Aquasearch and Cyanotech Settle Intellectual Property Litigation.

Business Editors and Medical/Health Writers

KAILUA-KONA, Hawaii--(BW HealthWire)--March 6, 2001

Cyanotech Corporation (Nasdaq NMS: CYAN) and Aquasearch, Inc. (OTCBB: AQSE.OB) today announced that they settled the intellectual property litigation between the two companies without admission of liability by either party. Terms of the agreement will remain confidential.

Under the agreement, Cyanotech has agreed to an injunction that prevents it from using any tube system for microalgal production that infringes Aquasearch's U.S. Patent No. 5,541,056. Aquasearch has agreed that Cyanotech's current proprietary process for producing microalgae, known as the PhytoDome, does not infringe its U.S. Patent No. 5,541,056. Cyanotech will also pay undisclosed royalties to Aquasearch. Cyanotech believes that such payments will not have a material effect on Cyanotech's financial condition or results of operations.

Both Cyanotech and Aquasearch have agreed to dismiss all claims with prejudice that the parties asserted in the litigation. The Court will enter an Order to that effect and that Aquasearch's U.S. Patent No. 5,541,056 is valid and enforceable.

Aquasearch's "Safe-Harbor" Statement

This press release contains forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, including statements regarding the potential efficacy of astaxanthin in any setting as well as statements that include the words "believes," "expects," "anticipates," "intends," or similar expressions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Aquasearch to differ materially from those implied or expressed by such forward-looking statements. Such factors include, among others, the risk factors included in Aquasearch's Annual Report on Form 10-KSB for the fiscal year ended October 31, 1999 and any subsequent reports filed with the Securities and Exchange Commission under the Exchange Act. This press release speaks as of the date first set forth above and Aquasearch assumes no responsibility to update the information included herein for events occurring after the date hereof.

Cyanotech's "Safe-Harbor" Statement

Except for statements of historical fact, the statements in this press release are forward-looking. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include, but are not limited to, general economic conditions, changes in sales levels to our largest customers, weather patterns, risks associated with the acceptance of new products, competition, and other factors more fully detailed in the company's recent quarterly 10-Q and annual 10-K filings with the Securities and Exchange Commission.