,548 or 120% to $19,310 in 1997 from $8,762 in 1996,
primarily due to the growth in production during 1997 associated with the two
new facilities in Fort Davis, Texas and Pocono, Pennsylvania.

Gross profit on net revenues increased $1,518 or 25% to $7,583 in 1997
from $6,065 in 1996, while gross margin percentage on product sales decreased to
19% in 1997 from 25% in 1996. Gross margin percentage decrease was primarily due
to startup costs in the greenhouse tomatoes segment and a shift in product mix
towards typically lower margin equipment product sales in the biological and
agricultural products market, partially offset by increased sales of typically
higher margin Biologicals, Bio-Blast and Bio-Save.

25
<PAGE>

Selling, general and administrative expenses increased $485 or 8% to
$6,879 in 1997 from $6,394 in 1996, primarily due to increases in personnel and
related costs.

Research and development expenses decreased $510 or 50% to $508 in 1997
from $1,018 in 1996, primarily due to reductions in personnel and related costs
and certain professional fees.

In June 1997, the Company reversed $300 of accrued restructuring costs
no longer deemed necessary for facilities consolidation and relocation, which
relate to accrued restructuring costs originally recorded in 1995. In August
1996, the Company and a finance company reached a lease settlement agreement
under which the Company paid $880 to satisfy the remaining lease obligation of
approximately $1,248 of principal and $17 of accrued interest, and returned
certain leased equipment with a net book value of $308 to the finance company,
which resulted in a reversal of a restructuring charge of $77 in 1997. In 1996,
the Company reversed $1,550 of accrued restructuring costs that related to a
termination of a lease for its Worcester corporate headquarters and research and
development facility.

Operating income increased $370 to $573 for 1997 compared to an
operating profit of $203 for 1996. The increase in operating income resulted
from a $1,518 increase in gross profit, partially offset by an increase of
$1,148 in total operating expenses in 1997 compared to 1996. Operating income
for 1997 was $196, an increase of $1,543, compared to an operating loss of
$1,347 for 1996, when the restructuring reversals are excluded. Operating
expenses decreased $25 to $7,387 for 1997 compared to $7,412 for 1996 when the
restructuring reversals are excluded.

Other income (expense) increased $1,436 or 302% to $1,911 net expenses
in 1997 compared to $475 net expense in 1996. The increase was primarily
attributable to an increase in interest expense of $1,312 or 215%, resulting
primarily from the higher average levels of long-term debt and capital lease
obligations outstanding during 1997 compared to 1996.

In 1996, the Company realized an extraordinary gain on the early
extinguishment of debt of $241 or $0.02 per share basic and diluted with no
related income tax effect.

The Company's net income increased $393 or $0.04 per share basic and
diluted to net income of $520 or $0.05 per share basic and diluted for 1997
compared to net income of $127 or $0.01 per share basic and diluted for 1996.
Excluding amounts for the reversals of accrued restructuring costs and
extraordinary gain, net income for 1997 was $143 or $0.01 per share basic and
diluted, a $1,807 or $0.16 per share basic and diluted improvement, compared to
the net loss of $1,664 or $0.15 per share basic and diluted for 1996. The
excluded amounts for the reversals and extraordinary gain of accrued
restructuring costs are: (i) for 1997: the $377 reversals of restructuring
charges; and (ii) for 1996: (a) the $1,550 reversal of accrued restructuring
costs, and (b) the $241 extraordinary gain on early extinguishment of debt.

Liquidity And Capital Resources

The Company's operations have been funded through revenues from product
sales, public and private placements of its equity securities, bank loans and
lease financings, licensing, collaborative research and development
arrangements, and investment income.

26
<PAGE>

The Company is experiencing a significant liquidity shortfall primarily
due to (i) the production start-up issues encountered at and crop cycle
adjustments of the approximate 127 acres of additional greenhouse production
capacity in its greenhouse tomato segment during 1998, discussed above, and (ii)
the need to refinance its $21,600 aggregate principal amount of promissory notes
issued to Cogentrix that becomes due on June 30, 1999 and its $3,000 line of
credit, the extended due date of which was April 28, 1999. In addition, the
Company did not make certain interest and principal payments due to its primary
lender beginning on October 20, 1998, which constituted default, and is in
default of financial covenants with its lenders. In February 1999, the Company
cured its payment defaults with its primary lender. The Company has also delayed
payments to vendors; however, the Company has structured extended terms with
certain vendors and has substantially paid most other vendors whose payments
were delayed.

Production and sales, and correspondingly, cash flow has improved in
the first quarter of calendar 1999 and the Company expects these improvements to
generally continue through 1999. The Company's management has been in close
contact with major suppliers and its lenders, and the parties are working
cooperatively together to manage this cash flow shortfall. Although the
Company's liquidity position is currently manageable, the cash shortfall will
remain until additional capital is raised. The Company is, as well, actively
seeking the refinancing of its $21,600 aggregate principal amount of promissory
notes and its $3,000 revolving line of credit related to its agricultural and
biological products division. If the Company is not successful in refinancing
the notes, it will seek a further extension of the due date or a restructuring
of the terms of the notes. In recent discussions with the Company, Cogentrix has
indicated that it would consider an extension of the due date of the notes to
January 2000; however, any such extension would be subject to the negotiation
and execution of definitive extension agreements. The Company has received a
term sheet from a financial institution in the amount of $4,000 to replace its
expiring revolving line of credit. The Company believes that it will finalize
the replacement financing arrangement in June 1999. No assurance can be given
that the Company will be able to complete the refinancings, obtain an extension
or restructuring of the notes or that the Company's creditors will not attempt
to enforce legal remedies available to them.

Village Farms International Finance Association ("VFIFA") is a
non-profit cooperative formed by APD to obtain and provide construction, term
and working capital financing for its members. VFIFA has entered into each of a
line of credit agreement (the "Line of Credit Agreement"), a term loan agreement
(the "Term Loan Agreement") and a construction loan agreement (the "Construction
Loan Agreement") with CoBank, ACB ("CoBank"), as lender and as agent for other
lenders which may become a party to such agreements (collectively, the "VFIFA
Loan Agreements"). The VFIFA Loan Agreements collectively provide up to $60
million aggregate amount of borrowings availability to VFIFA. The proceeds of
borrowings under the Loan Agreements are loaned by VFIFA to its members and
eligible affiliates of APD (such loans to be referred to herein as "Underlying
Loans" and the recipients of such loans to be referred to herein as "Underlying
Borrowers").

APD has guaranteed all of VFIFA's obligations under the VFIFA Loan
Agreements. Advances under the VFIFA Loan Documents are secured by a first lien
and security interest in all of the assets of VFIFA (including the agreements
and instruments which evidence the

27
<PAGE>

Underlying Loans) and APD. APD is in default of a covenant contained in the
VFIFA Loan Documents which requires it to maintain a 25% ratio of equity to long
term debt. As a result of this default and the payment defaults that were
subsequently cured, CoBank has notified the Company that until the default is
cured, it will not advance funds under the VFIFA Loan Agreements.

Under the terms of the Line of Credit Agreement, CoBank has agreed to
lend VFIFA up to $13,319 on a revolving basis. Subject to CoBank's right to
accelerate due to the existing default, borrowings under the Line of Credit
Agreement become due on September 30, 1999; provided, however, that such date
will be automatically extended for successive 12 month periods unless on or
before July 31, either CoBank or VFIFA elects to terminate the agreement as of
the following September 30.

CoBank has agreed to loan VFIFA up to $46,681 under the Term Loan
Agreement; provided, however, that CoBank's commitment under the Term Loan
Agreement is effectively reduced by the amount of borrowings outstanding under
the Construction Loan Agreement. Subject to CoBank's right to accelerate due to
the existing default, all borrowings under the Term Loan Agreement become due on
July 31, 2010.

CoBank has agreed to make up to $30 million of loans to VFIFA under the
Construction Loan Agreement. Subject to CoBank's right to accelerate due to the
existing default, each advance made under the Construction Loan Agreement with
respect to an Underlying Loan becomes due within 16 months from the date of the
first advance made with respect to such Underlying Loan; provided, however, that
the due date may be extended for a period of approximately 10 years if a
commitment to issue permanent financing with respect to the Underlying Loan is
issued under the Term Loan Agreement but the lenders under the Term Loan
Agreement refuse to provide such refinancing.

In the absence of a default, interest on amounts advanced under the
Line of Credit Agreement accrues at a rate based upon the prime rate. Interest
on amounts advanced under the Term Loan Agreement and the Construction Loan
Agreement accrues at a rate based upon the prime rate unless VFIFA chooses a
"Fixed Rate Option" (which is based upon a LIBOR rate) or a "Quoted Rate Option"
(which is based upon a rated quoted by CoBank). Interest is payable monthly
under all of the Loan Agreements. Due to the existing defaults under the VFIFA
Loan Agreements, CoBank has imposed a default rate of interest which is equal to
4% above the base rate and notified VFIFA that the option to select an
alternative interest rate is not currently available.

The VFIFA Loan Agreements and the documents evidencing the Underlying
Loans made by VFIFA contain covenants, including, among others, covenants which
limit the ability of VFIFA, APD and the Underlying Borrowers to incur other
indebtedness, pay dividends, make distributions, sell assets and participate in
mergers and other acquisition transactions.

As of April 4, 1999, $13,226 of borrowings were outstanding under the
Line of Credit Facility, $3,421 of borrowings were outstanding under the Term
Loan Agreement and $42,273 was outstanding under the Construction Loan
Agreement.

28
<PAGE>

In April 1997, the Company and a lender entered into a $3,000 revolving
line of credit agreement (the "Revolving Credit Agreement") for its biological
and agricultural products division. In the absence of a default, funds borrowed
under the Revolving Agreement bear interest at a rate of prime (7.75% at January
3, 1999) plus 2% and are secured by all the assets of the Company and all of the
outstanding common stock of AGRO owned by the Company. The Revolving Credit
Agreement imposes a financial covenant on the Company that requires a minimum
tangible net worth of $750, as defined. The Company is currently not in
compliance with this covenant. On November 24, 1998, the lender notified the
Company of its intention to terminate the Revolving Credit Agreement on December
28, 1998. The Company and the lender have agreed to four extensions which extend
the maturity date to April 28, 1999. The Company and the lender have agreed to
certain other modifications of the Revolving Credit Agreement, including a
reduction of the $1,200 inventory based borrowing limit by $40 each week which
commenced on January 28, 1999 and an increase in the interest rate to prime plus
5%. As of April 4, 1999, approximately $1,923 of borrowings were outstanding
under the Revolving Credit Agreement.

In January 1999, the Company received a term sheet from an
institutional lender for a $4,000 revolving line of credit which the Company
intends to utilize to replace the Revolving Credit Agreement. The term sheet
provides that (i) the lender's obligation to advance funds will be subject to
certain formulas based upon accounts receivable and inventory, (ii) interest
will accrue at a rate per annum equal to the prime rate plus 2.75%, (iii)
advances will be secured by all of the assets of EcoScience and (iv) the
facility will have a two year term. The lender's obligation to provide the
facility is subject to various conditions, including a satisfactory examination
of the Company and the collateral, the approval of its credit committee and the
absence of any material change in the condition of the Company. No assurance can
be given that the Company and the lender will be able to finalize the proposed
loan facility.

In March 1997, APD borrowed $1,375 from Cogentrix. The note
representing this loan becomes due on June 2, 2000 and provides for quarterly
interest and principal payments of $69. Borrowings under the note bear interest
at the rate of 6% per annum.

Cash and cash equivalents were $660 at April 4, 1999 compared to $1,095
at January 3, 1999. Cash provided by operating activities totaled $773 for the
thirteen weeks ended April 4, 1999 and principally consisted of a decrease in
accounts receivable of $1,704 and depreciation and amortization of $1,598,
partially offset by a decrease in accounts payable and accrued

29
<PAGE>

expenses of $2,085, and a net loss of $730. Cash used in operating activities
totaled $6,015 for the period ended January 3, 1999 and principally consisted of
a net loss of $8,487, minority interest in the net loss of the consolidated
limited partnerships of $2,255 and an increase in inventory of $4,159; partially
offset by an increase in accounts payable and accrued expenses of $6,094, and
depreciation and amortization of $2,146. Cash used in financing activities
totaled $1,211 for the thirteen weeks ended April 4, 1999, which consisted of
payments of long-term debt of $880 and net payments under lines of credit of
$331. Cash provided by financing activities totaled $10,037 for the period ended
January 3, 1999, which consisted principally of net borrowings under lines of
credit of $8,332, proceeds from long-term debt of $3,602 and minority interest
contributions of $1,000 partially offset by payments of long-term debt of
$2,312, and S Corporation stockholder distributions of $400 (prior to the
merger, APD was taxed as a S Corporation, which required this distribution for
payment of related taxes by the APD shareholders). Cash used in investment
activities for the thirteen weeks ended April 4, 1999 totaled $32, which
consisted principally of purchases of property and equipment of $95, and an
increase in non-current assets of $96; partially offset by proceeds from the
sale of investments of $127. Cash used in investment activities for the period
ended January 3, 1999 totaled $4,026, which consisted principally of purchases
of property and equipment of $4,632, associated with the construction of an
additional 26 acre greenhouse facility, and a decrease in non-current
liabilities of $2,548; partially offset by a release of restricted cash of
$2,500, which partially paid down debt in the amount of $1,500. The Company's
current liabilities exceeded its current assets by $82,073 (which includes
$43,651 of senior debt classified as current, which otherwise would have been
classified as long-term had the Company not had certain technical defaults under
the VFIFA Loan Documents) and its current ratio was 0.18 to 1, at April 4, 1999
compared to 0.20 to 1, respectively, at January 3, 1999.

Debt and capital leases decreased by $1,211 to $84,586 at April 4, 1999
compared to $85,797 at January 3, 1999. The decrease was attributable to
payments under the Company's lines of credit and construction loans.

The Company believes that its $660 of cash and cash equivalents as of
April 4, 1999, along with revenues from product sales, and approximately $1,100
of net proceeds derived from the sale of its Mt. Carmel Pennsylvania greenhouse
in June 1999, will be sufficient to fund the Company's working capital needs,
planned capital expenditures, and to service its indebtedness through April 5,
2000, provided that the Company can resolve its short term cash flow shortfall
by raising additional capital and refinance its $21,600 aggregate principal
amount of promissory notes due on June 30, 1999 and its $3,000 Revolving Credit
Agreement that expired on April 28, 1999. The Company has engaged a financial
advisor to assist it in raising additional funds to finance its ongoing
operations in 1999, current debt obligations and expected growth after January
4, 2000. The Company is currently attempting to raise debt and/or equity
financing. If the Company is not successful in refinancing the $21,600 of notes,
it will continue discussions with Cogentrix with respect to an extension of the
due date or a restructuring of the terms of the notes. No assurance can be given
that the Company will be able to complete the refinancings, restructure the
VFIFA loan facility, obtain an extension or restructuring of the notes, or that
the Company's creditors will not attempt to enforce legal remedies available to
them.

30
<PAGE>

Seasonality

The timing of the Company's operating revenues may vary as a result of
the seasonal nature of its businesses. In addition, operating revenues may be
affected by the timing of new product launches, acquisitions, sales orders,
sales product mix, addition of growing capacity, cropping cycles, crop
production and other economic factors. Accordingly, quarterly or other interim
results should not be considered indicative of results to be expected for any
other quarter or for the full fiscal year.

Year 2000

The Company has initiated an in-house assessment of Year 2000 ("Y2K")
issues as they relate to the Company's information technology ("IT") and non-IT
systems. The Company has completed its assessment of all computer hardware. The
Company has determined that 95% of the Company's hardware is free of Year 2000
problems. The Company estimates that the replacement cost of non-compliant
computer hardware will be approximately $10, which amount is budgeted for the
second quarter of 1999. The Company expects that all computer hardware will be
fully compliant by September 1, 1999.

The Company has identified six software applications critical to the
Company's operations. All such packages were purchased from third-party vendors.
Four software applications constitute the Company's accounting applications. The
software vendors for two of those applications have certified the packages to be
Y2K compliant. The other two applications shall be Y2K compliant by the end of
the second quarter of 1999. The Company is in the process of creating test plans
for all accounting applications. The Company expects to complete such compliance
testing by July 31, 1999.

The Company's assessment of software applications relating to
communications with business partners is 50% complete. All such applications
assessed to date are Y2K compliant. The Company expects to complete its
assessment of such applications by the end of the second quarter 1999. The
Company's remaining critical software applications relate to the operations of
the Company's greenhouse facilities. The Company is awaiting a Y2K assessment
and certification from the third-party vendors who maintain such software. Such
assessment and the resulting certification or maintenance is scheduled for
completion by the end of the second quarter of 1999.

In addition to the above-referenced IT systems, the Company is
currently assessing its non-IT systems including its telecommunications and
security systems. This assessment of non-IT systems is 85% complete. To date,
the Company has discovered no Y2K problems. The Company expects that all non-IT
systems shall be Y2K compliant by the end of the second quarter of 1999.

The Company has contacted all of its critical vendors and customers,
and has provided each such vendor and customer with a questionnaire relating to
its respective Y2K compliance. To date, the Company has received completed
questionnaires relating to approximately 15% of such vendors and customers.
Vendors or customers that have not returned a completed questionnaire will be
pursued for a response. Upon its receipt of the remaining questionnaires, the
Company, with appropriate participation by each of its divisions, shall create a
Y2K contingency plan which will provide for vendor supply and customer base
adaptations necessitated by Y2K non-compliance by such parties.

31
<PAGE>

To date, the only anticipated Y2K costs to the Company will relate to
the replacement of non-compliant computer hardware and upgrades of software. The
cost of upgrading current software to become Y2K compliant is expected to be
less than $10. The Company does not expect to incur Y2K assessment and
compliance costs, as such assessments and compliance are performed by Company
personnel.

The Company's primary risks relating to Y2K non-compliance consist of
its dependence upon computer hardware and software, its highly computerized
greenhouse facilities, and its dependence upon various transportation vendors to
move the Company's products to market. As discussed previously, the Company
believes that the risks associated with computer hardware and software will be
minimal. The Company's potential risks associated with its computerized
greenhouse operations are extensive. The greenhouse facilities utilize computers
to control water, sunlight, carbon dioxide and temperature. The costs of
non-compliant control systems would be considerable. The Company is currently
working with the vendors of such control systems to assess and correct any
possible Y2K related problems. The Company expects that the costs to the Company
of such assessment and correction will be minimal, as the Company's vendors are
expected to provide any necessary Y2K corrections at minimal cost to the
Company. Finally, the Company's trucking contractors are among those surveyed
for Y2K compliance. The Company will assess the risks associated with
noncompliance among those contractors and will provide for the use of
alternative transportation sources in its Y2K contingency plan as necessary.

<PAGE>

PRO FORMA CONDENSED
CONSOLIDATED FINANCIAL INFORMATION

(UNAUDITED)

The following Unaudited Pro Forma Condensed Consolidated Statements of
Operations for the Fiscal Year Ended June 30, 1998 and for the Period Ended
January 3, 1999, have been prepared to give effect to (i) the acquisition by the
Company from Cogentrix Delaware Holdings, Inc. ("Cogentrix") of all of the
outstanding common stock of certain corporations that are partners with the
Company in limited partnerships (the "Greenhouse Partnerships") that operate
four of the Company's greenhouse operations (the "Cogentrix Acquisition"), (ii)
the issuance to Cogentrix of 1,000,000 shares of the Company's Common Stock and
$21,600,000 aggregate principal amount of promissory notes bearing interest at
11.25% per annum, (iii) the forgiveness of a note receivable of $1,838,000
bearing interest at 6% per annum, together with accrued interest thereon of
$191,000, due from an affiliate of Cogentrix to one of the Greenhouse
Partnerships, (iv) the forgiveness of a $643,000 note payable bearing interest
at 6% per annum, together with accrued interest thereon of $65,000, due to an
affiliate of Cogentrix from one of the Greenhouse Partnerships and (v)
termination of an Option Agreement with Cogentrix, in which APD granted to
Cogentrix certain rights to participate in future projects involving the
development, acquisition, owning of or operating by APD of any greenhouse
facility at which fruit or vegetables are to be grown, as defined; as if such
transactions had occurred on July 1, 1997.

The pro forma condensed consolidated financial information has been
prepared using the purchase method of accounting for the Cogentrix Acquisition.
Under this method of accounting, an allocation of the purchase price
consideration given plus related acquisition costs incurred by the Company in
connection with these transactions has been made based upon a preliminary
estimate of the fair value of the investment in the net assets acquired from
Cogentrix. The fair value of the 1,000,000 shares of Common Stock which was
issued on December 30, 1998, has been estimated at $4.00 per share using the
average of the closing market prices for the seven trading days between November
27, 1998 and December 7, 1998, the date on which the Stock Purchase Agreement
was executed. The actual purchase accounting adjustments to reflect the fair
value of the investment in the net assets acquired from Cogentrix will be based
upon an independent appraisal, and accordingly, the pro forma adjustments that
have been used in the pro forma condensed consolidated financial information are
subject to change pending final allocation of the purchase price and are based
on preliminary assumptions regarding purchase accounting adjustments.

The pro forma condensed consolidated statements of operations have been
prepared to reflect the Company's purchase of Cogentrix's minority interests in
the four Greenhouse Partnerships after giving effect to the pro forma
adjustments for depreciation expense, goodwill amortization expense, interest
income, and interest expense related to the transactions described above. The
pro forma condensed consolidated financial information does not purport to be
indicative of the Company's consolidated results of operations or financial
position that would have been reported had these transactions occurred on the
dates indicated above, nor which may occur in the future.

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE TRANSITION PERIOD ENDED JANUARY 3, 1999
(In thousands, except per share data)

Pro Forma
----------------------------
Historical Transaction
Company Adjustments(1) Consolidated
------- -------------- ------------
Net revenue ........................... $ 26,194 $ 26,194
Cost of revenue ....................... 25,237 $ 233(2) 25,470
-------- -------- --------
Gross profit (loss) ................... 957 (233) 724
Operating expenses:
Selling, general and administrative 8,307 301 8,608
Research and development ........... 239 239
-------- -------- --------
Total operating expenses ....... 8,546 301 8,847
-------- -------- --------
Operating loss ........................ (7,589) (534) (8,123)
Other income (expenses):
Interest, net ...................... (2,928) (1,250) (4,178)
Other, net ......................... (158) (158)
-------- -------- --------
Total other expense, net ....... (3,086) (1,250) (4,336)
-------- -------- --------
Income before income taxes and minority
interest ............................. (10,675) (1,784) (12,459)
Provision for (benefit from) income
taxes ................................ 67 0(6) 67
-------- -------- -------
Loss before minority interest ......... (10,742) (1,784) (12,526)
Minority interest in net loss of
consolidated limited partnerships .... 2,255 (2,255) 0
-------- -------- --------
Net loss .............................. ($ 8,487) ($ 4,039) ($12,526)
======== ======== ========
Loss per share:
Basic
-----
Net loss ......................... ($ 0.73) ($ 0.99)
======== ========
Weighted average basic shares
outstanding .......................... 11,641 1,000(1) 12,641
======== ======= ========
Diluted
-------
Net loss ......................... $ (0.73) $ (0.99)
======== ========
Weighted average diluted shares
outstanding .......................... 11,641 1,000 12,641
======== ======= ========

See accompanying notes to pro forma condensed financial information.

34
<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE FISCAL YEAR ENDED JUNE 30, 1998
(In thousands, except per share data)

Pro Forma
----------------------------
Historical Transaction
Company Adjustments(1) Consolidated
------- -------------- ------------
Net revenue ........................... $ 46,177 $ 46,177
Cost of revenue ....................... 41,847 $ 467(2) 42,314
-------- -------- --------
Gross profit .......................... 4,330 (467) 3,863
Operating expenses:
Selling, general and administrative 10,336 603(3) 10,939
Research and development ........... 465 465
-------- -------- --------
Total operating expenses ....... 10,801 603 11,404
-------- -------- --------
Operating loss ........................ (6,471) (1,070) (7,541)
-------- -------- --------
Other income (expenses):
Interest, net ...................... (3,289) (2,501)(4) (5,790)
Other, net ......................... (115) (115)
-------- -------- --------
Total other expense, net ....... (3,404) (2,501) (5,905)
Income before income taxes and
minority interest .................... (9,875) (3,571) (13,446)
Provision for income taxes (benefit) .. 21 0(6) 21
-------- -------- --------
Income before minority interest ....... (9,896) (3,571) (13,467)
Minority interest in net loss of
consolidated limited partnerships .... 5,659 (5,659)(5) 0
-------- -------- --------
Net loss .............................. ($ 4,237) ($ 9,230) ($13,467)
======== ======== ========
Loss per share:
Basic
Net loss ........................... (0.36) (1.07)
======== ========
Weighted average basic shares
outstanding .......................... 11,619 1,000(1) 12,619
======== ======== ========
Diluted
Net loss ........................... (0.36) (1.07)
======== ========
Weighted average diluted shares
outstanding .......................... 11,619 1,000(1) 12,619
======== ======== ========

See accompanying notes to pro forma condensed financial information.

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES

NOTES TO PRO FORMA CONDENSED
CONSOLIDATED FINANCIAL INFORMATION

(UNAUDITED)

(1) Pursuant to the Stock Purchase Agreement by and between Cogentrix and the
Company, the closing and effective date of which was December 30, 1998, the
Company issued 1,000,000 shares of its Common Stock with a par value of
$0.01 per share and a $20,600 promissory note bearing interest at 11.25%
per annum, which was originally due and payable on March 15, 1999, in
exchange for all of the outstanding stock of certain corporations that were
partners with the Company in limited partnerships that operate four
greenhouses. On March 12, 1999, Cogentrix agreed to extend the maturity
date of the note to June 30, 1999 for $1,000.

In addition, pursuant to the Stock Purchase Agreement, the Company has
forgiven the amount due from Cogentrix of $1,838 under a promissory note
bearing interest at a rate of 6% per annum, together with accrued interest
thereon of $191, and Cogentrix has forgiven the amount due from the Company
of $643 under a promissory note bearing interest at a rate of 6% per annum,
together with the accrued interest thereon of $65.

The accompanying pro forma condensed consolidated financial information
does not contain a pro forma balance sheet as of January 3, 1999 as the
effects of the above acquisition have been reflected in the historical
January 3 1999 financial statements of the Company contained herein.

The estimated goodwill asset which has resulted from these transactions is
as follows:
(amounts in thousands, except per share and percentage data):

Fair value of Common Stock issued based upon an
average of the closing market prices as reported
between November 27, 1998 and December 7,
1998 ($4.00 per share)...................................... $4,000
Issuance of 11.25% promissory notes payable to
Cogentrix on June 30, 1999.................................. 21,600
Forgiveness of 6% promissory note due from
Cogentrix................................................... 1,838
Forgiveness of 6% promissory note due to Cogentrix........... (643)
Forgiveness of accrued interest receivable for 6%
promissory note due from Cogentrix.......................... 191
Forgiveness of accrued interest payable for 6%
promissory note due to Cogentrix............................ (65)
Estimated accrued transaction costs.......................... 325
-------
Total purchase price consideration given by
the Company................................................. 27,246
Estimated fair value of the net assets of the
four greenhouses acquired from Cogentrix,
including $5,848 in minority interest....................... 15,188
-------
Estimated excess of purchase price over net
assets acquired (goodwill).................................. $12,058
=======

(2) To adjust depreciation expense on property and equipment using the
straight-line method, as follows:
(amounts in thousands, except useful life and time factor data):

Amount of step-up in basis of property and
equipment for the interests in four greenhouses
acquired to estimated fair value............................. $9,340
Estimated useful life in years................................ 20
------
Pro forma depreciation expense adjustment for fiscal
year ended June 30, 1998..................................... $467
Factor to divide annual pro forma depreciation
expense to determine pro forma adjustment for
transition period............................................ 2
------
Pro forma depreciation expense adjustment for
the transition period ended January 3, 1999.................. $233
======
36
<PAGE>

(3) To reflect goodwill amortization expense which resulted from the Company's
purchase of the acquired entities using the straight-line method as
follows:

(amounts in thousands, except useful life data):

Amount of goodwill related to the purchase of the
acquired entities in four greenhouses estimated above......... $12,058
Estimated useful life in years................................. 20
-------
Pro forma goodwill amortization expense adjustment
for fiscal year ended June 30, 1998........................... $603
Factor to divide annual pro forma goodwill
amortization expense to determine pro forma
adjustment for transition period.............................. 2
-------
Pro forma goodwill amortization expense for the
transition period ended January 3, 1999....................... $ 301
=======

(4) To adjust interest income and interest expense to reflect the issuance of
the $21,600 aggregate principal amount of promissory notes bearing interest
at 11.25% per annum, the forgiveness of the $1,838 promissory note bearing
interest at 6% per annum due from Cogentrix, and the forgiveness of the
$643 promissory note bearing interest at 6% per annum due to Cogentrix as
if such transactions had occurred at the beginning of periods presented as
follows:

(amounts in thousands, except percentage and time factor data):

Record interest expense on 11.25% $21,600 notes
payable to Cogentrix.......................................... ($2,430)
Eliminate interest expense on 6% $643 note
payable to Cogentrix.......................................... 39
Eliminate interest income on 6% 1,838 note
receivable from Cogentrix..................................... (110)
-------
Pro forma interest expense, net of interest
income adjustment for the fiscal year ended June 30, 1998..... ($2,501)
-------
Factor to divide annual pro forma interest expense, net
to determine pro forma adjustments for transition period....... 2
-------
Pro forma interest expense, net of interest income
adjustment for the transition period ended January 3, 1999..... ($1,250)
=======

(5) To eliminate minority interest in net losses from the limited partnerships.

(6) Since the Company has incurred significant historical operating losses for
both financial and income tax reporting purposes for the periods presented
and due to the uncertainty of the realization of the benefit of any related
deferred tax assets, the pro forma adjustments do not reflect any income
tax benefit.

37
<PAGE>

BUSINESS

General

The Company is primarily engaged in the production, marketing and sale
of branded premium grade tomatoes grown in intensive greenhouse facilities. In
addition, the Company markets, sells, develops and commercializes products for
the agricultural and biological insect and disease control industries.

The Company is, in terms of total acreage controlled by a single
entity, the largest producer and marketer of premium quality, greenhouse grown
tomatoes in the United States. The Company conducts its greenhouse operations
through APD, a wholly owned subsidiary which was acquired by the Company
pursuant to a merger transaction which became effective on September 30, 1998.
APD develops, constructs and operates sophisticated, highly intensive
agricultural greenhouse projects and markets and sells the premium tomatoes
produced at these facilities, as well as tomatoes produced by other greenhouse
growers, under its Village Farms(R) and Home Choice(TM) brand names as a
consumer product, primarily to retail supermarkets and dedicated fresh food
distribution companies. In 1998, APD sold approximately 47.8 million pounds of
tomatoes grown at APD greenhouses, and sold an additional 4.3 million pounds of
tomatoes under APD's Village Farms(R) and Home Choice(TM) brand names pursuant
to marketing arrangements with third party producers.

The Company serves the biological and agricultural product markets
primarily through three subsidiaries: Agro Dynamics, Inc. and Agro Dynamics
Canada Inc. (collectively, "AGRO") and EcoScience Produce Systems Corp.
("EPSC").

EcoScience was incorporated under the laws of the State of Florida on
August 27, 1982, and was reincorporated in the State of Delaware on June 29,
1988. On November 18, 1992, EcoScience acquired all of the outstanding capital
stock of AGRO, an East Brunswick, New Jersey based company that engineers,
designs, markets and distributes advanced technologies, products, growing
systems and services for the North American intensive farming, horticulture,
nursery and produce packing industries. On May 24, 1994, the Company acquired
certain assets and liabilities of American Machinery Corporation ("AMC"), an
Orlando, Florida based business that provided postharvest coating products and
services to the fresh fruit and vegetable markets throughout the United States,
the Caribbean, Central America and South America. Concurrent with the
acquisition of certain assets and liabilities of AMC, the Company formed EPSC to
combine the AMC product line and operating unit with the Company's existing
activities in those markets.

In February 1999, the Company sold its postharvest equipment
distribution business, which engaged primarily in the sale of sorting, grading
and packing systems manufactured by Aweta, B.V., to Autoline, Inc.

The Company's primary products are (i) premium greenhouse grown
tomatoes which it sells to retail supermarkets and dedicated fresh food
distribution companies, (ii) advanced growing systems based on Stonewool(R),
manufactured by Grodania A/S, (iii) computerized environmental and irrigation
control systems manufactured by H. Hoogendoorn Automation

38
<PAGE>

B.V., (iv) PacRite(R) and Indian River Gold(TM) coatings manufactured by EPSC,
(v) Bio-Save(R) PostHarvest BioProtectant line of products and (vi) Bio-Blast(R)
Biological Termiticide manufactured by EcoScience. In addition, the Company
distributes a broad array of specialty products used in greenhouses and in
fruit, vegetable and ornamental packing.

Financial information for each of the Company's business segments is
set forth in "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and Note 15 to the Company's Consolidated Financial
Statements. Financial information segregated by major geographic area (United
States and Canada) is set forth in Note 15 to the Company's Consolidated
Financial Statements.

Greenhouse Tomatoes

General

Through APD, the Company currently operates seven greenhouse facilities
in the United States, representing approximately 190 acres of growing capacity.
Three of these facilities, each of which has approximately forty-one (41) acres
of growing capacity, are among the largest greenhouses in the United States. By
producing, harvesting, packaging and directly marketing all of its products, APD
eliminates numerous intermediaries (i.e. repackers, brokers and wholesalers)
utilized by traditional field producers of fresh vegetables. In order to develop
additional sources of supply, APD has entered into agreements to market and sell
fresh tomatoes produced, under Village Farms(R) specifications, by two other
greenhouse operations, which currently comprise a total of approximately 30
acres. If these marketing arrangements remain in effect, APD will control the
marketing of approximately 216 acres of greenhouse vegetable production.

The Greenhouse Vegetable Industry

Approximately $7 billion at the retail level, or over 5 billion pounds,
of fresh tomatoes were sold in the United States in 1998. According to industry
estimates, greenhouse grown tomatoes currently represent only approximately 10%
to 12% of the fresh tomatoes sold in the United States. Although the United
States greenhouses vegetable industry is growing rapidly (as evidenced by an
increase in greenhouse tomato acreage from 1996 to 1997 of approximately 30%
according to Dr. Richard Snyder, Vegetable Specialist at Mississippi State
University), the Company estimates that there are only 700 to 900 acres devoted
to greenhouse vegetable production in the United States and approximately 55% of
the greenhouse grown tomatoes sold in the United States are imported from other
countries. The Company believes that a significant opportunity exists for
greenhouse growers to capture a sizable share of the market for certain fresh
vegetables, including tomatoes.

The ability to control climatic conditions within a greenhouse enables
greenhouse growers to produce varieties of tomatoes that are superior to field
grown tomatoes in terms of taste, color, appearance and shelf life. This is
particularly notable during periods when local production is not available. In
many markets, the only fresh tomatoes that are consistently available during
"off season periods" are picked while green and treated with ethylene gas during
shipment from California, Florida or Mexico to turn the tomatoes red. The
Company believes that due to inferior flavor, many consumers avoid tomatoes
during off season periods and

39
<PAGE>

generally consume only tomatoes grown in their gardens or purchased from nearby
farm stands during a limited period of seasonal availability. When greenhouse
grown tomatoes are available, consumers have demonstrated a willingness to pay a
premium price for superior quality and taste. A 1996 study conducted by
Information Resources, Inc., an independent research firm, at APD's request
indicated that in certain areas of the United States (western New York; Denver,
Colorado; Detroit, Michigan; and New England), where local production has been
available to certain retail chains from nearby greenhouses with consistent
quality and volume, the percentage of greenhouse grown tomatoes sold by the
retail chains has averaged 40% to 70% of total fresh tomato sales by the
retailers. According to information provided to APD by two of these retail
chains which are currently APD customers, in 1990 sales of greenhouse grown
tomatoes did not exceed 15% of fresh tomato sales.

Greenhouse vegetable production has been a thriving industry in Europe,
particularly the Netherlands, since the 1940s. The acreage devoted to greenhouse
vegetable production in Europe is substantially greater than greenhouse acreage
in the United States. Imported greenhouse grown tomatoes from Europe, Israel and
Canada are available at certain times of the year in major United States markets
but, with the exception of Canadian tomatoes, are rarely distributed throughout
the United States due to the additional freight, distribution costs and
distribution channels necessary to reach central and western markets. Due to
insufficient domestic greenhouse production, imports currently represent the
only option for many large volume United States supermarkets. The supply of
imported tomatoes is, however, limited and often erratic because foreign market
exporters generally sell first to their domestic markets to avoid the increased
distribution costs associated with distributing tomatoes in the United States.

The Company believes that the market for greenhouse grown produce has
significant growth potential due to: (i) the superior quality and flavor of
greenhouse grown vegetables; (ii) an increase in the demand for fresh fruit and
vegetables, including greenhouse grown tomatoes and other vegetables; (iii) the
health and food safety benefits of U.S. produced greenhouse grown produce and
(iv) a growing but limited supply of greenhouse grown produce. The successful
production of greenhouse vegetables on a large scale basis, however, requires
specialized operating skills, know-how, technology, complex logistics support,
market knowledge and capital. As the developer and operator of three of the
largest tomato greenhouses in the United States, the Company believes that the
experience it has gained, the technological innovations it has made and the
success it has achieved to date as an industry leader makes it uniquely and
strategically positioned and qualified to take advantage of promising market
opportunities.

Greenhouse Operations

The Company currently owns four of the seven greenhouse facilities
currently in operation. The other three facilities are leased. The Company uses
inert media culture systems to grow tomatoes in these glass paneled greenhouse
structures which currently range from 10 to 42 acres. Using these sophisticated
systems, tomatoes are grown not in soil but in "rockwool," a porous, artificial
substrate made out of volcanic based rock. Through drip irrigation, each plant
is fed nutrients directly from a computer-controlled irrigation system. Hot
water is circulated through pipes running next to the plants to keep the plants
at optimal temperature, which varies throughout each 24 hour period and crop
lifecycle. The water is heated by cogeneration sources and/or natural gas
boilers which capture carbon dioxide that is recycled back to the greenhouse

40
<PAGE>

for plant consumption. The Company's computer systems enable it to regulate
substantially all environmental and climate parameters to optimize growing
conditions. The Company believes that greenhouses generally yield approximately
10 to 20 times the yield of comparable outdoor farm acreage, depending on the
crop. The Company's production methods incorporate technology and growing
systems substantially similar to those used throughout the well established
European greenhouse growing industry.

The Company's tomatoes are naturally pollinated by bumblebees released
into the greenhouse. Integrated pest management practices such as predator
insects are used to control pests such as white fly.

Three of the greenhouse facilities operated by the Company were
developed in conjunction with electric cogeneration plants. Federal laws enacted
in the 1970s encouraged the establishment of cogeneration plants and the use of
their waste steam to provide heat for other industries, including greenhouse
vegetable production. The use of this waste steam enables the Company to heat
greenhouses located near cogeneration plants. Cogentrix is a developer and
operator of two cogeneration energy facilities with which the Company has
associated greenhouse operations.

The Company forms separate operating companies to own and/or lease and
manage each of the greenhouse facilities it operates. The following table
provides information with respect to the Company's greenhouse facilities:

<TABLE>
<CAPTION>
Date
Operations Leased/
Greenhouse Facility Commenced Acreage Location Owned
------------------- --------- ------- -------- -----
<S> <C> <C> <C> <C>
Keystone Village Farms 3/1/94 10 Ringgold, PA Leased(1)
Village Farms of Wheatfield 3/1/94 12 Wheatfield, NY Leased(2)
Village Farms of Texas 12/1/96 41 Fort Davis, TX Owned
Village Farms of Marfa 12/1/97 41 Marfa, TX Owned
Village Farms of Buffalo 4/1/98 18 Buffalo, NY Owned
Village Farms of Virginia 4/1/98 42 King George Cty, VA Leased(3)
Village Farms of Presidio 10/1/98 26 Marfa, TX Owned(4)
----
Total Acreage 190
</TABLE>

- ----------
(1) This facility is leased pursuant to a ten year lease agreement with
Cogentrix which expires in 2003 and requires the Company to pay a fixed
monthly lease payment and an annual supplemental lease payment based on a
specified percentage of Cash Flow (as defined) of the facility.

(2) This facility is leased pursuant to a 15 year operating and lease agreement
which expires in 2008 and requires the Company to pay a fixed monthly lease
payment and an annual supplemental lease payment based upon a percentage of
the net operating income (as defined) of the facility.

(3) This facility is leased pursuant to a ten year lease and operating
agreement which expires in 2007 and requires a fixed quarterly rental
payment and an annual supplemental payment equal to a specified percentage
of the Cash Flow (as defined) of the facility.

41
<PAGE>

(4) The Company has an 85.25% limited partnership interest and a 1% general
partnership interest in the limited partnership which owns this facility.
Third party investors own a 12.75% limited partnership interest and a 1%
general partnership interest in the limited partnership.

In June 1999, the Company completed the sale of its 12 acre greenhouse
facility in Mt. Carmel, Pennsylvania for $2,000. The net proceeds of the sale,
after the satisfaction of certain indebtedness secured by a mortgage on the
facility and other closing adjustments, were approximately $1,100.

In January 1998, Village Farms of Colorado, Inc. ("VFC"), a wholly
owned subsidiary of the Company, entered into an agreement with Ripe Touch
Greenhouses, Inc. ("Ripe Touch") of Castlerock, Colorado to lease a 20 acre
greenhouse to be built and located in Calhan, Colorado. The Company plans to
produce beefsteak tomatoes during the winter pricing period at this greenhouse
and to establish a distribution center adjacent to the facility. The term of the
lease will commence 30 days after substantial completion of the construction of
the facility and will continue for ten years. The terms of the lease require the
Company to pay a fixed monthly lease payment and an annual supplemental lease
payment equal to a specified percentage of Cash Flow (as defined in the lease)
of the facility. Ripetouch has not obtained financing for the construction of
this facility and no assurance can be given that this facility will be
completed.

Greenhouse Products

The Company's current product line consists of beefsteak tomatoes and
cluster or "on-the-vine" tomatoes. These products are distinguished by their
consistently superior taste and appearance over field grown tomatoes. The
Company believes that by growing in modern greenhouses using state of the art
technology in various locations in the United States it can produce high quality
produce on a year round basis. The Company's premium tomatoes are sold in high
quality packaging designed to protect the product as well as allow the retail
supermarket to readily display and replenish the product.

The Company's premium beefsteak tomatoes are packed into single layer
15 pound boxes with inserts. Hand picked tomatoes are transported by water flume
and then sorted and weighed using advanced color sorting and grading equipment
coupled with a skilled worker to assure each package is packed to the highest
quality standards. Village Farms(R) premium beefsteak tomatoes are packed in
five sizes, Jumbo, Extra Large, Large, Medium and Small with 18-52 tomatoes per
flat depending on the size. Each tomato is labeled with a Price Look Up sticker
(PLU) which has the company name and logo as well as the industry standard
product code number.

The Company's Home Choice(TM) tomatoes are packed in the same manner as
the Village Farms(R) Premium tomatoes but do not meet the Company's standards
for premium tomatoes. Tomatoes which do not meet Village Farms(R) or Home
Choice(TM) quality standards but grade a US#2 are packed into boxes with a net
weight of 20 or 25 pounds and marketed to local customers which include
restaurants, produce distributors and farm stands.

Cluster or "on-the-vine" tomatoes are packed into 11 pound boxes loose
with stem tags, or with each tomato labeled with a PLU or in mesh bags. Each
cluster contains between 3 to 5 blemish free tomatoes attached to vine.

Prepacked tomatoes are marketed in three package sizes. Village
Farms(R) premium tomatoes are packed 3 tomatoes into a plastic tray with a net
weight of 14 oz or into a 4 cell

42
<PAGE>

clamshell container with a net weight of 16 or 20 oz. The later product is
marketed under the label Village Farms Baby Beefstm . High quality tomatoes
without calyxes which have dislodged from the cluster tomatoes are packed into 4
count clamshell containers with a net weight of 16 or 20 oz and marketed under
the Red Splendortm label.

The Company is engaged in ongoing testing of new technologies and
systems and various varieties of tomatoes to determine if they could improve the
Company's production yields. The Company tests these tomato varieties for their
maturation period, resistance to disease, the size and quality of the tomatoes
and the tomatoes' shelf life, taste and adaptability to seasonal changes in
light. The Company's growers conduct these tests initially as varietal trials,
where a few plants of several different varieties are placed throughout a
greenhouse and observed. If a new variety shows promising characteristics, the
Company conducts a commercial trial where the new variety is planted on a larger
scale, with performance results compared to the Company's existing tomato
varieties. To date, the Company has selected two of these new varieties of
tomatoes for regular production on a seasonal basis, a Grace variety for winter
production and an as yet unnamed variety for summer production. All tomato
varieties tested and grown are of Dutch origin.

Marketing Arrangements with Others

Through marketing arrangements, APD markets and distributes fresh
tomatoes produced by other greenhouse operators under the Village Farms(R)
trademark. Under the terms of these arrangements, APD is generally entitled to a
commission based on a percentage of product revenues and a fixed amount for each
box of produce sold. APD currently participates in marketing arrangements with
the following growers: Fosters Farms, Inc., a wholly owned subsidiary of Foster
Wheeler Corporation which operates a 10 acre greenhouse located in Marion
Heights, Pennsylvania; and Agros, S.A. which operates a 20 acre greenhouse in
Queretaro, Mexico. The Foster Farms facility produces beefsteak tomatoes from
March through November. Agros, S.A. produces beefsteak tomatoes from October to
May. APD generated approximately $3,053 and $3,154 of revenues from various
marketing arrangements in calendar 1998 and 1997, respectively.

In May 1998, APD entered into an agreement with SunBlush Technologies
Corp. ("SunBlush"), a publicly traded corporation, which creates a strategic
alliance for the development of technology for the packaging of fresh cut
tomatoes. SunBlush, a Canadian company, owns rights to certain technologies
which purportedly extend the shelf life of fresh produce and flowers. Under the
terms of the agreement (the "SunBlush Agreement"), APD has agreed to provide up
to $50 of funding to SunBlush to develop the application of the SunBlush
technology to greenhouse tomatoes. If such technology can be successfully
developed, it is anticipated that it would be used so that salad products
containing fresh cut tomatoes could be prepackaged for sale to consumers. APD
has agreed to supply the greenhouse tomatoes required for the SunBlush
development project and has been granted the right to supply tomatoes for
inclusion in any product successfully developed by SunBlush pursuant to the
SunBlush Agreement that is subsequently marketed in the United States or Mexico.
Test marketing of a salad containing fresh cut tomatoes is expected to commence
in Boston, Massachusetts in June 1999.

43
<PAGE>

Sales and Distribution of Tomato Products

APD currently sells approximately 90% of its Village Farms(R), Home
Choice(TM) brand products to retail supermarket chains and dedicated
wholesalers. The remainder is sold to distributors and food service clients. APD
has no formal agreements with its customers. At the beginning of each year, APD
generally negotiates approximate volume and price levels for the upcoming year
with its customers. These arrangements provide APD with the flexibility to
account for significant changes in market conditions and quality/price
competition. APD currently employs 12 sales, marketing and quality assurance
personnel who are responsible for developing and servicing APD customers,
developing and maintaining industry and consumer awareness of Village Farms(R)
brand consumer products and building national recognition of the Village
Farms(R) brandname. The Company's supermarket and fresh food distribution
customers in 1998 were concentrated in the Northeastern United States and Texas.
The Company has recently initiated a plan to expand its customer base to the
midwestern, western and southeastern regions of the United States due to the
increased production capacity added in 1998.

Biological and Agricultural Products Business

Biological and Agricultural Products

The Company's biological and agricultural products include (i)
sophisticated growing systems which it sells to greenhouse operators; (ii)
automated irrigation and environmental control systems for greenhouses; (iii)
coatings and disease control products, including natural biologicals for
protecting fruits and vegetables in storage and transit to market and (iv) a
unique biological pest control product which it sells for use in consumer and
industrial applications. These products are described below.

Growing Systems. The Company is the exclusive distributor in the United
States, Canada, Mexico and the Caribbean of the Grodan(R) brand of stonewool, an
inert growing medium supplied by Grodania A/S, a Denmark based wholly owned
subsidiary of Rockwood International A/S. Stonewool is made by melting rock,
processing it to a fibrous material which can be flocculent or formed into solid
structures. It is both solid and porous, and designed to support the hydroponic
growth of high value crops and to improve plant root distribution and plant
yields through more efficient use of oxygen, water and fertilizer. Stonewool is
used worldwide for cultivation of a variety of plants in controlled growing
environments such as greenhouses. The distribution agreement with Grodania A/S
expires on December 31, 2000. The sale of products under the distribution
agreement accounted for 18%, 17%, 20% and 25% of the Company's total product
sales in the period ended January 3, 1999 and the fiscal years ended June 30,
1998, 1997 and 1996, respectively. The Company believes that revenues under this
distribution agreement will account for more than 10% of the Company's
consolidated product sales during the year ending January 2, 2000.

Automated Irrigation and Environmental Control Systems. The Company
through its ISYS(R) Division engineers, designs, fabricates, assembles and
distributes greenhouse irrigation and fertilization systems, computerized
environmental control systems and application products. In addition to these
products and systems, the Company provides customers with technical support,
product service, turnkey installation, product marketing and other supplementary

44
<PAGE>

services. The Company is the exclusive distributor in the United States, Canada
and Mexico of computerized environmental control systems and accessories
produced by H. Hoogendoorn Automation B.V., a Netherlands based company.

Coatings and Disease Control Products. The fruits and vegetable
production industry requires specialized services, equipment and products for
the harvesting, processing and storage of produce. Through AGRO and EPSC, the
Company provides coatings and disease control products to the fruit, vegetable
and ornamental packing markets. The Company's coating and disease control
products consist of traditional coating products and its BioSave(R) Post Harvest
BioProtectant line of Products.

Prior to shipping or storage, fruits and vegetables are typically
treated with a variety of processing and storage aids. These are designed to
enhance the appearance and preserve the quality of stored produce. The Company
manufactures, markets and provides a broad spectrum of postharvest coating and
cleaning products and services. Its traditional protective coating and storage
products include Indian River Gold, Pacrite, SEALBRITE(R) and DURA-FRESH(R).
These products were originally acquired in May 1994 with the asset purchase of
AMC. These traditional coating products are conventional shellac and carnauba
based coatings which have been used successfully in the citrus and pome fruit
markets. These traditional coating products, together with the Company's
Bio-Save coating products, maintain the quality and extend the shelf life of
produce by (i) providing a barrier to free gas exchange, (ii) providing a
barrier against abrasion, scuffing, bruising and other injuries, (iii) providing
a carrier for decay preventing agents, (iv) providing a glossy appearance that
is aesthetically appealing to consumers, (v) reducing shrinkage caused by water
loss and (vi) maintaining firmness of the fruit or vegetable. The Company's
traditional coating products contain materials that are U.S. Food and Drug
Administration ("FDA") approved additives or have been listed by the FDA as
"Generally Recognized As Safe" ("GRAS") and accordingly, these coatings do not
require FDA approval or registration. PacRite, SEALBRITE, and Indian River Gold
currently are sold by the Company in the United States, the Caribbean, Central
America and South America.

The Company's Bio-Save line of biological disease inhibitors are based
on the Company's microbial technology which uses live organisms that, through
natural growth, inhibit the ability of a target disease to proliferate. The
Bio-Save line of biological disease inhibitors are sold through EPSC to the
pear, apple and citrus markets. Postharvest diseases and damage during storage
and shipment can account for losses ranging from 10% to 25% of total annual
production of fruits and vegetables, depending on the crop and climate. The
Company has developed and registered with the U.S. Environmental Protection
Agency ("EPA") biological products for sale using the naturally occurring
microorganism, Pseudomonas syringae, which can control the development of Blue
Mold (Penicillium expansum), Gray Mold (Botrytis cinerea) and Mucor Rot (Mucor
pyriformis) on apples and pears, and Blue Mold (P. italium), Green Mold (P.
digitatum) and Sour Rot (Geotrichum candidum) on citrus fruit. The Company has
conducted successful field trials over the last five years utilizing these
microbial disease inhibiting agents in Florida, California, Oregon, West
Virginia, Massachusetts, Michigan and Washington; and in Chile. The Company
initiated commercial product launch of its Bio-Save products in fiscal 1997 and
plans for continued expansion of product marketing and development in fiscal
1999. In 1997, the Company received EPA registration for the use of Bio-Save on

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cherries and continues to investigate the application of Bio-Save to control
other postharvest diseases on fruits and vegetables, such as on potatoes.

Biological Insect Control Products. In the biological insect control
market, the Company, with collaborative partners, has been focused on developing
and selling cost effective bioinsecticide alternatives to synthetic chemical
insecticides for use in specific applications, including sensitive use
environments such as homes, restaurants, schools and food processing facilities.

The Company, together with its collaborator, Terminix International
Company L.P. ("Terminix"), has developed a natural fungal product to control
termites, the Bio-Blast Biological Termiticide. This product contains a fungus
selected for its ability to infect and kill termites, which has been formulated
for application utilizing conventional equipment in a termite infested
structure. The product is a dry wettable powder, packaged and portioned for ease
of storage and use; and used as a water suspension. Through commercial trials,
the Company has demonstrated that Bio-Blast is an effective method for the
control of termite infestations. The Company has demonstrated that termites
exposed to the fungus in the product can spread the fungus by contact to nest
mates that have not directly contacted the fungal agent, thereby infecting and
killing other termites through the Horizontal Transfer(R) effect. The Company
received EPA product registration for the termiticide in October 1994, and
subsequently received approval for registration from 48 states. In fiscal 1996,
the Company made its initial sales to both Terminix and Maruwa Biochemical. In
fiscal 1997, the Company initiated the U.S. commercial launch of Bio-Blast in
collaboration with Terminix.

Sales and Distribution of Biological and Agricultural Products

Growing and Control Systems. The Company sells its growing systems and
automated irrigation and environmental control systems directly through AGRO.
AGRO has a force of approximately 27 people involved in sales, marketing and
distribution, engineering and design, and system installation and service at its
distribution and service centers in East Brunswick, New Jersey; Milton, Ontario,
Canada; and Ventura, California.

Coating Products. The Company uses its AGRO and EPSC direct sales
operations to market and sell its traditional coatings and Bio-Save
BioProtectants to fruit and vegetable growers, packers and processors in the
United States, the Caribbean, Central America and South America. EPSC has a
sales and technical support services force of eight people located in its
distribution and service centers in Orlando, Florida and Visalia, California.

Biological Insect Control. In February 1999, the Company entered into a
Marketing and Distribution Agreement with Terminix pursuant to which Terminix
was appointed as a non-exclusive distributor of Bio-Blast in the United States,
its territories and Canada. Pursuant to this agreement, the Company has agreed
to manufacture and sell Bio-Blast to Terminix at a specified price. Terminix has
certain rights to return certain product previously purchased; however, the
Company's maximum repurchase obligation is approximately $278. This agreement,
which expires in August 2000 (subject to extension for successive one year
periods by mutual agreement of the parties) replaces the Product Development and
License Agreement between the parties which granted Terminix exclusive rights to
use and distribute Bio-Blast in the United States.

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In March 1999, the Company entered into an agreement with Prentiss
Incorporated pursuant to which Prentiss Incorporated ("Prentiss") was appointed
as a non-exclusive distributor of Bio-Blast Biological Termiticide in the United
States and Puerto Rico. Under this agreement, Prentiss has agreed to purchase a
specified quantity of Bio-Blast at a specified price. The agreement expires on
December 31, 1999, subject to earlier termination by either party upon 60 days
written notice. If EcoScience terminates the agreement, it will be obliged to
repurchase all of Prentiss' unsold inventory.

The Company expects to market its Bio-Blast Biological Termiticide
internationally primarily through local and regional distributors and partners.
The Company has entered into a marketing and distribution agreement with Maruwa
Biochemical Co. Ltd. ("Maruwa") pursuant to which it has appointed Maruwa as the
exclusive distributor of Bio-Blast in Japan. Pursuant to this agreement, the
Company has agreed to manufacture and sell Bio-Blast to Maruwa at a specified
price. The agreement, which replaces a prior Development and Distribution
Agreement between the parties, expires on September 30, 1999 and may be renewed
for successive one year periods by mutual agreement of the parties.

Manufacturing

The Company has established supply arrangements for the production of
fungal conidia, the active ingredient in the Bio-Blast product. Upon receipt of
the raw active ingredient, the Company processes, formulates and packages this
material using proprietary processes to produce the Bio-Blast product in its
Orlando, Florida manufacturing facility.

Traditional coating products are manufactured at the EPSC facility in
Orlando, Florida. Production of the Company's biological postharvest fruit
disease control product, Bio-Save, requires large scale fermentation and
formulation capacity. Currently, a single sub-contractor manufactures the
Bio-Save products for the Company. However, the Company believes other entities
would be capable of manufacturing these products. Although, to date, the Company
has been able to acquire a sufficient supply of the Bio-Save product for its
commercial sales; the inability of the sub-contractor to meet the Company's
needs for the Bio-Save products or a change in supplier could cause a delay in
filling orders, as well as a possible loss of sales, which would affect
operating results adversely.

Research and Development

The Company's technology for the postharvest and pest control
industries has applicability to a variety of potential products and product
systems. These include various insect spray and chamber products, plant and root
fungal disease control systems, and preharvest and postharvest coatings and
disease control systems which are currently in varying stages of development. As
part of the Company's prior restructuring program, and current cost control
programs, certain research and product development programs, and the funding
thereof, have been suspended, curtailed or deferred. Future development and
funding of these and other select research and product development programs will
depend on a number of factors, including market conditions, availability of
financial, technical and other resources, joint ventures, alliances,
technological advancements, manufacturing capabilities, commercial potential of
resultant end products, governmental regulations, and other relevant matters
which may confront the Company in the future.

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Lyme disease has become, in recent years, a disease of significant
public and medical concern throughout the U.S., particularly in the Northeast.
The disease is spread to people through the bite of several species of ticks.
The Company has signed a Material Transfer Agreement with the United States
Department of Agriculture's Agricultural Research Service ("ARS"), whereby the
Company provides formulated Metarhizium anisopliae to the ARS to support their
field trials against tick larvae. Laboratory trials conducted with this fungus
indicated good killing activity towards the tick larvae. Should these trials be
successful, the Company will consider further commercial development of a
product for the control of ticks capable of spreading Lyme disease.

The Company's operating costs and expenses to date for the biological
and agricultural products segment have, to a large extent, related to the
research and development of products and product systems for future
commercialization. Expenses incurred by the Company under third party funded
research and development programs totaled approximately $43 in the period ended
January 3, 1999 and $53, $7 and $0 in the fiscal years ended June 30, 1998, 1997
and 1996, respectively. Expenses incurred under Company funded research and
development programs totaled approximately $196 in the period ended January 3,
1999 and $412, $501 and $1,018 in the fiscal years ended June 30, 1998, 1997 and
1996, respectively.

Competition

The tomato market in which the Company competes is highly competitive.
In addition to other greenhouse producers, the Company must compete with U.S.
producers of field grown tomatoes, which generally have prices substantially
below those of greenhouse tomatoes. In addition, due to increased environmental
compliance costs in the United States, competition from producers in Mexico has
increased due to the North American Free Trade Agreement. Certain of the
producers of field tomatoes may have greater resources than APD. APD's
greenhouse competitors are located primarily in the United States, Canada,
Israel, Spain and Holland.

The Company faces substantial competition from a few large companies
and several smaller companies in the sale of certain products and growing
systems to greenhouses and nurseries in North America. The Company believes that
its range of products and services, and product quality, will allow it to
compete effectively in North America.

Competition in the fruit coatings market is also intense. Fruit coating
products are developed and marketed primarily by several large companies which
offer a full range of products. In addition, several smaller companies offer a
limited range of fruit coating products. The Company believes that it can
compete effectively in this market with its Bio-Save PostHarvest BioProtectant
and traditional coating products based on the cost effectiveness and the quality
of its coating formulations and services.

In the pesticide industry, the Company competes with large
manufacturers of synthetic chemical pesticides and established biopesticide
companies. The pesticide industry is dominated by large chemical companies
located in the United States, Japan and Europe. These companies have substantial
financial and technical resources, extensive sales and distribution
capabilities, varied product registration experience and the ability to
manufacture products efficiently.

<PAGE>

Environmental and Regulatory Matters

The Company's operations are subject to numerous environmental laws and
regulations, including the Food Quality Protection Act of 1996, the Clean Air
Act, the Clean Water Act, the Resource Conservation and Recovery Act, the
Federal Insecticide, Fungicide and Rodenticide Act ("FIFRA"), the Toxic
Substances Control Act and the Comprehensive Environmental Response,
Compensation and Liability Act. Compliance with these laws and regulations is an
ongoing process which is not currently expected to have a material effect on the
Company's capital expenditures, earnings or competitive position. Environmental
concerns are, however, inherent in most major agricultural operations, including
those conducted by the Company, and there can be no assurance that the cost of
compliance with environmental laws and regulations will not be material in the
future. The environmental laws which have the greatest impact on the Company's
operations are those that govern the handling of fertilizers and pesticides. To
help ensure compliance with environmental laws and regulations, all Company
personnel who handle fertilizers and pesticides must first be trained by a
licensed private applicator on the Company's staff certified to provide training
in the handling of hazardous materials. In addition, the Company has adopted
certain written policies and procedures which are designed to prevent accidents
and set forth the appropriate course of action in the event that a spill or
other accident occurs. The Company has also contracted with third parties to
assist in cleanup efforts in the event that an accident having environmental
implications occurs at certain of its facilities.

The Company's greenhouse operations are subject to regulations enforced
by, among others, the FDA and the USDA. The FDA enforces statutory standards
regarding the branding and safety of food products and determines the safety of
food substances in the United States.

The USDA sets standards for raw produce and governs its inspection and
certification. Under the Perishable Agricultural and Commodities Act ("PACA"),
the USDA exercises broad control over the marketing of produce in domestic and
foreign commerce, sets standards of fair conduct as to representations, sales,
delivery, shipment and payment for goods, and regulates the licensing of produce
merchants and brokers. The Company's growing operations are also subject to
oversight by the EPA regarding the use of fertilizers and pesticides protection.

Through its extensive use of labor in its growing operations, the
Company is subject to supervision by the United States Department of Labor,
under both the Fair Labor Standards Act and the Occupational Safety and Health
Act; and the prevalence of foreign workers in this sector of the Company's work
force necessarily involves oversight by the Immigration and Naturalization
Service.

Almost every aspect of federal regulation is accompanied by regulation
on the state level, in each jurisdiction where the Company conducts greenhouse
operations.

In most countries throughout the world, governmental authorities
require registration of pesticides before sales are allowed. In the United
States, the EPA regulates pesticides under FIFRA. Pesticides are also regulated
by the individual states. Some states, such as California, Florida and New York,
have their own extensive registration requirements. In order to market products
outside the United States, the company must receive regulatory approval from the
authorities of each applicable jurisdiction. In addition, the FDA administers
the Federal Food,

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Drug and Cosmetic Act ("FFDCA") and establishes standards for pesticide residues
in food to protect public health.

Detailed and complex procedures must be followed in order to obtain
approvals under FIFRA to commercialize a pesticide product. A registration
application must be submitted to the EPA for each product and must list each
pest for which the product will be used. Evaluation data for registration
includes, but may not be limited to, non-target organism testing, environmental
data, product analysis and residue studies, product performance, and toxicology
(hazards to human beings and domestic animals).

The EPA has established specific testing requirements for the
registration of microbial pesticides, which are set out in Subdivision M of the
EPA's Pesticide Assessment Guidelines. Chemical pesticides are currently subject
to a three tier toxicology testing procedure, and a four tier environmental
evaluation process. A microbial pesticide product which satisfactorily completes
both the toxicology Tier 1 tests and environmental evaluation is not required to
go through the increasingly difficult testing requirements of subsequent tiers.
Additional tests may be required, however, in response to any questions which
may arise during Tier 1 testing. The Company's product development cycle
typically anticipates two to three years of field evaluation and up to two years
for product registration, which can run concurrently with the last year of field
trials.

In October 1994, the Company received EPA registration for its
Bio-Blast termiticide. The Company subsequently received registration from 48
states. In March 1995, the Company received EPA registration for Bio-Save 10 and
Bio-Save 11 biofungicides in all states requested. In March 1996, the Company
received EPA registration for Bio-Save 1000, Bio-Save 100 and Bio-Save 110.
These registrations are for new formulations of the original Bio-Save 10 and 11
products. In addition, in May 1997, the Company received approval from the EPA
for a label extension for the use of Bio-Save 1000 on cherries.

Certain of the Company's activities, including the operation of its
laboratories, manufacturing facilities and greenhouse facilities, have been, or
maybe, subject to regulation under various other state and federal laws and
regulations including the Occupational Safety and Health Act, the National
Environmental Policy Act, the Emergency Planning and Community Right-To-Know
Act, the Food Quality Protection Act of 1996, the Resource Conservation and
Recovery Act, and other state and federal statutes regulating environmental
quality. From time to time, governmental authorities review the need for
additional laws and regulations that could, if adopted, apply to the business of
the Company. The Company is unable to predict whether any such new regulations
will be adopted or whether, if adopted, they will adversely affect its business.
Historically, compliance with applicable federal, state and local provisions
which have been enacted or adopted regulating the discharge of materials into
the environment by the Company's greenhouse, manufacturing or laboratory
operations has had an immaterial effect upon the Company's capital expenditures,
results of operations and competitive position.

Patents, Proprietary Rights and Trade Secrets

The Company owns or has rights to certain proprietary information,
including patents and patent applications, which relate to its technology and
products. The Company actively seeks protection, when appropriate, for its
products and proprietary information by means of United

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States and foreign patents. In addition, the Company may rely upon
confidentiality agreements and other contractual arrangements to protect certain
proprietary information.

The Company has been issued patents and has pending patent applications
that address its core technological strengths, with emphasis on fungal and
bacterial formulation, and storage technologies. These patents and patent
applications have been principally pursued in the U.S. and in some cases
internationally. The technology described in these patents and patent
applications is useful in the development of fungal and bacterial active
ingredient microbial pesticides. Microbial pesticide products are based on
microorganisms isolated from the environment, formulated and delivered to a
target pest so that they kill the pest, or control or inhibit its proliferation
on the target. These microorganisms are packaged alive and perform their
function through proliferation in the pest environment. Much of the formulation
and delivery technology developed for synthetic chemical pesticides is
inappropriate for microbial products which employ and preserve living organisms.
EcoScience microbial technology uses live microorganisms which either attack and
kill a target pest (e.g. Bio-Blast) or through natural growth inhibit the
ability of a target pest to proliferate (e.g. Bio-Save).

Together, the Company's patents describe a set of technologies
applicable to the use of fungi for the control of insect pests, and are central
to the Bio-Path(R) chamber technology which covers cockroaches, the further
development and sale of which the Company has suspended; however, this
technology can be extended to any other insect that can be controlled via a
chamber system. An additional patent describing further fungal formulation
technology is pending.

The Company has been issued two additional U.S. Patents which relate to
the use of bacteria, chiefly as biofungicides in the treatment of plant fungal
disease.

Provided maintenance fees are paid, U.S. design patents have a term of
14 years from the date of issue; and U.S. utility patents that are based on
applications filed before June 8, 1995, and that have not expired as of June 8,
1995, have a term that is the longer of 20 years from the earliest effective
filing date or 17 years from issuance. In certain instances, however, the term
may be limited to the term of a related patent claiming similar technology. The
Company has an additional pending patent application relating to a method of
extending microbial shelf life. None of the Company's current patents expire
prior to 2006. There can be no assurance that any patents will issue from any of
the Company's patent applications or that issued patents will provide adequate
protection for the Company.

In addition to its own active ingredients, the Company has acquired the
exclusive rights to the use of microbial strains developed by the USDA for the
control of postharvest diseases of pome fruits. The USDA has been granted one
patent covering this technology and has filed a patent application covering
additional postharvest disease control agents.

Much of the Company's technology and many of its processes are
dependent upon the knowledge, experience and skills of certain scientific and
technical personnel. To protect its rights to its proprietary information and
technology, the Company requires certain employees, consultants, advisors and
collaborators to enter into confidentiality agreements which prohibit the
disclosure of confidential information to persons unaffiliated with the Company,
and which require disclosure of and assignment to the Company ideas,
developments, discoveries and

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inventions made by such persons. There can be no assurance that these agreements
will prevent disclosure of the Company's confidential information or will
provide meaningful protection for the Company's confidential information.
Additionally, in the absence of patent protection, the Company's biological and
agricultural business may be adversely affected by competitors who develop
substantially equivalent technology.

Employees

As of June 1, 1999 the Company had approximately 950 employees. The
majority of these workers are employed in the Company's greenhouse operations.
None of the Company's employees is covered by a collective bargaining agreement.
The Company considers its relations with employees to be good.

Properties

The Company's corporate headquarters and research and development
operations, and AGRO's New Jersey operations are currently located in two
facilities in East Brunswick, New Jersey. These facilities consist of 23,000 and
10,000 square foot spaces and are under leases that expire in July 1999. The
Company recently entered into a ten year lease agreement with respect to 20,000
square feet of office/warehouse space in Eatontown, New Jersey and expects to
move its corporate headquarters and research and development operations to this
location in September 1999.

AGRO leases 10,000 square feet of space for its sales, service and
warehouse center located in Milton, Ontario, Canada under a three year lease
which expires in June 2001. AGRO also leases a 12,000 square foot facility for
its sales, service and warehouse center in Ventura, California.

APD's principal properties consist of its greenhouse facilities in
Ringgold, Pennsylvania; Buffalo and Wheatfield, New York; Fort Davis and Marfa,
Texas; and King George County, Virginia. APD has an ownership interest in the
facilities located in Buffalo, New York; Fort Davis, Texas; and the two
facilities in Marfa, Texas. The remaining facilities, and the land upon which
the Buffalo and Marfa facilities are located, are leased. Each of the
greenhouses operated by APD has adjacent packing and support facilities ranging
in size from approximately 11,300 square feet at the Ringgold, Pennsylvania
facility to the approximately 170,000 square foot storage and distribution
center adjacent to the Virginia greenhouse facility. Collectively, these
facilities provide an aggregate of approximately 512,778 square feet of packing
and support space to APD. In addition, APD leases a 4,000 square foot
distribution center in Buffalo, New York and approximately 500 square feet of
office space in Naples, Florida.

The Company's wholly owned subsidiary, EPSC, leases approximately
24,000 square feet of space for its headquarters, production and warehouse
facilities located in Orlando, Florida, under a five year lease which expires in
May 1999, and which provides an option to renew for an additional five year
term. In addition, EPSC leases on a month to month basis approximately 4,000
square feet of space for its sales, service and warehouse center located in
Visalia, California.

The Company believes that its existing facilities are adequate to meet
current requirements and that suitable additional or substitute space will be
available as needed to accommodate any expansion of operations and additional
offices.

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Legal Proceedings

The Company currently is not a party to any material legal proceedings,
nor is it currently aware of any threatened material legal proceedings. From
time to time, the Company may become involved in litigation relating to claims
arising out of its operations in the normal course of its business.

MANAGEMENT

Directors and Executive Officers

The directors and executive officers of the Company are listed in the
table below, and brief summaries of their business experience and certain other
information is set forth in the information which follows the table:

Name Age Position
---- --- --------
Michael A. DeGiglio 44 President, Chief Executive Officer and Director
Albert Vanzeyst 53 Executive Vice President and Director
J. Kevin Cobb 38 Senior Vice President - Corporate Development
Kenneth S. Hollander 34 Senior Vice President and Chief Financial Officer
David W. Miller 47 Senior Vice President and Chief Technology Officer
Kurt Hoffman 38 Secretary and Corporate Controller
Thomas A. Montanti 74 Director
David J. Ryan 43 Director
Heinz K. Wehner 67 Director

Michael A. DeGiglio has served as a Director of the Company since
November 1996, when he was elected to serve as a Director by the Board. Mr.
DeGiglio joined the Company upon its acquisition of Agro Dynamics, Inc. ("AGRO
Dynamics") in November 1992, and served as Chief Executive Officer of AGRO
Dynamics until November 1998. In July 1995, Mr. DeGiglio assumed the offices of
President and Chief Executive Officer of the Company. From 1984 until joining
the Company, Mr. DeGiglio was employed by AGRO Dynamics, where he served as
Chief Executive Officer. Prior to co-founding AGRO, Mr. DeGiglio was Vice
President of International Sales for NYPCO International Inc. Mr. DeGiglio
served on active duty in the United States Navy as an Officer and Jet Aviator
from July 1976 through January 1983, and the Naval Air Reserves from 1983 to
present, currently holding the rank of Captain with the United States Naval
Reserve. Throughout his Naval career, he has held various department head
positions, completed a tour as Commanding Officer of a Jet Aviation Squadron,
performed multiple tours overseas, and has completed numerous Senior Advanced
Management courses. Mr. DeGiglio is a co-founder of APD and has served as Chief
Executive Officer of APD since its inception in 1990. He served as President of
APD until January 1997. Mr. DeGiglio received a B.S. in Aeronautical Science and
Aviation Management from Embry Riddle Aeronautical University. Mr. DeGiglio's
term as a director of the Company will expire at the 2001 Annual Meeting of
Stockholders.

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Albert W. Vanzeyst has served as a Director of the Company since
September 1998, when he was elected to serve as a Director and Executive Vice
President by the Board pursuant to certain agreements made in connection with
the Merger pursuant to which the Company acquired APD. Mr. Vanzeyst, a
co-founder of APD, has been Chief Operating Officer and a Director of APD since
its inception in 1990. In January, 1997, he also assumed the role of President
of APD. Mr. Vanzeyst has 30 years of greenhouse design, engineering and
construction experience spanning several countries, crops and climates
throughout the world. Between 1984 and 1990, Mr. Vanzeyst was President of Dace
U.S.A., Inc., a subsidiary of Dace International, Inc., an international
turn-key greenhouse construction company. Prior thereto, he participated in the
development, design and construction of numerous greenhouse operations in
several countries throughout the world. Mr. Vanzeyst holds a degree in Foreign
Trade and International Commerce from Handelavond College in the Netherlands.
Mr. Vanzeyst's term as a director will expire at the 2000 Annual Meeting of
Stockholders.

J. Kevin Cobb joined the Company in September 1998, as Senior Vice
President-Corporate Development pursuant to certain agreements made by the
Company in connection with the Merger pursuant to which the Company acquired
APD. In February 1999, he was named Interim Chief Financial Officer and
Treasurer of the Company. Prior to joining the Company, Mr. Cobb served as
Senior Vice President and Chief Financial Officer of APD from January 1995 until
July 1998, when he was appointed Senior Vice President - Corporate Development
of APD. Mr. Cobb came to APD after five years experience with Cogentrix Energy,
Inc. of Charlotte, North Carolina. While at Cogentrix, he served as Treasurer
and Director of Project Finance. From 1988 to 1990, he served as Vice President
of Finance of The Lexington Group, Inc., a real estate investment and management
firm. Prior thereto, Mr. Cobb was employed as a Certified Public Accountant with
Arthur Andersen, LLP. Mr. Cobb holds a B.S. degree in accounting from the
University of North Carolina - Charlotte.

Kenneth S. Hollander has been Senior Vice President - Chief Financial
Officer of the Company since June 1999. From June 1996 to May 1999, Mr.
Hollander served as Chief Financial Officer of HumaScan, Inc., a publicly traded
medical device company. From 1989 to May 1996, Mr. Hollander was Controller of
Sidmak Laboratories, Inc., a generic pharmacetical company. From 1987 to 1989,
Mr. Hollander was employed by the accounting firm of Arthur Andersen & Co. Mr.
Hollander received a Bachelors of Science degree from Washington University in
St. Louis, Missouri.

David W. Miller joined the Company in May 1988 and serves as Senior
Vice President and Chief Technology Officer. Dr. Miller's current
responsibilities include technology development and management, intellectual
property oversight and product development Dr. Miller received a B.S. in
Biochemistry from the University of California, Davis, and a Ph.D. in
Biochemistry and Molecular Biology from Harvard University, where he studied the
molecular biology of insects. Dr. Miller also was a National Institutes of
Health post-doctoral Fellow studying insect viruses at the University of Idaho.
Prior to joining the Company, Dr. Miller was employed from 1983 to 1988 as Staff
Scientist and Project Leader at Genetics Institute, Inc., in Cambridge,
Massachusetts. Throughout his professional career, Dr. Miller has focused on the
development and commercialization of microbial pesticides with involvement from
the discovery stage to product sales.

Kurt Hoffman was appointed Secretary of the Company in April 1999. He
was appointed Corporate Controller in March 1999, having served as Division
Controller from November 1997

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through February 1999 and Assistant Controller from December 1995 through
October 1997. From April 1991 through August 1995, Mr. Hoffman served as an
Assistant Controller for Infomed, Inc. He is a Certified Public Accountant and
received a Bachelor of Arts Degree in Accounting from the University of
Maryland.

Thomas A. Montanti has served as a Director of the Company since
September 1998, when he was elected to serve as a Director by the Board pursuant
to certain agreements made by the Company in connection with the Merger pursuant
to which the Company acquired APD. Mr. Montanti, a co-founder of APD, served as
Chairman of the Board and Director of APD from its inception in 1990 until the
completion of the Merger. He is the father-in-law of Mr. DeGiglio. Mr. Montanti
co-founded Agro Dynamics, Inc. in 1984. Currently, Mr. Montanti is President of
NYPCO Industries, Inc., and New York Protective Coverings Industry, Inc., each
of which is located in New York and distributes building products and provides
specialized insulation contracting to the marine and power generating
industries. Mr. Montanti's term as a director will expire at the 2002 Annual
Meeting of Stockholders.

David J. Ryan has served as a Director of the Company since 1988. Since
1983, Mr. Ryan has been a General Partner of Copley Venture Partners, an
affiliate of Copley Partners 2, L.P., a venture capital investor in EcoScience.
Mr. Ryan has also been a Managing Partner of Mission Ventures, L.P. since 1997.
Prior to his involvement in venture capital, Mr. Ryan spent five years with
Medusa Corporation, a Midwest based manufacturer of industrial and building
products, in several financial and operating capacities. Mr. Ryan also serves as
a director of Mulberry Child Care Centers and other private companies. Mr. Ryan
holds a B.S. from Northeastern University and an M.B.A. from Case Western
Reserve University. Mr. Ryan's term as a director will expire at the 2001 Annual
Meeting of Stockholders.

Heinz K. Wehner has served as a Director of the Company since March
1993. From March 1976 to June 1992, Mr. Wehner served in several management
positions with Chemagro Corporation and Mobay Corporation, both subsidiaries of
Bayer A.G. in Germany and, most recently, Bayer Corporation, where he served as
President of the Agricultural, Animal Health and Consumer Products Divisions.
Previously, he held several management positions with Bayer Quimicas Unidas S.A.
in Peru, including Vice President of the Agricultural Chemicals and Animal
Health Division, and with Bayer de Mexico S.A., including Vice President of the
Crop Protection and Consumer Products Division. Mr. Wehner is an advisory
director for the Commerce Bank of Kansas City, N.A. in Kansas City, Missouri.
Mr. Wehner attended Escuelas Americanas in Peru where he studied business
administration. Mr. Wehner's term as a director will expire at the 2000 Annual
Meeting of Stockholders.

<PAGE>

Executive Compensation

The following table provides certain summary information regarding
compensation paid by the Company during the twelve month period ended January 3,
1999 and the fiscal years ended June 30, 1998 and 1997 to the Company's Chief
Executive Officer and to each of the other executive officers of the Company,
whose annual compensation and bonus for the twelve month period ended January
31, 1999 exceeded $100,000 (together with the Chief Executive Officer, the
"Named Executive Officers").

<TABLE>
<CAPTION>
Annual Compensation
----------------------------------------------- Long Term
Compensation Awards
-------------------
Number of Shares
Twelve Months Underlying Stock
Name and Principal Position Ended (1) Salary($) Bonus($) Options(#)(2)
--------------------------- --------- --------- -------- -------------
<S> <C> <C> <C> <C>
Michael A. DeGiglio..................... 1/03/99 $168,750(3) -- --
President and Chief Executive 6/30/98 150,000 75,000 --
Officer and Director 6/30/97 140,000 25,000 20,000

Harold A. Joannidi...................... 1/03/99 102,000 8,000 --
Former Treasurer, Corporate 6/30/98 102,000 8,000 --
Controller and Secretary (4) 6/30/97 93,500 -- 10,000

David W. Miller......................... 1/03/99 114,500 3,500 --
Senior Vice President and Chief 6/30/98 114,500 3,500 --
Technology Officer 6/30/97 106,167 -- 11,000
</TABLE>

- ---------------
(1) In 1998, the Company changed its fiscal year from the twelve month period
ending June 30 of each year to a fiscal year which ends on the Sunday
nearest December 31 of each year. As a result, the information presented
for the twelve months ended January 3, 1999 and the twelve months ended
June 30, 1998 reflects a six month overlap.

(2) As adjusted to reflect the one-for-five reverse stock split effected
September 30, 1998.

(3) Excludes $56,250 of compensation paid to Mr. DeGiglio by APD during the
nine month period ending September 30, 1998 (the effective date of the
Merger).

(4) Mr. Joannidi's employment with the Company terminated in April 1999.

Compensation of Directors

Each Director who is not an employee of the Company receives an annual
retainer of $5,000 for Board service, plus $750 for each Board meeting attended,
$375 for each telephonic Board meeting which lasts more than one hour and $500
for each Committee meeting attended, plus expenses. Those Directors who are
employees of the Company do not receive any compensation for their services as
Directors.

Each non-employee Director (other than Mr. Montanti who was appointed
to the Board in connection with the Merger) when first elected or appointed to
the Board receives a warrant to purchase 20,000 shares of Common Stock at an
exercise price equal to the fair market value on

56
<PAGE>

the grant date. These warrants vest at the rate of 20 percent on the grant date
and on the first anniversary of the grant date and 30 percent on the second and
third anniversaries of the grant date. Warrants granted to Directors of the
Company expire five years after the date of grant.

Options Grants in the Last Fiscal Year

During the twelve month period ended January 3, 1999, there were no
options granted under the Company's stock option plans to the Named Executive
Officers.

Aggregate Option Exercises in Twelve Months Ended January 3, 1999 and Year End
Option Values

The following table provides certain information with respect to
options to purchase Common Stock held by the Named Executive Officers at January
3, 1999.

Number of Securities Underlying Unexercised
Options at January 3, 1999(#)
-------------------------------------------
Name Exercisable Unexercisable
---- ----------- -------------
Michael A. DeGiglio 64,000 --
Harold A. Joannidi 17,000 --
David W. Miller 21,000 --

On December 31, 1998 (the last trading day prior to January 3, 1999),
the exercise price of each of the options listed in the table set forth above
exceeded the closing price of the Common Stock ($4.125 per share) on the Nasdaq
Stock Market. No options were exercised by the Named Executive Officers during
the twelve month period ended January 3, 1999.

Compensation Committee Interlocks and Insider Participation

The Compensation Committee currently consists of two independent
directors, David J. Ryan and Heinz K. Wehner. No such person was an officer or
employee of the Company during the twelve month period ended January 3, 1999 or
was formerly an officer or employee of the Company.

<PAGE>

PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth information regarding beneficial
ownership of the Common Stock as of June 7, 1999 by: (i) each person known to
EcoScience to be the beneficial owner of more than 5% of the Common Stock on
that date, (ii) the Selling Stockholders, (iii) each Director, (iv) each
executive officer and (v) all Directors and executive officers as a group.

<TABLE>
<CAPTION>
Beneficial Ownership of Beneficial Ownership of
Common Stock Prior to Common Stock After
Offering(1) Offering
---------------------------- ------------------------------
Number of
Shares of
Name and Address No. of Percent of Common Stock No. of Percent of
of Beneficial Owners Shares Class Being Offered Shares Class
-------------------- ------ ----- ------------- ------ -----
<S> <C> <C> <C> <C> <C>
Michael A. DeGiglio(2) .......................... 3,363,976 26.5% -- 3,363,976 26.5%
Albert Vanzeyst(3) .............................. 2,941,811 23.3% -- 2,941,811 23.3%
Thomas Montanti(4) .............................. 2,537,324 20.1% 633,273 1,904,051 15.1%
David J. Ryan(5) ................................ 172,586 1.4% -- 172,586 1.3%
Heinz K. Wehner(6) .............................. 8,000 * -- 8,000 *
David W. Miller(7) .............................. 25,772 * -- 25,772 *
J. Kevin Cobb ................................... 235,767 1.9% -- 235,767 1.9%
Kenneth S. Hollander ............................ 2,500 * -- -- *
Kurt Hoffman(8) ................................. 1,300 * -- 1,300 *
Cogentrix Delaware Holdings, Inc. ............... 1,000,000 7.9% 1,000,000 -- --
1105 North Market Street, Suite 1108
Wilmington, DE 19801
All directors and executive officers
as a group (10 persons)(9) ..................... 9,304,736 73.1 -- 9,302,236 73.1%
</TABLE>

- ---------------
* Less than 1%.

(1) Information with respect to beneficial ownership is based upon information
furnished to the Company by each stockholder included in this table. Except
as indicated in the notes to the table, each stockholder included in the
table has sole voting and investment power with respect to the shares shown
to be beneficially owned by him. Pursuant to the rules of the Securities
and Exchange Commission, shares of Common Stock which an individual or
member of a group has a right to acquire within 60 days of April 2, 1999
pursuant to the exercise of options or warrants are deemed to be
outstanding for the purpose of computing the percentage ownership of such
individual or group, but are not deemed to be outstanding for the purpose
of computing the percentage ownership of any other person shown in the
table.

(2) Includes 166,593 shares held by Mr. DeGiglio's wife, as to which Mr.
DeGiglio disclaims beneficial ownership, 518,900 shares held in trust for
the benefit of Mr. DeGiglio's children that Mr. DeGiglio has no right to
vote and as to which he disclaims beneficial ownership, and 64,000 shares
issuable upon the exercise of stock options.

(3) Includes 153,095 shares held in custody for Mr. Vanzeyst's child that Mr.
Vanzeyst has no right to vote and as to which he disclaims beneficial
ownership.

(4) Includes 4,231 shares held by Mr. Montanti's wife, as to which Mr. Montanti
disclaims beneficial ownership.

(5) Includes 8,000 shares of Common Stock issuable upon exercise of warrants,
and 151,253 and 13,333 shares of Common Stock held and issuable upon
exercise of a warrant, respectively, by Copley Partners 2, L.P.

58
<PAGE>

Copley Venture Partners L.P., a limited partnership of which Mr. Ryan is a
general partner, is a general partner of Copley Partners 2, L.P.

(6) Consists solely of shares of Common Stock issuable upon exercise of
warrants.

(7) Includes 21,000 shares of Common Stock issuable upon exercise of stock
options.

(8) Includes 1,300 shares of Common Stock issuable upon exercise of stock
options.

(9) Includes an aggregate for 107,633 shares of Common Stock issuable upon
exercise of stock options and warrants. Share amount includes 151,253 and
13,333 shares of Common Stock held and issuable upon exercise of a warrant,
respectively, by Copley Partners 2, L.P., for a total of 164,586 shares or
1.4% of total shares of Common Stock outstanding. Copley Venture Partners
L.P., a limited partnership of which Mr. Ryan is a general partner, is a
general partner of Copley Partners 2, L.P.

The mailing address for each of the stockholders listed above whose
address was not supplied in the table is c/o EcoScience Corporation, 10 Alvin
Court, East Brunswick, New Jersey 08816

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On September 30, 1998, the Company issued 9,421,487 shares of the
Company's Common Stock, $0.01 par value, to the holders of the Common Stock of
APD, pursuant to an Agreement and Plan of Merger (the "Merger Agreement"), which
provided for the merger of APD with and into a newly formed, wholly owned
subsidiary of the Company. Pursuant to the Merger Agreement, the stockholders of
APD received 30,619.067 shares of the Company's Common Stock for each
outstanding share of APD. In addition, on September 30, 1998, the Company issued
99,000 shares of Common Stock to certain stockholders of APD for their entire
50% interest in Village Farms of Morocco, S.A., a Moroccan company, as provided
for in the Merger Agreement (the "Morocco Transaction"). The shares of Common
Stock issued to the stockholders of APD pursuant to the Merger Agreement
represented approximately 80% of the outstanding shares of the Company, on a
fully diluted basis, at the effective time of the Merger.

Prior to the Merger, Michael A. DeGiglio, President, Chief Executive
Officer and a director of the Company owned beneficially (or may have been
deemed to own beneficially) 366,075 shares of Common Stock representing 3.4% of
the outstanding capital stock of the Company. Mr. DeGiglio was also Chief
Executive Officer and a Director of APD; he served as its President until
January, 1997. Prior to the Merger Mr. DeGiglio owned beneficially approximately
106 shares of the Common Stock of APD, representing 34.5% of the outstanding
capital stock thereof. Mr. DeGiglio and his wife and children were issued an
aggregate of 3,287,011 shares in connection with the Merger and the Morocco
Transaction.

Prior to the Merger, Albert Vanzeyst, a stockholder, director and
executive officer of APD owned beneficially approximately 95 shares of the
Common Stock of APD, representing 30.9% of the outstanding capital stock
thereof. Mr. Vanzeyst and members of his family were issued 3,061,906 shares in
connection with the Merger and the Morocco Transaction. As of the effective date
of the Merger, Mr. Vanzeyst became a director and Executive Vice President of
the Company.

59
<PAGE>

Prior to the Merger, Thomas Montanti, a stockholder, director and
Chairman of the Board of APD owned beneficially approximately 82 shares of the
Common Stock of APD, representing 26.5% of the outstanding capital stock
thereof. Mr. Montanti and members of his family (excluding Mr. DeGiglio and Mr.
DeGiglio's wife and children) were issued 2,902,803 shares in connection wit the
Merger and the Morocco Transaction. As of the effective date of the Merger, Mr.
Montanti became a director of the Company.

Prior to the Merger, J. Kevin Cobb, a stockholder and Senior Vice
President - Corporate Development of APD owned beneficially 7 7/10 shares of the
Common Stock of APD, representing 2.5% of the outstanding capital stock thereof.
Mr. Cobb was issued 235,767 shares in connection with the Merger. As of the
effective date of the Merger, Mr. Cobb became Senior Vice President - Corporate
Development of the Company.

Prior to the Merger between the Company and APD, the Company, during
the nine month period ended September 30, 1998, sold products to APD in the
amount of $4,216. Product sales to APD were $5,012,000 for the fiscal year ended
June 30,1998 and $2,954,000 for the fiscal year ended June 30, 1997.

The Company and APD share certain facilities and other costs for which
the Company, prior to the Merger between the Company and APD, charged APD
$31,500 during the nine month period ended September 30, 1998. Charges to APD
were $42,000 and $39,000 for the fiscal years ended June 30, 1998, and 1997,
respectively. APD was charged occupancy costs, including facility lease,
utilities and other costs, based on its proportionate occupancy and usage. In
addition, certain employees of each company performed shared duties. Each of the
Company and APD contributed that portion of each such employee's salary that
reflects the proportionate amount of work done for that entity.

The Company management believes that prices and fees charged to APD for
products, facilities, and costs prior to the Merger were consistent with what
would have been charged in arm's length transactions.

PLAN OF DISTRIBUTION

The sale or distribution of the Common Stock offered pursuant to this
Prospectus may be effected directly to purchasers by the Selling Stockholders as
principals or through one or more underwriters, brokers, dealers or agents from
time to time in one or more transactions (which may involve crosses or block
transactions) (i) on any stock exchange, in the Nasdaq SmallCap Market, or in
the over-the-counter market, (ii) in transactions otherwise than on any stock
exchange or in the over-the-counter market, or (iii) through the writing of
options (whether such options are listed on an options exchange or otherwise)
on, or settlement of short sales of, the Common Stock. Any of such transactions
may be effected at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, at varying prices determined at the
time of sale or at negotiated or fixed prices, in each case as determined by the
Selling Stockholder or by agreement between the Selling Stockholder and
underwriters, brokers, dealers, or agents, or purchasers. If the Selling
Stockholders effect such transactions by selling Common Stock to or through
underwriters, brokers, dealers or agents, such underwriters, brokers, dealers or
agents may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or commissions from purchasers of
Common Stock for whom they may act

<PAGE>

as agent (which discounts, concessions or commissions as to particular
underwriters, brokers, dealers or agents may be in excess of those customary in
the types of transactions involved). The Selling Stockholders and any brokers,
dealers or agents that participate in the distribution of the Common Stock may
be deemed to be underwriters, and any profit on the sale of Common Stock by them
and any discounts, concessions or commissions received by any such underwriters,
brokers, dealers or agents may be deemed to be underwriting discounts and
commissions under the Securities Act.

Under the securities laws of certain states, the Common Stock may be
sold in such states only through registered or licensed brokers or dealers.

The Company will not receive any proceeds from the sale of the shares
of Common Stock being offered by the Selling Stockholders. The Company has
agreed to bear all expenses incident to the registration, offering and sale of
the Common Stock to the public by the Selling Stockholders hereunder other than
commissions and discounts of underwriters, brokers, dealers and agents. The
Company has agreed to indemnify the Selling Stockholders and their officers,
directors, employees, agents, partners and controlling persons against certain
liabilities, including liabilities under the Securities Act, arising out of or
incident to registration of the Common Stock.

The Company has informed the Selling Stockholders that the
anti-manipulation provisions of Rules 10b-6 and 10b-7 under the Securities
Exchange Act of 1934 may apply to purchases and sales of the Common Stock by the
Selling Stockholders, and that there are restrictions on market-making
activities by persons engaged in the distribution of the Common Stock. The
Company has also advised the Selling Stockholders that if a particular offer of
Common Stock is to be made on terms constituting a material change from the
information set forth above with respect to the Plan of Distribution, then to
the extent required, a Prospectus Supplement must be distributed setting forth
such terms and related information as required.

DESCRIPTION OF SECURITIES

Common Stock

The Company is authorized to issue 100,000,000 shares of Common Stock,
par value $.01 per share. Each share of Common Stock entitles the holder thereof
to one vote on all matters submitted to the shareholders. Since the Common Stock
does not have cumulative voting rights, holders of more than 50% of the
outstanding shares can elect all of the directors and holders of the remaining
shares could not elect any directors. The shares are not subject to redemption
and there are no preemptive rights. All outstanding shares of Common Stock are
fully paid and non-assessable. Holders of Common Stock are entitled to receive
dividends out of funds legally available therefore when, as and if declared by
the Board of Directors. The payment of cash dividends on the Common Stock is
unlikely for the foreseeable future. See "Market Price and Dividend Policy."
Upon any liquidation, dissolution or winding up of the Company, holders of
Common Stock are entitled to share pro rata in any distribution to the holders
of Common Stock.

As of June 7, 1999, there were 269 record holders of the Company's
Common Stock.

61
<PAGE>

Preferred Stock

The Company's Restated Certificate of Incorporation authorizes
10,000,000 shares of Preferred Stock, par value $.01 per share, and authorizes
the Board of Directors to issue shares of Preferred Stock in one or more series
with such dividend, liquidation, conversion, redemption and other rights as the
Board establishes at the time. Shareholder approval is not required to issue
Preferred Stock. As of June 7, 1999, there were no shares of Preferred Stock
outstanding. To the extent that the Company issues any shares of Preferred
Stock, the ownership interest and voting power of the Company's shareholders
could be diluted.

The Preferred Stock could be issued in one or more series with such
voting, conversion and other rights as would discourage possible acquirors of
the Company from making a tender offer or other attempt to gain control of the
Company, even if such transaction were generally favorable to the Company's
shareholders. In the event of a proposed merger, tender offer or other attempt
to gain control of the Company which the Board does not approve, it might be
possible for the Board to authorize the issuance of a series of Preferred Stock
with rights and preferences which could impede the completion of such a
transaction. The Board could authorize holders of the Preferred Stock to vote,
either separately as a class or with the holders of Common Stock, on any merger,
sale or exchange of assets by the Company or other extraordinary corporate
transaction. Preferred Stock may be to discourage possible acquirors from making
a tender offer or other attempt to gain control of the Company with a view to
imposing a merger or sale of all or any part of the Company's assets, even
though a majority of shareholders may deem such acquisition attempts to be
desirable.

Transfer Agent and Registrar

The Company's transfer agent is Boston Equiserve, Boston,
Massachusetts.

SHARES ELIGIBLE FOR FUTURE SALE

As of June 7, 1999, there were 12,619,264 shares of Common Stock
outstanding, of which approximately 10,525,722 shares (83.4% of the shares to be
outstanding) are held by persons who acquired such shares in transactions which
were not registered under the Securities Act of 1933 (the "Securities Act").
These shares (the "Restricted Shares") may not be sold unless registered under
the Securities Act or sold pursuant to an applicable exemption from
registration, such as Rule 144 under the Securities Act.

In general, under Rule 144 as currently in effect, a person (or persons
whose shares are aggregated), including any person who may be deemed to be an
"affiliate" of the Company as that term is defined under the Securities Act, is
entitled to sell within any three-month period a number of shares beneficially
owned for at least two years that does not exceed the greater of (i) 1% of the
then outstanding shares of Common Stock or (ii) the average weekly trading
volume in the Common Stock during the four calendar weeks preceding such sale.
Sales under Rule 144 are also subject to certain requirements as to the manner
of sale, notice and the availability of current public information about the
Company. However, a person who is not an affiliate and has beneficially owned
such shares for at least two years is entitled to sell such shares under Rule
144(k) without regard to the volume, manner of sale, notice or public
information requirements.

62
<PAGE>

As of May 1, 1999, 5,235 of the 10,525,722 Restricted Shares were eligible for
sale in the public market in reliance upon Rule 144.

As of May 1, 1999, there were outstanding warrants to purchase an
aggregate of 124,311 shares (the "Warrant Shares") of the Company's Common Stock
and outstanding options to purchase an aggregate of 134,898 shares (the "Option
Shares") of the Company's Common Stock. The Option Shares have been registered
under the Securities Act.
The Company has granted the holders of the 9,063,578 Restricted Shares
outstanding as of May 1, 1999 certain demand and "piggyback" registration rights
which entitle the holders to have their shares registered for public sale.
Holders of warrants have been granted similar rights with respect to 61,198
Warrant Shares.

No predictions can be made as to the effect, if any that sales of
shares or the availability of shares for sale will have on the market price
prevailing from time to time. Moreover, the Company cannot predict the number of
shares of Common Stock which may be sold in the future pursuant to Rule 144 or
otherwise since such sales will depend upon the market price of the Common
Stock, the individual circumstances of the holders thereof and other factors.
Nevertheless, any sales of substantial amounts of the Common Stock in the public
market could have a significant adverse effect on the market price of the Common
Stock.

LEGAL MATTERS

Certain legal matters with respect to the Common Stock being offered
hereby will be passed upon for the Company by Giordano, Halleran & Ciesla, A
Professional Corporation.

EXPERTS

The financial statements included in this prospectus and elsewhere in
the registration statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto, and are
included herein in reliance upon the authority of said firm as experts in giving
said reports. Reference is made to said report, which includes an explanatory
paragraph with respect to the uncertainty regarding the Company's ability to
continue as a going concern as discussed in Note 1 to the financial statements.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company with the Commission may be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549
and at the Commission's regional offices at Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and Seven World Trade
Center, New York, New York 10048. Reports, proxy and information statements and
other information filed electronically by the Company with the Commission are
available at the Commission's World Wide Web Site at http://www.sec.gov. Copies
of such materials can be obtained from the Public Reference Section

63
<PAGE>

of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. The Company's Common Stock is quoted on the Nasdaq SmallCap
Market, and such reports, proxy statements and other information can be
inspected at the office of Nasdaq Operations, 1735 K Street, N.W., Washington,
D.C. 20006.

<PAGE>

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Public Accountants .............................. F-2

Consolidated Balance Sheets as of January 3, 1999,
June 30, 1998 and 1997 ............................................... F-3

Consolidated Statements of Operations for the fiscal years ended
June 30, 1998, 1997, 1996 and the transition periods (see Note 2)
ended January 3, 1999 and December 31, 1997 (unaudited) .............. F-4

Consolidated Statements of Stockholders' Equity (Deficit) for the
fiscal years ended June 30, 1998, 1997 and 1996 and the transition
period (see Note 2) ended January 3, 1999 ............................ F-5

Consolidated Statements of Cash Flows for the fiscal years ended
June 30, 1998, 1997 and 1996 and the transition periods (see Note 2)
ended January 3, 1999 and December 31, 1997 (unaudited) .............. F-6

Notes to Consolidated Financial Statements ............................ F-7

Consolidated Balance Sheets as of April 4, 1999 (unaudited)
and January 3, 1999 .................................................. F-30

Consolidated Statements of Operations for the thirteen weeks ended
April 4, 1999 (unaudited) and the three months ended March 31, 1998
(unaudited) .......................................................... F-31

Consolidated Statements of Cash Flows for the thirteen weeks ended
April 4, 1999 (unaudited) and the three months ended March 31, 1998
(unaudited) .......................................................... F-32

Notes to Consolidated Financial Statements ............................ F-33

F-1

<PAGE>

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of EcoScience Corporation:

We have audited the accompanying consolidated balance sheets of
EcoScience Corporation (a Delaware corporation) and subsidiaries as of January
3, 1999, June 30, 1998 and 1997, and the related consolidated statements of
operations, stockholders' equity (deficit) and cash flows for the transition
period (see Note 2) ended January 3, 1999 and each of the three years in the
period ended June 30, 1998. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of EcoScience
Corporation and subsidiaries as of January 3, 1999, June 30, 1998 and 1997, and
the results of their operations and their cash flows for the transition period
(see Note 2) ended January 3, 1999 and each of the three years in the period
ended June 30, 1998, in conformity with generally accepted accounting
principles.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in Note
1 to the consolidated financial statements, the Company has suffered recurring
losses from operations, an accumulated deficit, negative working capital and was
in default of certain covenants under its various debt agreements. These factors
raise substantial doubt about the ability of the Company to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 1. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

ARTHUR ANDERSEN LLP

Roseland, New Jersey
April 2, 1999

F-2

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)
<TABLE>
<CAPTION>
June 30,
January 3, ---------------------
1999 1998 1997
---- ---- ----
ASSETS
Current assets:
<S> <C> <C> <C>
Cash and cash equivalents .................... $ 1,095 $ 1,189 $ 3,009
Restricted cash .............................. -- 2,500 --
Short-term investments ....................... 127 533 528
Accounts receivable, less reserves of $551,
$660 and $178 at January 3,
1999, June 30, 1998 and 1997, respectively .. 7,271 6,809 3,456
Assets held for sale ......................... 1,911 1,911 --
Note receivable due from related party ....... -- 1,838 1,838
Inventories .................................. 9,209 5,050 6,716
Other current assets ......................... 1,212 2,411 1,756
--------- --------- ---------
Total current assets ....................... 20,825 22,241 17,303
--------- --------- ---------
Property, plant and equipment, net ........... 65,200 53,136 45,225
Restricted cash .............................. -- -- 3,250
Intangible assets, net ....................... 13,550 1,542 1,745
Other noncurrent assets ...................... 2,289 2,589 3,069
--------- --------- ---------
Total assets ........................ $ 101,864 $ 79,508 $ 70,592
========= ========= =========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Short-term borrowings ........................ $ 37,080 $ 7,148 $ 3,950
Current maturities of long-term debt ......... 47,557 5,043 3,878
Current obligations under capital leases ..... 42 55 59
Accounts payable ............................. 11,102 5,080 3,916
Accrued expenses and other current liabilities 7,705 7,118 3,719
--------- --------- ---------
Total current liabilities .................. 103,486 24,444 15,522
--------- --------- ---------
Noncurrent liabilities:
Long-term debt, less current maturities ...... 780 42,648 35,190
Obligations under capital leases ............. 338 380 406
Other long-term liabilities .................. 1,689 4,387 3,313
--------- --------- ---------
Total noncurrent liabilities ............... 2,807 47,415 38,909
--------- --------- ---------
Minority interest in limited partnerships ......... 665 7,767 12,115
Commitments and contingencies Stockholders'
equity (deficit):
Preferred stock, $0.01 par value,
10,000,000 shares authorized;
none issued and outstanding ................. -- -- --
Common stock, $0.01 par value, 100,000,000
shares authorized; 12,619,278, 11,618,178
and 11,600,722 shares issued and
outstanding at January 3, 1999,
June 30, 1998 and 1997, respectively ........ 126 116 116
Additional paid-in capital ........................ 55,574 57,509 57,426
Accumulated deficit ............................... (60,706) (57,749) (53,496)
Accumulated other comprehensive
income (loss) .................................... (88) 6 --
--------- --------- ---------
Total stockholders' equity (deficit) ....... (5,094) (118) 4,046
--------- --------- ---------
Total liabilities and stockholders'
equity (deficit) ....................... $ 101,864 $ 79,508 $ 70,592
========= ========= =========
</TABLE>

The accompanying notes are an integral part of these consolidated balance
sheets.

F-3

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
<TABLE>
<CAPTION>
Transition Period Years Ended
(see Note 2) Ended June 30,
------------------------ --------------------------------------
(Unaudited)
January 3, December 31,
1999 1997 1998 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net revenues ............................................ $ 26,194 $ 17,835 $ 46,177 $ 39,862 $ 24,668
Cost of revenues ........................................ 25,237 14,675 41,847 32,279 18,603
-------- -------- -------- -------- --------
Gross profit ............................................ 957 3,160 4,330 7,583 6,065
-------- -------- -------- -------- --------
Operating expenses:
Selling, general and administrative ................ 8,307 3,987 10,336 6,879 6,394
Research and development ........................... 239 202 465 508 1,018
Asset valuation and restructuring reversal ......... -- -- -- (377) (1,550)
-------- -------- -------- -------- --------
Total operating expenses ......................... 8,546 4,189 10,801 7,010 5,862
-------- -------- -------- -------- --------
Operating (loss) income ................................. (7,589) (1,029) (6,471) 573 203
-------- -------- -------- -------- --------
Other income (expense):
Interest, net ...................................... (2,928) (841) (3,289) (1,923) (611)
Other, net ......................................... (158) (100) (115) 12 136
-------- -------- -------- -------- --------
Total other expense .............................. (3,086) (941) (3,404) (1,911) (475)
-------- -------- -------- -------- --------
Loss before taxes, minority interest and
extraordinary item ..................................... (10,675) (1,970) (9,875) (1,338) (272)
Provision for income taxes .............................. 67 21 21 78 116
-------- -------- -------- -------- --------
Loss before minority interest and
extraordinary item ..................................... (10,742) (1,991) (9,896) (1,416) (388)
Minority interest ....................................... 2,255 1,311 5,659 1,936 274
-------- -------- -------- -------- --------
(Loss) income before extraordinary item ................. (8,487) (680) (4,237) 520 (114)
-------- -------- -------- -------- --------
Extraordinary item ...................................... -- -- -- -- 241
--------
Net (loss) income ....................................... ($ 8,487) ($ 680) ($ 4,237) $ 520 $ 127
======== ======== ======== ======== ========

(Loss) earnings per share
- -------------------------
Basic
(Loss) income before extraordinary item ............ ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 ($ 0.01)
Extraordinary item ................................. -- -- -- -- 0.02
-------- -------- -------- -------- --------
Net (loss) income .................................. ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 $ 0.01
======== ======== ======== ======== ========
Weighted average basic shares outstanding .......... 11,641 11,605 11,619 11,548 11,334
======== ======== ======== ======== ========

Diluted
(Loss) income before extraordinary item ............ ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 ($ 0.01)
Extraordinary item ................................. -- -- -- -- 0.02
-------- -------- -------- -------- --------
Net (loss) income .................................. ($ 0.73) ($ 0.06) ($ 0.36) $ 0.05 $ 0.01
======== ======== ======== ======== ========
Weighted average diluted shares outstanding ........ 11,641 11,605 11,619 11,583 11,381
======== ======== ======== ======== ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-4

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(In thousands, except share data)

<TABLE>
<CAPTION>
Common Stock
----------------------
Accumulated Total
Additional Other Stockholders'
Number of $0.01 Par Paid-in Accumulated Comprehensive Equity Comprehensive
Shares Value Capital Deficit Income (loss) (deficit) Income (loss)
------ ----- ------- ------- ------------- --------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at June 30, 1995 ........... 11,288,589 $ 113 $ 55,768 ($ 53,189) ($ 67) $ 2,625 $ --

Exercise of stock options .......... 333 -- 5 -- -- 5 --
Issuance of common stock
in settlement of WBDC lease ....... 100,000 1 499 -- -- 500 --
Unrealized gain on short-
term investments .................. -- -- -- -- 67 67 67
S Corp Distributions ............... -- -- -- (314) -- (314) --
Net income ......................... -- -- -- 127 -- 127 127
---------- ---------- ---------- ---------- ---------- ---------- ----------
Balance at June 30, 1996 ........... 11,388,922 114 56,272 (53,376) -- 3,010 194
==========
Exercise of stock options .......... 3,800 -- 17 -- -- 17 --
Issuance of common stock ........... 208,000 2 1,137 -- -- 1,139 --
S Corp Distributions ............... -- -- -- (640) -- (640) --
Net income ......................... -- -- -- 520 -- 520 520
---------- ---------- ---------- ---------- ---------- ---------- ----------
Balance at June 30, 1997 ........... 11,600,722 116 57,426 (53,496) -- 4,046 520
==========
Exercise of stock options .......... 17,456 -- 83 -- -- 83 --
Unrealized gain on short-
term investments .................. -- -- -- -- 6 6 6
Pooling adjustment ................. -- -- -- 314 -- 314 --
S Corp Distributions ............... -- -- -- (330) -- (330) --
Net loss ........................... -- -- -- (4,237) -- (4,237) (4,237)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Balance at June 30, 1998 ........... 11,618,178 116 57,509 (57,749) 6 (118) (4,231)
==========
Exercise of stock options .......... 1,100 -- 5 -- -- 5 --
Unrealized loss on short-
term investments .................. -- -- -- -- (4) (4) (4)
Cumulative translation
adjustments ....................... -- -- -- -- (90) (90) (90)
S Corp conversion .................. -- -- (5,930) 5,930 -- -- --
S Corp Distributions ............... -- -- -- (400) -- (400) --
Issuance of common stock ........... 1,000,000 10 3,990 -- -- 4,000 --
Net loss ........................... -- -- -- (8,487) -- (8,487) (8,487)
---------- ---------- ---------- ---------- ---------- ---------- ----------

Balance at January 3, 1999 ......... 12,619,278 $ 126 $ 55,574 (60,706) ($ 88) ($ 5,094) ($ 8,581)
========== ========== ========== ========== ========== ========== ==========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-5

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<TABLE>
<CAPTION>

Transition Period
(See Note 2) Ended Years Ended June 30,
------------------------ -------------------------------
(Unaudited)
January 3, December 31,
1999 1997 1998 1997 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net (loss) income ................................................. ($ 8,487) ($ 680) ($ 4,237) $ 520 $ 127
Adjustments to reconcile net (loss)
income to net cash used in operating
activities:
Extraordinary Item ............................................ -- -- -- -- (241)
Depreciation and amortization ................................. 2,146 1,301 3,223 1,906 863
Minority interest in limited partnership ...................... (2,255) (1,311) (5,659) (1,935) (274)
(Gain) loss on sale of investments ............................ (6) -- -- (2) 58
Loss (Gain) on sale of property, plant and equipment .......... 1 (3) (3) -- (74)
Gain on settlement of accounts payable ........................ -- -- -- -- (51)
Reversal of restructuring charge .............................. -- -- -- (377) (1,550)
Changes in current assets and liabilities:
Accounts receivable, net .................................. (462) (917) (2,818) (1,002) (488)
Inventories ............................................... (4,159) (3,704) (1,987) (2,427) (2,216)
Other current assets ...................................... 1,008 (1,015) (1,040) (553) (598)
Other ..................................................... 105 3 73 (30) (7)
Accounts payable and accrued expenses ..................... 6,094 908 5,015 1,081 831
-------- -------- -------- -------- --------
Net cash used in operating activities ......................... (6,015) (5,418) (7,433) (2,819) (3,620)
-------- -------- -------- -------- --------
Cash flows from investing activities:
Purchases of property, plant and equipment ........................ (4,632) (14,306) (26,099) (28,244) (17,499)
Proceeds from sale of property, plant and equipment ............... 2 343 628 50 368
Purchases of short-term investments ............................... -- -- -- (503) --
Proceeds from sale of short-term investments ...................... 409 -- -- 677 6,079
Changes in restricted cash ........................................ 2,500 -- 750 455 (3,205)
Decrease (increase) in other noncurrent assets .................... 243 (356) (141) (268) (80)
Decrease in other noncurrent liabilities .......................... (2,548) (4,606) (3,532) -- --
Decrease (increase) in loan receivable ............................ -- (643) (643) (1,538) 131
Proceeds from long-term construction liabilities .................. -- -- -- 801 1,645
-------- -------- -------- -------- --------
Net cash used in investing activities ......................... (4,026) (19,568) (29,037) (28,570) (12,561)
-------- -------- -------- -------- --------
Cash flows from financing activities:
Issuance of common stock .......................................... -- -- -- 1,139 4
Proceeds from exercise of stock options ........................... 5 83 83 17 1
Debt issue costs .................................................. (134) (601) (601) (1,507) (1,012)
Minority interest contribution .................................... 1,000 2,741 2,741 9,667 4,657
Cash dividends .................................................... (400) (220) (330) (640) (314)
Proceeds from long-term debt ...................................... 3,602 14,306 24,299 28,123 16,239
Net borrowings under line of credit ............................... 8,332 5,394 7,148 2,045 1,905
Payments on capital leases ........................................ (56) (24) (54) (46) (25)
Payments on long-term debt ........................................ (2,312) (3,849) (5,225) (6,146) (4,294)
-------- -------- -------- -------- --------
Net cash provided by financing activities ....................... 10,037 17,830 28,061 32,652 17,161
-------- -------- -------- -------- --------
Effects of exchange rates on cash balances ........................ (90) -- -- -- --
-------- -------- -------- -------- --------
Net change in cash and cash equivalents ................................ (94) (7,156) (8,409) 1,263 980
Cash and cash equivalents at beginning of period ....................... 1,189 $ 9,598 $ 9,598 1,746 766
======== ======== ======== ======== ========
Cash and cash equivalents at end of period ............................. $ 1,095 $ 2,442 $ 1,189 $ 3,009 $ 1,746
======== ======== ======== ======== ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.

F-6

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share data)

1. OPERATIONS

EcoScience Corporation ("EcoScience") and its wholly owned subsidiaries
(collectively, the "Company"), Agro Power Development, Inc. and its subsidiaries
and consolidated limited partnerships (collectively "APD"), Agro Dynamics, Inc.
and Agro Dynamics Canada Inc. (collectively, "AGRO") and EcoScience Produce
Systems Corp. ("EPSC") are primarily engaged in the production, marketing and
sale of premium grade tomatoes grown in intensive greenhouse facilities. In
addition, the Company markets, sells, develops and commercializes products for
the agricultural and biological industries.

The Company derives most of its revenues from the sale of: (i)
greenhouse tomatoes to retail supermarkets and dedicated fresh food distribution
companies; (ii) growing medium products and computerized environmental and
irrigation control systems to the intensive farming and horticulture industries;
and (iii) postharvest coating products to the fresh fruit market throughout the
western hemisphere. Prior to the sale of the Company's postharvest equipment
division to Aweta, B.V., in February 1999 (see Note 14), the Company had also
derived revenues from the sale of sorting, grading and packing systems to the
produce packing industry.

In 1988, EcoScience began full scale research and development
operations, which continued through its fiscal year ended June 30, 1996. The
Company incurred in excess of $30,000 in research and development costs during
this phase of its growth and development. During fiscal 1994 and 1995, the
Company incurred approximately $12,000 in restructuring charges to transition
the Company from research and development to a commercial operation. This was
enhanced through the beginning of greenhouse operations in 1994 by APD and the
acquisitions of AGRO in November 1992 and EPSC in May 1994. In addition, the
Company has also funded the construction and initial start-up operations of
approximately 180 acres of greenhouse production capacity since mid-1996.
EcoScience and APD completed a merger on September 30, 1998 (see Note 3), which
resulted in approximately $1,500 in transaction costs. The above activities have
been principally funded by the Company's initial private capitalization, public
equity offerings in February 1992 and December 1993 and the combined $60,000
credit facility discussed in Note 10.

As a result of the above, the Company has suffered significant
recurring losses resulting in an accumulated deficit of $60,706 as of January 3,
1999. The Company is in violation of certain covenants under various debt
agreements as of January 3, 1999, which has resulted in approximately $44,756 of
debt being classified as current in the accompanying January 3, 1999 balance
sheet which otherwise would have been classified as long-term. See Note 10 for
further information regarding the Company's various defaults. This along with
the note issued on December 30, 1998, in connection with the acquisition of
certain minority interests in consolidated limited partnerships (see Note 4),
has resulted in significant negative working

F-7
<PAGE>

capital; however, the Company's greenhouse operations are now believed by
management to be approaching their optimal cropping cycles for the first time
since the large 180 acreage expansion that began in mid-1996, with the exception
of Village Farms of Presidio, L.P. ("VFP") (see Note 2a). Management's plan is
focused on improving the gross profit of all greenhouse operations as a result
of greater production volumes, sizing and efficiency through a full cropping
cycle at each greenhouse facility.

The Company believes that its $1,095 of cash and cash equivalents and
$127 of short-term investments as of January 3, 1999, along with revenues from
product sales, will be sufficient to fund the Company's working capital needs,
planned capital expenditures, current acquisitions and to service its
indebtedness through January 4, 2000, provided that the Company can resolve its
near term cash flow problems by raising additional capital and refinance its
$21,600 aggregate principal amount of promissory notes issued on December 30,
1998 and March 15, 1999 that are due on June 30, 1999, restructure its $60
million credit facility and refinance its $3,000 line of credit, for which the
due date is April 28, 1999. The Company has engaged a financial advisor, who is
assisting in the raising of additional funds to finance its ongoing operations
during 1999 and expected growth after January 4, 2000. There can be no
assurances that such efforts will be successful or that additional debt or
equity financing can be obtained to meet working capital needs. These factors
raise substantial doubt about the ability of the Company to continue as a going
concern.

The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern, which contemplates
the realization of assets and the liquidation of liabilities in the normal
course of business. The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Principles of Consolidation

The accompanying consolidated financial statements include the accounts
of EcoScience and its wholly owned subsidiaries, APD, AGRO and EPSC.

Through December 30, 1998, the Company consolidated four 50% owned
limited partnerships due to the direction of power and control exerted by the
Company's management in the normal course of business over the daily operations
of Village Farms of Texas, L.P. ("VFT"), Pocono Village Farms, L.P. ("PVF"),
Village Farms of Marfa, L.P. ("VFM") and Village Farms of Buffalo, L.P. ("VFB").
The remaining minority interests in these four limited partnerships were
purchased from Cogentrix Delaware Holdings, Inc. ("Cogentrix") on December 30,
1998 (see Note 4).

On August 31, 1998, the Company entered into an agreement with two
wholly-owned subsidiaries of Agro Rent B.V. ("Agro Rent") to form a limited
partnership in Presidio County, Texas (the "VFP Agreement"). The purpose of the
VFP Agreement was to develop and operate a 41 acre greenhouse for the purpose of
producing and selling peppers. Due to the inability to attain the desired level
of financing only 26 acres of the greenhouse has been constructed. The VFP
Agreement defined the Company and Agro Rent as approximate 86% and 14% owners,
respectively. Therefore, the 86% interest in VFP is included in the accompanying
consolidated

F-8
<PAGE>

financial statements. All material intercompany transactions and balances have
been eliminated in consolidation.

(b) Fiscal Year-End and Transition Period

The Company has elected to change its fiscal year-end from the twelve
month period ended June 30 to a 52-53 week fiscal year. The year-end date of
such fiscal year shall be on the Sunday nearest December 31 of each year. The
audited transition period financial statements will be as of January 3, 1999 and
for the period from July 1, 1998 through January 3, 1999 (the "transition
period").

The unaudited consolidated financial information included herein for
the six months ended December 31, 1997 have been included for comparative
purposes to the audited transition period and have been prepared in accordance
with generally accepted accounting principles for interim financial statements.
In the opinion of the Company, these unaudited consolidated financial statements
reflect all adjustments necessary, consisting of normal recurring adjustments,
for a fair presentation of such data on a basis consistent with that of the
audited data presented herein.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, and
disclosures of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

(d) Cash and Cash Equivalents and Short-Term Investments

Cash and cash equivalents and short-term investments consist of highly
liquid investments and are stated at the lower of cost or market value. Cash and
cash equivalents consist of investments with original maturities of less than 90
days. Short-term investments have original maturities greater than 90 days and
such securities are classified as available for sale in accordance with
Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for
Certain Investments in Debt and Equity Securities." The Company uses the
specific identification method in determining the cost basis of short-term
investments, and in computing any realized gains or losses from the sale of such
securities.

Cash and cash equivalents consist of cash and highly liquid money
market funds, the balance of which was $1,095, $1,189 and $3,009 at January 3,
1999, and June 30, 1998 and 1997, respectively. Short-term investments consist
of United States government obligations with an original maturity date of
greater than 90 days, the balance of which was $127, $533 and $528 at January 3,
1999, and June 30, 1998 and 1997, respectively.

F-9
<PAGE>

(e) Restricted Cash

The Company had restricted cash of $2,500 and $3,250 at June 30, 1998
and 1997, respectively. The amounts were held as collateral for certain
outstanding debt. (See Notes 5 and 10).

(f) Inventories

June 30,
January 3, ----------------------
1999 1998 1997
---- ---- ----
Raw materials ..................... $ 77 $ 74 $ 17
Crop inventory .................... 6,582 2,724 4,776
Finished goods .................... 2,550 2,252 1,923
------ ------ ------
$9,209 $5,050 $6,716
====== ====== ======

Crop inventories represent direct and indirect production costs
incurred before harvesting the annual tomato and growing crops. Growing crops
are valued at the lower of cost or estimated market. Finished goods inventories
include material, labor and overhead. Raw materials and finished goods are
stated at the lower of first-in, first-out ("FIFO") cost or market.

(g) Property, plant and equipment.

Property, plant and equipment are stated at cost. The Company provides
for depreciation and amortization using the straight-line method by charges to
operations in amounts estimated to allocate the cost of these assets over their
useful lives as follows:

Classification Estimated Useful Life
-------------- ---------------------
Land.................................. --
Land improvements..................... 5-20 years
Greenhouses........................... 20 years
Greenhouse improvements............... 10-20 years
Greenhouse equipment.................. 5-10 years
Computer and office equipment......... 5-7 years
Laboratory equipment.................. 5 years

Leasehold improvements and assets held under capital leases are
amortized over the term of the lease or the useful life of the asset, whichever
is shorter.

(h) Intangible Assets

Intangible assets consist primarily of goodwill and other intangible
assets resulting from acquisitions accounted for using the purchase method of
accounting. Goodwill is amortized using the straight-line method over 20 years.
Other intangible assets relating to acquired businesses consist principally of
amounts attributable to distribution agreements. The amortization for
distribution agreements is on a straight line basis over five years. On December
30, 1998, the Company acquired the minority interests in certain limited
partnerships. The goodwill resulting from this transaction was $12,058 (see Note
4).

Goodwill, net of accumulated amortization, was $13,550, $1,542 and
$1,745 at January 3, 1999, June 30, 1998 and 1997, respectively. The accumulated
amortization of goodwill and other

F-10
<PAGE>

intangible assets totaled $509, $459, and $823 at January 3, 1999, June 30, 1998
and 1997, respectively. Amortization of goodwill and other intangible assets
included in the accompanying consolidated statements of operations was $50,
$136, $204 and $204 in the transition period ended January 3, 1999 and fiscal
years 1998, 1997 and 1996, respectively.

(i) Revenue Recognition

Revenue from tomato product sales is recognized upon shipment by the
Company. Certain equipment sales are recognized upon installation and include
certain warranty provisions.

(j) Research and Development Expenses

The Company charges research and development expenses to operations as
incurred. Expenses incurred by EcoScience under third party funded research and
development programs totaled approximately $43, $53, $7, and $0 in transition
period ended January 3, 1999 and fiscal years 1998, 1997 and 1996, respectively.
Expenses incurred under Company funded research and development programs totaled
approximately $196, $412, $501 and $1,018 in the transition period ended January
3, 1999 and fiscal years 1998, 1997 and 1996.

(k) Foreign Currency Translation

The assets and liabilities of the Company's Canadian subsidiary are
translated into U.S. dollars at current exchange rates and the related revenue
and expense items are translated at average annual exchange rates. The aggregate
effect of translation losses is reflected as a component of accumulated other
comprehensive loss in the accompanying financial statements until the sale or
liquidation of the underlying foreign investment.

(l) Earnings (Loss) Per Share

The Company has adopted Statement of Financial Accounting Standards No.
128, "Earnings per Share," which requires presentation of both basic and diluted
earnings per share in the Consolidated Statement of Operations. Basic earnings
per share excludes any dilutive effects of options, warrants and convertible
securities. Diluted earnings per share gives effect to all potentially dilutive
common shares that were outstanding during the period.

The following table sets forth a reconciliation of weighted average
common shares outstanding to the weighted average common shares assuming
dilution:

Transition
Period Ended Years ended June 30,
January 3, ---------------------------
1999 1998 1997 1996
---- ---- ---- ----
Weighted average common
shares outstanding ................ 11,641 11,619 11,548 11,334
Dilutive effect of common
shares issuable(1) ................ -- -- 35 47
------ ------ ------ ------
Weighted average common
shares outstanding
assuming dilution ................. 11,641 11,619 11,583 11,381
====== ====== ====== ======
- ------------
(1) Issuable under common stock purchase warrants and stock option plans.

F-11
<PAGE>

Common stock purchase warrants and stock options at January 3, 1999,
June 30, 1998, 1997 and 1996 to purchase 259,209, 281,491, 185,673 and 119,829
shares, respectively, of common stock were not included in the computation of
earnings per common share assuming dilution because their effect would be
anti-dilutive.

(m) Fair Value of Financial Instruments

No class of financial instrument had a material difference between its
carrying value and estimated fair value based on market quotations, projected
cash flows or other estimating methods. See Note 10 for the estimated fair value
of certain debt agreements.

(n) Supplemental Cash Flow Information

The Company made certain cash payments and consummated certain non-cash
investing and financing transactions as summarized below:

<TABLE>
<CAPTION>
Transition
Period Ended Years ended June 30,
January 3, -----------------------------
1999 1998 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Cash paid for:
Interest ..................... $ 1,828 $ 3,320 $ 2,761 $ 1,004
Income taxes ................. 2 5 175 73

Non-cash investing and
financing activities:
Disposition of assets
under capital lease ......... -- -- 308 2,936
Termination of capital
lease obligation ............ -- -- (405) (3,500)
Termination of operating
lease obligation and
related reduction of
accrued restructuring costs . -- -- (405) (3,500)
Issuance of common stock
in exchange for termination
of operating lease obligation -- -- -- 500
Assets acquired under
capital leases .............. -- 319 451 --
Interest capitalized ......... 165 384 384 285
Acquisition of minority
interests ................... (26,921) -- -- --
Cancellation of notes and
related interest, net ....... 1,321 -- -- --
Issuance of acquisition
notes payable ............... 21,600 -- -- --
Issuance of common stock ..... 4,000 -- -- --
</TABLE>

(o) Long-Lived Assets

The Company has adopted Financial Accounting Standards Board ("FASB")
Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for
the Impairment of Long Lived Assets and for Long Lived Assets to be Disposed of"
("SFAS 121"). SFAS 121 requires, among other things, that an entity review its
long lived assets and certain related intangibles for impairment from changes in
circumstances that would indicate the carrying amount of an asset

F-12
<PAGE>

may not be fully recoverable. As a result of its review during the transition
period, the Company does not believe any impairment exists in the recoverability
of its long lived assets.

(p) Stock Based Compensation

The Company has adopted Financial Accounting Standards Board Statement
of Financial Accounting Standards No. 123, "Accounting for Stock Based
Compensation" ("SFAS 123"), which encourages, but does not require, an entity to
account for employee stock based compensation under a fair value based method.
SFAS 123 allows an entity to continue to measure compensation cost for employee
stock based compensation plans using the intrinsic value based method of
accounting prescribed by APB Opinion No. 25, "Accounting for Stock Issued to
Employees" ("APB 25"). The Company continues to account for employee stock based
compensation using the intrinsic value based method and is required to make pro
forma disclosures of net income and earnings per share as if the fair value
based method of accounting under SFAS 123 had been applied (see Note 12).

(q) Income Taxes

The Company accounts for income taxes under the provisions of SFAS 109,
"Accounting for Income Taxes". This statement requires the Company to recognize
deferred tax assets and liabilities for the expected future tax consequences of
events that have been recognized in the Company's financial statements or tax
returns. Under this method, deferred tax assets and liabilities are determined
based on the estimated future tax effects of differences between the financial
statements, carrying amounts and the tax basis of assets and liabilities at
currently enacted tax laws and rates. Prior to the merger on September 30, 1998,
APD elected, by consent of their stockholders, to be treated under the
provisions of Subchapter S of the Internal Revenue Code, Section 1372. Under
such provisions, earnings and losses of APD were passed through to the
stockholders in proportion to their ownership interest and reported on their
individual income tax returns. Accordingly, no provision for Federal income
taxes had been made in the APD financial statements. All distributions paid to
stockholders through September 30, 1998 were paid in part to fund Federal and
state income tax obligations of the stockholders arising from the income
generated by APD (see Note 13).

(r) Accumulated Other Comprehensive Income (Loss)

In June 1997, the FASB issued SFAS 130, "Reporting Comprehensive
Income," which establishes standards for reporting and presenting information on
comprehensive income and its components in annual and interim financial
statements. The Company adopted SFAS 130 as of July 1, 1998. Comprehensive
income (loss) includes net income, unrealized gains on available-for-sale
securities and foreign currency translation adjustments. The Company has
disclosed comprehensive income (loss) in the Consolidated Statement of
Stockholders' Equity (Deficit).

(s) Reclassifications

Certain amounts in the previous years consolidated financial statements
have been reclassified to conform to the transition period presentations.

F-13
<PAGE>

3. MERGER WITH AGRO POWER DEVELOPMENT, INC.

On September 30, 1998, the Company issued 9,421,487 shares of the
Company's common stock, $0.01 par value, to the holders of the common stock of
APD, a privately held corporation, pursuant to an Agreement and Plan of Merger,
in which APD was merged with and into a newly formed, wholly owned subsidiary of
the Company (the "Merger"). The stockholders of APD received 30,619.067 shares
of the Company's common stock for each outstanding share of common stock of APD.
In addition, on September 30, 1998, the Company issued 99,000 shares of common
stock to certain stockholders of APD for their entire 50% interest in Village
Farms of Morocco, S.A., a Moroccan company, as provided for in the Agreement and
Plan of Merger. After the Merger, the stockholders of APD owned approximately
80% of the outstanding shares of the Company, on a fully diluted basis.

The merger has been accounted for as a pooling of interests.
Accordingly, the consolidated financial statements give retroactive effect to
the merger with APD, accounted for as a pooling of interests, as if the merger
had occurred at the beginning of the earliest period presented.

The effective date of the merger, September 30, 1998, was during the
transition period ended on January 3, 1999. The following table summarizes the
results of operations of EcoScience and APD on a separate company basis for the
period (July 1, 1998-September 30, 1998) before the combination was consummated
that is included within the consolidated statement of operations for the
transition period ended January 3, 1999.

(Unaudited)
EcoScience APD
---------- ---
Net revenues..................... $6,028(1) $4,557
====== ======
Net loss......................... ($1,088)(1) ($2,593)
======= ======
S Corporation distributions...... N/A $400
======
- --------
(1) The net revenues and net loss amounts for EcoScience above include
transactions with APD during the period that resulted in approximately
$1,877 in net revenues and $211 in gross profit, respectively.

The following sets forth the reconciliations of net revenue and net
income (loss) previously reported by the Company to the combined amounts
presented in the accompanying historical consolidated statements of operations:

Years Ended June 30,
-----------------------------------------
1998 1997 1996
---- ---- ----
Net revenues:
EcoScience .................. $ 22,317 $ 20,853 $ 14,151
APD ......................... 28,871 21,963 11,090
Eliminations ................... (5,011) (2,954) (573)
-------- -------- --------
Total ....................... $ 46,177 $ 39,862 $ 24,668
======== ======== ========
Net (loss) income:
EcoScience .................. ($ 967) $ 385 ($ 587)
APD ......................... (3,010) 356 734
Eliminations ................... (260) (221) (20)
-------- -------- --------
Total ....................... ($ 4,237) $ 520 $ 127
======== ======== ========

F-14
<PAGE>

On September 30, 1998, APD's S Corporation tax status was terminated as
it became a wholly-owned subsidiary of a C Corporation. The accumulated deficit
of $5,930 on the merger date was reclassified to additional paid-in-capital in
the accompanying consolidated statement of stockholders' equity (deficit).

The Company incurred approximately $1,500 of transaction costs in
connection with the merger, which were charged to operations during the
transition period.

The financial statements, for periods prior to the September 30, 1998
merger are reported using EcoScience's historical financial reporting periods.
EcoScience's historical financial statements are presented for the years ended
June 30, 1998, 1997 and 1996. In addition, since APD's historical fiscal year,
for periods prior to the September 30, 1998 merger, ended on the Sunday nearest
December 31, the accompanying June 30, 1998 financial statements required APD to
recast its 1998 historical financial statements to conform to and be combined
with EcoScience's fiscal year ended June 30, 1998. The APD financial data
combined into the accompanying financial statements for the years ended June 30,
1997 and 1996 represent the historical financial statements for APD for the 52
week periods ended December 28, 1997 and December 29, 1996, respectively.

Due to the periods being combined, the 26 week period ended December
28, 1997 for APD is included in the combined financial statements for both
periods ended June 30, 1998 and 1997. Revenues for the 26 week period ended
December 28, 1997 totaled $8,656 and both loss before extraordinary item, of
which there were none, and net loss amounted to $94. S Corporation distributions
of $220, which occurred during the 26 week period ended December 28, 1997, were
included for both periods ended June 30, 1998 and 1997. Accordingly, the
accompanying consolidated statements of Stockholders' Equity (Deficit) for the
year ended June 30, 1998, reflects a $314 pooling adjustment to the accumulated
deficit to reverse the impact of including this historical activity twice.

4. ACQUISITION

On December 30, 1998, the Company acquired, through the acquisition of
four entities, the Cogentrix minority interests in certain investments of APD
that operate four of the Company's greenhouse operations. The purchase price of
the minority interests consisted of 1,000,000 shares of EcoScience common stock
valued at $4.00 per share, the market value at the time of the acquisition, and
a $20,600 note bearing interest at a rate of 11.25% per annum, which was
originally due and payable on March 15, 1999. On March 12, 1999, Cogentrix
agreed to extend the maturity date of the note to June 30, 1999. In connection
with the extension, the Company issued Cogentrix an additional note in the
principal amount of $1,000 which has terms similar to the original note and
becomes due on June 30, 1999. The notes are secured by all of the outstanding
capital stock of APD and the Acquired Companies. EcoScience is currently seeking
additional debt and equity financing to fulfill this obligation. If the Company
is not successful in refinancing the $21,600 aggregate principal amount of
notes, it will seek an extension of the due date or a restructuring of the terms
of the notes. There can be no assurances that EcoScience will be successful in
these efforts.

As a condition to the acquisition, EcoScience agreed to register the
1,000,000 shares of common stock for public sale. In the event the stock is not
registered by June 15, 1999,

F-15
<PAGE>

EcoScience may be required, at the election of Cogentrix, to repurchase the
1,000,000 shares from Cogentrix at a price equal to the greater of $4.00 or the
market price the day prior to the repurchase demand, as provided.

Additional consideration given in the transaction is as follows: (i)
termination of an option agreement with Cogentrix, pursuant to which APD granted
to Cogentrix certain rights to participate in future projects involving the
development, acquisition, owning of or operating by APD of any greenhouse
facility at which fruit or vegetables are to be grown, as defined; (ii)
Cogentrix assigned and contributed its note receivable of $643 along with its
accrued interest ($65), due from APD to Cogentrix Greenhouse Investment, Inc.
(one of the entities acquired) and (iii) one of the greenhouse limited
partnerships cancelled its note receivable due from Cogentrix in the amount of
$1,838, along with its accrued interest ($191). Following the cancellation and
the acquisition of the minority interests by EcoScience, Cogentrix Greenhouse
Investment, Inc. issued a promissory note payable to that greenhouse limited
partnership in the same amount. The Company has estimated $325 in transaction
costs will be incurred in connection with this acquisition.

The financial statements reflect the preliminary allocation of the
$27,246 purchase price, which includes a $9,340 fair value increase of certain
minority interest assets acquired. The allocation has not been finalized due to
ongoing negotiations relating to the notes issued in connection with this
acquisition and all of the finalized appraisals regarding the fair values of the
assets acquired have not been received by the Company. Accordingly, in 1999
goodwill associated with the acquisition may change. The excess of the purchase
price over the fair value of the net assets acquired is estimated to be
approximately $12,058 and is being amortized on a straight-line basis over 20
years (see also Note 2h).

The $1,838 note was previously issued in March 1997 by a subsidiary of
APD. The note was unsecured, interest was payable at 6.0% per annum and
principal and interest were due on demand and it was reflected in the
accompanying financial statements as a note receivable due from related party.
See Note 10 for a description of the note payable from APD to Cogentrix also
affected by this acquisition.

The acquisition of minority interests described above was accounted for
by the purchase method of accounting for business combinations. Accordingly, the
accompanying consolidated statements of operations continued to reflect minority
interests through the December 30, 1998 closing date. The following unaudited
pro forma information presents the results of operations of the Company as if
the acquisition had taken place on July 1, 1997:

Transition period ended Year ended
January 3, 1999 June 30, 1998
--------------- -------------
Net revenues.................... $26,194 $46,177
Net loss........................ $(12,526) $(13,467)
Net loss per share.............. $(0.99) $(1.07)

5. ASSETS HELD FOR SALE

The Company is attempting to sell a greenhouse property that was
damaged by a tornado. Estimated costs of approximately $500 to be incurred
through the estimated sale date (May

F-16
<PAGE>

1999) were accrued by the Company. The assets, totaling $1,911, have been
disclosed as held for sale in the accompanying January 3, 1999 and June 30, 1998
Consolidated Balance Sheets.

6. OTHER CURRENT ASSETS

Other current assets consist of the following:

June 30,
January 3, -------------------
1999 1998 1997
---- ---- ----
Government grant ........................... $ 400 $ -- $ --
Prepaid equipment project costs ............ 322 838 653
Non-trade receivables ...................... 237 207 504
Interest receivable ........................ -- 214 93
Merger costs ............................... -- 653 --
Other ...................................... 253 499 506
------ ------ ------
$1,212 $2,411 $1,756
====== ====== ======

The $653 in merger costs (see Note 3) as of June 30, 1998, along with
other merger costs incurred during the period July 1, 1998 through the effective
date of the merger for a total of approximately $1,500, were expensed in the
transition period.

7. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consists of the following:

June 30,
January 3, ------------------------
1999 1998 1997
---- ---- ----
Land ................................. $ 973 $ 986 $ 1,102
Land improvements .................... 2,266 1,236 1,326
Greenhouses .......................... 54,062 33,540 35,109
Greenhouse improvements .............. 239 203 717
Greenhouse equipment ................. 11,250 9,111 7,908
Computer and office equipment ........ 1,808 1,779 1,154
Laboratory equipment ................. 65 65 65
Leasehold improvements ............... 62 62 62
Construction in progress ............. -- 9,837 --
-------- -------- --------
70,725 56,819 47,443
-------- -------- --------
Less accumulated depreciation
and amortization .................... (5,525) (3,683) (2,218)
-------- -------- --------
$ 65,200 $ 53,136 $ 45,225
======== ======== ========

Included in the amounts above are $435, $547 and $563 in assets held
under capital leases at January 3, 1999, June 30, 1998 and 1997, respectively.

F-17

<PAGE>

8. OTHER NONCURRENT ASSETS

Other noncurrent assets consist of the following:

June 30,
January 3, ------------------------
1999 1998 1997
---- ---- ----
Debt issuance costs (1) .............. $ 2,517 $ 2,558 $ 2,520
Security deposits .................... 77 65 57
Notes receivable ..................... 106 270 229
Other ................................ 28 355 420
------- ------- -------
2,728 3,248 3,226
Less accumulated amortization ........ (439) (659) (157)
------- ------- -------
$ 2,289 $ 2,589 $ 3,069
======= ======= =======
- --------------
(1) Debt issuance costs represent amounts incurred in obtaining financing for
various greenhouse construction facilities. Included in these costs are the
unamortized premiums paid for the purchase of interest rate cap agreements
(see Note 10). The premiums paid are being amortized to interest expense
over the terms of the cap agreements (5 years).

9. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the
following:

In Thousands
June 30,
January 3, --------------------
1999 1998 1997
---- ---- ----
Payroll related costs ................... $ 540 $ 622 $ 309
Professional fees ....................... 833 187 186
Accrued warranty costs .................. 50 72 59
Accrued inventory purchases ............. 546 344 620
Customer deposits ....................... 415 1,209 971
Interest ................................ 2,707 1,239 265
Rent .................................... -- 651 --
Third party grower ...................... 46 42 398
Insurance ............................... 199 245 174
Utilities ............................... 401 241 33
Restructuring ........................... 344 198 307
Severance ............................... 127 -- --
Repairs and maintenance ................. 257 -- --
Sales tax ............................... 201 -- --
Greenhouse costs ........................ -- 797 --
Other ................................... 1,039 1,271 397
------ ------ ------
$7,705 $7,118 $3,719
====== ====== ======

F-18
<PAGE>

10. DEBT

(a) Short-term borrowings

Short-term borrowings consists of the following:

June 30,
January 3, ---------------------
1999 1998 1997
---- ---- ----
Revolving line of credit(1) ............. $ 2,254 $ 1,091 $ --
VFT revolving line of credit(2) ......... -- -- 2,000
VFIFA line of credit(3) ................. 13,226 6,057 1,950
Note payable to Cogentrix(4) ............ 21,600 -- --
------- ------- -------
$37,080 $ 7,148 $ 3,950
======= ======= =======

(b) Long-term debt

Long-term debt consists of the following:

June 30,
January 3, ------------------------
1999 1998 1997
---- ---- ----
VFT term loan credit
facility(2) ......................... $ -- $ 18,181 $ 18,414
VFIFA construction and
term loan credit facility(3) ........ 46,219 26,478 16,486
PVF non-revolving line of
credit(5) ........................... 804 1,201 2,125
Notes payable to Cogentrix(6) ........ 1,071 1,743 1,949
Other long-term debt ................. 243 88 94
-------- -------- --------
48,337 47,691 39,068
-------- -------- --------
Less-current maturities .............. (47,557) (5,043) (3,878)
-------- -------- --------
$ 780 $ 42,648 $ 35,190
======== ======== ========

- ------------
(1) On November 24, 1998, the lender to the biological and agricultural
products segment notified the Company of its intention to terminate the
revolving line of credit on December 24, 1998. The Company and the Bank
have agreed to four extensions to the revolving line of credit, since
November 24, 1998, which make the maturity date April 28, 1999.

The Company and the Bank have also agreed to the following modifications of
the revolving line of credit pursuant to the extensions of the maturity
date and forbearance period; (i) reduction of the $1,200 inventory based
borrowing limit by $40 each week commencing the week of January 28, 1999
and (ii) an increase to the interest rate to prime plus 5.0%. As of January
3, 1999, the Company had $747 of additional borrowing availability under
the revolving line of credit. The Company has received a term sheet from a
financial institution in the amount of $4,000 to replace this existing
revolving line of credit. Although no assurance can be given, the Company
believes that it will finalize the replacement financing arrangement in
April or May 1999.

(2) On August 14, 1998, the VFT revolving line of credit was terminated, the
Debt Service Reserve (restricted cash) was released and applied to
outstanding principal under the Term loan, the Additional Debt Service
Reserve (restricted cash) was released to VFT for

F-19
<PAGE>

working capital purposes and the remaining outstanding principal under the
Term Loan ($16,681) was assigned by the lenders to Village Farms
International Finance Association ("VFIFA"), a wholly-owned subsidiary of
the Company. VFIFA repaid the $16,681 utilizing availability under the
VFIFA construction and term loan credit facility (see below). A new
repayment schedule for the $16,681, to reflect the $1,500 paydown, was
provided to VFIFA by the Lenders. The final quarterly installment is due
and payable on March 31, 2007.

In October 1996, VFT purchased an interest rate cap ("Rate Cap") from a
bank for $307. The Rate Cap protected VFT from increases in interest rates
above 6.5% (excluding the applicable margin) for a period of five years on
$10,000 of outstanding debt. The purchase is reflected in other noncurrent
assets in the accompanying consolidated balance sheets (see Note 8) and is
being amortized to interest expense on a straight-line basis over the life
of the Rate Cap (sixty months).

(3) In June 1997, VFIFA negotiated a $60,000 combined credit facility (the
"VFIFA Facility") with a bank (the "Lender"). The combined VFIFA Facility
consists of a term loan, construction loan ($50,000, with construction
borrowings not to exceed $30,000) and revolving line of credit commitment
($10,000). The proceeds from the borrowings under the VFIFA Facility are
loaned by VFIFA to its members, which are all wholly-owned subsidiaries of
the Company. APD has guaranteed all obligations incurred under the VFIFA
Facility. Advances under the VFIFA Facility are secured by the assets of
APD, VFIFA and any underlying borrower. The maturity date of the VFIFA
Facility is July 31, 2010.

In April 1998, VFIFA completed the final advances under the construction
loans for the VFM and VFB greenhouse facilities and converted the $26,478
in aggregate construction financing into a term loan (the "VFIFA Term
Loan"). The VFIFA Term Loan is being repaid in 40 quarterly installments
which commenced on June 30, 1998. As previously discussed, the VFIFA Term
Loan borrowings were increased by $16,681, when VFIFA purchased the VFT
Term Loan on August 14, 1998. On August 31, 1998 and in connection with the
formation of VFP, the remaining construction loan availability of $3,522
was allocated for financing of the VFP greenhouse facility. On September
29, 1998, the VFIFA Facility was amended to approve APD's merger with
EcoScience and to change the availability under the revolving line of
credit and term loan from $10,000 and $50,000, respectively, to $13,319 and
$46,681, respectively. The aggregate commitment under the VFIFA Facility of
$60,000 remained unchanged.

Prior to December 1, 1998, interest rate options were selected by VFIFA on
all or any portion of the borrowings at a base rate (prime), a fixed
(LIBOR) rate or a quoted rate, as defined in the VFIFA Facility.
Originally, interest was payable monthly at the maturity of an applicable
LIBOR rate election period under all commitments outstanding under the
VFIFA Facility. Each interest rate option has an applicable margin over
such rate in determining the total interest rate associated with each
borrowing. The applicable margin for each interest rate option is based
upon the relationship between annual debt service (principal and interest
payments) and total cash flow, as defined, with cash flow as the numerator
and debt service as the denominator. As the aforementioned relationship
increases, the applicable margin for each interest rate election decreases.
At January 3,

F-20
<PAGE>

1999, the term loan borrowings were at various fixed rate elections, which
combined with the applicable margin and 4% default interest (see below),
resulted in interest rates between 11.75% and 13.23% At January 3, 1999,
the construction loan borrowings were at various fixed rate elections,
which combined with the applicable margin and 4% default interest (see
below), resulted in interest rates between 12.26% and 12.63%. The various
LIBOR rate elections were to be reset periodically during the term of the
construction and term loan borrowings. Interest on the revolving line of
credit is payable at the variable prime rate, as defined, 12.625% at
January 3, 1999.

As of January 3, 1999, $42,798, $3,421 and $13,226 of borrowings were
outstanding under the VFIFA Term Loan, construction loan commitment and
revolving line of credit commitment, respectively. The fair value of the
VFIFA Facility was $59,347 as of January 3, 1999. The value of the VFIFA
Facility at June 30, 1998 and 1997 approximated its book value. On December
1, 1998, the VFIFA Facility lenders informed VFIFA and the "Underlying
Borrowers" (including VFT, PVF, VFM, VFB, VFP and APD) through written
correspondence that they were not in compliance with certain terms and
conditions of the VFIFA Facility. The events of default included (1)
VFIFA's default of certain interest payments due (2) the Underlying
Borrower's principal and interest payment default with VFIFA and (3) APD's
default on the financial covenant contained in the guaranty to the VFIFA
Facility relating to equity to senior long-term debt. The letter of default
referred to interest defaults totaling approximately $1,000. Following the
receipt of the letter, further debt service payment defaults occurred
including additional interest defaults and principal payment defaults on
the December 31, 1998 VFIFA Term Loan installments. In December 1998, VFIFA
began to make debt service payments against the defaults identified in the
December 1, 1998 letter. The final installment of the series of payments,
totaling approximately $2,005 in the aggregate, for approximately $460, was
made on February 12, 1999, which brought VFIFA and the Underlying Borrowers
into full principal and interest compliance under the VFIFA Facility.
However, APD and the Underlying Borrowers still remain in violation of
certain financial covenants. The VFIFA Facility lenders expressly stated in
the December 1, 1998 letter of default that they were not exercising their
right under the VFIFA Facility to accelerate payment of all outstanding
amounts, however, they were reserving their right to do so. As a result,
the entire amount outstanding under the VFIFA Facility, $46,219, has been
reflected in the current portion of long-term debt in the accompanying
balance sheet, which includes $44,756 in debt that would otherwise have
been classified as long-term. The VFIFA Facility lenders have informed
VFIFA and the Underlying Borrowers that no further advances will be made
under the VFIFA Facility and all outstanding VFIFA Facility balances will,
as of December 1, 1998, bear interest at the default rate (4% in addition
to the stated rates), until the violations of the financial covenants are
cured.

APD and VFIFA will be negotiating new terms to the existing VFIFA Facility
in connection with the planned restructuring of the VFIFA Facility and the
Company's capital raising efforts that are intended to bring VFIFA and the
Underlying Borrowers into compliance with all defaults. There can be no
assurance that APD and VFIFA will be able to renegotiate more favorable
terms.

F-21
<PAGE>

In October 1997, VFIFA purchased two interest rate caps ("Rate Caps") from
a bank for $436. The Rate Caps protect VFIFA from increases in interest
rates above 6.5% for a period of five years commencing on December 31, 1997
on up to approximately $26,500 of debt under the VFIFA Facility. The
purchases are reflected in other noncurrent assets in the accompanying
consolidated balance sheets (see Note 8), and are being amortized to
interest expense on a straight-line basis over the life of the Rate Caps
(sixty months).

(4) On December 30, 1998, the Company entered into a promissory note payable to
Cogentrix in the amount of $20,600 bearing an interest rate of 11.25%,
originally payable at maturity on March 15, 1999. The financing was a
result of the acquisition discussed in Note 4. On March 12, 1999, Cogentrix
agreed to extend the maturity date of the note to June 30, 1999 for $1,000.
The notes are secured by all of the outstanding capital stock of APD and
VFM, VFT, VFB and PVF. The Company is currently seeking additional debt and
equity financing to fulfill this obligation, or alternatively will seek to
renegotiate the terms of the notes. There can be no assurance that the
Company will be successful in these efforts.

(5) In March 1997, PVF entered into a $2,200 loan agreement with a bank. As of
January 3, 1999, there were no additional borrowings available under this
loan. The loan was required to be repaid in sixty quarterly installments of
$37 of interest and principal beginning on July 1, 1997, plus a final
installment of any amount necessary to pay the indebtedness in full. The
loan bears interest at a variable rate, as defined 9.25% at January 3,
1999, subject to the lender's applicable interest rate tier. The loan is
secured by a real estate mortgage in the PVF property and a first lien on
all assets, excluding inventory and accounts receivable, as defined. As of
January 3, 1999, PVF was in violation of a financial covenant of the loan
agreement. As such the entire amount outstanding under the loan agreement,
$804 has been reflected in the current portion of long-term debt in the
accompanying January 3, 1999 balance sheet. PVF was also required to
maintain $750 of cash as replacement collateral for the portion of the PVF
greenhouse assets sold to VFB during 1997. This amount was classified as
restricted cash in the accompanying financial statements.

As discussed in Note 5, the assets of PVF are held for sale as of January
3, 1999. The proceeds from the sale will be utilized to repay the remaining
outstanding amounts under this loan agreement. PVF has already prepaid $750
and $425 of the outstanding borrowings with the replacement collateral and
insurance proceeds, respectively.

(6) In March 1997, APD borrowed $643 from Cogentrix. The note was unsecured,
interest was payable at 6.0% per annum and principal and interest were due
on demand. On December 30, 1998, in connection with the acquisition of
certain minority interests (see Note 4) by the Company, this note, and its
accrued interest, of approximately $65, became payable to one of the
entities acquired. Thus the amount is no longer payable to Cogentrix and
all related amounts to this note eliminate in consolidation beginning on
December 30, 1998. In March, 1997, APD borrowed $1,375 from Cogentrix. The
note matures on June 2, 2002 with quarterly principal and interest payments
of $69. Borrowings under the note bear interest at 6.0%.

F-22

<PAGE>

The aggregate maturities of debt as of January 3, 1999 are as follows:

1999 ................................... $47,557
2000 ................................... 321
2001 ................................... 302
2002 ................................... 157
-------
$48,337
=======

11. LEASES

(a) Capital Leases

The Company leases certain equipment under capital leases. Future
minimum lease payments are as follows:

1999 .................................. $67
2000 .................................. 64
2001 .................................. 64
2002 .................................. 49
2003 .................................. 30
Thereafter ............................ 255
------
Total minimum lease payments ................. 529
Less amount representing interest .............. (149)
------
380
Less current maturities ................... (42)
------
$338
======

(b) Operating Leases

The future minimum lease payments as of January 3, 1999 are as follows:

1999 .................................. $3,986
2000 .................................. 3,976
2001 .................................. 3,944
2002 .................................. 3,911
2003 .................................. 3,944
Thereafter ............................ 15,301
-------
$35,062
=======

The above amounts reflect future minimum lease payments under an
agreement executed on March 23, 1999, for the Company's new corporate office and
warehouse space (approximately 20,000 square feet). The expected commencement
date of the ten year lease is September 1, 1999.

Rent expense under the Company's various lease agreements totaled
approximately $2,114, $4,061, $1,830 and $2,262 for the transition period ended
January 3, 1999 and the years ended June 30, 1998, 1997 and 1996, respectively.

F-23
<PAGE>

Included in noncurrent liabilities in the accompanying consolidated
balance sheet is $876, $868 and $860 at January 3, 1999, June 30, 1998 and June
30, 1997, respectively, related to the effect of accounting for the scheduled
rent increases on a straight-line basis over the applicable lease terms.

12. STOCKHOLDERS' EQUITY (DEFICIT)

(a) Amendment of Certificate of Incorporation for Reverse Stock Split
and Increase in Authorized Capital Stock

On September 30, 1998 the Company's certificate of incorporation was
amended to effect a one for five reverse stock split of the Company's common
stock, to increase the number of authorized shares of the Company's common stock
from 25,000,000 shares to 100,000,000 shares and to increase the number of
authorized preferred stock from 1,000,000 shares to 10,000,000 shares. The
accompanying financial statements give retroactive effect to the one for five
reverse stock split for all periods presented.

(b) Private Placement

In September 1996, the Company sold 208,000 shares of common stock in a
private placement. Net proceeds realized from the equity offering totaled $1,139
after fees and expenses totaling $161. In connection with the offering, the
Company also issued a warrant to purchase 31,200 shares of its common stock at
$10.00 per share to the placement agent.

The Company has issued warrants to purchase shares of its common stock
to certain stockholders, directors and consultants of the Company. Outstanding
warrants expire through 2002. The following table summarizes warrant activity
for the three years ended June 30, 1998 and the transition period ended January
3, 1999:

<TABLE>
<CAPTION>
Weighted Average
Number of Warrants Price Per Share Range Exercise Price
------------------ --------------------- --------------
<S> <C> <C> <C> <C> <C>
Outstanding at June 30, 1995 ........ 72,009 $1.88 - $ 55.00 $ 33.01
Granted .......................... 50,000 6.88 - 15.00 10.76
Cancelled ........................ (30,217) 1.88 - 47.75 20.35
-------- ------ --- ------ ------
Outstanding at June 30, 1996 ........ 91,792 6.88 - $ 55.00 25.06
Granted .......................... 56,311 5.00 - 18.75 11.51
Cancelled ........................ (15,792) 30.00 - 55.00 51.51
-------- ------ --- ------ ------
Outstanding at June 30, 1997 ........ 132,311 5.00 - 48.75 16.18
Granted .......................... -- -- - -- --
Cancelled ........................ (8,000) 34.38 - 35.00 34.53
-------- ------ --- ------ ------
Outstanding at June 30, 1998 ........ 124,311 5.00 - 48.75 $ 15.00
======== ====== === ====== ======
Outstanding at January 3, 1999 ...... 124,311 5.00 - 48.75 $ 15.00
======== ====== === ====== ======
Exercisable at January 3, 1999 ...... 124,311 $5.00 - $ 48.75 $ 15.00
======== ====== === ====== ======
</TABLE>

F-24
<PAGE>

(d) Stock Option Plans

In December 1998, the Board of Directors approved a stock option plan
(the "1999 Plan") to grant options to acquire up to 1,800,000 shares of common
stock, less the number of option shares issued under the Company's 1991 stock
option plan (1991 plan), outstanding to employees and consultants. Options
granted under the 1999 Plan vest over various periods and expire no later than
10 years from the date of grant. Options are to be granted at the fair value of
the Company's common stock on the date of grant. The Board of Directors has
agreed not to issue future options under the 1991 plan.

Option activity for the three years ended June 30, 1998 and the
transition period ended January 3, 1999, is summarized as follows:

Weighted Average
Number of Options Price Per Share Range Exercise Price
----------------- --------------------- --------------
<S> <C> <C> <C> <C> <C>
Outstanding at June 30, 1995................ 92,207 $1.88 - $56.88 $22.41
Granted.................................. 110,100 2.81 - 8.13 4.87
Exercised................................ (333) 2.25 2.25
Cancelled................................ (34,771) 3.00 - 56.88 22.67
-------- ----- --- ------ -----
Outstanding at June 30, 1996................ 167,203 1.88 - 56.88 10.84
Granted.................................. 68,036 4.69 - 12.50 6.07
Exercised................................ (3,800) 4.38 4.38
Cancelled................................ (54,363) 1.88 - 56.88 19.93
-------- ----- --- ------ -----
Outstanding at June 30, 1997................ 177,076 2.81 - 35.00 6.35
Granted.................................. 6,680 4.06 - 8.13 6.51
Exercised................................ (17,456) 4.38 5.00 4.80
Cancelled................................ (9,120) 4.38 - 10.63 5.30
-------- ----- --- ------ -----
Outstanding at June 30, 1998................ 157,180 $2.81 - $35.00 6.60
======== ===== === ====== =====
Exercised................................ (1,100) 4.38 - 4.38 4.38
Cancelled................................ (4,880) 4.38 - 12.50 2.13
-------- ----- --- ------ -----
Outstanding at January 3, 1999.............. 151,200 $2.81 - $35.00 $6.57
======== ===== === ====== =====
Exercisable at January 3, 1999.............. 134,898 $2.81 - $35.00 $6.55
======== ===== === ====== ======
</TABLE>

All stock options and warrants granted by the Company were granted at
exercise prices not less than the fair market value of the Company's common
stock on the date of grant.

The Company accounts for its common stock purchase warrants and options
plans based upon the "intrinsic value" method set forth in APB 25. Had
compensation costs for the Company's stock option plans been determined
consistent with SFAS 123, the Company's pro-forma net loss and net loss per
share for the transition period ended January 3, 1999 and the fiscal years ended
June 30, 1998, 1997 and 1996 would have been as follows:

F-25

<PAGE>

<TABLE>
<CAPTION>
Transition
Period Ended Years ended June 30,
January 3, -----------------------------------------
1999 1998 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net income (loss)........................... (8,574) ($4,462) $29 ($13)
------- -------- ------- -------
Net loss per share, basic and diluted....... ($0.74) ($0.38) ($0.00) ($0.00)
------- -------- ------- -------
</TABLE>

Because SFAS 123 has not been applied to warrants and options granted
prior to July 1, 1995, the resulting pro-forma compensation cost may not be
representative of that to be expected in future periods.

Under SFAS 123, the fair value of each stock option grant is estimated
on the date of grant using the Black-Scholes option pricing model with the
weighted average assumptions for the fiscal years ended June 30, 1998, 1997, and
1996, respectively as follows: (i) risk free interest rate of 6% for all years;
(ii) expected life of approximately eight years for all years; and (iii)
expected volatility of 67%, 70%, and 70% for the fiscal years ended June 30,
1998, 1997, and 1996, respectively. The weighted average fair value of the
options granted during the fiscal years ended June 30, 1998, 1997, and 1996 was
$0.85, $0.86, and $0.69, respectively. No options were granted during the
transition period ended January 3, 1999.

13. INCOME TAXES

As of January 3, 1999, the Company had available net operating loss
carryforwards of approximately $10,800 and research and development tax credit
carryforwards of approximately $900 to reduce future federal income taxes, if
any. These carryforwards expire through 2013 and are subject to review and
possible adjustment by the Internal Revenue Service. The Tax Reform Act of 1986
limits a Company's ability to utilize certain net operating loss and tax credit
carryforwards in the event of a cumulative change in ownership in excess of 50%,
as defined. The Company has recently completed a merger with APD which has
resulted in a change in ownership in excess of 50%, as defined. Therefore,
utilization of net operating loss and tax credit carryforwards will be limited
due to ownership changes. As discussed in Note 2, APD was taxed as an S
Corporation prior to the merger on September 30, 1998 and as such no Federal
income taxes were paid by APD. Therefore, APD recorded no deferred tax assets or
liabilities prior to September 30, 1998. State deferred income taxes were not
material.

The components of the net deferred tax amount recognized in the
accompanying consolidated balance sheets are set forth below:

June 30,
January 3, ------------------------
1999 1998 1997
---- ---- ----
Deferred tax assets............ $5,400 $16,500 $16,000
Valuation allowance............ (5,400) (16,500) (16,000)
------ ------- -------
$ -- $ -- $ --
====== ======= =======

F-26
<PAGE>

The approximate tax effect of each type of temporary difference and
carryforward before allocation of the valuation allowance is summarized as
follows:

June 30,
January 3, ---------------------
1999 1998 1997
---- ---- ----
Net operating losses .................... $ 4,300 $15,400 $15,000
Other temporary differences ............. 200 200 100
Research and development credits ........ 900 900 900
------- ------- -------
$ 5,400 $16,500 $16,000
======= ======= =======

Due to the uncertainty surrounding the timing of realizing the
potential benefits of its favorable tax attributes in future income tax returns,
the Company has recorded a valuation allowance against its otherwise
recognizable deferred tax assets.

A reconciliation of the provision for (benefit from) income taxes for
the transition period ended January 3, 1999 and the fiscal year ended June 30,
1998, 1997 and 1996 with the statutory federal income tax rate follows:

Transition
Period Ended Years Ended June 30,
January 3, ---------------------------
1999 1998 1997 1996
---- ---- ---- ----
(Benefit) provision at
nominal rate ......................... (34.0%) (34.0%) 34.0% (34.0%)
Increases (reductions) in
taxes resulting from:
Net operating loss carryforward ..... -- -- (34.0) --
Valuation allowance ................. 34.0 34.0 -- 34.0
Foreign income taxes ................ -- -- 10.8 22.0
State income taxes .................. 0.1 0.1 4.2 69.3
----- ----- ----- ------
Provision for income taxes-% .......... 0.1% 0.1% 15.0% 91.3%
----- ----- ----- ------
Provision for income taxes-$ .......... $ 67 $ 21 $ 78 $ 116
----- ----- ----- ------

The provision for (benefit from) income taxes for the transition period
ended January 3, 1999 and the fiscal year ended June 30, 1998, 1997 and 1996 is
primarily composed of foreign and state income taxes.

14. SALES, LICENSE AND DEVELOPMENT AGREEMENTS

AGRO has a distribution agreement with an unrelated company for a term
of three years ending in December 2000, with automatic one-year extensions
unless either party elects to terminate the agreement. The agreement grants AGRO
the exclusive right to sell the unrelated company's product in the United
States, Canada, Mexico, and the Caribbean. The agreement requires AGRO to
maintain minimum annual sales which, if not met, would allow the unrelated
company to modify the exclusivity of the agreement. The sale of products under
this agreement accounted for 18%, 17%, 20% and 25% of the Company's total net
revenues for the transition period ended January 3, 1999 and the fiscal years
ended June 30, 1998, 1997 and 1996, respectively. Although there are a limited
number of sources of the particular growing medium products that are sold under
this distribution agreement, the Company's management believes

F-27
<PAGE>

that other suppliers could provide similar products on comparable terms. A
change in suppliers, however, could cause a delay in filling orders as well as a
possible loss of sales, which would affect operating results adversely.

In August 1995, AGRO entered into a distribution agreement with an
unrelated company, which granted AGRO the exclusive right to sell the unrelated
company's sorting, grading and packing products and equipment in the United
States, Canada, Mexico and the Caribbean through September 1999. The sale of
products under this agreement accounted for 14%, 8%, 12% and 11% of total net
revenues for the transition period ended January 3, 1999 and the fiscal years
ended June 30, 1998, 1997 and 1996, respectively.

On February 1, 1999, the Company's postharvest equipment division of
Agro Dynamics, Inc., which was the exclusive distributor in North America for
Aweta B.V.'s sorting and grading equipment, was sold to Autoline, Inc.

15. SEGMENT AND GEOGRAPHIC INFORMATION

The Company has two reportable segments: greenhouse tomatoes and
biological and agricultural products. The greenhouse tomatoes segment operates
seven greenhouse facilities in the United States, representing approximately 190
acres of growing capacity. Through these facilities, the Company produces,
harvests, packages and distributes premium vine-ripened tomatoes. The tomatoes
are marketed under the Village Farms(R) brandname and sold to retail supermarket
chains, dedicated wholesalers, distributors and food service clients throughout
the United States.

The biological and agricultural products segment distributes various
products under written distribution agreements and relations with specific
vendors. The Company's biological and agricultural products include (1) growing
medium products and computerized environmental and irrigational control systems;
(2) postharvest coating products and (3) biological pest control products.

The accounting policies of the segments described above are the same as
those described in the summary of significant accounting policies. The Company's
reportable segments are strategic business units that offer different products.
The Company is not dependent on any single customer for its net revenues.

F-28

<PAGE>

<TABLE>
<CAPTION>
Transition
period ended Year ended June 30,
Company data by operating January 3, --------------------------------
segment(1) 1999 1998 1997 1996
- ------------------------- ---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues
Greenhouse tomatoes ....... $ 15,453 $ 28,871 $ 21,963 $ 11,090
Biological and agricultural
products ................. $ 10,741 $ 17,306 $ 17,899 $ 13,578
--------- --------- --------- ---------
Total ..................... $ 26,194 $ 46,177 $ 39,862 $ 24,668
========= ========= ========= =========
Total Assets
Greenhouse tomatoes ....... $ 93,539 $ 69,971 $ 62,072 $ 26,279
Biological and agricultural
products ................. $ 8,325 $ 9,537 $ 8,520 $ 9,970
--------- --------- --------- ---------
Total ..................... $ 101,864 $ 79,508 $ 70,592 $ 36,249
========= ========= ========= =========
Capital Expenditures
Greenhouse tomatoes ....... $ 4,568 $ 25,554 $ 28,154 $ 17,372
Biological and agricultural
products ................. 64 545 90 127
--------- --------- --------- ---------
Total ..................... $ 4,632 $ 26,099 $ 28,244 $ 17,499
========= ========= ========= =========
Operating (loss) income
Greenhouse tomatoes ....... ($ 6,272) ($ 5,276) $ 295 ($ 541)
Biological and agricultural
products ................. (1,317) (1,195) 278 744
--------- --------- --------- ---------
Total ..................... ($ 7,589) ($ 6,471) $ 573 $ 203
========= ========= ========= =========
Depreciation and amortization
expense
Greenhouse tomatoes ....... $ 1,979 $ 2,891 $ 1,504 $ 283
Biological and agricultural
products ................. 167 332 402 580
--------- --------- --------- ---------
Total ..................... $ 2,146 $ 3,223 $ 1,906 $ 863
========= ========= ========= =========
Company data by geographic
segments(2)
Net revenues
United States ......... $ 23,135 $ 39,243 $ 34,219 $ 20,247
Canada ................ 3,059 6,934 5,643 4,421
--------- --------- --------- ---------
Total ..................... $ 26,194 $ 46,177 $ 39,862 $ 24,668
========= ========= ========= =========
</TABLE>

- ---------------
(1) All research and development expenses and restructuring reversals were a
result from operations of the biological and agricultural products segment.

(2) The long-lived assets in Canada are immaterial for all periods presented.

F-29

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

January 3, April 4,
1999 1999
---- ----
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents ........................ $ 660 $ 1,095
Short-term investments ........................... -- 127
Accounts receivable, less reserves of $678 at
April 4, 1999 and $551 at January 3, 1999 ...... 5,567 7,271
Assets held for sale ............................. 1,911 1,911
Inventories ...................................... 9,104 9,209
Other current assets ............................. 951 1,212
--------- ---------
Total current assets ........................... 18,193 20,825
--------- ---------
Property and equipment, net .......................... 63,947 65,200
Intangible assets, net ............................... 13,375 13,550
Other noncurrent assets .............................. 2,278 2,289
========= =========
Total assets .............................. $ 97,793 $ 101,864
========= =========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Short-term borrowings ............................ $ 36,749 $ 37,080
Current maturities of long-term debt ............. 46,768 47,557
Current obligations under capital leases ......... 42 42
Accounts payable ................................. 10,632 11,102
Accrued expenses and other current liabilities ... 6,075 7,705
--------- ---------
Total current liabilities ...................... 100,266 103,486
--------- ---------
Noncurrent liabilities:
Long-term debt, less current maturities .......... 700 780
Obligations under capital leases ................. 327 338
Other long-term liabilities ...................... 1,689 1,689
--------- ---------
Total noncurrent liabilities ................... 2,716 2,807
--------- ---------
Minority interest in limited partnership ............. 602 665
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $0.01 par value,
10,000,000 shares authorized; none issued
and outstanding ................................. -- --
Common stock, $0.01 par value, 100,000,000 shares
authorized; 12,619,278 shares issued and
outstanding at April 4, 1999 and January 3, 1999 . 126 126
Additional paid-in capital ........................... 55,574 55,574
Accumulated deficit .................................. (61,436) (60,706)
Accumulated other comprehensive loss ................. (55) (88)
--------- ---------
Total stockholders' deficit .................... (5,791) (5,094)
========= =========
Total liabilities and stockholders' deficit $ 97,793 $ 101,864
========= =========

The accompanying notes are an integral part of these consolidated financial
statements.

F-30

<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)

Thirteen Three Months
Weeks Ended Ended
April 4, March 31,
1999 1998
---- ----
Net revenues ......................................... $ 18,264 $ 12,291
Cost of revenues ..................................... 12,839 7,993
-------- --------
Gross profit ......................................... 5,425 4,298
-------- --------
Operating expenses:
Selling, general and administrative ............... 3,513 2,679
Research and development .......................... 117 105
-------- --------
Total operating expenses .................... 3,630 2,784
-------- --------
Operating income ..................................... 1,795 1,514
-------- --------
Other (expense) income:
Interest, net ..................................... (2,671) (1,095)
Other, net ........................................ 87 100
-------- --------
Total other expense, net .................... (2,584) (995)
-------- --------
(Loss) income before taxes and minority interest ..... (789) 519
Provision for income taxes ........................... 3 --
-------- --------
(Loss) income before minority interest ............... (792) 519
Minority interest .................................... 62 (421)
-------- --------
Net (loss) income .................................... ($ 730) $ 98
======== ========
(Loss) earnings per share:

Basic
-----
Net (loss) earnings per share .................. ($ 0.06) $ 0.01
======== ========
Weighted average common shares outstanding ..... 12,619 11,619
======== ========

Diluted
-------
Net (loss) earnings per share .................. ($ 0.06) $ 0.01
======== ========
Weighted average diluted shares outstanding .... 12,619 11,660
======== ========

The accompanying notes are an integral part of these consolidated financial
statements.

F-31
<PAGE>

ECOSCIENCE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

(Unaudited)
--------------------
Thirteen Three
Weeks Months
Ended Ended
April 4, March 31,
1999 1998
---- ----
Cash flows from operating activities:
Net (loss) income ................................. ($ 730) $ 98
Adjustments to reconcile net (loss)
income to net cash (used in) provided
by operating activities:
Depreciation and amortization ............... 1,598 802
Minority interest in limited partnerships ... (62) (421)
Gain on sale of investments ................. (2) --
Foreign exchange (gain) loss ................ (16) 6
Changes in current assets and liabilities:
Accounts receivable, net ............. 1,704 295
Inventories .......................... 105
(3,978)
Other current assets ................. 261 (302)
Accounts payable and accrued expenses 1,247
(2,085)
------- -------
Net cash provided by (used in) operating
activities ................................. 773 (2,253)
------- -------
Cash flows from investing activities:
Purchases of property and equipment ............... (95) (861)
Proceeds from sale of assets ................... 32 --
Proceeds from sales of short-term investments .... 127 --
(Increase) decrease in other noncurrent assets .... (96) 7
Decrease in noncurrent liabilities ............... -- (968)
------- -------
Net cash used in investing activities ....... (32) (1,822)
------- -------
Cash flows from financing activities:
Proceeds from issuance of stock ................... -- 1
Proceeds from long-term debt ............ -- 2,946
Net (payments) borrowings under line of credit .... (331) 991
Payments on long-term debt and capital leases ..... (880) (587)
Debt issue costs ............................... -- (15)
Minority interest contribution to limited
partnership ................................... -- 1,076
S Corp Stockholder Distributions ............... -- (110)
------- -------
Net cash (used in) provided by
financing activities ....................... (1,211) 4,302
------- -------
Effects of exchange rates on cash balances ..... 35 --
(Decrease) increase in cash and cash equivalents ....... (435) 227
Cash and cash equivalents at beginning of period ....... 1,095 2,443
------- -------
Cash and cash equivalents at end of period ............. $ 660 $ 2,670
======= =======
Total unrestricted and restricted cash, cash
equivalents and short-term investments at
end of period ......................................... $ 660 $ 3,199
======= =======
Supplemental cash flow information
Cash paid for:
Interest ...................................... $ 2,439 $ 995
Income taxes .................................. 3 --

The accompanying notes are an integral part of these consolidated financial
statements.

F-32
<PAGE>

ECOSCIENCE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
APRIL 4, 1999
(in thousands, except share data)
Unaudited

1. OPERATIONS

The Company has suffered losses resulting in an accumulated deficit of
$61,436 as of April 4, 1999. The Company continues to be in violation of certain
technical covenants under various debt agreements as of April 4, 1999, which has
resulted in approximately $43,651 of debt being classified as current in the
accompanying April 4, 1999 balance sheet which otherwise would have been
classified as long-term and default interest of $587. This along with the note
issued on December 30, 1998, in connection with the acquisition of certain
minority interests in consolidated limited partnerships, has resulted in
significant negative working capital; however, the Company's greenhouse
operations are now believed by management to be approaching their optimal
cropping cycles for the first time since the large 180 acreage expansion that
began in mid-1996 resulting in APD becoming the largest greenhouse producer in
the U.S. in terms of acreage controlled by a single entity. Management's plan is
focused on improving the gross profit of all greenhouse operations as a result
of greater production volumes, sizing and efficiency through a full cropping
cycle at each greenhouse facility.

On February 1, 1999, the Company's postharvest equipment division of
its wholly owned subsidiary Agro Dynamics, Inc., which was the exclusive
distributor in North America for Aweta B.V.'s sorting and grading equipment, was
sold to Autoline, Inc. Autoline Inc. and Aweta B.V. are both wholly owned
subsidiaries of FPS Food Processing Systems of Holland. Sales of this division
were $3,532 in the period ended January 3, 1999 and $3,557, $4,967 and $2,830 in
the fiscal years ended June 30, 1998, 1997 and 1996, respectively. The Company
concluded that

F-33
<PAGE>

the long term outlook of the postharvest equipment distribution business was no
longer consistent with its future strategic direction. This transaction did not
result in a material gain or loss and will not have a material impact on the
Company's financial position or results of operations.

The Company believes that its $660 of cash and cash equivalents as of
April 4, 1999, along with revenues from product sales, will be sufficient to
fund the Company's working capital needs, planned capital expenditures, current
acquisitions and to service its indebtedness through April 5, 2000, provided
that the Company can resolve its near term cash flow problems by raising
additional capital and refinance its $21,600 aggregate principal amount of
promissory notes issued on December 30, 1998 and March 15, 1999 that are due on
June 30, 1999. The Company is currently negotiating a refinancing of its $3,000
line of credit, for which the due date was April 28, 1999. The Company has
engaged a financial advisor, who is assisting in the raising of additional funds
to finance its ongoing operations during 1999 and expected growth after January
4, 2000. There can be no assurances that such efforts will be successful or that
additional debt or equity financing can be obtained to meet working capital
needs.

2. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been
prepared by the Company and reflect all adjustments, consisting of only normal
recurring adjustments, which are, in the opinion of management, necessary for a
fair presentation of financial results for the thirteen weeks ended April 4,
1999 and the three months ended March 31, 1998, in accordance with generally
accepted accounting principles for interim financial reporting and pursuant to
Article 10 of Regulation S-X. Certain information and footnote disclosures
normally included in the Company's annual audited consolidated financial
statements have been condensed or omitted pursuant to such rules and
regulations.

The results of operations for the thirteen weeks ended April 4, 1999
and the three months ended March 31, 1998 are not necessarily indicative of the
results of operations to be expected for a full fiscal year. These interim
consolidated financial statements should be read in conjunction with the audited
consolidated financial statements for the transition period ended January 3,
1999, which are included in the Company's Annual Report on Form 10-K filed with
the Securities and Exchange Commission.

The consolidated financial statements give retroactive effect to the
merger with Agro Power Development, Inc. that occurred on September 30, 1998,
which was accounted for as a pooling of interests, and a one for five reverse
stock split, effective September 30, 1998.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and disclosures of
contingent assets and liabilities as of the dates of the financial statements,
and the reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates.

F-34
<PAGE>

3. DEBT

The Company failed to pay $1,923 of indebtedness due under a $3,000
line of credit which became due on April 28, 1999, the extended expiration date
of the facility. The Company is currently negotiating the terms of replacement
financing with a new lender. Although no assurance can be given, the Company
believes that it will finalize replacement financing in May 1999.

4. NET INCOME (LOSS) PER SHARE

The Company has adopted Statement of Financial Accounting Standards No.
128, "Earnings per Share," which requires presentation of both basic and diluted
earnings per share in the Consolidated Statements of Operations. Basic earnings
per share excludes any dilutive effects of options, warrants and convertible
securities. Diluted earnings per share gives effect to all potentially dilutive
common shares that were outstanding during the period.

The following table sets forth a reconciliation of weighted average
common shares outstanding to the weighted average common shares assuming
dilution:

Thirteen Weeks Three Months
Ended Ended
April 4, March 31,
1999 1998
---- ----
Weighted average common shares
outstanding ..................................... 12,619 11,619
Dilutive effect of common shares
issuable(1) ..................................... -- 41
------ ------
Weighted average common shares
outstanding assuming dilution ................... 12,619 11,660
------ ------

- ------------
(1) Common stock purchase warrants and stock options at April 4, 1999 and March
31, 1998 to purchase 275,511 and 127,200 shares, respectively, were not
included in the computation of earnings per share assuming dilution as
their effect would be anti-dilutive.

5. COMPREHENSIVE INCOME

Effective January 3, 1999, the Company adopted the provisions of
Statement No. 130, Reporting Comprehensive Income, which modifies the financial
statement presentation of comprehensive income and its components.

F-35
<PAGE>

Comprehensive income, representing all changes in stockholders' equity
during the period other than changes resulting from the company's stock and
dividends, for the thirteen weeks ended April 4, 1999 and for the three months
ended March 31, 1998 is as follows:

Thirteen Weeks Three Months
Ended Ended
April 4, 1999 March 31, 1998
------------- --------------
Net (loss) income ............................. ($730) $ 98

Other comprehensive gain (loss),
net of taxes
Foreign currency translation
adjustments ............................... 35 --
Net unrealized loss on securities
available for sale ........................ (2) (3)
----- -----
Other comprehensive gain (loss) ............... 33 (3)
----- -----

Comprehensive (loss) income ................... ($697) $ 95
===== =====

6. SEGMENT AND GEOGRAPHIC INFORMATION

The Company has two reportable segments: greenhouse tomatoes and
biological and agricultural products. The greenhouse tomatoes segment operates
seven greenhouse facilities in the United States, representing approximately 190
acres of growing capacity. Through these facilities, the Company produces,
harvests, packages and distributes premium hydroponic vine-ripened tomatoes. The
tomatoes are marketed under the Village Farms(R) and Home Choice(TM) brandnames
and sold to retail supermarket chains, dedicated wholesalers, distributors and
food service clients throughout the United States.

The accounting policies of the segments described above are the same as
those described in the summary of significant accounting policies. The Company's
reportable segments are

F-36
<PAGE>

strategic business units that offer different products. The Company is not
dependent on any single customer for its net revenues.

Thirteen Weeks Three Months
Ended Ended
Company data by operating segment April 4, 1999 March 31, 1998
- --------------------------------- -------------- --------------
Net revenues
Greenhouse tomatoes ...................... $ 15,159 $ 7,375
Biological and agricultural products ..... 3,105 4,916
======== ========
Total .................................... $ 18,264 $ 12,291
======== ========
Operating (loss) income
Greenhouse tomatoes ...................... $ 1,934 $ 1,620
Biological and agricultural products ..... (142) (106)
======== ========
Total .................................... $ 1,792 $ 1,514
======== ========
Company data by geographic segments
Net revenues
United States ........................ $ 17,280 $ 9,995
Canada ................................ 984 2,296
======== ========
Total .................................... $ 18,264 $ 12,291
======== ========

F-37
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth the estimated expenses, all of which are being
paid by the Company, in connection with this offering.

Registration fees.......................... $ 767
Legal fees and expenses.................... 50,000
Accounting fees and expenses............... 50,000
Miscellaneous.............................. 5,000
--------
Total............................. $105,767
========

Item 14. Indemnification of Directors and Officers.

Delaware General Corporation Law, Section 102(b)(7), authorizes a corporation to
eliminate or limit personal liability of members of its board of directors for
violations of a director's fiduciary duty of care. Such elimination or
limitation of personal liability is not permitted, however, where there has been
a breach of the duty of loyalty, failure to act in good faith, intentional
misconduct or knowing violation of law, or payment of a dividend or approval of
a stock repurchase which was deemed illegal or where a director obtains an
improper personal benefit.

The Company's Restated Certificate of Incorporation provides that a director of
the Company shall, to the maximum extent permitted by Section 102(b)(7) or any
successor provision or provisions, have no personal liability to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a
director.

Delaware General Corporation Law, Section 145, permits a corporation organized
under Delaware law to indemnify directors and officers with respect to any
matter in which the director or officer acted in good faith and in a manner he
reasonably believed to be not opposed to the best interests of the corporation
and, with respect to any criminal action, had no reasonable cause to believe his
conduct was unlawful.

The Company's Restated Certificate of Incorporation provides that any director
or officer of the Company involved in any action, suit or proceeding, the basis
of which is alleged action or inaction by such director or officer while he was
acting in an official capacity as a director or officer of the Company or as a
director, trustee, officer, employee or agent of another entity at the request
of the Company, shall be indemnified and held harmless by the Company to the
fullest extent permitted by Section 145 against all expense, liability and loss
reasonably incurred or suffered by such person in connection therewith. Such
indemnification as to such alleged action or inaction continues as to an
indemnitee who has after such alleged action or inaction ceased to be a director
or officer of the Company or a director, officer, trustee, employee or agent of
such other entity and inures to the benefit of the indemnitee's heirs, executors
and administrators. The Restated Certificate of Incorporation also provides that
the right to

II-1
<PAGE>

indemnification shall be a contract right which shall not be affected adversely
as to any indemnitee by any amendment to the Restated Certificate of
Incorporation with respect to any action or inaction occurring prior to such
amendment and shall include, unless otherwise restricted or prohibited by law or
the Company's By-laws, the right to be paid by the Company for expenses incurred
in defending any such proceeding in advance of its final disposition. The
Company's Board of Directors may also grant these indemnification rights to any
employee or agent of the Company or to any person who is or was a director,
officer, employee or agent of the Company's affiliates, predecessors or
subsidiaries.

The Registration Rights Agreement dated as of December 30, 1998 among the
Company and Cogentrix Delaware Holdings, Inc. ("CDHI") provides that CDHI shall
indemnify the Company and each of its directors and officers against all claims,
losses, damages and liabilities arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in a registration
statement, prospectus, offering circular or other document, or any omission (or
alleged omission) to state a material fact required to be stated or necessary to
make the statements therein not misleading. CDHI shall reimburse the Company and
such directors and officers for any legal or other expenses reasonably incurred
in connection with investigating or defending any such claim, loss, damage,
liability or action to the extent that such untrue statement (or alleged untrue
statement) or omission (or alleged omission) is made in such Registration
Statement in reliance upon and in conformity with written information furnished
to the Company by CDHI. The Registration Rights Agreement dated as of September
30, 1998 between the Company and Mr. Montanti contains similar indemnification
provisions.

Item 15. Recent Sales of Unregistered Securities.

On September 30, the Company issued an aggregate of 9,520,487 shares of Common
Stock (after giving effect to a one-for-five reverse split of the Common Stock
effective on the same date) to the shareholders of Agro Power Development, Inc.,
a New York corporation ("APDNY"), pursuant to the Amended and Restated Agreement
and Plan of Merger dated as of July 31, 1998, among the Company, Agro
Acquisition Corp., APDNY and certain stockholders of APDNY. The shares were
issued in reliance upon Section 4(2) of the Securities Act of 1933, as amended.

On December 31, 1998, the Company issued 1,000,000 shares of Common Stock to
CDHI pursuant to a Stock Purchase Agreement dated as of December 7, 1998 which
provided for the acquisition by the Company of the outstanding capital stock of
certain entities that are partners with certain subsidiaries of the Company in
limited partnerships formed to operate certain greenhouse operations. The shares
of Common Stock issued to CDHI were issued in reliance upon the exemption
provided by Section 4(2) of the Securities Act of 1933, as amended.

II-2

<PAGE>

Item 16. Exhibits and Financial Statement Schedules.

(a) Exhibits

Exhibit
Number Exhibit Description
------ -------------------

2.1 Amended and Restated Agreement and Plan of Merger dated as
of July 31, 1998 among EcoScience Corporation, Agro
Acquisition Corporation and Agro Power Development, Inc.
[incorporated herein by reference to the Registrant's Proxy
Statement dated August 10, 1998 - Appendix A].

3.1 Restated Certificate of Incorporation of the Registrant
dated June 29, 1988 [incorporated by reference to Exhibit
3.1 to the Registrant's Annual Report on Form 10-K for the
fiscal year ended June 30, 1992].

3.2 By-Laws of the Registrant [filed herewith].

3.3 Certificate of Amendment of Restated Certificate of
Incorporation of the Registrant dated September 28, 1998.
[incorporated by reference to Exhibit 10.60 to the
Registrant's September 30, 1998 quarterly report on form
10-Q].

4.1 Specimen Common Stock Certificate of the Registrant
[incorporated by reference to Exhibit 4.1 to the
Registrant's Registration Statement on Form S-1,
Registration Statement No. 33-44664].

4.2 Registration Rights Agreement between EcoScience Corporation
and the Shareholders identified on Schedule I thereto dated
September 30, 1998. [incorporated by reference to Exhibit
10.60 to the Registrant's September 30, 1998 quarterly
report on form 10-Q].

5.1 Opinion of Giordano, Halleran & Ciesla, a Professional
Corporation, including consent of such counsel [filed with
the Registration Statement on Form S-1 being amended by this
Amendment No. 1].

10.1* Registrant's 1991 Stock Option Plan, As Amended
[incorporated by reference to Exhibit 10.1 to the
Registrant's Registration Statement on Form S-1,
Registration Statement No. 33-44664].

10.2* Registrant's 1999 Stock Option Plan. [incorporated by
reference to Exhibit 10.2 to the Registrant's Annual Report
on Form 10-K for the transition period ended January 3,
1999.]

10.3* Form of Non-Statutory Stock Option Agreement [incorporated
by reference to Exhibit 10.3 to the Registrant's
Registration Statement on Form S-1, Registration Statement
No. 33-44664].

II-3
<PAGE>

10.4 Common Stock Purchase Warrant between the Registrant and
Copley Partners 2, L.P., dated December 6, 1989, as amended
[incorporated by reference to Exhibit 10.8 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1993].

10.7 Series B Preferred Stock Purchase Agreement between the
Registrant and the other parties named therein, dated July
30, 1991, and amended on October 31, 1991 [incorporated by
reference to Exhibit 10.7 to the Registrant's Registration
Statement on Form S-1, Registration Statement No. 33-44664].

10.8 Common Stock Warrant between the Registrant and E. Andrews
Grinstead III, dated May 22, 1991, as amended [incorporated
by reference to Exhibit 10.9 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended June 30,
1993].

10.10 Common Stock Purchase Warrant between the Registrant and E.
Andrews Grinstead, III, dated June 7, 1991, as amended
[incorporated by reference to Exhibit 10.11 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1993].

10.15 Assignment of Patent Rights, dated November 7, 1991
[incorporated by reference to Exhibit 10.20 to the
Registrant's Registration Statement on Form S-1,
Registration Statement No. 33-44664].

10.20 Cooperative Research and Development Agreement between the
Registrant and the United States Department of Agriculture,
dated July 10, 1990 [incorporated by reference to Exhibit
10.26 to the Registrant's Registration Statement on Form
S-1, Registration Statement No. 33-44664].

10.24 Agreement between Agro Dynamics, Inc. and Grodania A/S
[incorporated by reference to Exhibit 10.35 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1993]. **

10.26 Form of Warrant issued to Directors of the Registrant
[incorporated by reference to Exhibit 10.38 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1993].

10.49 Form of Stock Purchase Agreement dated September 25, 1996,
by and among EcoScience Corporation, Taglich Brothers,
D'Amadeo, Wagner & Company, Incorporated, and other entities
[incorporated by reference to Exhibit 10.49 to Registrant's
Annual Report on Form 10-K for fiscal year ended June 30,
1996].

10.50 Loan and Security Agreement dated as of April 28, 1997 by
and among the Registrant, Agro Dynamics, Inc., Agro Dynamics
Canada Inc. and EcoScience Produce Systems Corp. and Silicon
Valley Bank. [incorporated by reference to Exhibit 10.50 to
the Registrant's Quarterly Report on Form 10-Q for the
Quarter Ended March 31, 1997].

II-4
<PAGE>

10.51 Schedule to Loan and Security Agreement dated as of April
28, 1997 by among the Registrant, Agro Dynamics, Inc., Agro
Dynamics Canada Inc. and EcoScience Produce Systems Corp.
and Silicon Valley Bank. [incorporated by reference to
Exhibit 10.51 to the Registrant's Quarterly Report on Form
10-Q for the Quarter Ended March 31, 1997].

10.52 Continuing Guaranty by each of the Registrant, EcoScience
Produce Systems Corp. and Agro Dynamics, Inc. guaranteeing
the obligations of the Registrant, EcoScience Produce
Systems Corp., Agro Dynamics, Inc. and Agro Dynamics Canada
Inc. in favor of Silicon Valley Bank. [incorporated by
reference to Exhibit 10.52 to the Registrant's Quarterly
Report on Form 10-Q for the Quarter Ended March 31, 1997].

10.53 Continuing Guarantee by Agro Dynamics Canada Inc.
guaranteeing the obligations of the Registrant in favor of
Silicon Valley Bank. [incorporated by reference to Exhibit
10.53 to the Registrant's Quarterly Report on Form 10-Q for
the Quarter Ended March 31, 1997].

10.54 Collateral Assignment, Patent Mortgage and Security
Agreement by and between EcoScience Corporation (Assignor)
and Silicon Valley Bank (Assignee). [incorporated by
reference to Exhibit 10.54 to the Registrant's Quarterly
Report on Form 10-Q for the Quarter Ended March 31, 1997].

10.55 Collateral Assignment, Patent Mortgage and Security
Agreement by and between EcoScience Produce Systems Corp.
(Assignor) and Silicon Valley Bank (Assignee). [incorporated
by reference to Exhibit 10.55 to the Registrant's Quarterly
Report on Form 10-Q for the Quarter Ended March 31, 1997].

10.56 Collateral Assignment, Patent Mortgage and Security
Agreement by and between Agro Dynamics, Inc. (Assignor) and
Silicon Valley Bank (Assignee). [incorporated by reference
to Exhibit 10.56 to the Registrant's Quarterly Report on
Form 10-Q for the Quarter Ended March 31, 1997].

10.57 Agreement between Agro Dynamics, Inc. and Grodania A/S,
dated September 29, 1997. [incorporated by reference to
Exhibit 10.57 to the Registrant's Form 10-Q for the Quarter
Ended September 30, 1997]. **

10.59 Amendment to Loan Documents dated September 25, 1998, by and
among the Registrant, EcoScience Produce Systems Corp., Agro
Dynamics, Inc., Agro Dynamics Canada Inc. and Silicon Valley
Bank. [incorporated by reference to Exhibit 10.59 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1998].

10.61 Ground Lease dated September 4, 1997 between the Buffalo
Enterprise Development Corporation and Agro Power
Development, Inc. [incorporated by reference to Exhibit
10.61 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

II-5
<PAGE>

10.62 Commercial Greenhouse Lease and Operating Agreement dated
July 22, 1992 between Oxbow Power of North Tonawanda, New
York, Inc. and Village Farms of Wheatfield, Inc.
[incorporated by reference to Exhibit 10.62 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.63 Operating Agreement dated as of November 14, 1997 between
Greenhost, Inc. and Village Farms of Virginia, Inc for
Birchwood, Virginia greenhouse facility. [incorporated by
reference to Exhibit 10.63 to the Registrant's September 30,
1998 quarterly report on form 10-Q]

10.64 Lease Agreement dated as of September 21, 1993 between
Cogentrix of Pennsylvania, Inc. and Keystone Village Farms,
Inc. for Ringgold, Pennsylvania greenhouse facility.
[incorporated by reference to Exhibit 10.64 to the
Registrant's September 30, 1998 quarterly report on form
10-Q] **

10.65 Amended Ground Lease effective March 14, 1997 between the
Presidio County Commissioners Court and Agro Power
Development, Inc. [incorporated by reference to Exhibit
10.65 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.66 Lease Agreement dated as of January 29, 1998 between Ripe
Touch Greenhouses, Inc., and Village Farms of Colorado, Inc.
[incorporated by reference to Exhibit 10.66 to the
Registrant's September 30, 1998 quarterly report on form
10-Q] **

10.71 Agreement of Limited Partnership of Village Farms of Marfa,
L.P., dated as of June 4, 1997. [incorporated by reference
to Exhibit 10.71 to the Registrant's September 30, 1998
quarterly report on form 10-Q] **

10.72 Management, Operating and Maintenance Contract between
Village Farms of Marfa and Village Farms of Delaware, LLC,
dated June 4, 1997. [incorporated by reference to Exhibit
10.72 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.73 Marketing and Sales Agreement between Village Farms of
Marfa, L.P. and Village Farms of Delaware dated June 4,
1997. [incorporated by reference to Exhibit 10.73 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.74 Amended and Restated Agreement of Limited Partnership of
Village Farms of Buffalo, L.P., dated as of September 4,
1997. [incorporated by reference to Exhibit 10.74 to the
Registrant's September 30, 1998 quarterly report on form
10-Q] **

10.75 Management, Operating and Maintenance Contract between
Village Farms of Delaware and Village Farms of Buffalo,
dated September 4, 1997 and amendment thereto dated as of
April 17, 1998. [incorporated by reference to Exhibit 10.75
to the Registrant's September 30, 1998 quarterly report on
form 10-Q]

II-6
<PAGE>

10.76 Marketing and Sales Agreement between Village Farms of
Delaware and Village Farms of Buffalo, L.P. dated September
4, 1997. [incorporated by reference to Exhibit 10.76 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.78 Marketing Agreement by and between Foster Farms, Inc. and
Agro Power Development, Inc. dated January 1, 1995.
[incorporated by reference to Exhibit 10.78 to the
Registrant's September 30, 1998 quarterly report on form
10-Q] **

10.79 Credit Agreement (Line of Credit Facility) by and between
CoBank, ACB, as Agent and as a Syndication Party and Village
Farms International Financing Association dated as of June
24, 1997 [incorporated by reference to Exhibit 10.79 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.80 Promissory Note (Line of Credit Facility) of Village Farms
International Financing Association dated June 24, 1997 in
principal amount of $10,000,000. [incorporated by reference
to Exhibit 10.80 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.81 First Amendment to Credit Agreement (Line of Credit
Facility) [Regarding EcoScience Merger] by and between
Village Farms .International Finance Association and CoBank,
ACB dated September 29, 1998. [incorporated by reference to
Exhibit 10.81 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.82 Second Amendment to Credit Agreement (Line of Credit
Facility) by and between CoBank, Village Farms International
Finance Association and Agro Power Development Inc. dated
September 29, 1998. [incorporated by reference to Exhibit
10.82 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.83 Line of Credit Security Agreement by and between Village
Farms International Finance Association, and CoBank, ACB
dated June 24, 1997 with a line of credit of $10,000,000.
[incorporated by reference to Exhibit 10.83 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.84 Credit Agreement (Construction Loan Funding) by and between
CoBank, ACB as Agent and Syndicated Party and Village Farms
International Financing Association dated as of June 24,
1997. [incorporated by reference to Exhibit 10.84 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.85 First Amendment to Credit Agreement (Construction Loan
Funding) [Regarding EcoScience Merger] by and between
Village Farms International Finance Association and CoBank,
ACB dated September 29, 1998. [incorporated by reference to
Exhibit 10.85 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

II-7
<PAGE>

10.86 Promissory note (Construction Loan Funding) of Village Farms
International Financing Association dated June 24, 1997 in
principal amount of $30,000,000. [incorporated by reference
to Exhibit 10.86 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.87 Construction Loan Security Agreement by and between Village
Farms International Finance Association, and CoBank, ACB
dated June 24, 1997. [incorporated by reference to Exhibit
10.87 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.88 Credit Agreement (Term Loan Funding) by and between CoBank,
ACB as Agent and Syndication Party and Village Farms
International Financing Association dated as of June 24,
1997. [incorporated by reference to Exhibit 10.88 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.89 Promissory Note (Term Loan Funding) of Village Farms
International Financing Association dated June 24, 1997 in
principal amount of $50,000,000. [incorporated by reference
to Exhibit 10.89 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.90 Guaranty of Agro Power Development, Inc. dated as of June
24, 1997 to Construction Lenders, Term Lenders and Line of
Credit Lenders. [incorporated by reference to Exhibit 10.90
to the Registrant's September 30, 1998 quarterly report on
form 10-Q]

10.91 First Amendment to Credit Agreement (Term Loan Funding)
[Regarding EcoScience Merger] by and between Village Farms
International Finance Association and CoBank, ACB dated
September 29, 1998. [incorporated by reference to Exhibit
10.91 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.92 Second Amendment to Credit Agreement (Term Loan Funding) by
and between CoBank, Village Farms International Finance
Association and Agro Power Development Inc. dated September
29, 1998. [incorporated by reference to Exhibit 10.92 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.93 Term Loan Security Agreement by and between Village Farms
International Finance Association, and CoBank, ACB dated
June 24, 1997. [incorporated by reference to Exhibit 10.93
to the Registrant's September 30, 1998 quarterly report on
form 10-Q]

10.94 Amendment to Loan Documents by and between CoBank, Village
Farms International Finance Association and Agro Power
Development, Inc. dated September 29, 1998. [incorporated by
reference to Exhibit 10.94 to the Registrant's September 30,
1998 quarterly report on form 10-Q]

II-8
<PAGE>

10.95 First Amendment to Guarantor Security and Pledge Agreement
[Regarding EcoScience Merger] by and between Agro Power
Development, Inc. and CoBank, ACB dated September 29, 1998.
[incorporated by reference to Exhibit 10.95 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.96 First Amendment to Guaranty of Agro Power Development, Inc.
[Regarding EcoScience Merger] by and between Agro Power
Development, Inc. and The Lender Group dated September 29,
1998. [incorporated by reference to Exhibit 10.96 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.99 Agreement of Limited Partnership of Village Farms of
Presidio, L.P. dated as of August 31, 1998. [incorporated by
reference to Exhibit 10.99 to the Registrant's September 30,
1998 quarterly report on form 10-Q]

10.100 Commercial Greenhouse Design and Construction Contract
between Agro Power Development and Dalsem Kassenboyw B.V.
dated as of August 31, 1998. [incorporated by reference to
Exhibit 10.100 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.101 Commercial Design and Construction Contract between Village
Farms of Presidio, L.P. and Agro Power Development, Inc.
dated as of August 31, 1998. [incorporated by reference to
Exhibit 10.101 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.102 Commercial Packing House Design and Construction Contract
dated July 10, 1998 between Agro Power Development, Inc. and
NC Sturgeon, Inc. [incorporated by reference to Exhibit
10.102 to the Registrant's September 30, 1998 quarterly
report on form 10-Q]

10.103 Marketing and Sales Agreement between Village Farms of
Presidio, L.P. and Village Farms, Inc. dated as of August
31, 1998. [incorporated by reference to Exhibit 10.103 to
the Registrant's September 30, 1998 quarterly report on form
10-Q]

10.104 Management, Operation and Maintenance Contract dated as of
August 31, 1998 among New Amsterdam Joint Venture, L.L.C.
and Village Farms of Presidio, L.P. incorporated by
reference to Exhibit 10.104 to the Registrant's September
30, 1998 quarterly report on form 10-Q]

10.105 $1,375,000 Promissory Note and Security Agreement dated
March 10, 1997 among Agro Power Development, Inc., Village
Farms of Delaware LLC, Village Farms LLC and Cogentrix
Delaware Holdings, Inc. [incorporated by reference to
Exhibit 10.105 to the Registrant's September 30, 1998
quarterly report on form 10-Q]

10.106 Loan Agreement by and between Pocono Village and First
Pioneer Farm Credit, ACA, dated March 5, 1997. [incorporated
by reference to Exhibit 10.106 to the Registrant's September
30, 1998 quarterly report on form 10-Q]

II-9
<PAGE>

10.107 Installment Promissory Note for $2,200,000.00 from Pocono
Village to First Pioneer Farm Credit, ACA, dated March 10,
1997. [incorporated by reference to Exhibit 10.107 to the
Registrant's September 30, 1998 quarterly report on form
10-Q]

10.108 Construction Loan Agreement between Pocono Village and First
Pioneer Farm Credit, dated March 10, 1997. [incorporated by
reference to Exhibit 10.108 to the Registrant's September
30, 1998 quarterly report on form 10-Q]

10.109 Security Agreement between Pocono Village and First Pioneer
Farm Credit, ACA, dated March 10, 1997. [incorporated by
reference to Exhibit 10.109 to the Registrant's September
30, 1998 quarterly report on form 10-Q]

10.112 Stock Purchase Agreement, dated as of December 7, 1998,
Stock Pledge Agreement, dated as of December 30, 1998, and
Registration Rights Agreement, dated as of December 30, 1998
between the Registrant and Cogentrix Delaware Holdings. Inc.
and $20.6 million Promissory Note dated December 30, 1998
issued by Registrant to Cogentrix Delaware Holdings, Inc.
[incorporated by reference to Exhibit 10.112 to Registrant's
Form 8-K dated December 7, 1998]

10.113 Amendment to Loan Documents dated February 26, 1999 by and
among Registrant, EcoScience Produce Systems Corp., Agro
Dynamics, Inc. Agro Dynamics Canada, Inc. and Silicon Valley
Bank.[incorporated by reference to Exhibit 10.113 to
Registrant's September 30, 1998 quarterly report on Form
10-Q]

10.114 First Amendment to Registration Rights Agreement dated as of
March 11, 1999 between the Registrant and Cogentrix Delaware
Holdings, Inc. [incorporated by reference to Exhibit 10.114
to Registrant's September 30, 1998 quarterly report on form
10-Q].

10.115 Extension Agreement dated as of March 15, 1999 between
Registrant and Cogentrix Delaware Holdings, Inc.
[incorporated by reference to Exhibit 10.115 to the
Registrant's Annual Report on Form 10-K for the transition
period ended January 3, 1999]

10.116 Allonge to Promissory Note dated December 30, 1998 of
Registrant, payable to Cogentrix Delaware Holdings, Inc.
[incorporated by reference to Exhibit 10.116 to the
Registrant's Annual Report on Form 10-K for the transition
period ended January 3, 1999]

10.117 Promissory Note dated March 15, 1999 issued by Registrant to
Cogentrix Delaware Holdings, Inc. in the amount of $1
million. [incorporated by reference to Exhibit 10.117 to the
Registrant's Annual Report on Form 10-K for the transition
period ended January 3, 1999]

II-10
<PAGE>

10.118 Amendment to Stock Pledge Agreement dated as of March 15,
1999 between Registrant and Cogentrix Delaware Holdings,
Inc. [incorporated by reference to Exhibit 10.118 to the
Registrant's Annual Report on Form 10-K for the transition
period ended January 3, 1999]

10.119 Employment Agreement dated June 1, 1999 between Registrant
and Kenneth s. Hollander [filed herewith].

21 Subsidiaries of the Registrant. [filed with the Registration
Statement on Form S-1 being amended by this Amendment No.
1.]

23.1 Consent of Arthur Andersen LLP. [filed herewith].

23.2 Consent of Giordano, Halleran & Ciesla, P.C. [filed with
exhibit 5].

24 Powers of Attorney of officers and directors of the Company
[included in the signature page to the Registration
Statement on Form S-1 being amended by this Amendment No.
1].

(b) Financial Statement Schedules

All Schedules are omitted because they are not applicable or the required
information is shown in the Consolidated Financial Statements or the notes
thereto.

Item 17. Undertakings.

(a) The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to:

(i) To include any prospectus required by Section 10(a)(3) of the Act;

(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;

(iii) Include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-11
<PAGE>

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.

(b) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment of
the Registrant of expenses incurred or paid by a director, officer, or
controlling person of the Registrant in the successful defense of any
action, suit, or proceeding) is asserted by such director, officer, or
controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
the Registrant is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.

II-12

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-1 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of East Brunswick, the State of New Jersey, on June 10,
1999.

ECOSCIENCE CORPORATION

By: /s/ Michael A. DeGiglio
-----------------------------------------
Michael A. DeGiglio
President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the Registrant and in the capacities and on the dates indicated.

Name Title Date
- ---- ----- ----
<S> <C> <C>
/s/ Michael A. DeGiglio President, Chief Executive Officer June 10, 1999
- ------------------------- (Principal Executive Officer) and
Michael A. DeGiglio Director

/s/ Kenneth S. Hollander Senior Vice President and Chief June 10, 1999
- ------------------------ Financial Officer (Principal
Kenneth S. Hollander Financial Officer)

/s/ Kurt Hoffman Secretary and Corporate Controller June 10, 1999
- ------------------------ (Principal Accounting Officer)
Kurt Hoffman

* Executive Vice President and June 10, 1999
- ------------------------ Director
Albert W. Vanzeyst

* Director June 10, 1999
- -----------------------
Thomas A. Montanti

* Director June 10, 1999
- -----------------------
David J. Ryan

* Director June 10, 1999
- -----------------------
Heinz K. Wehner

*By: /s/ Michael A. DeGiglio
-----------------------
Michael A. DeGiglio
As Attorney-in-Fact

</TABLE>

EXHIBIT 3.2

BYLAWS

ECOSCIENCE CORPORATION

(A Delaware Corporation)

ARTICLE I

Offices

Section 1. Offices. The Corporation may have a principal or other
office at such place or places, either within or without the State of Delaware,
as the Board of Directors may from time to time determine or as shall be
necessary or appropriate for the conduct of the business of the Corporation.

ARTICLE II.

Meetings of the Stockholders

Section 1. Place of Meetings. All meetings of stockholders shall be
held at such place within the United States as shall be fixed by the Board of
Directors in the notice of the meeting. At least ten (10) days' notice shall be
given to the stockholders of the place so fixed in the manner set forth in
Section 4 of this Article II.

Section 2. Annual Meetings. Annual meetings of stockholders shall be
held on a regular business day of the month of April or May at the offices of
the Corporation or at such other date, time and place which shall be established
by the Board of Directors, at which they shall elect directors and transact such
other business as may properly be brought before the meeting.

If the annual meeting shall not be held on the day designated herein, a
special meeting of the stockholders in lieu of the annual meeting may be held on
such date as shall be designated by the Board in the notice thereof. At such
special meeting the stockholders may elect directors and

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transact other business with the same force and effect as at an annual meeting
of the stockholders duly called and held.

Section 3. Special Meetings. A special meeting of the stockholders (or
of any class thereof entitled to vote) for any purpose or purposes may be called
at any time by the President or by order of any two (2) members of the Board of
Directors and shall be called by the President or the Secretary upon the written
request of stockholders holding of record at least forty percent (40%) of the
outstanding shares of all classes of stock of the Corporation entitled to vote
at such meeting. Such written request shall state the purpose or purposes for
which such meeting is to be called.

Section 4. Notice of Meetings. Except as otherwise expressly required
by law, notice of each meeting of stockholders, whether annual or special, shall
be given at least ten (10) days before the date on which the meeting is to be
held to each stockholder of record entitled to vote thereat by delivering a
notice thereof to him personally or by mailing such notice in a postage prepaid
envelope directed to him at his address as it appears on the stock ledger of the
Corporation, unless he shall have filed with the Secretary of the Corporation a
written request that notices intended for him be directed to another address, in
which case such notice shall be directed to him at the address designated in
such request. Every notice of a special meeting of the stockholders, besides
stating the time and place of the meeting, shall state briefly the objects or
purposes thereof. Notices of any meeting of stockholders shall not be required
to be given to any stockholder who shall attend such meeting in person or by
proxy; and, if any stockholder shall, in person or by attorney thereunto
authorized, in writing or by telegraph, cable or wireless, waive notice of any
meeting of the stockholders, whether prior to or after such meeting, notice
thereof need not be given to him. Notice of any adjourned meeting of the
stockholders shall not be required to be given, except as expressly required by
law.

Section 5. List of Stockholders. It shall be the duty of the Secretary
or other officer of the Corporation who shall have charge of the stock ledger to
prepare and make, at least ten (10) days before every election of directors, a
complete list of the stockholders entitled to vote thereat, arranged in
alphabetical order, and showing the address of each stockholder and the number
of shares registered in his name. Such list shall be open for ten (10) days at
the place

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where said election is to be held to the examination of any stockholder during
ordinary business hours and shall be produced and kept at the time and place of
the election during the whole time thereof and subject to the inspection of any
stockholder who may be present. The original or duplicate stock ledger shall be
the only evidence as to who are the stockholders entitled to examine such list
or the books of the Corporation or to vote in person or by proxy at such
election.

Section 6. Quorum. At each meeting of the stockholders, the holders of
record of a majority of the issued and outstanding stock of the Corporation
entitled to vote at such meeting, present in person or by proxy, shall
constitute a quorum for the transaction of business, except where otherwise
provided by law, the Certificate of Incorporation or these Bylaws. In the
absence of a quorum, any officer entitled to preside at, or act as Secretary of,
such meeting shall have the power to adjourn the meeting from time to time until
a quorum shall be constituted. At any such adjourned meeting at which a quorum
shall be present any business may be transacted which might have been transacted
at the meeting as originally called, but only those stockholders entitled to
vote at the meeting as originally noticed shall be entitled to vote at any
adjournment or adjournments thereof.

Section 7. Voting. Except as otherwise provided in the Certificate of
Incorporation, at every meeting of stockholders each holder of record of the
issued and outstanding stock of the Corporation entitled to vote at such meeting
shall be entitled to one vote in person or by proxy for each such share of stock
entitled to vote held by such stockholder, but no proxy shall be voted after
eleven (11) months from its date unless the proxy provides for a longer period,
and, except where the transfer books of the Corporation shall have been closed
or a date shall have been fixed as the record date for the determination of
stockholders entitled to vote, no share of stock shall be voted on at any
election for directors which shall have been transferred on the books of the
Corporation within twenty (20) days next preceding such election of directors.
Shares of its own capital stock belonging to the Corporation directly or
indirectly shall not be voted upon directly or indirectly. At all meetings of
the stockholders, a quorum being present, all matters shall be decided by a
majority vote of the shares of stock entitled to vote held by stockholders
present in person or by proxy, except as otherwise required by the laws of the
State of Delaware, the Certificate of Incorporation or these Bylaws.

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Unless demanded by a stockholder of the Corporation present in person or by
proxy at any meeting of the stockholders and entitled to vote thereat or so
directed by the Chairman of the meeting or required by the laws of the State of
Delaware, the vote thereat on any question need not be by ballot. On a vote by
ballot, each ballot shall be signed by the stockholder voting, or in his name by
his proxy, if there by such proxy, and shall state the number of shares voted by
him and the number of votes to which each share is entitled.

ARTICLE III

Board of Directors

Section 1. General Powers. The property, business and affairs of the
Corporation shall be managed by the Board of Directors.

Section 2. Number. The number of directors shall be fixed from time to
time by resolution of the Board of Directors but shall not be less than three
(3), unless there shall be less than (3) stockholders, in which case the number
of directors shall not be less than the number of stockholders.

Section 3. Classes of Directors. Effective as of such date, prior to
the 1992 Annual Meeting of Stockholders, as shall be fixed by the Board of
Directors, the directors shall be divided into three classes, with each class to
be as nearly equal in number as reasonably possible, and with the initial term
of office of the first class of directors to expire at the 1992 Annual Meeting
of Stockholders, the initial term of office of the second class of directors to
expire at the 1993 Annual Meeting of Stockholders and the initial term of office
of the third class of directors to expire at the 1994 Annual Meeting of
Stockholders. Commencing with the 1992 Annual Meeting of Stockholders, directors
elected to succeed those directors whose terms have thereupon expired shall be
elected for a term of office to expire at the third succeeding Annual Meeting of
Stockholders after their election, and upon the election and qualification of
their successors. If the number of directors is changed, any increase or
decrease shall be apportioned among the classes so as to maintain or attain, if
possible, the number of directors in each class as nearly equal as reasonably
possible, but in no case will a decrease in the number of directors shorten the
term of any incumbent director.

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Section 4. Quorum and Manner of Acting. Unless otherwise provided by
law, the presence of a majority of the whole Board of Directors shall be
necessary to constitute a quorum for the transaction of business. In the absence
of a quorum, a majority of the directors present may adjourn the meeting from
time to time until a quorum shall be present. Notice of any adjourned meeting
need not be given. At all meetings of the directors, a quorum being present, all
matters shall be decided by the affirmative vote of a majority of the directors
present, except as otherwise required by the laws of the State of Delaware.

Section 5. Place of Meetings, Books and Records. The Board of Directors
may hold its meetings and keep the books and records of the Corporation, at such
place or places within or without the State of Delaware, as the Board may from
time to time determine.

Section 6. Annual Meeting. As promptly as practicable after each annual
meeting of stockholders for the election of directors, the Board of Directors
shall meet for the purpose of organization, the election of officers and the
transaction of other business. Notice of such meeting need not be given. Such
meeting may be held at any other time or place as shall be specified in a notice
given as hereinafter provided for special meetings of the Board of Directors or
in a waiver of notice thereof signed by all the directors.

Section 7. Regular Meetings. Regular meetings of the Board of Directors
may be held at such time and place, within or without the State of Delaware, as
shall from time to time be determined by the Board of Directors. After there has
been such determination, and notice thereof has been given to each member of the
Board of Directors, regular meetings may be held without further notice being
given.

Section 8. Special Meetings and Notice Thereof. Special meetings of the
Board of Directors shall be held whenever called by the President or by a
majority of the directors. Notice of each such meeting shall be mailed to each
director, addressed to him at his residence or usual place of business, at least
two (2) days before the date on which the meeting is to be held, or shall be
sent to him at such place by telegraph, cable, radio or wireless, or be
delivered personally or by telephone, not later than the day before the day on
which such meeting is to be held. Each such notice shall state the time and
place of the meeting and the purpose thereof. In lieu of the notice to be given
as set forth above, a waiver thereof in writing, signed by the

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director or directors entitled to said notice, whether before or after the time
stated therein, shall be deemed equivalent thereto for purposes of this Section
8. No notice to or waiver by any director with respect to any special meeting
shall be required if such director shall be present at said meeting.

Section 9. Resignation. Any director of the Corporation may resign at
any time by giving written notice thereof to the President or the Secretary of
the Corporation. The resignation of any director shall take effect upon receipt
of notice thereof or at such later time as shall be specified in such notice;
and, unless otherwise specified therein, the acceptance of such resignation
shall not be necessary to make it effective. When one or more directors shall
resign from the Board, effective at a future date, a majority of the directors
then in office including those who have so resigned shall have power to fill
such vacancy or vacancies, the vote thereon to take effect when such resignation
or resignations shall become effective.

Section 10. Vacancies. Vacancies and newly created directorships
resulting from any increase in the authorized number of directors shall be
filled by a majority of the directors then in office, although less than a
quorum, or by a sole remaining director, and any director so appointed shall
hold office until the next election of the class for which such director has
been chosen and until his successor is elected and qualified.

Section 11. Removal of Directors. Except as may be provided in a
resolution or resolutions providing for any class or series of Preferred Stock
pursuant to Article IV of the Certificate of Incorporation with respect to any
directors elected by the holders of such class or series, any director, or the
entire Board of Directors, may be removed from office at any time, but only for
cause and only by the affirmative vote of the holders of at least 66-2/3% of the
voting power of all of the shares of capital stock of the Corporation then
entitled to vote generally in the election of directors, voting together as a
single class.

Section 12. Compensation of Directors. Directors, as such, shall not
receive any stated salary for their services, but the Board may provide for the
payment to any of the directors, other than officers or employees of the
Corporation, of a specified amount for services as a director or member of a
committee of the Board, or of a specified amount for attendance at each regular
or special Board or committee meeting, or of both, and all directors shall be
reimbursed for

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expenses of attendance at any such meeting; provided that nothing herein
contained shall be construed to preclude any director from serving the
Corporation or any subsidiary thereof in any other capacity and receiving
compensation therefor.

Section 13. Committees. The Board of Directors may, by resolution
passed by a majority of the whole Board, designate one or more committees, each
committee to consist of two or more directors of the Corporation, which, to the
extent provided in the resolution or in these Bylaws, shall have and may
exercise such powers of the Board in the management of the business and affairs
of the Corporation (including the power to authorize the seal of the Corporation
to be affixed to all papers which may require it), as the Board may be
resolution determine and specify in the respective resolutions appointing them,
subject to such restrictions as may be contained in the Certificate of
Incorporation. Such committee or committees shall have such name or names as may
be determined from time to time by resolution adopted by the Board of Directors.
The committees shall keep regular minutes of their proceedings and report the
same to the Board when required. A majority of all the members of any such
committee may fix its rules of procedure, determine its action and fix the time
and place, whether within or without the State of Delaware, of its meetings and
specify what notice thereof, if any, shall be given, unless the Board of
Directors shall otherwise by resolution provide. The Board of Directors shall
have power to change the membership of any such committee at any time, to fill
vacancies thereon and to discharge any such committee, either with or without
cause, at any time. Each member of any such committee shall be paid such fee, if
any, as shall be fixed by the Board of Directors for each meeting of such
committee which he shall attend and, in addition, such transportation and other
expenses actually incurred by him in going to the meeting of such committee and
returning therefrom as the Board of Directors shall approve.

Section 14. Action Without Meeting. Any action required or permitted to
be taken at any meeting of the Board of Directors or of any committee thereof
may be taken without a meeting if a written consent thereto is signed by all
members of the Board or of such committee, as the case may be, and such written
consent is filed with the minutes or proceedings of the Board or committee.

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ARTICLE IV

Officers

Section 1. Number. The principal officers of the Corporation shall be a
President, one or more Vice Presidents, a Treasurer and a Secretary. The
Corporation may also have, at the discretion of the Board of Directors, a
Chairman of the Board or such other officers as may be appointed in accordance
with the provision of these Bylaws. One person may hold the offices and perform
the duties of any two or more of said offices, except the offices and duties of
President and Secretary.

Section 2. Election or Appointment and Term of Office. The principal
officers of the Corporation shall be chosen annually by the Board of Directors
at the annual meeting thereof. Each such officer shall hold office until his
successor shall have been duly chosen and shall qualify, or until his death or
until he shall resign or shall have been removed in the manner hereinafter
provided.

Section 3. Subordinate Officers. In addition to the principal officers
enumerated in Section 1 of this Article IV, the Corporation may have one or more
Assistant Treasurers, one or more Assistance Secretaries and such other
officers, agents and employees as the Board of Directors may deem necessary,
each of whom shall hold office for such period, have such authority, and perform
such duties as the President or the Board of Directors may from time to time
determine. The Board of Directors may delegate to any principal officer the
power to appoint and to remove any such subordinate officers, agents or
employees.

Section 4. Removal. Any officer may be removed, either with or without
cause, at any time, by resolution adopted by the Board of Directors at any
regular meeting of the Board or at any special meeting of the Board called for
that purpose at which a quorum is present.

Section 5. Resignations. Any officer may resign at any time by giving
written notice to the Board of Directors or to the President or to the
Secretary. Any such resignation shall take effect upon receipt of such notice or
at any later time specified therein; and, unless otherwise specified therein,
the acceptance of such resignation shall not be necessary to make it effective.

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Section 6. Vacancies. A vacancy in any office may be filled for the
unexpired portion of the term in the manner prescribed in these Bylaws for
election or appointment to such office for such term.

Section 7. Chairman of the Board. If the Corporation has a Chairman of
the Board, he shall preside at all meetings of the Board of Directors and of
stockholders and he shall perform such other appropriate duties as from time to
time may be assigned to him by the Board of Directors.

Section 8. President. The President shall be the chief executive
officer of the Corporation and as such shall have general supervision of the
affairs of the Corporation, subject to the control of the Board of Directors. He
shall be ex officio a member of all standing committees. In the absence of the
Chairman of the Board the President shall preside at all meetings of
stockholders and at all meetings of the Board of Directors. Subject to the
control and discretion of the Board of Directors, the President may enter into
any contract or execute and deliver any instrument in the name and on behalf of
the Corporation. In general, he shall perform all duties incident to the office
of President, as herein defined, and all such other duties as from time to time
may be assigned to him by the Board of Directors.

Section 9. Vice Presidents. The Vice Presidents in the order of their
seniority, unless otherwise determined by the Board of Directors, shall, in the
absence or disability of the President, perform the duties and exercise the
powers of the President. They shall perform such other duties and have such
other powers as the President or the Board of Directors may from time to time
prescribe.

Section 10. Treasurer. The Treasurer shall have charge and custody of,
and be responsible for, all funds and securities of the Corporation and shall
deposit all such funds in the name of the Corporation in such banks or other
depositories as shall be selected by the Board of Directors. He shall exhibit at
all reasonable times his books of account and records to any of the directors of
the Corporation upon application during business hours at the office of the
Corporation where such books and records shall be kept; when requested by the
Board of Directors, he shall render a statement of the condition of the finances
of the Corporation at any meeting of the Board or at the annual meeting of
stockholders; he shall receive, and give recept

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for, moneys due and payable to the Corporation from any source whatsoever; and
in general, he shall perform all the duties incident to the office of Treasurer
and such other duties as from time to time may be assigned by the President or
the Board of Directors. The Treasurer shall give such bond, if any, for the
faithful discharge of his duties as the Board of Directors may require.

Section 11. Secretary. The Secretary, if present, shall act as
Secretary at all meetings of the Board of Directors and of the stockholders and
keep the minutes thereof in a book or books to be provided for that purpose; he
shall see that all notices required to be given by the Corporation are duly
given and served; he shall have charge of the stock records of the Corporation;
he shall see that all reports, statements and other documents required by law
are properly kept and filed; and in general, he shall perform all the duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him by the President or the Board of Directors.

Section 12. Salaries. The salaries of the principal officers shall be
fixed from time to time by the Board of Directors, and the salaries of any other
officers may be fixed by the President.

ARTICLE V

Shares and Their Transfer

Section 1. Certificate for Stock. Every stockholder of the Corporation
shall be entitled to a certificate or certificates, to be in such form as the
Board of Directors shall prescribe, certifying the number of shares of the
capital stock of the Corporation owned by him.

Section 2. Stock Certificates. Any stock certificate which certifies
the number of shares owned by any holder of stock of the Corporation shall be
numbered in the order in which it shall be issued and shall be signed by the
President or any Vice President, and by the Treasurer or an Assistant Treasurer
or the Secretary or an Assistant Secretary of the Corporation and shall have the
seal of the Corporation affixed thereto; provided, however, that, where any such
certificate is signed (1) by a transfer agent or an assistant transfer agent or
(2) by a transfer clerk acting on behalf of the Corporation and a registrar, if
the Board shall by resolution so authorize, the signature of such President,
Vice President, Treasurer , Secretary, Assistant Treasurer or Assistant
Secretary and the seal of the Corporation may be facsimiles thereof. In case any

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officer or officers of the Corporation who shall have signed, or whose facsimile
signature of signatures shall have been used on, any such certificate shall
cease to be such officer or officers, whether by reason of death, resignation or
otherwise, before such certificate shall have been delivered by the Corporation,
such certificate may nevertheless be adopted by the Corporation and be issued
and delivered as though the person or persons who signed such certificate or
whose facsimile signature or signatures shall have been affixed thereto, had not
ceased to be such officer or officers.

Section 3. Stock Ledger. A record shall be kept by the Secretary,
transfer agent or by any other officer, employee or agent designated by the
Board of Directors of the name of the person, firm or corporation holding the
stock represented by such certificate, the number of shares represented by such
certificate, and the date thereof, and in case of cancellation, the date of
cancellation.

Section 4. Cancellation. Every certificate surrendered to the
Corporation for exchange or transfer shall be cancelled, and no new certificate
or certificates shall be issued in exchange for any existing certificate until
such existing certificate shall have been so cancelled, except in cases provided
for in Section 7 of this Article V.

Section 5. Transfer of Stock. Transfers of shares of the capital stock
of the Corporation shall be made only on the books of the Corporation by the
registered holder thereof, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the Secretary of the Corporation or with a
transfer clerk or a transfer agent appointed as in Section 6 of this Article V
provided, and on surrender of the certificate or certificates for such shares
properly endorsed and the payment of all taxes thereon. The person in whose name
shares of stock stand on the books of the Corporation shall be deemed the owner
thereof for all purposes as regards the Corporation; provided, however, that
whenever any transfer of shares shall be made for collateral security, and no
absolutely, such fact, if known to the Secretary of the Corporation, shall be so
expressed in the entry of transfer.

Section 6. Regulations. The Board of Directors may make such rules and
regulations as it may deem expedient, not inconsistent with the Certificate of
Incorporation or these Bylaws, concerning the issue, transfer and registration
of certificates for shares of the stock of the

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Corporation. It may appoint, or authorize any principal officer or officers to
appoint, one or more transfer clerks or one or more transfer agents and one or
more registrars, and may require all certificates of stock to bear the signature
or signatures of any of them.

Section 7. Lost, Stolen, Mutilated or Destroyed Certificates. As a
condition to the issue of a new certificate of stock in the place of any
certificate theretofore issued and alleged to have been lost, stolen, mutilated
or destroyed, the Board of Directors, in its discretion, may require the owner
of any such certificate, or his legal representatives, to give the Corporation a
bond in such sum and in such forma s it may direct to indemnify the Corporation
against any claim that may be made against it on account of the alleged loss,
theft, mutilation or destruction of any such certificate or the issuance of such
new certificate. Proper evidence of such loss, theft, mutilation or destruction
shall be procured for the Board of Directors, if required. The Board of
Directors, in its discretion, may authorize the issuance of such new certificate
without any bond when in its judgment it is proper to do so.

Section 8. Record Date. The Board may fix a date in advance of any
meeting of stockholders not exceeding sixty (60) days nor less than ten (10)
days before the date of such meeting, or the date for the payment of any
dividend, or the date for the allotment of rights, or the date when any change
or conversion or exchange of capital stock shall go into effect, as a record
date for the determination of the stockholders entitled to notice of, and to
vote at, such meeting, and any adjournment thereof, or to receive payment of any
dividend, or to receive any such allotment of rights, or to exercise the rights
in respect of any such change, conversion, or exchange of capital stock, as the
case may be, notwithstanding any transfer of any stock on the books of the
Corporation after any record date so fixed.

ARTICLE VI

Miscellaneous Provisions

Section 1. Corporate Seal. The Board of Directors shall provide a
corporate seal, which shall be in the form of a circle and shall bear the name
of the Corporation and words and figures showing that it was incorporated in the
State of Delaware in the year 1988. The Secretary shall be the custodian of the
seal. The Board of Directors may authorize a duplicate seal to be kept and used
by any other officer.

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Section 2. Fiscal Year. The fiscal year of the Corporation shall be as
specified by the Board of Directors.

Section 3. Voting of Stocks Owned by the Corporation. The Board of
Directors may authorize any person on behalf of the Corporation to attend, vote
and grant proxies to be used at any meeting of stockholders of any corporation
(except this Corporation) in which the Corporation may hold stock.

Section 4. Dividends. Subject to the provisions of the Certificate of
Incorporation, the Board of Directors may, out of funds legally available
therefor, at any regular or special meeting declare dividends upon the capital
stock of the Corporation as and when they deem expedient. Before declaring any
dividend there may be set apart out of any funds of the Corporation available
for dividends such sum or sums as the directors from time to time in their
discretion may deem proper for working capital or as a reserve fund to meet
contingencies or for equalizing dividends or for such other purposes as the
directors may deem conducive to the interests of the Corporation.

ARTICLE VII

Amendments

The Bylaws of the Corporation may be altered, amended or repealed
either by the affirmative vote of the holders of a majority of the stock issued
and outstanding and entitled to vote in respect thereof and represented in
person or by proxy at any annual or special meeting of the stockholders, or by
the Board of Directors at any regular or special meeting of the Board of
Directors, except that the vote of not less than eighty percent (80%) of the
voting power of all of the shares of capital stock of the Corporation entitled
to vote generally in the election of director, voting together as a single
class, shall be required to alter, amend or repeal Section 3, 10, or 11 of
Article III hereof or this Article VII. Bylaws, whether made or altered by the
stockholders or by the Board of Directors, shall be subject to alteration or
repeal by the stockholders as in this Article VII above provided.

Exhibit 10.119

EMPLOYMENT AGREEMENT

This agreement is made as of June 1, 1999 between EcoScience Corporation (the
"Company") with its principal place of business at 10 Alvin Court, E. Brunswick,
NJ 08816 ("Corporate Headquarters") and KENNETH S. HOLLANDER (the "Employee.")

Whereas, the Company desires to hire the Employee upon the terms set forth in
this Agreement and the Employee desires to be employed by the Company based on
the terms of this Agreement, the Company and the Employee agree to the following
terms and conditions of this Employment Agreement:

Section 1. EMPLOYMENT DUTIES

The Employee shall serve as Senior Vice President and Chief Financial Officer of
the Company and report directly to the President/Chief Executive Officer. He
shall perform such duties and functions which are consistent with this position
and such duties and functions as the President/Chief Executive Officer of the
Company may reasonably require. The Employee will perform his duties primarily
at the Company's Corporate Headquarters location but may, from time to time, be
required to travel to other Company locations or locations of customers or
suppliers. Specific duties shall include, but may not be limited to, the
following: 1) responsibility for all internal and external financial reporting
as may be required by the SEC or other public agencies; 2) responsibility and
accountability for overall management of the Company's accounting and finance
departments; 3) responsibility for assisting the President/CEO and others in the
development and execution of ongoing corporate financial strategies which may
include, but not be limited to, debt restructuring, public and/or private
offering, mergers and acquisitions, etc.; 4) responsibility for maintaining
professional working relationships with the Company's auditors, legal advisors,
communications and public relations firms, etc.; 6) responsibility for assisting
the President/CEO in ongoing cost reduction reviews and implementation of cost
reduction programs; and 7) all other responsibilities which are consistent with
the position of Chief Financial Officer of a public company.

Section 2. COMMENCEMENT AND TERM OF EMPLOYMENT

The date of commencement of the Employee's employment will be June 1, 1999 (the
"Commencement Date"). The term of this Agreement shall run indefinitely, unless
sooner terminated as provided in this Agreement.

Section 3. PERFORMANCE

During the term of this Agreement the Employee shall devote suitable time and
effort to the business of the Company and will not engage in consulting work or
any other activity on his own behalf or on behalf of another company without the
express written concurrence of the Company's President/CEO, except that the
Employee shall be entitled to provide consulting services to HumaScan Inc. or
any successor company provided that it does not interfere with the Employee's
responsibilities to the Company.

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Section 4. COMPENSATION AND BENEFITS

The Company agrees to compensate the Employee as follows:

(a) The Employee's starting salary, effective June 1, 1999, will be
$140,000 per year, paid semi-monthly at the gross rate of
$5,833.33 per pay period. The Company agrees that the Employee
will receive a pay increase of at least 10% ($14,000) after
successfully completing one year of service with the Company.
Subsequent salary increases will be at the discretion of the
President/CEO.

(b) The Company will pay the Employee a one-time bonus of between
$20,000 and $25,000 for fiscal year 1999 upon successful
completion of all required financial reporting matters and the
achievement of certain qualitative measures, to wit: efficiency
achieved in the Accounting Department, the morale of the staff
and cost effective management of the job, all to the reasonable
satisfaction of the President/CEO.

(c) In the fiscal year 2000, and beyond, the Company will pay the
Employee an annual bonus based on attainment of the Company's
Profit Plan. If 80% of this Plan is achieved the bonus will equal
15% of the Employee's then current base pay; if 100% of this Plan
is achieved the bonus will equal 25% of the Employee's then
current base pay; and if 120% of this Plan is achieved the bonus
will equal 30% of the Employee's then current base pay. All such
bonuses shall be calculated and paid upon completion of the
fiscal year audit for that specific year. In the event the
minimum target (80%) is not met the President/CEO may, at his
sole discretion, choose to pay the Employee a bonus based on
certain qualitative issues (see above) or other quantitative
issues such as an increase in shareholder value as defined by a
rise in the price of common stock or other financial benefits
which may accrue to the Company. The Company's Profit Plan will
be established by senior management prior to or at the
commencement of the relevant fiscal year and will be communicated
to the Employee within a reasonable period of time after it is so
established.

(d) The Company shall, concurrent with the Commencement Date, issue
to the Employee incentive stock options ("ISOs") for 100,000
shares of the Company's common stock. These ISOs will vest as
follows: 20% (20,000) after six (6) months of service; another
20% (20,000) after one (1) year of service; another 30% (30,000)
after two (2) years of service; and the final 30% (30,000) after
three (3) years of service. All options will vest immediately in
the event of a change in control of the Company.

(e) The Company will pay the Employee a "signing bonus" of $20,000.
This bonus will be paid as follows: 50% ($10,000) will be payable
no later than fifteen (15) days after the Commencement Date and
the remaining 50% ($10,000) will be payable no later than thirty
(30) days after the Commencement Date.

(f) The Employee shall be entitled to all other benefits normally
accorded to full time executive level employees of the Company.
These benefits presently include:

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(1) A Medical Insurance Plan provided by the Company for its
employees. This plan is currently underwritten by Blue
Cross/Blue Shield of Texas. The Company pays 80% of the
premium cost for individual employee coverage; the Company
pays 50% of the premium costs for dependent coverage in this
Plan. A mandatory ninety (90) day waiting period is required
for all new employees.

(2) A Dental Insurance Plan provided by the Company for its
employees, currently underwritten by Delta Dental of NJ.
This plan is administered in a manner similar to the Medical
Plan.

(3) The Company will provide, at no cost to the Employee, life
insurance, accidental death and dismemberment insurance and
long term disability insurance. The Employee will be
eligible for these benefits immediately upon commencement of
work for the Company. The Human Resources Department will
provide details on these benefits as soon as the Employee
begins work.

(4) A 401(k) plan sponsored by the Company, which is managed by
Franklin Templeton. The Employee is immediately eligible to
participate in this plan; however, enrollment dates are
restricted to the first calendar day of each calendar
quarter.

(g) The Employee shall develop and adhere to an annual budget for
business expenses. All business expenses will be reimbursed to
the Employee through the Company's expense reporting process and
must be approved by the Employee's supervisor. Receipts for all
expenses are requested and are mandatory for any expense above
$25.00. The Company currently reimburses employees at the rate of
$0.27/mile for use of personal vehicles on Company business.

(h) The Employee shall be entitled to two (2) weeks (10 business
days) of paid vacation in 1999. Thereafter, the Employee shall be
entitled to three (3) weeks (15 business days) of paid vacation
per year. Company policy allows for the carryover of a maximum of
five (5) unused vacation days from one year to the next.

(i) The Company will withhold taxes from the Employee's salary in
accordance with its normal payroll procedures.

Section 5. TERMINATION

The following rules shall apply with respect to the termination of the
Employee's employment with the Company:

(a) In the event of the Employee's death this Agreement will
terminate at the end of the calendar month in which the death
occurs.

(b) If the Employee becomes disabled, either physically or mentally,
and is unable to perform his duties and functions as described
herein for a continuous period of six

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(6) months, this Agreement may be terminated by either party upon
written notice to the other. If any questions arise as to whether
the Employee has become so disabled as to be unable to perform
the duties the position requires due to physical or mental
illness the Employee shall submit to an examination by a
physician jointly selected by the Company and the Employee and to
whom the Employee has no reasonable objection. Following such
examination the physician shall submit to the Company and the
Employee a report in reasonable detail setting forth the
physician's opinion as to whether the Employee is so disabled.
Such report shall, for the purposes of this Agreement, be
conclusive of the issue. If any such question shall arise, and
the Employee fails to submit to such a physical examination, a
determination by the Board of Directors of the Company as to the
Employee's disability for the purposes of this Agreement shall be
conclusive.

(c) If the Employee's employment is terminated by the Company for
Cause, this Agreement may be terminated by written notice to the
Employee by the President/CEO or the Board of Directors detailing
such Cause. In the event of termination of the Employee for
Cause, the Company shall pay the Employee all accrued but unpaid
salary through the date of termination, and the Company shall
have no further obligations to the Employee under this Agreement.
"Cause", for these purposes, shall be defined as:

(1) dishonesty detrimental to the Company, its subsidiaries or
affiliates or its employees;

(2) a conviction of the Employee for a crime involving an act of
moral turpitude;

(3) incompetent performance or substantial and continuing
inattention to or neglect of the duties and responsibilities
assigned to the Employee pursuant to this Agreement,
including failure to comply with reasonable requests made by
the President/CEO or the Board of Directors, and failure of
the Employee to cure the same within thirty (30) days after
notice is given, in writing, to the Employee of these
circumstances; or

(4) a material breach of the provisions of this Agreement and
the failure of Employee to cure the same within thirty (30)
days of written notice of such breach.

(d) If the Employee is terminated without Cause, the Employee will be
given written notice at least thirty (30) days prior to the
effective date of the termination. In such event the Employee
will receive severance pay equal to six (6) months of his then
current regular base salary ("Severance Pay"). The Employee will
be required to sign a release agreement in the form attached
hereto as Exhibit A ("Release Agreement") in order to receive
this Severance Pay.

(e) In the event of any termination of the Employee's employment, the
exercisability of any stock options granted to the Employee shall
be governed by the provisions of

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the option agreements relating to such stock options and the
plan, if any, pursuant to which such options were granted.

(f) Any termination by the Company shall be effected by a "Notice of
Termination" to the Employee given in accordance with Section 10
of this Agreement. For purposes of this Agreement a Notice of
Termination means a written notice (i) indicating the specific
termination provisions in this Agreement relied upon by the
Company; (ii) setting forth in reasonable detail the facts and
circumstances claimed by the Company to provide a basis for the
termination of the Employee and (iii) a proposed termination date
not less than thirty (30) days after the date of the notice.
During the thirty (30) day period following the date of such
notice the Company shall give the Employee the opportunity to
appear before the Board of Directors to be heard. The meeting
will give the Employee an opportunity to cure or dispute any
alleged basis for the termination.

(g) Should the Employee voluntarily terminate his employment without
Good Reason (as hereinafter defined) he will be required to
provide notice of termination at least thirty (30) days prior to
the effective date of the termination. In such event, any
severance pay provided to the Employee will be determined by the
President/CEO and the Board of Directors and the amount of such
severance pay will be at their sole discretion. The Employee will
be required to sign a Release Agreement in order to receive any
such severance pay.

(h) If the Employee voluntarily terminates his employment with the
Company for Good Reason, the Company shall pay to the Employee
the Severance Pay that would have been payable by the Company to
the Employee under Section 5(d) of this Agreement if the
Employee's employment by the Company had been terminated by the
Company without Cause. The Employee will be required to sign a
Release Agreement in order to receive this Severance Pay. "Good
Reason," for these purposes, shall be defined as:

(1) the assignment to the Employee of any material duties
inconsistent in any material respect with the Employee's
duties as defined hereunder or any other action by the
Company that results in a material diminution in the
Employee's position, authority, duties or responsibilities
from those contemplated by Section 1 of this Agreement that
is not remedied by the Company within thirty (30) days after
receipt of written notice from the Employee of the same;

(2) the Company's requiring the Employee to be regularly based
at any office or location more than 60 miles outside of East
Brunswick, NJ, except for travel reasonably required in the
performance of the Executive's responsibilities; or

(3) any failure by the Company to comply with any of the
provisions of Section 4 of this Agreement that is not
remedied by the Company within thirty (30) days after
receipt of written notice from the Employee of the same.

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Section 6. CONFIDENTIALITY

The Employee is required to sign, as a condition of employment, a confidential
information and invention assignment agreement in the form attached hereto as
Exhibit B (the "Confidentiality Agreement"), the terms of which are incorporated
herein by reference. The Employee's obligation under such Confidentiality
Agreement shall extend beyond the termination of this Employment Agreement as
set forth in the Confidentiality Agreement.

Section 7. CONFLICTING AGREEMENTS

The Employee represents and warrants that he is free to enter into this
Agreement; he has not made, and will not make, any agreements in conflict with
this Agreement; he will not disclose to the Company any trade secrets or
confidential information that are the property of any former employer(s).

Section 8. ASSIGNMENTS

(a) Neither this agreement nor any right or interest hereunder shall
be assignable by the Employee without prior written consent of
the Company or by the Company without prior written consent of
the Employee, except that the Company may assign its rights
hereunder in connection with the sale or disposition of the
business and assets of the Company in whole or in substantial
part.

(b) Except as required by law, no right to receive payments under
this Agreement shall be subject to assignment, encumbrance,
charge, pledge or assignment by operation of law, and any attempt
to effect such action will be void and of no effect.

(c) This Agreement shall be binding upon and inure and to the benefit
of the Company and the Employee and their respective heirs,
administrators, executors, successors and assigns.

Section 9. SEVERABILITY

If any provision of this Agreement shall be declared invalid or unenforceable
the remainder of this Agreement, or the application of such provision in
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each provision of this Agreement shall be
valid and be enforceable to the fullest extent permitted by law.

Section 10. NOTICE

All notices to be sent under this Agreement shall be given in writing and shall
be sufficient when delivered by hand or by recognized courier (such as Federal
Express) or three (3) business days after deposit in the United States Mail, by
registered or certified mail, addressed to the Company, or to the Employee, at
their respective addresses, or to any such other address as may be designated in
writing by each party to the other party hereto.

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Section 11. WAIVERS

The failure of any party to require the performance of any term or obligation of
this Agreement, or the waiver by any party of any breach of this Agreement,
shall not be deemed a waiver of any subsequent breach of this Agreement or such
term or obligation.

Section 12. ENTIRE AGREEMENT

This Agreement constitutes the entire understanding of the Employee and the
Company with respect to the Employee's employment. No modification or waiver of
any provisions of this Agreement shall be made unless made in writing and signed
by the Employee and by such person on behalf of the Company and as the Board of
Directors may designate for such purposes.

Section 13. GOVERNING LAW

The interpretation, construction and application of this Agreement and the
Confidentiality Agreement shall be governed by the internal laws of the State of
New Jersey.

Section 14. CAPTIONS

The captions set forth in this Agreement are for convenience only and shall not
be considered as part of the Agreement or in any way limiting or amplifying the
terms and provisions hereof.

IN WITNESS WHEREOF, the parties have signed, sealed and delivered this Agreement
as of the date first stated above.

ECOSCIENCE CORPORATION

By:________________________
Michael A. DeGiglio
Chief Executive Officer

EMPLOYEE

By:________________________
Kenneth S. Hollander

[exhibits omitted]

EXHIBIT 23

ARTHUR ANDERSEN LLP

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our reports
(and to all references to our Firm) included in or made a part of this
registration statement.

ARTHUR ANDERSEN LLP

Roseland, New Jersey
June 10, 1999