1273784--11/24/2008--NATIONAL_BEEF_PACKING_CO

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{stock, price, operating}

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{operation, international, foreign}

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Risks Related to the Proposed Acquisition JBS and NBP may be unable to obtain the regulatory approvals required to complete the proposed transaction or, in order to do so, JBS and NBP may be required to comply with material restrictions or conditions, which they may be unable or unwilling to do. The purchase agreement limits NBP s ability to pursue alternatives to the proposed transaction. The businesses of NBP may be adversely affected if the proposed transaction is not completed. Although it is expected that the proposed transaction will result in benefits to JBS, which will include NBP, JBS may not realize those benefits because of integration and other challenges. JBS will continue to be controlled by its current controlling shareholders, whose interests may differ from those of NBP. Risks Related to Our Operations Outbreaks of disease affecting livestock can adversely affect our business. If our products become contaminated, we may be subject to product liability claims and product recalls that would adversely affect our business. If the products of our competitors become contaminated, the beef industry may be subject to adverse publicity, which could negatively affect our business. Our substantial debt could adversely affect our business. Despite our current levels of debt, we may still incur significantly more debt, which could intensify the risks described above. Restrictive covenants under our amended and restated credit facility and the indenture may limit our ability to operate our business. We may be unable to generate sufficient cash flow to service our debt, which could adversely affect our financial condition and results of operations. Our margins may be negatively impacted by fluctuating raw material costs and selling prices and other factors that are outside of our control. We generally do not have long-term contracts with our customers, and, as a result, the prices at which we sell our beef products are subject to market forces. Wal-Mart s failure to continue purchasing from us could have a material adverse effect on our sales. We are subject to extensive governmental regulation and our noncompliance with or changes in applicable requirements could adversely affect our business, financial condition, results of operations and cash flows. Compliance with environmental regulations may result in significant costs and failure to comply with environmental regulations may result in civil as well as criminal penalties, liability for damages and negative publicity. Our international operations expose us to political and economic risks in foreign countries, as well as to risks related to currency fluctuations. Failure to successfully implement our business strategy may impede our plans to increase revenues, margins and cash flow. Changes in consumer preferences could adversely affect our business. The beef processing industry is highly competitive and our customers may not continue to purchase our products. The sales of our beef products are subject to seasonal variations and, as a result, our quarterly operating results may fluctuate. We depend on the service of key individuals, the loss of which could materially harm our business. Our performance depends on favorable labor relations with our employees. Any deterioration of those relations or increase in labor costs could adversely affect our business. The consolidation of our retail and foodservice customers may put pressures on our operating margins. We may not be able to successfully integrate existing and future acquisitions, which could result in our not achieving the expected benefits of the acquisition, the disruption of our business and an increase in our costs. Risks Related to U.S. Premium Beef U.S. Premium Beef has a majority interest in our Company and, through their representative on our Board of Managers, has the ability to significantly influence our business and affairs; U.S. Premium Beef s interests could conflict with other stakeholders. We purchase a portion of our cattle through U.S. Premium Beef and its producer-owners and, because U.S. Premium Beef has a majority interest in our Company, we may not be able to resolve conflicts with respect to these purchases on the most favorable terms to us.

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1273784--11/24/2008--NATIONAL_BEEF_PACKING_CO_LLC