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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q



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(Mark One)

|  |  |                                                                                        
|- |  | ---------------------------------------------------------------------------------------
|x |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 27, 2003

OR

|  |  |                                                                                         
|- |  | ----------------------------------------------------------------------------------------
|o |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to

Commission File Number 000-26519

SEMINIS, INC.

(Exact Name of Registrant as Specified in Its Charter)


|                                                                                 |  |                                                
|-------------------------------------------------------------------------------- |  | -----------------------------------------------
|Delaware
(State or Other Jurisdiction of Incorporation or
Organization)          |  | 36-0769130
(I.R.S. Employer Identification No.)
|2700 Camino del Sol, Oxnard, California
(Address of Principal Executive Offices) |  | 93030-7967
(Zip Code)                          

(805) 647-1572
(Registrants telephone number, including area code)

Not Applicable
(Former name, address and former fiscal year, if changed since last report)

Indicate, by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. YES x NO o

Indicate, by check mark whether the Registrant is an accelerated filer (as
defined in rule 12b-2 of the Exchange Act). YES o NO x

As of July 31, 2003, the Registrant had 19,012,719 registered shares of
Class A Common Stock, $0.01 par value per share, issued and outstanding and
45,142,508 unregistered shares of Class B Common Stock, $0.01 par value per
share, issued and outstanding.



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TABLE OF CONTENTS



|                               |                                                                                               |                                                |  |  |  |  |  | 
|------------------------------ | --------------------------------------------------------------------------------------------- | ---------------------------------------------- |  |  |  |  |  | 
|PART I  FINANCIAL INFORMATION
|                               | Item 1. Financial Statements                                                                 
|                               |                                                                                               | Consolidated Balance Sheets                   
|                               |                                                                                               | Consolidated Statements of Operations         
|                               |                                                                                               | Consolidated Statement of Stockholders Equity
|                               |                                                                                               | Consolidated Statements of Cash Flows         
|                               |                                                                                               | Notes to Consolidated Financial Statements    
|                               | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                               | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|                               | Item 4. Controls and Procedures                                                              
|PART II  OTHER INFORMATION   
|                               | Item 1. Legal Proceedings                                                                    
|                               | Item 6. Exhibits and Reports on Form 8-K                                                     
|Signatures                    
|Certification                 
|EXHIBIT 99.1                  
|EXHIBIT 99.2                  



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##### Table of Contents



SEMINIS, INC.

Form 10-Q
For the Quarterly Period Ended June 27, 2003

TABLE OF CONTENTS

|        |  |                                                                                                           |  |     
|------- |  | --------------------------------------------------------------------------------------------------------- |  | ----
|        |  |                                                                                                           |  | Page
|        |  | PART I  FINANCIAL INFORMATION                                                                            |  |     
|Item 1. |  | Financial Statements                                                                                      |  |     
|        |  | Consolidated Balance Sheets as of June 27, 2003 and
September 30, 2002                                    |  | 3   
|        |  | Consolidated Statements of Operations for the Three and
Nine Months Ended June 27, 2003 and June 28, 2002 |  | 4   
|        |  | Consolidated Statement of Stockholders Equity for the
Nine Months Ended June 27, 2003                    |  | 5   
|        |  | Consolidated Statements of Cash Flows for the Nine Months
Ended June 27, 2003 and June 28, 2002           |  | 6   
|        |  | Notes to Consolidated Financial Statements                                                                |  | 7   
|Item 2. |  | Managements Discussion and Analysis of Financial                                                         |  |     
|        |  | Condition and Results of Operations                                                                       |  | 14  
|Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk                                                |  | 21  
|Item 4. |  | Controls and Procedures                                                                                   |  | 21  
|        |  | PART II  OTHER INFORMATION                                                                               |  |     
|Item 1. |  | Legal Proceedings                                                                                         |  | 22  
|Item 6. |  | Exhibits and Reports on Form 8-K                                                                          |  | 22  
|        |  | Signatures                                                                                                |  | 25  
|        |  | Certification of Results                                                                                  |  | 26  

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PART I  FINANCIAL INFORMATION




Item 1.Financial Statements




SEMINIS, INC.
Consolidated Balance Sheets
(In thousands, except per share data)

|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |          |         | 
|------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------- | ------- | ------------- | ------- | ------------- | ------- | -------- | ------- | 
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         | As of   
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         | As of         |         | September 30,
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         | June 27, 2003 |         | 2002         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |              
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         | (Unaudited)   |         |               |         |         
|Assets:                                                             |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|Current assets                                                      |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    | Cash and cash equivalents                                                                                                                                                                                                                                                                                                              |                                    | $       | 28,130        |         |               | $       | 36,805   |        
|                                                                    | Accounts receivable, less allowances for doubtful accounts
of $14,154 and $12,344, respectively                                                                                                                                                                                                                                        |                                    |         | 175,269       |         |               |         | 140,315  |        
|                                                                    | Inventories                                                                                                                                                                                                                                                                                                                            |                                    |         | 266,150       |         |               |         | 272,527  |        
|                                                                    | Prepaid expenses and other current assets                                                                                                                                                                                                                                                                                              |                                    |         | 4,329         |         |               |         | 2,427    |        
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | Total current assets               |         |               | 473,878 |               |         |          | 452,074 | 
|Property, plant and equipment, net                                  |                                                                                                                                                                                                                                                                                                                                        |                                    | 163,564 |               |         |               | 168,729 |         
|Goodwill, net                                                       |                                                                                                                                                                                                                                                                                                                                        |                                    | 102,706 |               |         |               | 98,931  |         
|Intangible assets, net                                              |                                                                                                                                                                                                                                                                                                                                        |                                    | 54,514  |               |         |               | 61,872  |         
|Other assets                                                        |                                                                                                                                                                                                                                                                                                                                        |                                    | 20,035  |               |         |               | 18,391  |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | $                                  | 814,697 |               |         | $             | 799,997 |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |          |        
|Liabilities, Mandatorily Redeemable Stock and
Stockholders Equity: |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|Current liabilities                                                 |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    | Short-term borrowings                                                                                                                                                                                                                                                                                                                  |                                    | $       | 39,774        |         |               | $       | 28,532   |        
|                                                                    | Current maturities of long-term debt                                                                                                                                                                                                                                                                                                   |                                    |         | 219,454       |         |               |         | 21,709   |        
|                                                                    | Accounts payable                                                                                                                                                                                                                                                                                                                       |                                    |         | 22,784        |         |               |         | 38,179   |        
|                                                                    | Accrued liabilities                                                                                                                                                                                                                                                                                                                    |                                    |         | 97,218        |         |               |         | 98,624   |        
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | Total current liabilities          |         |               | 379,230 |               |         |          | 187,044 | 
|Long-term debt                                                      |                                                                                                                                                                                                                                                                                                                                        |                                    | 14,965  |               |         |               | 228,293 |         
|Deferred income taxes                                               |                                                                                                                                                                                                                                                                                                                                        |                                    | 18,740  |               |         |               | 15,753  |         
|Minority interest in subsidiaries                                   |                                                                                                                                                                                                                                                                                                                                        |                                    | 1,677   |               |         |               | 1,902   |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | Total liabilities                  |         |               | 414,612 |               |         |          | 432,992 | 
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|Commitments and contingencies (see Note 8)                          |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|Mandatorily redeemable stock                                        |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    | Class B Redeemable Preferred Stock, $.01 par value; 25
shares authorized as of June 27, 2003 and September 30,
2002; 25 shares issued and outstanding as of June 27,
2003 and September 30, 2002                                                                                                                                       |                                    |         | 31,000        |         |               |         | 29,500   |        
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | Total mandatorily
redeemable stock |         |               | 31,000  |               |         |          | 29,500  | 
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|Stockholders equity                                                |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    | Class C Preferred Stock, $.01 par value; 17 and 14 shares
authorized as of June 27, 2003 and September 30, 2002,
respectively; 17 and 12 shares issued and outstanding
as of
June 27, 2003 and September 30, 2002, respectively
(Liquidation Value of $191.9 and $138.2 million at June
27, 2003 and September 30, 2002, respectively) |                                    |         | 1             |         |               |         | 1        |        
|                                                                    | Class A Common Stock, $.01 par value; 211,000 shares
authorized as of June 27, 2003 and September 30, 2002;
19,013 and 18,940 shares issued and outstanding as of
June 27, 2003 and September 30, 2002,
respectively                                                                                                                   |                                    |         | 190           |         |               |         | 190      |        
|                                                                    | Class B Common Stock, $.01 par value; 67,000 shares
authorized as of June 27, 2003 and September 30, 2002;
45,142 shares issued and outstanding as of June 27, 2003
and September 30, 2002                                                                                                                                             |                                    |         | 452           |         |               |         | 452      |        
|                                                                    | Additional paid-in-capital                                                                                                                                                                                                                                                                                                             |                                    |         | 697,855       |         |               |         | 699,255  |        
|                                                                    | Accumulated deficit                                                                                                                                                                                                                                                                                                                    |                                    |         | (315,642      | )       |               |         | (324,558 | )      
|                                                                    | Accumulated other comprehensive loss                                                                                                                                                                                                                                                                                                   |                                    |         | (13,771       | )       |               |         | (37,835  | )      
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | Total stockholders equity         |         |               | 369,085 |               |         |          | 337,505 | 
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        | $                                  | 814,697 |               |         | $             | 799,997 |         
|                                                                    |                                                                                                                                                                                                                                                                                                                                        |                                    |         |               |         |               |         |          |        

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

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SEMINIS, INC.
Consolidated Statements of Operations
(In thousands, except per share data)

|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |         |         | 
|------------------------------------------------------------ | -------------------------------------------- | ------------------------ | ------- | -------------------------- | ------ | ------------------------- | ------- | -------- | ------ | -------- | ------- | ------- | ------- | - | ------- | ------- | ------- | 
|                                                             |                                              |                          |         | For the Three Months Ended |        | For the Nine Months Ended
|                                                             |                                              |                          |         |                            |        |                          
|                                                             |                                              |                          |         | June 27,                   |        | June 28,                  |         | June 27, |        | June 28,
|                                                             |                                              |                          |         | 2003                       |        | 2002                      |         | 2003     |        | 2002    
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |         
|                                                             |                                              |                          |         | (Unaudited)                |        | (Unaudited)              
|Net sales                                                    |                                              | $                        | 113,088 |                            |        | $                         | 106,564 |          |        | $        | 352,705 |         |         | $ | 338,952 |        
|Cost of goods sold                                           |                                              |                          | 42,113  |                            |        |                           | 41,581  |          |        |          | 130,354 |         |         |   | 128,325 |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             | Gross profit                                 |                          |         | 70,975                     |        |                           |         | 64,983   |        |          |         | 222,351 |         |   |         | 210,627 |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Operating expenses                                           |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             | Research and development expenses            |                          |         | 12,564                     |        |                           |         | 10,973   |        |          |         | 34,942  |         |   |         | 32,483  |        
|                                                             | Selling, general and administrative expenses |                          |         | 46,685                     |        |                           |         | 43,972   |        |          |         | 138,022 |         |   |         | 132,500 |        
|                                                             | Amortization of intangible assets            |                          |         | 4,014                      |        |                           |         | 4,236    |        |          |         | 11,907  |         |   |         | 12,538  |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             |                                              | Total operating expenses |         |                            | 63,263 |                           |         |          | 59,181 |          |         |         | 184,871 |   |         |         | 177,521 | 
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             | Gain on sale of assets                       |                          |         | 366                        |        |                           |         | 448      |        |          |         | 1,457   |         |   |         | 5,723   |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Income from operations                                       |                                              |                          | 8,078   |                            |        |                           | 6,250   |          |        |          | 38,937  |         |         |   | 38,829  |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Other income (expense)                                       |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             | Interest income                              |                          |         | 120                        |        |                           |         | 104      |        |          |         | 626     |         |   |         | 346     |        
|                                                             | Interest expense                             |                          |         | (8,920                     | )      |                           |         | (7,186   | )      |          |         | (24,361 | )       |   |         | (21,530 | )      
|                                                             | Foreign currency gain (loss)                 |                          |         | 151                        |        |                           |         | 2,838    |        |          |         | 180     |         |   |         | (1,504  | )      
|                                                             | Other, net                                   |                          |         | (930                       | )      |                           |         | 720      |        |          |         | (483    | )       |   |         | 410     |        
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             |                                              |                          | (9,579  | )                          |        |                           | (3,524  | )        |        |          | (24,038 | )       |         |   | (22,278 | )      
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Income (loss) before income taxes                            |                                              |                          | (1,501  | )                          |        |                           | 2,726   |          |        |          | 14,899  |         |         |   | 16,551  |        
|Income tax benefit (expense)                                 |                                              |                          | (1,843  | )                          |        |                           | 1,538   |          |        |          | (5,983  | )       |         |   | (5,944  | )      
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Net income (loss)                                            |                                              |                          | (3,344  | )                          |        |                           | 4,264   |          |        |          | 8,916   |         |         |   | 10,607  |        
|Preferred stock dividends                                    |                                              |                          | (4,660  | )                          |        |                           | (3,496  | )        |        |          | (13,844 | )       |         |   | (10,423 | )      
|Additional capital contribution dividends                    |                                              |                          |        |                            |        |                           | (1,164  | )        |        |          |        |         |         |   | (3,467  | )      
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Net loss available for common
stockholders                   |                                              | $                        | (8,004  | )                          |        | $                         | (396    | )        |        | $        | (4,928  | )       |         | $ | (3,283  | )      
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|Net loss available for common
stockholders per common share: |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        
|                                                             | Basic/diluted                                |                          | $       | (0.12                      | )      |                           | $       | (0.01    | )      |          | $       | (0.08   | )       |   | $       | (0.05   | )      
|                                                             |                                              |                          |         |                            |        |                           |         |          |        |          |         |         |         |   |         |        

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

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SEMINIS, INC.
Consolidated Statement of Stockholders Equity
(In thousands)



|                                                    |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |        |     |   |  |  |        |   |  |   |     |   |  | 
|--------------------------------------------------- | --------------------------------------------------- |  | -- | --------------- |  | ------------ | - | ------------ |  | ------ | ------ | ------ |  | ------ | --- | - |  |  | ------ | - |  | - | --- | - |  | 
|                                                    |                                                     |  |    | Class C         |  | Class A      |   | Class B     
|                                                    |                                                     |  |    | Preferred Stock |  | Common Stock |   | Common Stock
|                                                    |                                                     |  |    |                 |  |              |   |             
|                                                    |                                                     |  |    | Number          |  | Amount       |   | Number       |  | Amount |        | Number |  | Amount
|                                                    |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |       
|Balance, September 30, 2002                         |                                                     |  | 12 |                 |  | $            | 1 |              |  |        | 18,940 |        |  | $      | 190 |   |  |  | 45,142 |   |  | $ | 452 |  
|Comprehensive income                                |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |        |     |   |  |  |        |   |  |   |     |  
|                                                    | Net income (Unaudited)                              |  |    |                |  |              |   |             |  |        |        |       |  |        |     |  |  |  |        |  |  |   |     |  | 
|                                                    | Translation
Adjustment (Unaudited)                  |  |    |                |  |              |   |             |  |        |        |       |  |        |     |  |  |  |        |  |  |   |     |  | 
|Conversion of additional capital                    |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |        |     |   |  |  |        |   |  |   |     |  
|                                                    | Contribution to Class C Preferred
Stock (Unaudited) |  |    | 5               |  |              |   |             |  |        |        |       |  |        |     |  |  |  |        |  |  |   |     |  | 
|Options Exercised (Unaudited)                       |                                                     |  |   |                 |  |              |  |              |  |        | 73     |        |  |        |    |   |  |  |       |   |  |   |    |  
|Dividends on Redeemable Preferred
Stock (Unaudited) |                                                     |  |   |                 |  |              |  |              |  |        |       |        |  |        |    |   |  |  |       |   |  |   |    |  
|                                                    |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |        |     |   |  |  |        |   |  |   |     |  
|Balance, June 27, 2003
(Unaudited)                  |                                                     |  | 17 |                 |  | $            | 1 |              |  |        | 19,013 |        |  | $      | 190 |   |  |  | 45,142 |   |  | $ | 452 |  
|                                                    |                                                     |  |    |                 |  |              |   |              |  |        |        |        |  |        |     |   |  |  |        |   |  |   |     |  

[Additional columns below]

[Continued from above table, first column(s) repeated]

|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |        |  | 
|--------------------------------------------------- | --------------------------------------------------- | - | ------- | ---------- |  | ----------- | -------- | ------------- |  | ------------- | ------- | ----------- |  | - | ------- | ------ |  | 
|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         | Accumulated |  |   |         |       
|                                                    |                                                     |   |         | Additional |  |             |          |               |  | Other         |         | Total      
|                                                    |                                                     |   |         | Paid-In    |  | Accumulated |          | Comprehensive |  | Stockholders
|                                                    |                                                     |   |         | Capital    |  | Deficit     |          | Loss          |  | Equity       
|                                                    |                                                     |   |         |            |  |             |          |               |  |              
|Balance, September 30, 2002                         |                                                     | $ | 699,255 |            |  | $           | (324,558 | )             |  | $             | (37,835 | )           |  | $ | 337,505 |       
|Comprehensive income                                |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |       
|                                                    | Net income (Unaudited)                              |   |         |           |  |             |          | 8,916         |  |               |         |            |  |   |         | 8,916  | 
|                                                    | Translation Adjustment (Unaudited)                  |   |         |           |  |             |          |              |  |               |         | 24,064      |  |   |         | 24,064 | 
|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |       
|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   | 32,980  |       
|Conversion of additional capital                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |       
|                                                    | Contribution to Class C Preferred
Stock (Unaudited) |   |         |           |  |             |          |              |  |               |         |            |  |   |         |       | 
|Options Exercised (Unaudited)                       |                                                     |   | 100     |            |  |             |         |               |  |               |        |             |  |   | 100     |       
|Dividends on Redeemable Preferred
Stock (Unaudited) |                                                     |   | (1,500  | )          |  |             |         |               |  |               |        |             |  |   | (1,500  | )     
|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |       
|Balance, June 27, 2003
(Unaudited)                  |                                                     | $ | 697,855 |            |  | $           | (315,642 | )             |  | $             | (13,771 | )           |  | $ | 369,085 |       
|                                                    |                                                     |   |         |            |  |             |          |               |  |               |         |             |  |   |         |       

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

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Consolidated Statements of Cash Flows
(In thousands)

|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |         |         |         |  
|------------------------------------------------------------ | ----------------------------------------------------------------------------- | --------------------------------------------------- | --------------------------------- | ------- | ------------------------- | ------- | ------------- | ------- | ------- | ------- | -
|                                                             |                                                                               |                                                     |                                   |         | For the Nine Months Ended
|                                                             |                                                                               |                                                     |                                   |         |                          
|                                                             |                                                                               |                                                     |                                   |         | June 27, 2003             |         | June 28, 2002
|                                                             |                                                                               |                                                     |                                   |         |                           |         |              
|                                                             |                                                                               |                                                     |                                   |         | (Unaudited)              
|Cash flows from operating activities:                        |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             | Net income                                                                    |                                                     | $                                 | 8,916   |                           |         | $             | 10,607  |        
|                                                             | Adjustments to reconcile net income to net cash used in operating
activities: |                                                     |                                   |         |                           |         |               |         |        
|                                                             |                                                                               | Depreciation and amortization                       |                                   |         | 22,875                    |         |               |         | 23,993  |        
|                                                             |                                                                               | Gain on sale of fixed assets                        |                                   |         | (1,457                    | )       |               |         | (1,705  | )      
|                                                             |                                                                               | Deferred income taxes                               |                                   |         | 2,156                     |         |               |         | 3,752   |        
|                                                             |                                                                               | Provision for minority interest subsidiary          |                                   |         | 153                       |         |               |         | 616     |        
|                                                             |                                                                               | Inventory write-down                                |                                   |         | 11,104                    |         |               |         | 12,309  |        
|                                                             |                                                                               | Gain on sale of non-core business                   |                                   |         |                          |         |               |         | (4,018  | )      
|                                                             |                                                                               | Compensation expense for restricted stock           |                                   |         |                          |         |               |         | 4,359   |        
|                                                             |                                                                               | Other                                               |                                   |         | 915                       |         |               |         | (4,066  | )      
|                                                             |                                                                               | Changes in assets and liabilities:                  |                                   |         |                           |         |               |         |         |        
|                                                             |                                                                               |                                                     | Accounts receivable               |         |                           | (24,830 | )             |         |         | (14,942 | )
|                                                             |                                                                               |                                                     | Inventories                       |         |                           | 8,766   |               |         |         | 5,198   |  
|                                                             |                                                                               |                                                     | Prepaid expenses and other assets |         |                           | (8,591  | )             |         |         | (3,753  | )
|                                                             |                                                                               |                                                     | Current income taxes              |         |                           | (63     | )             |         |         | (3,953  | )
|                                                             |                                                                               |                                                     | Accounts payable                  |         |                           | (17,376 | )             |         |         | (25,505 | )
|                                                             |                                                                               |                                                     | Other liabilities                 |         |                           | (6,158  | )             |         |         | (448    | )
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             |                                                                               | Net cash provided by (used in) operating activities |                                   |         | (3,590                    | )       |               |         | 2,444   |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|Cash flows from investing activities:                        |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             | Purchases of fixed and intangible assets                                      |                                                     |                                   | (9,546  | )                         |         |               | (8,767  | )      
|                                                             | Proceeds from disposition of assets                                           |                                                     |                                   | 8,969   |                           |         |               | 25,758  |        
|                                                             | Proceeds from sale of non-core business                                       |                                                     |                                   |        |                           |         |               | 17,551  |        
|                                                             | Other                                                                         |                                                     |                                   | (36     | )                         |         |               | (569    | )      
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             |                                                                               | Net cash provided by (used in) investing activities |                                   |         | (613                      | )       |               |         | 33,973  |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|Cash flows from financing activities:                        |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             | Proceeds from long-term debt                                                  |                                                     |                                   | 686     |                           |         |               | 1,636   |        
|                                                             | Repayment of long-term debt                                                   |                                                     |                                   | (16,754 | )                         |         |               | (56,902 | )      
|                                                             | Net short-term borrowings                                                     |                                                     |                                   | 8,170   |                           |         |               | 14,981  |        
|                                                             | Other                                                                         |                                                     |                                   | 100     |                           |         |               |        |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|                                                             |                                                                               | Net cash used in financing activities               |                                   |         | (7,798                    | )       |               |         | (40,285 | )      
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|Effect of exchange rate changes on cash and cash equivalents |                                                                               |                                                     | 3,326                             |         |                           |         | 2,370         |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|Decrease in cash and cash equivalents                        |                                                                               |                                                     | (8,675                            | )       |                           |         | (1,498        | )      
|Cash and cash equivalents, beginning of period               |                                                                               |                                                     | 36,805                            |         |                           |         | 22,323        |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |        
|Cash and cash equivalents, end of period                     |                                                                               | $                                                   | 28,130                            |         |                           | $       | 20,825        |        
|                                                             |                                                                               |                                                     |                                   |         |                           |         |               |         |        

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

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SEMINIS, INC.
Notes to Consolidated Financial Statements
(In Thousands, Except Per Share Data)

Note 1  Summary of Significant Accounting Policies

Description of Business

Seminis, Inc. (Seminis, we or the Company) is the leading worldwide
developer, producer and marketer of vegetable and fruit seeds. The Company is a
majority-owned subsidiary of Savia, S.A. de C.V. (Savia) and effectively
began operations when it purchased Asgrow Seed Company in December 1994.

Basis of Presentation

The consolidated financial statements include the accounts of the Company and
its majority controlled and owned subsidiaries. Investments in unconsolidated
entities, representing ownership interests between 20% and 50%, are accounted
for using the equity method of accounting. All material intercompany
transactions and balances have been eliminated in consolidation. Certain
reclassifications have been made to prior periods to conform to the current
quarter presentation.

Seminis generally operates on a 13 week quarter closing on the Friday closest
to the natural calendar quarter, except for the fiscal year end, which closes
on September 30.

The unaudited consolidated financial statements included herein reflect all
adjustments (consisting only of normal recurring adjustments) that the Company
considers necessary for a fair presentation of the results of operations for
the interim periods covered and the financial condition of the Company at
the date of the interim balance sheet. The Companys business is subject to
seasonal fluctuation and, therefore, the results of operations for periods less
than one year are not necessarily indicative of results that may be expected
for any other interim period or for the fiscal year as a whole.

Supplementary Cash Flow Information

|                                          |                                              |   |                   |       |          |   |        |       | 
|----------------------------------------- | -------------------------------------------- | - | ----------------- | ----- | -------- | - | ------ | ----- | 
|                                          |                                              |   | Nine Months Ended
|                                          |                                              |   |                  
|                                          |                                              |   | June 27,          |       | June 28,
|                                          |                                              |   | 2003              |       | 2002    
|                                          |                                              |   |                   |       |         
|                                          |                                              |   | (Unaudited)      
|Cash paid for interest                    |                                              | $ | 18,288            |       |          | $ | 18,993 |      
|Cash paid for income taxes                |                                              |   | 3,890             |       |          |   | 6,145  |      
|Supplemental non-cash transactions:       |                                              |   |                   |       |          |   |        |      
|                                          | Class C Preferred Stock dividends            |   |                   |      |          |   |        | 8,923 | 
|                                          | Class B Redeemable Preferred Stock
dividends |   |                   | 1,500 |          |   |        | 1,500 | 
|Additional capital contribution dividends |                                              |   |                  |       |          |   | 3,467  |      

Effective January 2001, shares of Seminis Class C Preferred Stock and
additional capital contribution accrue cash dividends at 10% per annum. The
Companys syndicated credit facility, however, precludes the payment of cash
dividends. These dividends have not been accrued effective July 1, 2002 in
accordance with an amended and restated exchange agreement by and between the
Company and Savia, as further described in Note 2. As part of the amended and
restated agreement, Savia agreed to forego dividends on its shares of Seminis
Class C Preferred Stock and additional capital contributions effective July 1,
2002; however, such dividends would be payable if the transactions described in
Note 2 are not completed and the amended and restated agreement is terminated.

Loss per Common Share

Net loss per common share has been computed pursuant to the provisions of
Statement of Financial Accounting Standards (SFAS ) No. 128, Earnings per
Share. Basic loss per common share is computed by dividing net loss available
to common stockholders by the average number of common shares outstanding
during each period. Net loss available to common stockholders represents
reported net income (loss) less preferred and additional capital contribution
dividends. Diluted net loss per common share reflects the potential

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dilution that could occur if dilutive securities and other contracts were
exercised or converted into common stock or resulted in the issuance of common
stock. The following table provides a reconciliation of net income (loss) and
sets forth the computation for basic and diluted net loss per share available
for common stockholders.

|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |              |  
|------------------------------------------------------------ | ---------------------------------------------------- | - | ------------------ | ------------ | ----------------- | - | -------- | ------------ | -------- | - | ------- | ------------ | - | - | ------- | ------------ | -
|                                                             |                                                      |   | Three Months Ended |              | Nine Months Ended
|                                                             |                                                      |   | June 27,           |              | June 28,          |   | June 27, |              | June 28,
|                                                             |                                                      |   | 2003               |              | 2002              |   | 2003     |              | 2002    
|                                                             |                                                      |   |                    |              |                   |   |          |              |         
|                                                             |                                                      |   | (Unaudited)        |              | (Unaudited)      
|Numerator for basic and diluted:                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|Net income (loss)                                            |                                                      | $ | (3,344             | )            |                   | $ | 4,264    |              |          | $ | 8,916   |              |   | $ | 10,607  |             
|Preferred stock dividends                                    |                                                      |   | (500               | )            |                   |   | (3,496   | )            |          |   | (1,500  | )            |   |   | (10,423 | )           
|Additional capital contribution dividends                    |                                                      |   |                   |              |                   |   | (1,164   | )            |          |   |        |              |   |   | (3,467  | )           
|Contingent dividends payable                                 |                                                      |   | (4,160             | )            |                   |   |         |              |          |   | (12,344 | )            |   |   |        |             
|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|                                                             | Net loss available for common
stockholders           |   | $                  | (8,004       | )                 |   | $        | (396         | )        |   | $       | (4,928       | ) |   | $       | (3,283       | )
|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|Denominator  shares:                                        |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|                                                             | Weighted average common shares
outstanding (basic)   |   |                    | 64,155       |                   |   |          | 62,746       |          |   |         | 64,111       |   |   |         | 61,619       |  
|                                                             | Add: potential common shares:                        |   |                    |             |                   |   |          |             |          |   |         |             |   |   |         |             |  
|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|                                                             | Weighted average common shares
outstanding
(diluted) |   |                    | 64,155       |                   |   |          | 62,746       |          |   |         | 64,111       |   |   |         | 61,619       |  
|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|Net loss available for common
Stockholders per common share: |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             
|                                                             | Basic/ diluted                                       |   | $                  | (0.12)/(0.12 | )                 |   | $        | (0.01)/(0.01 | )        |   | $       | (0.08)/(0.08 | ) |   | $       | (0.05)/(0.05 | )
|                                                             |                                                      |   |                    |              |                   |   |          |              |          |   |         |              |   |   |         |             

A total of 4.1 million potential shares from options were excluded from the
computation of diluted earnings per share for the three and nine months ended
June 27, 2003, due to their antidilutive effect. A total of 4.4 million
potential shares from options were excluded from the computation of diluted
earnings per share for the three and nine months ended June 28, 2002, due to
their antidilutive effect.

Contingently payable dividends represent dividends that may be
payable to Savia if the exchange contemplated by the amended and restated
exchange agreement described in Note 2 is not consummated. As part of the
amended and restated exchange agreement, Savia agreed to forego dividends on
its shares of Seminis Class C Preferred Stock and additional capital
contributions effective July 1, 2002; however, such dividends would be payable
if the transactions contemplated by the amended and restated exchange agreement
are not completed and the amended and restated exchange agreement is
terminated. These dividends have not been accrued but are included in the
calculation of earnings per share.

Recent Accounting Pronouncements

In August 2001, the Financial Accounting Standards Board (FASB) issued SFAS
No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS
No. 144 supersedes SFAS No. 121 but retains many of its fundamental provisions.
In addition, SFAS No. 144 expands the scope of discontinued operations to
include more disposal transactions. We have adopted SFAS No. 144 as of October
1, 2002. The adoption of SFAS No. 144 did not have a material effect on our
consolidated financial position, results of operations or cash flows.

In May 2002, the FASB issued SFAS No. 145, Rescission of SFAS Nos. 4, 44 and
64, Amendment of SFAS No. 13 and Technical Corrections. Among other things,
SFAS No. 145 rescinds various pronouncements regarding extinguishment of debt
and allows extraordinary accounting treatment for early extinguishment only
when the provisions of Accounting Principles Board Opinion No. 30, Reporting
the Results of Operations-Reporting the Effects of Disposal of a Segment of a
Business and Extraordinary, Unusual and Infrequent Occurring Events and
Transactions are met. SFAS No. 145 provisions regarding early extinguishment
of debt are generally effective for fiscal years beginning after May 15, 2002.
Accordingly, SFAS No. 145 was adopted by the Company on October 1, 2002. Such
adoption did not have an impact on our business, consolidated financial
position, results of operations or cash flow.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated
with Exit or Disposal Activities. SFAS No. 146 supersedes previous accounting
guidance, principally Emerging Issues Task Force Issue No. 94-3, Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit
an Activity (Including Certain Costs Incurred in a Restructuring).

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SFAS No. 146 requires that the liability for costs associated with an exit or
disposal activity be initially measured at fair market value and recognized
when the liability is incurred. In periods subsequent to initial measurement,
changes to the liability are measured using the credit-adjusted risk-free rate
that was used in the initial measurement of the liability recorded. The
cumulative effect of a change resulting from revisions either to the timing or
the amount of estimated cash flow is recognized as an adjustment to the
liability in the period of the change and charged to the same line items in the
statement of operations used when the related costs were initially recognized.
Under EITF No. 94-3, a liability for an exit cost was recognized at the date of
the Companys commitment to an exit plan.

The provisions of SFAS No. 146 are required to be applied prospectively to exit
or disposal activities initiated after December 31, 2002. The Company believes
SFAS No. 146 may affect the timing of recognizing future restructuring costs,
as well as the amounts recognized, depending on the nature of the exit or
disposal activity and the timing of the related estimated cash flows.

On November 25, 2002, the Financial Accounting Standards Board issued FASB
Interpretation No. (FIN 45, Guarantors Accounting and Disclosure
Requirements for Guarantees of Indebtedness of Others, Including Indirect
Guarantees of Indebtedness of Others, an interpretation of FASB Statements No.
5, 57 and 107 and Rescission of FASB interpretation No. 34. FIN 45 clarifies
the requirements of FASB Statement No. 5, Accounting for Contingencies,
relating to the guarantors accounting for and disclosure of, the issuance of
certain types of guarantees. The disclosure provisions of the interpretation
are effective for financial statements of interim or annual periods that end
after December 15, 2002. Accordingly, the Company adopted FIN 45 during the
quarter ended December 27, 2002. The Company has no guarantees that would
require disclosure under FIN 45.

In January 2003, the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation-Transition and Disclosure, an amendment of FASB Statement No.
123. SFAS No. 148 provides alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock-based employee
compensation. It also requires disclosures in both annual and interim financial
statements about the method of accounting for stock-based employee compensation
and the effect of the method used on reported results. SFAS No. 148 is
effective for annual and interim periods beginning after December 15, 2002. As
we have elected not to change to the fair value based method of accounting for
stock-based employee compensation, the adoption of SFAS No. 148 will not have
an impact upon our financial condition or results of operations.

In January 2003, the FASB issued Interpretation No. 46, Consolidation of
Variable Interest Entities  an Interpretation of Accounting
Research Bulletin (ARB) No. 51. This
interpretation clarifies the application of ARB No. 51, Consolidated Financial Statements, to certain entities in which equity
investors do not have the characteristics of a controlling financial interest
or do not have sufficient equity at risk for the entity to finance its
activities without additional subordinated financial support from other
parties. The provisions of this Interpretation are effective for all
enterprises with variable interests in variable interest entities created after
January 31, 2003. The adoption of this Interpretation did not have a
significant impact on the Companys financial condition or results of
operations.

In April 2003, the FASB issued SFAS No. 149, Amendment of Statement 133 on
Derivative Instruments and Hedging Activities. This Statement amends and
clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts
(collectively referred to as derivatives) used for hedging activities under
SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities.
The provisions of this Statement are effective for contracts entered into or
modified after June 30, 2003 and for hedging relationships designated after
June 30, 2003. The adoption of this Statement is not expected to have
significant impact on the Companys financial condition or results of
operations.

In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity. This
Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. This Statement requires that an issuer classify a financial instrument
that is within its scope as a liability (or an asset in some circumstances).
The provisions of this Statement are effective for financial instruments
entered into or modified after May 31, 2003, and otherwise are effective at the
beginning of the first interim period beginning after June 15, 2003. Upon
adoption of this Statement, the Company will have to restate the carrying value
of its mandatorily redeemable preferred stock to the present value of this
obligation and reclassify this amount into liabilities on the balance sheet.
Additionally, amounts previously accrued as dividends on the mandatorily
redeemable preferred stock will be expensed in the statement of operation as
interest expense.

Note 2  Liquidity

As of September 30, 2000, we were not in compliance with certain covenants of
our existing syndicated credit facility, which gave the lenders the right to
accelerate payment of all amounts outstanding under the facility. In December
2000, the lenders granted a waiver with respect to these covenants that
extended through April 30, 2001, at which time any defaults would once again
arise. As we did

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not expect to be in compliance with our covenants once the waiver expired, all
outstanding borrowings under the syndicated credit facility were classified as
a current liability as of September 30, 2000. In connection with granting the
waivers, the lenders agreed to reschedule principal payments within fiscal year
2001. The lenders also accelerated the final maturity of the term loan and the
termination date for the revolving credit commitments to June 30, 2002 from
June 30, 2004. We were obligated to deliver a financial plan through September
30, 2002, which detailed cash flow projections on a monthly basis as well as
proposed alternatives for the refinancing of the syndicated credit facility or
recapitalization of the Company.

On May 31, 2001, our lenders agreed with the financial plan that we submitted
and agreed to restructure our existing syndicated credit facility. Upon receipt
of the amended syndicated credit facility, long-term portions of borrowings
were reclassified from current liabilities to long-term debt. Among other
things, the amendment extended the final maturity of the syndicated credit
facility from the previously agreed on date of June 30, 2002 to December 31,
2002, revised principal payment dates under the term loan, instituted a new
grid pricing formula to determine interest on borrowings and revised covenant
obligations. Interim principal obligations under the amendment included $16.0
million due in the fourth quarter of fiscal year 2001 and $19.0 million, $4.0
million, $31.0 million and $9.0 million due in the first, second, third and
fourth quarters of fiscal year 2002, respectively. All remaining amounts were
due in the first quarter of fiscal year 2003.

In October 2001, we completed the sale of an office building in Seoul, South
Korea, which generated net proceeds of approximately $20.0 million. We used
$19.5 million of the proceeds to make the scheduled $19.0 million payment on
the syndicated credit facility in October 2001. We also sold one of our
non-core businesses in January 2002, which generated additional proceeds of
approximately $17.6 million. We used $13.0 million of the proceeds to prepay
our existing syndicated credit facility in January 2002 and utilized our
operating cash flow to pay the remaining $18.0 million in June 2002.

We met all required principal and interest payments during fiscal years 2002
and 2001 and were in compliance with all of our financial covenants under the
amended syndicated credit facility at September 30, 2002. In October 2002, we
paid an additional $5.0 million of principal as required by the amended
syndicated credit facility; however, as of December 31, 2002, we had not
completed a refinancing transaction in order to pay the remaining balance of
$224.7 million. The lenders agreed to temporarily extend the term of the
syndicated credit facility and in January 2003, a formal amendment was
executed. Among other things, the amendment extended the final maturity of the
syndicated credit facility from the previously agreed on date of December 31,
2002 to December 31, 2003, revised principal payment dates under the term loan,
instituted a new grid pricing formula to determine interest on borrowings and
revised covenant obligations. Outstanding interim principal obligations under
the amendment included $6.0 million due in the fourth quarter of fiscal year
2003. The remaining outstanding amount totaling $210.6 million will be due in
the first quarter of fiscal year 2004. We met all required principal and
interest payments and were in compliance with all of our financial covenants at
June 27, 2003 under the newly extended amendment. As all remaining amounts
under the amended syndicated credit facility are due within one year, the
$216.6 million of outstanding borrowings under the syndicated credit facility
has been classified as a current liability as of June 27, 2003.

On May 30, 2003, we and/or certain other parties entered into an amended and
restated exchange agreement, a contribution agreement, an agreement and plan of
merger, a stock purchase agreement and certain other related agreements
pursuant to which an acquisition company was formed at the direction of Fox
Paine & Company, LLC, a San Francisco based private equity firm, to acquire all
of the outstanding shares of the Companys common stock. Public holders of
approximately 15.8 million shares of Seminis common stock will receive cash
consideration of $3.78 per share in the merger. Immediately following the
merger and related transactions, Fox Paine, its affiliates and co-investors
will own approximately 75% of the shares of Seminis common stock outstanding following
the completion of the transactions, and the remaining shares will be owned by
certain affiliates of Alfonso Romo Garza, Seminis and Savias current Chairman
and Chief Executive Officer, certain creditors of a Savia affiliate and nine
members of Seminis and Savia management. Additionally, certain entities
affiliated with Mr. Romo will receive co-investment rights to purchase, subject
to certain conditions, up to 34% of the outstanding shares of Seminis
common stock following the transactions.
Following the merger and related transactions, the Company will be privately
held and Seminis common stock will no longer be listed on The Nasdaq National
Market. Seminis stockholders representing approximately 85% of the voting
power represented by the outstanding shares of Seminis common stock currently
entitled to vote have entered into a voting agreement to vote in favor of the
merger.

Prior to the consummation of the merger and pursuant to the terms of the
amended and restated exchange agreement, Savia will exchange all of its
outstanding shares of Seminis Class C preferred stock (including
accrued Paid In Kind (PIK)
dividends) having a principal value of $120.2 million, additional paid-in
capital (including accrued PIK dividends) of $46.7 million and accrued and
unpaid dividends for 37.7 million shares of Seminis Class A Common Stock and
cash equal to $15.0 million plus interest at a rate of 10.0% per annum from
July 1, 2002, less $3.0 million.

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Although we have met our obligations and covenant requirements under the
amended syndicated credit facility through June 27, 2003, we must successfully
execute a refinancing plan prior to December 31, 2003 in order to meet the
final maturity of the facility. The consummation of the proposed transactions
require the Companys amended syndicated credit facility to be refinanced. It
is anticipated that the proposed transactions would be funded, in part, by
financing arranged by the newly-formed acquisition company. There can be no
assurances that the merger and related transactions will be consummated.
Failure to comply with existing covenants in the amended syndicated credit
facility, which would make the facility callable, or our inability to refinance
the facility prior to December 31, 2003, could have a material adverse impact
on our business, results of operations or financial condition.

Note 3  Inventories

Inventories consist of the following:

|                               |  |               |         |                    |  |   |         | 
|------------------------------ |  | ------------- | ------- | ------------------ |  | - | ------- | 
|                               |  | June 27, 2003 |         | September 30, 2002
|                               |  |               |         |                   
|                               |  | (Unaudited)   |         |                    |  |  
|Seed                           |  | $             | 236,622 |                    |  | $ | 238,448 | 
|Unharvested crop growing costs |  |               | 21,880  |                    |  |   | 27,199  | 
|Supplies                       |  |               | 7,648   |                    |  |   | 6,880   | 
|                               |  |               |         |                    |  |   |         | 
|                               |  | $             | 266,150 |                    |  | $ | 272,527 | 
|                               |  |               |         |                    |  |   |         | 

Note 4  Goodwill

Changes in the net carrying amount of goodwill for the period ended June 27,
2003, are as follows:

|                                              |                                                 |   |         |     | 
|--------------------------------------------- | ----------------------------------------------- | - | ------- | --- | 
|                                              |                                                 |   | Amount 
|                                              |                                                 |   |        
|Balance as of September 30, 2002              |                                                 | $ | 98,931  |    
|                                              | Goodwill acquired during the period (unaudited) |   |         | 304 | 
|                                              | Impairment losses (unaudited)                   |   |         |    | 
|Translation adjustments and other (unaudited) |                                                 |   | 3,471   |    
|                                              |                                                 |   |         |    
|Balance as of June 27, 2003 (unaudited)       |                                                 | $ | 102,706 |    
|                                              |                                                 |   |         |    

Goodwill acquired during the period
resulted from the purchases of minority holdings of Selekta, a South
African subsidiary and Nath Sluis, an Indian subsidiary.

Note 5  Intangibles

The following table sets forth the Companys intangible assets, at June 27,
2003 and September 30, 2002, which continue to be amortized:

|                               |  |                 |         |                    |  |                 |         |                 |  |              |        |                 |  |   |         |  |  |   |         |  |  |   |        | 
|------------------------------ |  | --------------- | ------- | ------------------ |  | --------------- | ------- | --------------- |  | ------------ | ------ | --------------- |  | - | ------- |  |  | - | ------- |  |  | - | ------ | 
|                               |  | June 27, 2003   |         | September 30, 2002
|                               |  |                 |         |                   
|                               |  | Gross           |         | Accumulated        |  | Net             |         | Gross           |  | Accumulated  |        | Net            
|                               |  | Carrying Amount |         | Amortization       |  | Carrying Amount |         | Carrying Amount |  | Amortization |        | Carrying Amount
|                               |  |                 |         |                    |  |                 |         |                 |  |              |        |                
|                               |  | (Unaudited)     |         | (Unaudited)        |  | (Unaudited)     |         |                 |  |              |        |                 |  |   |         |  |  |  
|Amortizable
intangible assets: |  |                 |         |                    |  |                 |         |                 |  |              |        |                 |  |   |         |  |  |   |         |  |  |   |        | 
|Germplasm                      |  | $               | 101,948 |                    |  | $               | 76,614  |                 |  | $            | 25,334 |                 |  | $ | 99,844  |  |  | $ | 71,431  |  |  | $ | 28,413 | 
|Software costs                 |  |                 | 35,984  |                    |  |                 | 25,585  |                 |  |              | 10,399 |                 |  |   | 33,922  |  |  |   | 20,697  |  |  |   | 13,225 | 
|Trademarks                     |  |                 | 14,900  |                    |  |                 | 8,306   |                 |  |              | 6,594  |                 |  |   | 14,900  |  |  |   | 7,772   |  |  |   | 7,128  | 
|Other intangibles              |  |                 | 27,653  |                    |  |                 | 15,466  |                 |  |              | 12,187 |                 |  |   | 25,953  |  |  |   | 12,847  |  |  |   | 13,106 | 
|                               |  |                 |         |                    |  |                 |         |                 |  |              |        |                 |  |   |         |  |  |   |         |  |  |   |        | 
|Total                          |  | $               | 180,485 |                    |  | $               | 125,971 |                 |  | $            | 54,514 |                 |  | $ | 174,619 |  |  | $ | 112,747 |  |  | $ | 61,872 | 
|                               |  |                 |         |                    |  |                 |         |                 |  |              |        |                 |  |   |         |  |  |   |         |  |  |   |        | 

Amortization expense on intangible assets was $4.0 and $4.2 million for the
three months ended June 27, 2003 and June 28, 2002, respectively; and $11.9 and
$12.5 million for the nine months ended June 27, 2003 and June 28, 2002,
respectively. Based on current information, estimated amortization expense for
acquired intangible assets for this fiscal year, and for each of the next four
succeeding fiscal years, is expected to be approximately $15.8, $14.5, $13.5,
$12.6 and $12.0 million, respectively.

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Note 6  Accrued Liabilities

Accrued liabilities consist of the following at June 27, 2003 and September 30,
2002:

|                                       |  |               |        |                    |  |   |        | 
|-------------------------------------- |  | ------------- | ------ | ------------------ |  | - | ------ | 
|                                       |  | June 27, 2003 |        | September 30, 2002
|                                       |  |               |        |                   
|                                       |  | (Unaudited)   |        |                    |  |  
|Employee salaries and related benefits |  | $             | 44,833 |                    |  | $ | 44,754 | 
|Severance                              |  |               | 555    |                    |  |   | 3,269  | 
|Seedmens errors and omissions         |  |               | 5,291  |                    |  |   | 4,072  | 
|Interest                               |  |               | 387    |                    |  |   | 412    | 
|Savia dividends and interest payable   |  |               | 26,548 |                    |  |   | 25,383 | 
|Income taxes payable                   |  |               | 3,075  |                    |  |   | 3,236  | 
|Other                                  |  |               | 16,529 |                    |  |   | 17,498 | 
|                                       |  |               |        |                    |  |   |        | 
|                                       |  | $             | 97,218 |                    |  | $ | 98,624 | 
|                                       |  |               |        |                    |  |   |        | 

Note 7  Stock-Based Compensation

The Company has a policy whereby all stock option grants are priced at fair
market value on the date of grant. Under the provisions of SFAS No. 123,
Accounting for Stock-Based Compensation, the Company uses the intrinsic value
method of accounting for stock-based compensation in accordance with Accounting
Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to
Employees. Under the intrinsic value method, compensation cost is the excess,
if any, of the quoted market price of the stock at the grant date or other
measurement date over the amount an employee must pay to acquire the stock.

In accordance with the disclosure provisions of SFAS No. 148, Accounting for
Stock-Based Compensation-Transition and Disclosures, the following table
reflects pro forma net income and earnings per share had the Company elected to
adopt the fair value approach of SFAS No. 123:

|                                                                         |  |                            |        |                           |  |               |       |               |  |   |        |   |  |   |        |  
|------------------------------------------------------------------------ |  | -------------------------- | ------ | ------------------------- |  | ------------- | ----- | ------------- |  | - | ------ | - |  | - | ------ | -
|                                                                         |  | For The Three Months Ended |        | For The Nine Months Ended
|                                                                         |  |                            |        |                          
|                                                                         |  | June 27, 2003              |        | June 28, 2002             |  | June 27, 2003 |       | June 28, 2002
|                                                                         |  |                            |        |                           |  |               |       |              
|                                                                         |  | (Unaudited)                |        | (Unaudited)              
|Net loss available for
common stockholders, as
reported                  |  | $                          | (8,004 | )                         |  | $             | (396  | )             |  | $ | (4,928 | ) |  | $ | (3,283 | )
|Compensation expense, net
of
tax                                         |  |                            | (182   | )                         |  |               | (258  | )             |  |   | (547   | ) |  |   | (578   | )
|                                                                         |  |                            |        |                           |  |               |       |               |  |   |        |   |  |   |        |  
|Pro forma net loss
available for common
stockholders                     |  | $                          | (8,186 | )                         |  | $             | (654  | )             |  | $ | (5,475 | ) |  | $ | (3,861 | )
|                                                                         |  |                            |        |                           |  |               |       |               |  |   |        |   |  |   |        |  
|Net loss available for
common stockholders per
common share as reported: |  |                            |        |                           |  |               |       |               |  |   |        |   |  |   |        |  
|Basic/ diluted                                                           |  | $                          | (0.12  | )                         |  | $             | (0.01 | )             |  | $ | (0.08  | ) |  | $ | (0.05  | )
|Pro forma net loss
available for common
stockholders per common
share:   |  |                            |        |                           |  |               |       |               |  |   |        |   |  |   |        |  
|Basic/diluted                                                            |  | $                          | (0.13  | )                         |  | $             | (0.01 | )             |  | $ | (0.09  | ) |  | $ | (0.06  | )

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Note 8  Contingencies

In January 2002, melon growers in Costa Rica notified us that our Dorado melon
seeds were infected with watermelon fruit blotch. Growers who purchased the
infected Seminis seeds and growers whose crops were infected by the bacteria
that spread from crops grown with the infected seeds have claimed damages
against us. The claims by those growers who purchased Seminis seeds have been
settled for approximately $5.8 million, of which, approximately $2.6 million
was recovered under our errors and omissions insurance policy and the remainder
of the settlement was paid by the Company by July 2002. The claims by the
growers with infected crops total approximately $4.7 million and we believe
these claims are covered under our general liability insurance policy. We have
finalized a settlement of nearly all of these claims. Our general liability
insurance carrier continues to deny coverage, and we are continuing to
negotiate with them on this matter. In the event we cannot finalize the
settlement with our general liability insurance carrier, we plan to seek all
legal remedies and redress available to us against the carrier.

In early 2000, we filed a suit against Dietrich Schmidt, the former president
of Seminis and the current president of United Genetics, a competitor of ours,
United Genetics and two former Seminis breeders, Ken Owen and Wei Ouyang, for
trade secret misappropriation and breach of contract. Schmidt filed a
counterclaim for defamation against us. We were unsuccessful on our claims for
trade secret misappropriation and breach of contract and Schmidt was successful
on his counterclaim, with the court awarding him $1 in nominal damages. The
court subsequently awarded Schmidt, Owen and Ouyang their attorneys fees. We
have appealed certain aspects of the judgment, including the fee award. The
appeal is still pending and is not expected to be decided until late 2003.

Between December 17, 2002 and January 31, 2003, five purported class action
lawsuits were filed relating to the proposed transaction under which Fox Paine
and several Savia-related parties would acquire all of the outstanding shares
of Seminis. Four of these actions  Garry Firth v. Alfonso Romo Garza, et al.,
Civil Action No. 20085, Boris Pozniak v. Alfonso Romo Garza,
et al., Civil
Action No. 20097, Pablo Herranz v. Seminis, Inc., et al.,Civil Action No.
20105 and Haven Capital Management v. Seminis, Inc., et al.,Civil Action No.
20140-NC were filed in the Delaware Court of Chancery (New Castle, County),
while the fifth, Mark Rosales v. Seminis, Inc.,Case No. CIV216255, was filed
in California Superior Court (Ventura County). In February 2003, the Firth,
Pozniak, Herranzand Haven Capitalcases were consolidated into one proceeding
entitled In re Seminis, Inc. Shareholders Litigation, Consolidated C.A. No.
20140-NC and the Haven Capitalcomplaint was designated as the operative
complaint in the consolidated lawsuit. That complaint names as defendants
Savia, Seminis and Seminis directors. The Rosales(California) complaint
names as defendants Seminis and its directors. Both the Delaware consolidated
action and the Rosalesaction purport to be brought on behalf of Seminis common
stockholders or their successors. Both of these actions-which were brought
prior to the public announcement of Seminis entering into the merger
agreement-allege that the merger, if consummated, would provide insufficient
consideration to Seminis common stockholders and allege that the defendants
breached their fiduciary duties in connection with the transaction. The
complaints seek a preliminary and permanent injunction to enjoin the
transaction and, in the event the transaction is consummated, rescission and
damages. No provision for loss has been made in
the accompanying consolidated financial statements, as the
probability of an unfavorable outcome and the amount of loss, if any,
are not determinable at this time.

During the last months of fiscal year
2002, Seminis subsidiary in Spain sold Boludo tomato seed to
growers in the Canary Islands of Spain. Subsequently, some fields
planted with this seed showed symptoms of the bacteria, Clavibacter
michiganses, which can be seed borne, among other possible
sources. Seminis has been conducting an investigation of the seeds
and until July 31, 2003, all Seminis seed used in these fields
that had been tested, tested negative for the presence of the bacteria. Spanish authorities
requested an analysis of all seed lots sold in the Canary Islands. On
July 31, 2003, Seminis was notified that after analyzing 89 lots
of Boludo seed, a single seed lot tested positive for the presence of
the bacteria. Seminis believes that other factors that may cause the
disease were present at the time of the infection, and could be
responsible for, or contributing factors to, the presence of the
bacteria and damage to the crops. These factors include, but are not
limited to: poor sanitary practices in the growers fields
(failure to remove debris from prior harvests); bacteria from sources
other than Seminis that remained in the fields from prior seasons;
the practice of grafting, which can magnify the effects of small
outbreaks and weaken the crops; failure to properly rotate crops from
season to season; and third-party isolates (different strains) of the
disease that may have been present. Seminis continues to
investigate this matter vigorously, in particular investigating the single
positive test result, which is inconsistent with the findings of all of
the other independent laboratories test results for Seminis
seed lots. Seminis does not believe that its Boludo tomato
seeds sold in the Canary Islands caused any bacterial damage.
Notwithstanding the foregoing, tomato
growers may initiate legal claims against the Company alleging that
Seminis seeds were the source of the bacteria and claiming
significant damages and Seminis cannot predict the outcome of any
such claims, if initiated.

We are involved from time to time as a
defendant in various other lawsuits arising in
the normal course of business. We believe that no current claims, individually
or in the aggregate, will have a material adverse effect on our business,
results of operations or financial condition.

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Item 2.Managements Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the
consolidated financial statements, including the notes thereto, appearing
elsewhere herein. The following discussion and analysis contains certain
forward-looking statements, which are subject to certain risks, uncertainties
and contingencies, including, without limitation, those set forth below, which
could cause Seminis actual business, results of operations or financial
condition to differ materially from those expressed in or implied by such
statements.

RISK FACTORS

Readers should be aware that there are various risk factors including, but not
limited to, those set forth below:



| |  | We have experienced losses in the past and we may experience losses in the
future.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| 
| |  | As of December 31, 2002, we had not completed a refinancing
transaction in order to pay the remaining balance of our syndicated
credit facility totaling $224.7 million. The lenders agreed to
temporarily extend the term of the syndicated credit facility and in
January 2003, a formal amendment was executed. Among other things, the
amendment extended the final maturity of the syndicated credit
facility from the previously agreed upon date of December 31, 2002 to
December 31, 2003, revised principal payment dates under the term
loan, instituted a new grid pricing formula to determine interest on
borrowings and revised covenant obligations. Outstanding interim
principal obligations under the amendment included $6.0 million due in
the fourth quarter of fiscal year 2003. The remaining outstanding
amount totaling $210.6 million will be due in the first quarter of
fiscal year 2004. Whereas we have met our obligations as well as
covenant requirements under the amended syndicated credit facility
through June 27, 2003, we must successfully execute a refinancing plan
prior to December 31, 2003 in order to meet the final maturity of the
facility. We will continue to pursue a refinancing plan, which may
include negotiation of a new syndicated credit facility and/or
placement of new debt securities; however, there can be no assurances
that we will be able to successfully complete the refinancing.
Additionally, there can be no assurances that the proposed transaction
as further described below under the caption OverviewLiquidity and
Capital Resources with the Company, Savia and Fox Paine will be
consummated. Failure to comply with existing covenants, which would
make the amended syndicated debt callable or our inability to obtain
adequate financing with reasonable terms prior to December 31, 2003
could have a material adverse impact on our business, results of
operations or financial condition.
| 
| |  | The Company is currently restricted from any additional borrowings
under the syndicated credit facility. As of November 2000, Savia
suspended advancing funds to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| 
| |  | Savia owns approximately 63.4% of the Companys outstanding common
stock and controls approximately 78.9% of the vote of its common
stock. Accordingly, Savia controls the Company and has the power to
approve all actions requiring the approval of our stockholders,
including the power to elect all of its directors. Therefore, Savia
effectively controls our management.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| 
| |  | The Company continues to invest in research and development in order
to enable us to identify and develop new products to meet consumer
demands. In fiscal year 2002, our investment in research and
development represented 9.8% of net sales. Despite investments in this
area, our research and development may not result in the discovery or
successful development of new products, which will be accepted by our
customers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| 
| |  | The Company may not have the ability to protect its intellectual
property due to the uncertainty of litigation and the ineffectiveness
of the laws in some of the countries that the Company currently has
operations, which could have a material adverse effect on our
business, results of operations or financial condition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| 
| |  | A change in U.S. law protecting plant patents could limit or take away
patent protection for the Companys patented seeds, which could have a
material adverse effect on our business, results of operations or
financial condition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| 
| |  | The Company faces substantial competition due to technological
advances by competitors such as other seed companies, pharmaceutical
and chemical companies and biotechnology companies. Many of these
companies have substantially greater resources than the Company. If a
competitor introduces a competitively successful product, it could
take years to develop a competitive seed variety, which could have a
material adverse effect on our business, results of operations or
financial condition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

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| |  | The Companys failure to accurately forecast and manage inventory
could result in an unexpected shortfall or surplus of seeds, which
could have a material adverse effect on our business, results of
operations or financial condition.                                                                                                                  
|- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| 
| |  | Extreme weather conditions, disease and pests can materially and
adversely affect the quality and quantity of seeds produced. There can
be no assurance that these factors will not affect a substantial
portion of the Companys production in any year and have a material
adverse effect on our business, results of operations or financial
condition.
| 
| |  | Defective seeds could result in claims and negative publicity, and the
insurance covering claims may become unavailable or be inadequate,
which could have a material adverse effect on our business, results of
operations or financial condition.                                                                                                       
| 
| |  | The Company owns production and processing facilities in numerous
countries throughout the world and markets its products worldwide.
Accordingly, fluctuations in currency rates may affect the Companys
operating results and net income.                                                                                                               
| 
| |  | The Companys business is seasonal.                                                                                                                                                                                                                                                                                                                       
| 
| |  | The Companys worldwide operation and products are highly regulated in
the areas of safety and protection of human health and the environment.
Compliance with these health and safety regulations can be costly.                                                                                                                                         

OVERVIEW

Seminis is the leading worldwide developer, producer and marketer of vegetable
and fruit seeds. We produce more than 60 species and 4,000 vegetable and fruit
seed products (which do not include tree and citrus fruits). We market our
seeds through four full-line brands  Seminis, Asgrow, Petoseed and Royal Sluis
 and five specialty and regional brands. We have established a worldwide
presence and global distribution system. We market seeds in over 150 countries,
have 48 research and development facilities in 17 countries and territories and
production sites in over 25 countries, which allows us to remain close to local
markets around the world, adapt our products to any microclimate and meet the
preferences of local consumers.

Seminis was formed in 1994 to consolidate various industry-leading vegetable
and fruit seed brands into one consumer-oriented producer and marketer of
vegetable and fruit seeds. Our core business was created through the
acquisition of the Asgrow seed business in December 1994 and the subsequent
combination of the Asgrow business with the Petoseed and Royal Sluis seed
businesses in October 1995. Since our formation, we have been at the forefront
of the consolidation of the vegetable and fruit seed industry and have
completed ten acquisitions.

Our rapid growth through acquisitions created a highly complex operation that
impacted our results. An increasing level of inventory as well as production
and quality assurance difficulties were the primary operating problems that
resulted in us experiencing severe financial difficulties over the past several
years.

Global Restructuring and Optimization Plan

In February 2000, we announced a cost-saving initiative designed to
streamline operations, increase utilization of facilities and improve
efficiencies. The first phase of the initiative, which commenced in fiscal year
2000 and focused on North American operations, was completed by the end of
fiscal year 2001. In June 2001, we commenced the second phase, which was
targeted at our global operations and expanded the phase to cover additional
headcount reductions and to consolidate our facilities in Holland. The key
elements to the Global Restructuring and Optimization Plan involve:



| |  | reorganizing our 10 legacy seed companies into four geographical regions;           
|- |  | ------------------------------------------------------------------------------------
| 
| |  | selling or consolidating certain operation and production facilities;               
| 
| |  | reducing headcount in connection with the reorganization and facility consolidation;
| 
| |  | rationalizing our product portfolio;                                                
| 
| |  | implementing an advanced logistics management information system; and               

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##### Table of Contents





| |  | divesting non-strategic assets.
|- |  | -------------------------------

In connection with phase one of the Global Restructuring and Optimization Plan,
we recorded pre-tax charges to operations of approximately $34.4 million for
restructuring costs during fiscal year 2000 that included severance and other
exit costs, inventory write-downs and costs associated with streamlining our
products portfolio. Of this amount, $18.4 million was included in cost of goods
sold for inventory write-downs. The remaining $16.0 million was included in
selling, general and administrative expenses and consisted primarily of
severance costs. The total phase one and initial phase two severance charges
related to a planned 600-employee reduction worldwide in both operational and
administrative groups.

As part of the implementation of the expanded second phase of our Global
Restructuring and Optimization Plan, we recorded a pre-tax charge of $12.0
million in selling, general and administrative expenses in the third quarter of
fiscal year 2001. This charge was primarily related to severance and related
costs resulting from an additional planned 250-employee reduction worldwide in
both operational and administrative groups. In fiscal year 2001, we also
recorded non-cash inventory write-downs of $58.2 million in cost of goods sold
in order to comply with more stringent seed quality standards and to further
rationalize our product portfolio from 6,000 to 4,000 varieties. We believe we
have established adequate reserves for all of the remaining costs and expenses
related to our Global
Restructuring and Optimization Plan.

The remaining components of the restructuring accruals are as follows:

(In Millions)

|                               |  |         |      |          |  |           |       |            |  |            |      |           |  |            |      |            |  |           |       |            |  |          |      |            |  |   |   |  |  |   |      |   |  |   |     |  |  |             |      |             |  |   |     | 
|------------------------------ |  | ------- | ---- | -------- |  | --------- | ----- | ---------- |  | ---------- | ---- | --------- |  | ---------- | ---- | ---------- |  | --------- | ----- | ---------- |  | -------- | ---- | ---------- |  | - | - |  |  | - | ---- | - |  | - | --- |  |  | ----------- | ---- | ----------- |  | - | --- | 
|                               |  |         |      |          |  | Amounts   |       | Balance at |  | Additional |      | Amounts   |  | Balance at |      | Additional |  | Amounts   |       | Balance at |  | Amounts  |      | Balance at
|                               |  | Charges |      | Incurred |  | Sept. 30, |       | Charges    |  | Incurred   |      | Sept. 30, |  | Charges    |      | Incurred   |  | Sept. 30, |       | Incurred   |  | June 27,
|                               |  | 2000    |      | 2000     |  | 2000      |       | 2001       |  | 2001       |      | 2001      |  | 2002       |      | 2002       |  | 2002      |       | 2003       |  | 2003    
|                               |  |         |      |          |  |           |       |            |  |            |      |           |  |            |      |            |  |           |       |            |  |         
|                               |  |         |      |          |  |           |       |            |  |            |      |           |  |            |      |            |  |           |       |            |  |          |      |            |  |   |   |  |  |   |      |   |  |   |     |  |  | (Unaudited) |      | (Unaudited)
|Severance and
related expenses |  | $       | 14.0 |          |  | $         | (1.8  | )          |  | $          | 12.2 |           |  | $          | 12.0 |            |  | $         | (12.3 | )          |  | $        | 11.9 |            |  | $ |  |  |  | $ | (8.6 | ) |  | $ | 3.3 |  |  | $           | (2.7 | )           |  | $ | 0.6 | 
|Inventory
write-downs          |  |         | 18.4 |          |  |           | (18.4 | )          |  |            |     |           |  |            | 58.2 |            |  |           | (58.2 | )          |  |          |     |            |  |   |  |  |  |   |     |   |  |   |    |  |  |             |     |             |  |   |    | 
|Other                          |  |         | 2.0  |          |  |           | (2.0  | )          |  |            |     |           |  |            |     |            |  |           |      |            |  |          |     |            |  |   |  |  |  |   |     |   |  |   |    |  |  |             |     |             |  |   |    | 
|                               |  |         |      |          |  |           |       |            |  |            |      |           |  |            |      |            |  |           |       |            |  |          |      |            |  |   |   |  |  |   |      |   |  |   |     |  |  |             |      |             |  |   |     | 
|Total                          |  | $       | 34.4 |          |  | $         | (22.2 | )          |  | $          | 12.2 |           |  | $          | 70.2 |            |  | $         | (70.5 | )          |  | $        | 11.9 |            |  | $ |  |  |  | $ | (8.6 | ) |  | $ | 3.3 |  |  | $           | (2.7 | )           |  | $ | 0.6 | 
|                               |  |         |      |          |  |           |       |            |  |            |      |           |  |            |      |            |  |           |       |            |  |          |      |            |  |   |   |  |  |   |      |   |  |   |     |  |  |             |      |             |  |   |     | 

As of June 27,2003, there have been no material adjustments to amounts accrued
under our Global Restructuring and Optimization Plan. The remaining $0.6
million reserve balance is expected to be utilized in fiscal year 2003.

Results of Operations

The table below sets forth Seminis results of operations data expressed as a
percentage of net sales.

|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|-------------------------------------------- |  | ------------------ | ----- | ----------------- |  | -------- | ----- | -------- |  |  | ----- | - |  |  | ----- | -
|                                             |  | Three Months Ended |       | Nine Months Ended
|                                             |  |                    |       |                  
|                                             |  | June 27,           |       | June 28,          |  | June 27, |       | June 28,
|                                             |  | 2003               |       | 2002              |  | 2003     |       | 2002    
|                                             |  |                    |       |                   |  |          |       |         
|                                             |  | (Unaudited)        |       | (Unaudited)      
|Net sales                                    |  |                    | 100.0 | %                 |  |          | 100.0 | %        |  |  | 100.0 | % |  |  | 100.0 | %
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|Gross profit                                 |  |                    | 62.8  |                   |  |          | 61.0  |          |  |  | 63.0  |   |  |  | 62.1  |  
|Research and
development
expenses            |  |                    | 11.1  |                   |  |          | 10.3  |          |  |  | 9.9   |   |  |  | 9.6   |  
|Selling, general
and administrative
expenses |  |                    | 41.3  |                   |  |          | 41.3  |          |  |  | 39.1  |   |  |  | 39.1  |  
|Amortization of
intangible assets            |  |                    | 3.6   |                   |  |          | 4.0   |          |  |  | 3.4   |   |  |  | 3.7   |  
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|Total operating
expenses                     |  |                    | 56.0  |                   |  |          | 55.6  |          |  |  | 52.4  |   |  |  | 52.4  |  
|Gain on sale of assets                       |  |                    | 0.3   |                   |  |          | 0.4   |          |  |  | 0.4   |   |  |  | 1.7   |  
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|Income from operations                       |  |                    | 7.1   |                   |  |          | 5.8   |          |  |  | 11.0  |   |  |  | 11.4  |  
|Interest expense, net                        |  |                    | (7.8  | )                 |  |          | (6.6  | )        |  |  | (6.7  | ) |  |  | (6.2  | )
|Other non-operating
income (expense),
net    |  |                    | (0.7  | )                 |  |          | 3.4   |          |  |  | (0.1  | ) |  |  | (0.3  | )
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|Income (loss)
before income taxes            |  |                    | (1.4  | )                 |  |          | 2.6   |          |  |  | 4.2   |   |  |  | 4.9   |  
|Income tax benefit
(expense)                 |  |                    | (1.6  | )                 |  |          | 1.4   |          |  |  | (1.7  | ) |  |  | (1.8  | )
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  
|Net income (loss)                            |  |                    | (3.0  | )%                |  |          | 4.0   | %        |  |  | 2.5   | % |  |  | 3.1   | %
|                                             |  |                    |       |                   |  |          |       |          |  |  |       |   |  |  |       |  

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Nine months ended June 27, 2003 compared with nine months ended June 28, 2002

Net sales

Net sales increased 4.1% to $352.7 million for the nine months ended June 27,
2003 from $339.0 million for the same period ended June 28, 2002. The increase
was primarily due to $21.0 million of favorable currency fluctuations relating
to the strengthening of the Euro and South Korean Won versus the U.S. Dollar
during the nine months ended June 27, 2003, compared to the same period in the
prior fiscal year, partially offset by $2.0 million decrease reflecting the
divestiture of a non-core business in January 2002. In constant dollars, stated
at monthly average exchange rates of fiscal year 2002, and excluding the sales
of the divested and phased out non-core businesses, sales would have decreased
1.5%. Despite a general seed price increase in all the regions, sales were
affected by volume decrease and product mix. This decrease was primarily due to
weaker sales in the Far East that were attributable to a reduction of acreage
for hot pepper varieties and demand for watermelon varieties and the decrease
of certain carrot and hot pepper sales in the NAFTA region. Our business is
subject to seasonal fluctuations and, therefore, the sales for the nine months
of a fiscal year are not necessarily indicative of those to be expected in any
other interim period or for an entire fiscal year.

Gross Profit

Gross profit increased 5.6% to $222.4 million for the nine months ended June
27, 2003 from $210.6 million for the nine months ended June 28, 2002. Gross
margin increased to 63.0% for the nine months ended June 27, 2003 from 62.1%
for the nine months ended June 28, 2002. The increase was primarily due to
general seed price increases in all regions as well as an improved product mix.

Research and Development Expenses

Research and development expenses increased 7.6% to $34.9 million for the nine
months ended June 27, 2003 from $32.5 million for the nine months ended June
28, 2002. The increase was primarily due to the currency fluctuation impact on
research and development expenses denominated in the Euro and South Korean Won,
and general increases from year to year.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 4.2% to $138.0 million
for the nine months ended June 27, 2003 from $132.5 million for the nine months
ended June 28, 2002. The increase was primarily attributable to an expense of
$4.4 million related to an executive severance package, the impact of an
additional $3.3 million in severance expenses, the incurrence of $2.4 million
of legal and financial advisory expenses related to the proposed
merger and related transaction
and currency fluctuation impact during this fiscal year. The increases were
partially offset by decreases of $2.9 million of expenses related to a divested non-core
business, $5.5 million of restricted stock award expenses and $0.8 million of
consulting fees related to restructuring during the same period last fiscal
year.

Amortization of Intangible Assets

Amortization of intangible assets decreased 5.0% to $11.9 million for the nine
months ended June 27, 2003 from $12.5 million for the nine months ended June
28, 2002. The decrease was primarily due to the effect of latter stages of
accelerated amortization of intangible assets related to purchase accounting.
The decrease was partially offset by the currency impact from the fluctuation
of the South Korean Won on South Korea-based intangible assets.

Gain on Sale of Assets

The gain on sale of assets of $1.5 million for the nine months ended June 27,
2003 was primarily due to the sale of certain South Korean assets, a Salinas,
California property and a company-owned house. The gain on sale of assets of
$5.7 million for the nine months ended June 28, 2002 was primarily due to the
sale of a non-core business and asset sales of our South Korean subsidiary.

Interest Expense, Net

Interest expense, net, increased 12.0% to $23.7 million for the nine months
ended June 27, 2003 from $21.2 million for the nine months ended June 28, 2002.
The increase was primarily due to amortization of increased deferred financing
fees and higher interest rates resulting from the amendment of the Companys
syndicated credit facility in January 2003, offset by the effect of lower
average debt balances.

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Other Non-Operating Income (expense), Net

We had other non-operating expense, net, including foreign currency gain
(loss), net, of $0.3 million for the nine months ended June 27, 2003, as
compared to other non-operating expense, net, of $1.1 million for the nine
months ended June 28, 2002. Other non-operating expense, net, for the nine
months ended June 27, 2003 primarily consisted of non-operating losses from
subsidiaries in the United States, Guatemala, Chile, Brazil and Italy. Other
non-operating expense, net, for the nine months ended June 28, 2002 primarily
consisted of foreign currency losses of $1.5 million resulting from currency
fluctuations in South America and a U.S. Dollar denominated loan in the
Netherlands.

Income Tax Expense

Income tax expense was $6.0 million for the nine months ended June 27, 2003
compared to income tax expense of $5.9 million for the nine months ended June
28, 2002. The year-to date effective tax rate increased to 40.2% for 2003
compared to 35.9% for the nine months of 2002 and 13.3% for the fiscal year
2002. The increase in the period was due to the mix of worldwide
income and the receipt of a $5.9 million income tax refund, for
which no benefit was previously recorded.

Three months ended June 27, 2003 compared with three months ended June 28, 2002

Net sales

Net sales increased 6.1% to $113.1 million for the three months ended June 27,
2003 from $106.6 million for the same period ended June 28, 2002. The increase
was primarily due to $7.5 million of favorable currency fluctuations relating
to the strengthening of the Euro and South Korean Won versus the U.S. Dollar
during the three months ended June 27, 2003, compared to the same period in the
prior fiscal year. In constant dollars, stated at monthly average exchange
rates of fiscal year 2002, and excluding the phased out non-core business,
sales would have decreased 0.8%. Despite a general seed price increase in all
the regions, sales were affected by volume decrease and product mix. This
decrease was primarily due to weaker sales in the NAFTA region that were
attributable to a reduction of certain carrot and hot pepper sales. Our
business is subject to seasonal fluctuations and, therefore, the sales for an
interim period are not necessarily indicative of those to be expected in any
other interim period or for an entire fiscal year.

Gross Profit

Gross profit increased 9.2% to $71.0 million for the three months ended June
27, 2003 from $65.0 million for the three months ended June 28, 2002. Gross
margin increased to 62.8% for the three months ended June 27, 2003 from 61.0%
for the three months ended June 28, 2002. The increase was primarily due to
general seed price increases in all regions as well as an improved product mix.

Research and Development Expenses

Research and development expenses increased 14.5% to $12.6 million for the
three months ended June 27, 2003 from $11.0 million for the three months ended
June 28, 2002. The increase was primarily due to the currency fluctuation
impact on research and development expenses denominated in the Euro and South
Korean Won and general increases from year to year.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 6.2% to $46.7 million
for the three months ended June 27, 2003 from $44.0 million for the three
months ended June 28, 2002. The increase was primarily due to approximately
$1.3 million of additional severance expenses, the incurrence of $1.2 million
of legal and financial advisory expenses related to the proposed
merger and related transaction
and the currency fluctuation impact during this quarter. The increase was
partially offset by a decrease of $2.9 million of restricted stock award expenses during the
same period last year.

Amortization of Intangible Assets

Amortization of intangible assets decreased 5.2% to $4.0 million for the three
months ended June 27, 2003 from $4.2 million for the three months ended June
28, 2002. The decrease was primarily due to the effect of latter stages of
accelerated amortization of intangible assets related to purchase accounting.
The decrease was partially offset by the currency impact from the fluctuation
of the South Korean Won on South Korea-based intangible assets.

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Gain on Sale of Assets

The gain on sale of assets of $0.4 million for each of the three months ended
June 27, 2003 and June 28, 2002 was primarily due to the sale of certain South
Korean assets. Moreover, the gain from June 28, 2002 was offset by losses from
the sale of certain U.S. assets.

Interest Expense, Net

Interest expense, net, increased 24.3% to $8.8 million for the three months
ended June 27, 2003 from $7.1 million for the three months ended June 28, 2002.
The increase was primarily due to amortization of increased deferred financing
fees and higher interest rates resulting from the amendment of the Companys
syndicated credit facility in January 2003, offset by the effect of lower
average debt balances.

Other Non-Operating Income (Expense), Net

Seminis had other non-operating expense, net, including foreign currency gain
(loss), net, of $0.8 million for the three months ended June 27, 2003, as
compared to other non-operating income, net, of $3.6 million for the three
months ended June 28, 2002. Other non-operating expense, net, for the three
months ended June 27, 2003 primarily consisted of $0.9 million of non-operating
losses from several subsidiaries, offset by an approximate $0.2 million gain
from foreign currency resulting from currency fluctuations of a U.S. Dollar
denominated loan in the Netherlands. Other non-operating income, net, for the
three months ended June 28, 2002 primarily consisted of foreign currency gain
of $2.8 million resulting from currency devaluations in South America and a
U.S. Dollar denominated loan in the Netherlands, and $0.7 million of
non-operating gains from several subsidiaries.

Income Tax Expense

Income tax expense was $1.8 million for the three months ended June 27, 2003,
compared to an income tax benefit of $1.5 million for the three months ended
June 28, 2002. The year-to date effective tax rate increased to 40.2% for 2003
compared to 35.9% for the nine months of 2002 and 13.3% for the fiscal year
2002. The increase in the quarter was due to the mix of worldwide
income and the receipt of a $5.9 million income tax refund, for which
no benefit was previously recorded.

Seasonality

The seed business is highly seasonal. Generally, net sales are highest in the
second fiscal quarter due to increased demand from Northern Hemisphere growers
who plant seed in the early spring. We recorded 33.7% of our fiscal year 2002
net sales during our second fiscal quarter. We have historically operated at a
loss during the first and third fiscal quarters due to lower sales during these
quarters. Our results in any particular quarter should not be considered
indicative of those to be expected for a full year.

Liquidity and Capital Resources

Cash flows from operations

Operating activities utilized $3.6 million in cash flow during the nine months
ended June 27, 2003 compared to $2.4 million in cash flow provided during the
same period in the prior fiscal year. The operating cash flow of this interim
period was negatively impacted by approximately $5.2 million of restructuring
fees, $4.5 million of severance and consulting fees paid to an executive, $2.4
million of fees associated with the proposed transaction with Fox Paine and
Savia, additional interest incurred due to restructuring of our syndicated
credit facility and other additional severance incurred.

Cash flows from investments

Investing activities utilized $0.6 million in cash flow during the nine months
ended June 27, 2003 compared to $34.0 million in cash flow utilized in the same
period in the prior fiscal year. This reduction was primarily due to $17.6
million of proceeds from the sale of a non-core business and $24.3 million of
proceeds from the disposition of assets primarily related to an office building
in Seoul, South Korea during the last fiscal year. Capital expenditures
remained consistent between the two fiscal periods.

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Cash flows from financing

Financing activities utilized $7.8 million and $40.3 million during the nine
months ended June 27, 2003 and June 28, 2002, respectively. The reduction was
primarily due to principal payment requirements of the syndicated credit
facility in the respective periods.

Our total indebtedness as of June 27, 2003 was $274.2 million, of which $216.6
million were borrowings under our existing syndicated credit facility. We had
$12.5 million, $10.1 million, $7.5 million and $21.4 million of borrowings by
our U.S., Italian, Spanish and South Korean subsidiaries, respectively, and
$6.1 million of borrowings by other foreign subsidiaries.

As of September 30, 2000, we were not in compliance with certain covenants of
our existing syndicated credit facility, which gave the lenders the right to
accelerate payment of all amounts outstanding under the facility. In December
2000, the lenders granted a waiver with respect to these covenants that
extended through April 30, 2001, at which time any defaults would once again
arise. As we did not expect to be in compliance with our covenants once the
waiver expired, all outstanding borrowings under the syndicated credit facility
were classified as a current liability as of September 30, 2000. In connection
with granting the waivers, the lenders agreed to reschedule principal payments
within fiscal year 2001. The lenders also accelerated the final maturity of the
term loan and the termination date for the revolving credit commitments to June
30, 2002 from June 30, 2004. We were obligated to deliver a financial plan
through September 30, 2002, which detailed cash flow projections on a monthly
basis as well as proposed alternatives for the refinancing of the syndicated
credit facility or recapitalization of the Company.

On May 31, 2001, our lenders consented to the financial plan that we submitted
and agreed to restructure our existing syndicated credit facility. Upon receipt
of the amended syndicated credit facility, long-term portions of borrowings
were reclassified from current liabilities to long-term debt. Among other
things, the amendment extended the final maturity of the syndicated credit
facility from the previously agreed on date of June 30, 2002 to December 31,
2002, revised principal payment dates under the term loan, instituted a new
grid pricing formula to determine interest on borrowings and revised covenant
obligations. Interim principal obligations under the amendment included $16.0
million due in the fourth quarter of fiscal year 2001, $19.0 million, $4.0
million, $31.0 million and $9.0 million due in the first, second, third and
fourth quarters of fiscal year 2002, respectively. All remaining amounts were
due in the first quarter of fiscal year 2003.

In October 2001, we completed the sale of an office building in Seoul, South
Korea, which generated net proceeds of approximately $20.0 million. We used
$19.5 million of the proceeds to make the scheduled $19.0 million payment on
the syndicated credit facility in October 2001. We also sold one of our
non-core businesses in January 2002, which generated additional proceeds of
approximately $17.6 million. We used $13.0 million of the proceeds to prepay
our existing syndicated credit facility in January 2002 and utilized our
operating cash flow to pay the remaining $18.0 million in June 2002.

We met all required principal and interest payments during fiscal years 2002
and 2001 and were in compliance with all of our financial covenants under the
amended syndicated credit facility at September 30, 2002. In October 2002, we
paid an additional $5.0 million of principal as required by the amended
syndicated credit facility; however, as of December 31, 2002, we had not
completed a refinancing transaction in order to pay the remaining balance of
$224.7 million. The lenders agreed to temporarily extend the term of the
syndicated credit facility and in January 2003, a formal amendment was
executed. Among other things, the amendment extended the final maturity of the
syndicated credit facility from the previously agreed on date of December 31,
2002 to December 31, 2003, revised principal payment dates under the term loan,
instituted a new grid pricing formula to determine interest on borrowings and
revised covenant obligations. Outstanding interim principal obligations under
the amendment included $6.0 million due in the fourth quarter of fiscal year
2003. The remaining outstanding amount totaling $210.6 million will be due in
the first quarter of fiscal year 2004. We met all required principal and
interest payments during the first six months of fiscal year 2003 and were in
compliance with all of our financial covenants at June 27, 2003 under the newly
extended amendment. As all remaining amounts under the amended syndicated
credit facility are due within one year, the $216.6 million of outstanding
borrowings under the syndicated credit facility has been classified as a
current liability as of June 27, 2003.

On May 30, 2003, we and/or certain other parties entered into an amended and
restated exchange agreement, a contribution agreement, an agreement and plan of
merger, a stock purchase agreement and certain other related agreements
pursuant to which an acquisition company was formed at the direction of Fox
Paine & Company, LLC, a San Francisco based private equity firm, to acquire all
of the outstanding shares of the Companys common stock. Public holders of
approximately 15.8 million shares of Seminis common stock will receive cash
consideration of $3.78 per share in the merger. Immediately following the
merger and related transactions, Fox Paine, its affiliates and co-investors
will own approximately 75% of the shares of Seminis common stock outstanding following
the completion of the transactions, and the remaining shares will be owned by
certain affiliates of Alfonso Romo Garza, Seminis and Savias current Chairman
and Chief Executive Officer, certain creditors of a Savia affiliate and nine
members of Seminis and Savia management. Additionally, certain entities
affiliated with Mr. Romo will receive co-investment rights to
purchase, subject

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to certain conditions, up to 34% of
the outstanding shares of Seminis common stock following the transactions.
Following the merger and related transactions, the Company will be privately
held and Seminis common stock will no longer be listed on The Nasdaq National
Market. Seminis stockholders representing approximately 85% of the voting
power represented by the outstanding shares of Seminis common stock currently
entitled to vote have entered into a voting agreement to vote in favor of the
merger.

Prior to the consummation of the merger and pursuant to the terms of the
amended and restated exchange agreement, Savia will exchange all of its
outstanding shares of Seminis Class C preferred stock (including accrued PIK
dividends) having a principal value of $120.2 million, additional paid-in
capital (including accrued PIK dividends) of $46.7 million and accrued and
unpaid dividends for 37.7 million shares of Seminis Class A Common Stock and
cash equal to $15.0 million plus interest at a rate of 10.0% per annum from
July 1, 2002, less $3.0 million.

Although we have met our obligations and covenant requirements under the
amended syndicated credit facility through June 27, 2003, we must successfully
execute a refinancing plan prior to December 31, 2003 in order to meet the
final maturity of the facility. The consummation of the proposed transactions
require the Companys amended syndicated credit facility to be refinanced. It
is anticipated that the proposed transactions would be funded, in part, by
financing arranged by the newly-formed acquisition company. There can be no
assurances that the merger and related transactions will be consummated.
Failure to comply with existing covenants in the amended syndicated credit
facility, which would make the facility callable, or our inability to refinance
the facility prior to December 31, 2003, could have a material adverse impact
on our business, results of operations or financial condition

Seminis exposure to foreign currency fluctuations is primarily due to foreign
currency gains or losses that occur from intercompany receivables and payables
between Seminis and its foreign subsidiaries and from the U.S. dollar
denominated loan, originated by SVS Holland, B.V., a foreign subsidiary of
Seminis. Seminis does not have any material outstanding hedging contracts as of
June 27, 2003.




Item 3.Quantitative and Qualitative Disclosures About Market Risk

Our market risk disclosures set forth in our Annual Report on Form 10-K
for the year ended September 30, 2002 has not changed significantly through the
third quarter ended June 27, 2003.




Item 4.Controls and Procedures



|(a) |  | Evaluation of Disclosure Controls and Procedures. The Companys chief
executive officer and VP WW Corporate Comptroller and chief accounting
officer have evaluated the effectiveness of the Companys disclosure
controls and procedures (as such term is defined in Rules 13a-14(c) and
15d-14(c) under the Securities Exchange Act of 1934 as amended the
Exchange Act) as of a date (the Evaluation Date) within 90 days prior
to the filing date of this quarterly report. Based on such evaluation,
such officers have concluded that, as of the Evaluation Date, the
Companys disclosure controls and procedures are effective to ensure that
information required to be disclosed by the Company in the reports that it
files or submits under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of
the U.S. Securities and Exchange Commission. However, in evaluating the
disclosure controls and procedures, management recognized that any
controls and procedures, no matter how well designed and operated, can
provide only reasonable assurance of achieving the desired control
objectives, and management necessarily was required to apply its judgement
in evaluating the cost-benefit relationship of possible controls and
procedures.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) |  | Changes in Internal Controls. Since the Evaluation Date, there have not
been any significant changes in the Companys internal controls or in
other factors that could significantly affect these controls during the
period covered by this quarterly report.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

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PART II  OTHER INFORMATION




Item 1.Legal Proceedings

In January 2002, melon growers in Costa Rica notified us that our Dorado melon
seeds were infected with watermelon fruit blotch. Growers who purchased the
infected Seminis seeds and growers whose crops were infected by the bacteria
that spread from crops grown with the infected seeds have claimed damages
against us. The claims by those growers who purchased Seminis seeds have been
settled for approximately $5.8 million, of which, approximately $2.6 million
was recovered under our errors and omissions insurance policy and the remainder
of the settlement was paid by the Company by July 2002. The claims by the
growers with infected crops total approximately $4.7 million and we believe
these claims are covered under our general liability insurance policy. We have
finalized a settlement of nearly all of these claims. Our general liability
insurance carrier continues to deny coverage, and we are continuing to
negotiate with them on this matter. In the event we cannot finalize the
settlement with our general liability insurance carrier, we plan to seek all
legal remedies and redress available to us against the carrier.

In early 2000, we filed a suit against Dietrich Schmidt, the former president
of Seminis and the current president of United Genetics, a competitor of ours,
United Genetics and two former Seminis breeders, Ken Owen and Wei Ouyang, for
trade secret misappropriation and breach of contract. Schmidt filed a
counterclaim for defamation against us. We were unsuccessful on our claims for
trade secret misappropriation and breach of contract and Schmidt was successful
on his counterclaim, with the court awarding him $1 in nominal damages. The
court subsequently awarded Schmidt, Owen and Ouyang their attorneys fees. We
have appealed certain aspects of the judgment, including the fee award. The
appeal is still pending and is not expected to be decided until late 2003.

Between December 17, 2002 and January 31, 2003, five purported class action
lawsuits were filed relating to the proposed transaction under which Fox Paine
and several Savia-related parties would acquire all of the outstanding shares
of Seminis. Four of these actions  Garry Firth v. Alfonso Romo Garza, et al.,
Civil Action No. 20085, Boris Pozniak v. Alfonso Romo Garza, et al., Civil
Action No. 20097, Pablo Herranz v. Seminis, Inc., et al.,Civil Action No.
20105 and Haven Capital Management v. Seminis, Inc., et al.,Civil Action No.
20140-NC were filed in the Delaware Court of Chancery (New Castle, County),
while the fifth, Mark Rosales v. Seminis, Inc.,Case No. CIV216255, was filed
in California Superior Court (Ventura County). In February 2003, the Firth,
Pozniak, Herranzand Haven Capitalcases were consolidated into one proceeding
entitled In re Seminis, Inc. Shareholders Litigation, Consolidated C.A. No.
20140-NC and the Haven Capitalcomplaint was designated as the operative
complaint in the consolidated lawsuit. That complaint names as defendants
Savia, Seminis and Seminis directors. The Rosales(California) complaint
names as defendants Seminis and its directors. Both the Delaware consolidated
action and the Rosalesaction purport to be brought on behalf of Seminis common
stockholders or their successors. Both of these actions-which were brought
prior to the public announcement of Seminis entering into the merger
agreement-allege that the merger, if consummated, would provide insufficient
consideration to Seminis common stockholders and allege that the defendants
breached their fiduciary duties in connection with the transaction. The
complaints seek a preliminary and permanent injunction to enjoin the
transaction and, in the event the transaction is consummated, rescission and
damages. No provision for loss has been made in the accompanying
consolidated financial statements, as the probability of an
unfavorable outcome and the amount of loss, if any, are not
determinable at this time.

We are involved from time to time as a
defendant in various other lawsuits arising in
the normal course of business. We believe that no current claims, individually
or in the aggregate, will have a material adverse effect on our business,
results of operations or financial condition.




Item 6.Exhibits and Reports on Form 8-K



|(a) |  | Exhibits           
|--- |  | -------------------
|   
|    |  | See exhibits index.
|   
|(b) |  | Reports on Form 8-K

On April 15, 2003, the Company filed a Current Report on Form 8-K reporting
under Item 5 thereof that Savia has noticed its shareholders for a meeting to
be held at the end of the month to authorize the necessary actions to be taken
by Savia, assuming that the transactions contemplated by the letter of intent
between Savia and Fox Paine & Company, LLC are consummated.

On May 2, 2003, the Company filed a Current Report on Form 8-K (a) furnishing
under Item 12 thereof the preliminary results of its operations for the quarter
ended March 28, 2003 and (b) filing as an exhibit under Item 7 thereof the
related press release.

22



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##### Table of Contents



On May 16, 2003, the Company filed a Current Report on Form 8-K (a) furnishing
under Item 12 thereof the unaudited results of its operations for the three and
six month periods ending March 28, 2003 and (b) filing as an exhibit under
Item 7 thereof the related press release.

On June 5, 2003, the Company filed a Current Report on Form 8-K (a) reporting
under Item 5 thereof that the Company entered into a definitive agreement and
plan of merger, dated as of May 30, 2003, with Seminis Acquisition LLC and
Seminis Merger Corp., both affiliates of Savia, and related agreements and (b)
filing as exhibits under Item 7 thereof a copy of the merger agreement and
other related agreements.

Exhibit Index

|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|Number        |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(a) 1         |  | Form of Underwriting Agreement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) 2         |  | Merger Agreement by and between Seminis, Inc., an Illinois
corporation and Seminis, Inc., a Delaware corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) 3.1       |  | Certificate of Incorporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) 3.2       |  | Certificate of Designations of Class A Mandatorily
Redeemable Preferred Stock and Class B Mandatorily
Redeemable Preferred Stock of Seminis, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) 3.3       |  | Certificate of Designations of Class C Redeemable Preferred
Stock of Seminis, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) 3.4       |  | By-Laws                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 10.1      |  | Agreement and Plan of Merger by and among Seminis, Inc., Seminis Acquisition LLC and Seminis Merger Corp., dated as
of May 30, 2003, incorporated herein by reference to the Form 8-K filed by Seminis, Inc. on June 5, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                      
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 10.2      |  | Stock Purchase Agreement by and among Fox Paine Seminis Holdings., LLC Banca Afirme, SA., Institución de Banca
Multiple, Afirme Grupo Financiero, as Trustee, Under the Irrevocable Administration and Payment Trust Number 167-5
(Fideicomiso Irrevocable de Administración y Pago Número 167-5), Seminis Acquisition LLC and Seminis Merger Corp.,
dated as of May 30, 2003, incorporated herein by reference to the Form 8-K filed by Seminis, Inc. on June 5, 2003.                                                                                                                                                                                            
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 10.3      |  | Voting Agreement by and among Savia, S.A. de C.V., Banca Afirme, S. A., Institución de Banca Multiple, Afirme
Grupo Financiero, as Trustee, under the Irrevocable Administration and Payment Trust Number 167-5 (Fideicomiso
Irrevocable de Administración y Pago Número 16705),
Conjunto Administrativo Integral, S.A. de C.V., Emprima S.A. de
C.V., Park Financial Group, Ltd (BVI), Seminis Acquisition LLC, Alfonso Romo Garza and Fox Paine Seminis Holdings,
LLC, dated as of May 30, 2003, incorporated herein by reference to the Form 8-K filed by Seminis, Inc. on June 5,
2003.                                                                        
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 10.4      |  | Amended and Restated Exchange Agreement by and between Seminis, Inc. and Savia, S.A. de C.V., dated as of May 30,
2003, incorporated herein by reference to the Form 8-K filed by Seminis, Inc. on June 5, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 10.5      |  | Contribution Agreement by and among Seminis Acquisition LLC, Savia, S.A. de C.V., Banca Afirme, S.A., Institución de Banca
Multiple, Afirme Grupo Financiero, as Trustee, under the Irrevocable Administration and Payment Trust Number 167-5
(Fideicomiso Irrevocable de Administración y Pago Número 167-5), Conjunto Administrativo Integral, S.A. de C.V., Desarrollo
Consolidado de Negocios, S.A. de C.V., Emprima, S.A. de C.V., Park Financial Group, Ltd (BVI), Alfonso Romo Garza and Certain
Members of Seminis and Savia Management, dated as of May 30, 2003, incorporated herein by reference to the Form 8-K filed by
Seminis, Inc. on June 5, 2003.
|              |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(t) 99.1/99.2 |  | Certification pursuant to section 906 of the Sarbanes Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

23



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##### Table of Contents



|        |  |                                                                                          
|------- |  | -----------------------------------------------------------------------------------------
|Exhibit |  |                                                                                          
|Number  |  | Description                                                                              
|        |  |                                                                                          
|(a)     |  | Incorporated by reference to Seminis Form S-1 filed on February
11, 1999.               
|        |  |                                                                                          
|(b)     |  | Incorporated by reference to Seminis Amendment No. 2 to Form S-1
filed on May 27, 1999. 
|        |  |                                                                                          
|(c)     |  | Incorporated by reference to Seminis Amendment No. 3 to Form S-1
filed on June 21, 1999.
|        |  |                                                                                          
|(d)     |  | Filed with the June 30, 2000 Form 10-Q.                                                  
|        |  |                                                                                          
|(e)     |  | Filed with the September 30, 2000 Form 10-K.                                             
|        |  |                                                                                          
|(f)     |  | Filed with the December 30, 2000 Form 10-Q.                                              
|        |  |                                                                                          
|(g)     |  | Filed with the March 30, 2001 Form 10-Q.                                                 
|        |  |                                                                                          
|(h)     |  | Filed with the June 29, 2001 Form 10-Q.                                                  
|        |  |                                                                                          
|(i)     |  | Filed with the September 30, 2001 Form 10-K.                                             
|        |  |                                                                                          
|(j)     |  | Filed with the March 29, 2002 Form 10-Q.                                                 
|        |  |                                                                                          
|(k)     |  | Filed with the September 30, 2002 Form 10-K.                                             
|        |  |                                                                                          
|(l)     |  | Filed with the December 27, 2002 Form 10-Q.                                              
|        |  |                                                                                          
|(m)-(s) |  | Filed with the March 28, 2003 Form 10-Q.                                                 
|        |  |                                                                                          
|(t)     |  | Filed with the June 27, 2003 Form 10-Q.                                                  

24



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##### Table of Contents






Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                      |  |                                             
|--------------------- |  | --------------------------------------------
|Date: August 11, 2003 |  | SEMINIS, INC.                               
|                      |  |                                             
|                      |  | By /s/ Alfonso Romo Garza                   
|                      |  |                                             
|                      |  | Alfonso Romo Garza                          
|                      |  | Chief Executive Officer                     
|                      |  | (Principal Executive Officer)               
|                      |  |                                             
|                      |  | By /s/ Gaspar Alvarez Martinez              
|                      |  |                                             
|                      |  | Gaspar Alvarez Martinez                     
|                      |  | VP WW Corporate Comptroller &               
|                      |  | Chief Accounting Officer                    
|                      |  | (Principal Financial and Accounting Officer)

25



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##### Table of Contents






Certification

I, Alfonso Romo Garza, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of Seminis, Inc.;                                                                                                                                                                                                                                                          
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                    
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     



| | a) |  | designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to
record, process, summarize and report financial data and have identified
for the registrants auditors any material weaknesses in internal
controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal
controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: August 11, 2003

| |                        
| | -----------------------
| | /s/ Alfonso Romo Garza 
| |                        
| | Alfonso Romo Garza     
| | Chief Executive Officer

26



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##### Table of Contents



Certification

I, Gaspar Alvarez Martinez, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of Seminis, Inc.;                                                                                                                                                                                                                                                          
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;                    
|  
|4. |  | The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we
have:                                                                                                     



| | a) |  | designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrants ability to
record, process, summarize and report financial data and have identified
for the registrants auditors any material weaknesses in internal
controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal
controls; and                                                                                                                                        



|6. |  | The registrants other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and
material weaknesses.
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: August 11, 2003

| |                              
| | -----------------------------
| | /s/ Gaspar Alvarez Martinez  
| |                              
| | Gaspar Alvarez Martinez      
| | VP WW Corporate Comptroller &
| | Chief Accounting Officer     

27