The Board of Directors of Hardware & Lumber Ltd. and Grace, Kennedy & Company Ltd. on August 3, 2001 reached agreement, subject to due diligence on the merger of H&L and its subsidiaries including H&L Value and H & L Agri & Marine Co., with Rapid & Sheffield and Agro Grace Ltd. This merger is subject to the signing of a formal agreement. To effect the merger, H&L will issue shares to Grace, Kennedy in exchange for the issued shares in Rapid and Agro Grace. The merged company will be the largest wholesaler and retailer of hardware and home improvement goods as well as agricultural products in Jamaica. H&L will remain a public, listed company on Jamaica Stock Exchange with Grace, Kennedy & Company Ltd. being the largest shareholder and managers oft he company. The merger is expected to be completed by the end of the year.