Exhibit 4.4
EXECUTION COPY
$175,000,000
6.875% Senior Notes due 2013
SUBURBAN PROPANE PARTNERS, L.P.
(a Delaware limited partnership)
and
SUBURBAN ENERGY FINANCE CORP.
(a Delaware corporation)
as Issuers
PURCHASE AGREEMENT
December 18, 2003
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December 18, 2003
Wachovia Capital Markets, LLC
Goldman, Sachs & Co.
c/o Wachovia Capital Markets, LLC
One Wachovia
Center
301 South
College Street
Charlotte, North
Carolina 28288
Ladies and Gentlemen:
Suburban Propane
Partners, L.P., a Delaware limited partnership (the
"Partnership"), and Suburban Energy Finance
Corp., a Delaware corporation
("Finance Corp." and together with the
Partnership, the "Issuers"), propose,
subject to the terms and conditions stated
herein, to issue and sell to the
several purchasers named in Schedule I
hereto (the "Initial Purchasers"), for
whom Wachovia Capital Markets, LLC and
Goldman, Sachs & Co. are acting as
Representatives (in such capacity, the
"Representatives"), $175,000,000
aggregate principal amount of their 6.875%
Senior Notes due 2013 (the "Notes").
The Notes will be issued pursuant to an
Indenture (the "Indenture"), dated as of
the Closing Date (as defined in Section 2
hereof), among the Issuers and The
Bank of New York, as trustee (the
"Trustee").
Concurrently with the
offering of the Notes (this "Offering"), the
Partnership is offering 2,600,000 common
units representing limited partner
interests ("Common Units") in a public
offering. Neither this Offering nor the
concurrent public offering of Common Units
is contingent on the completion of
the other. The net proceeds of this
Offering, together with the net proceeds
from the concurrent offering of Common
Units, will be used to fund the
acquisition (the "Acquisition") of
substantially all of the assets and
operations of Agway Energy Products LLC,
Agway Energy Services, Inc. and Agway
Energy Services PA, Inc. (collectively,
"Agway Energy") and for general
partnership purposes.
The Notes will
be offered and sold through the Initial Purchasers without
being registered under the Securities Act
of 1933, as amended (the "Securities
Act"), to qualified institutional buyers in
compliance with the exemption from
registration provided by Rule 144A under
the Securities Act and in offshore
transactions in reliance on Regulation S
under the Securities Act ("Regulation
S"). The Initial Purchasers have advised
the Issuers that they will offer and
sell the Notes purchased by them hereunder
in accordance with Section 3 hereof
as soon as the Representatives deem
advisable.
In the event the
Acquisition does not close on the Closing Date, the
Issuers will enter into an escrow and
security agreement, dated as of the
Closing Date (the "Escrow and Security
Agreement"), among the Issuers, the
Initial Purchasers and the Trustee, as
escrow agent (the "Escrow Agent"),
pursuant to which the Initial Purchasers
will deposit the net proceeds of this
Offering into an escrow account (the
"Escrow Account") held by the Escrow Agent,
and the Issuers will contribute to the
Escrow Account an amount in cash such
that the total escrowed
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funds will be sufficient to pay the Special
Redemption Price (as defined below).
The Notes are subject to special redemption
no later than February 29, 2004, at
a special redemption price equal to 101% of
the aggregate principal amount of
the Notes plus accrued interest to, but not
including, the redemption date (the
"Special Redemption Price") if the
Acquisition is not consummated by February
15, 2004. Alternatively, the Issuers may
redeem the Notes, at their option, in
whole but not in part, at any time prior to
February 29, 2004, if, in their
judgment, the Acquisition will not be
consummated by February 15, 2004, at a
redemption price equal to 101% of the
aggregate principal amount of the Notes,
plus accrued interest to, but not
including, the redemption date.
This Agreement,
the Escrow and Security Agreement, the Registration Rights
Agreement, to be dated the Closing Date,
among the Initial Purchasers and the
Issuers (the "Registration Rights
Agreement") and the Indenture are hereinafter
collectively referred to as the
"Transaction Documents" and the execution and
delivery of the Transaction Documents and
the transactions contemplated herein
and therein are hereinafter referred to as
the "Transactions."
In connection
with the sale of the Notes, the Issuers have prepared a
preliminary offering memorandum, dated
December 5, 2003 (the "Preliminary
Memorandum") and a final offering
memorandum, dated the date hereof (the "Final
Memorandum" and, with the Preliminary
Memorandum, each a "Memorandum"). Each
Memorandum sets forth certain information
concerning the Issuers, the Notes, the
Transaction Documents, the Transactions and
the Acquisition. Each Issuer hereby
confirms that it has authorized the use of
the Preliminary Memorandum and the
Final Memorandum, and any amendment or
supplement thereto, in connection with
the offer and sale of the Notes by the
Initial Purchasers. As used herein, the
term "Memorandum" shall include, except
where specifically noted, in each case
the documents incorporated by reference
therein. The terms "supplement,"
"amendment" and "amend" as used herein with
respect to a Memorandum shall
include all documents deemed to be
incorporated by reference in the Preliminary
Memorandum or Final Memorandum that are
filed subsequent to the date of such
Memorandum with the Securities and Exchange
Commission (the "Commission")
pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange
Act").
The Partnership
and Suburban Propane, L.P., a Delaware limited partnership
(the "Operating Partnership") are
collectively referred to herein as the
"Partnership Entities," and Suburban Sales
& Service, Inc., a Delaware
corporation, Suburban Holdings, Inc., a
Delaware corporation, Suburban @ Home,
Inc., a Delaware corporation, Suburban
Franchising, Inc., a Nevada corporation,
and Gas Connection, Inc., an Oregon
corporation, all of which are subsidiaries
of the Operating Partnership, are
collectively referred to herein as the
"Subsidiaries."
1.
Representations and Warranties of the Issuers. The Issuers jointly
and
severally represent and warrant to, and
agree with, each of the Initial
Purchasers that:
(a) The Preliminary Memorandum does not contain, and the Final
Memorandum, in
the form used by the Initial Purchasers to confirm sales and
on the Closing
Date, and any amendment or supplement thereto does not and
will not
contain, any untrue statement of a material fact or omit to
state
any material fact necessary to
make the statements therein, in the light of
the
circumstances under which they were made, not misleading;
provided,
however,
that
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the
representations or warranties set forth in this paragraph shall
not
apply to
statements in or omissions from either Memorandum made in
reliance
upon and in
conformity with information furnished in writing to the Issuers
by the
Representatives expressly for use therein, as specified in
Section
11.
(b) The Partnership is subject to and in full compliance with
the
reporting
requirements of Section 13 or Section 15(d) of the Exchange
Act.
The documents
incorporated by reference in the Final Memorandum, when they
became effective
or were filed with the Commission, as the case may be,
conformed in all
material respects to the requirements of the Act or the
Exchange Act, as
applicable, and the rules and regulations of the
Commission
thereunder, and none of such documents contained an untrue
statement of a
material fact or omitted to state a material fact required
to be stated
therein or necessary to make the statements therein not
misleading; and
any further documents so filed and incorporated by
reference in the
Final Memorandum or any further amendment or supplement
thereto, when
such documents become effective or are filed with the
Commission, as
the case may be, will conform in all material respects to
the requirements
of the Act or the Exchange Act, as applicable, and the
rules and
regulations of the Commission thereunder and will not contain
an
untrue statement
of a material fact or omit to state a material fact
necessary to
make the statements therein, in the light of the circumstances
under which they
were made, not misleading.
(c) None of the Issuers, the Operating Partnership or any of
the
Subsidiaries has
sustained since the date of the latest audited financial
statements
included or incorporated by reference in the Final Memorandum
any loss or
interference with its business from fire, explosion, flood or
other calamity,
whether or not covered by insurance, or from any labor
dispute or court
or governmental action, order or decree, that,
individually or
in the aggregate, would have a material adverse effect on
the business,
prospects, operations, financial condition or results of
operations of
the Issuers, the Operating Partnership and the Subsidiaries
taken as a whole
(a "Material Adverse Effect"), otherwise than as set forth
or contemplated
in the Final Memorandum. In addition, since the respective
dates as of
which information is given in the Final Memorandum, (i) none of
the Partnership
and its subsidiaries have incurred any material liability
or obligation,
direct or contingent, or entered into any material
transaction
(other than the Acquisition) in each case not in the ordinary
course of business; (ii) the
Partnership has not purchased any of its
outstanding
capital stock, and, except for regular quarterly distributions
on the common
units of the Partnership in amounts per share that are
consistent with
past practice, has not declared, paid or otherwise made any
dividend or
distributions of any kind on any class of its capital stock;
and (iii) there
has not been any change in the partners' capital or
long-term debt
(other than borrowings under the Operating Partnership's
existing credit
facility) of either of the Issuers or the Operating
Partnership or
any material adverse change, or any development involving a
prospective
material adverse change, in or affecting the general affairs,
management, financial
position, partners' capital or results of operations
of either of the
Issuers or the Operating Partnership, otherwise than as
set forth or
contemplated in the Final Memorandum.
(d) Each of the Issuers, the Operating Partnership and the
Subsidiaries has
good and marketable title in fee simple to all real
property and
good and marketable title to all personal property owned by
it, in each case
free and clear of all liens, encumbrances and defects,
except such as
are described in the Final Memorandum or such as do not
materially
affect the value of
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such property
and do not materially interfere with the use made and
proposed to be
made of such property by that Issuer, Operating Partnership
or Subsidiary.
All real property and buildings held under lease by the
Issuers, the
Operating Partnership or the Subsidiaries are held under
valid,
subsisting and enforceable leases with such exceptions as are
not
material and do
not materially interfere with the use made and proposed to
be made of such
property and buildings by the lessee.
(e) Each of the Partnership Entities is and on the Closing Date
will
be a limited
partnership duly formed, validly existing and in good standing
under the laws
of the State of Delaware, with all necessary partnership
power and
authority to own its properties and conduct its business as
described in the
Final Memorandum, and has been duly licensed or qualified
to do business
and is in good standing as a foreign limited partnership in
all
jurisdictions in which it owns or leases properties or conducts
any
business so as
to require such licensing or qualification, except where the
failure to be so
qualified or in good standing would not have a Material
Adverse Effect.
Complete and correct copies of the certificates of limited
partnership of
the Partnership and the Operating Partnership, and all
amendments
thereto, and of the agreements of limited partnership of the
Partnership, as
amended and restated (the "Partnership Agreement") and the
Operating
Partnership, as amended and restated (the "Operating
Partnership
Agreement"), have been delivered
to the Initial Purchasers.
(f) Finance Corp. is and on the Closing Date will be a
corporation
duly
incorporated, validly existing and in good standing under the laws
of
the State of
Delaware, with all necessary corporate power and authority to
own its
properties and conduct its business as described in the Final
Memorandum, and
has been duly licensed or qualified to do business and is
in good standing
as a foreign corporation in all jurisdictions in which it
owns or leases
properties or conducts any business so as to require such
licensing or
qualification, except where the failure to be so qualified or
in good standing
would not have a Material Adverse Effect. Complete and
correct copies
of the certificate of incorporation of Finance Corp., and
all amendments
thereto (the "Certificate of Incorporation"), and of the
by-laws of
Finance Corp., as amended and restated (the "By-laws"), have
been delivered
to the Initial Purchasers.
(g) Suburban Energy Services Group LLC, the general partner of each
of
the Partnership
Entities (the "General Partner"), has been, and on the
Closing Date
will be, duly formed and is validly existing as a limited
liability
company in good standing under the laws of the State of
Delaware,
with limited
liability company power and authority to own its properties
and conduct its
business as described in the Final Memorandum, and has been
duly qualified
as a foreign limited liability company for the transaction
of business and
is in good standing under the laws of each other
jurisdiction in
which it owns or leases properties or conducts any business
so as to require
such qualification, except where the failure to be so
qualified or in
good standing would not have a Material Adverse Effect.
Complete and
correct copies of the certificate of formation and the limited
liability
company agreement of the General Partner, and all amendments
thereto, have
been delivered to the Initial Purchasers.
(h) Each of the Subsidiaries has been, and on the Closing Date
will
be, duly
incorporated and is validly existing as a corporation in good
standing under
the laws of the jurisdiction of its incorporation, with
corporate power
and authority to own its properties and
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conduct its
business as described in the Final Memorandum, and has been
duly qualified
as a foreign corporation for the transaction of business and
is in good
standing under the laws of each other jurisdiction in which it
owns or leases
properties or conducts any business so as to require such
qualification,
except where the failure to be so qualified or in good
standing would
not have a Material Adverse Effect. Complete and correct
copies of the
certificate of incorporation and the bylaws of each of the
Subsidiaries
have been delivered to the Initial Purchasers.
(i) The Partnership has no direct or indirect subsidiaries (other
than
the Operating
Partnership and the Subsidiaries) that, taken as a whole,
would be deemed
to be a significant subsidiary (as such term is defined in
Section 1-02 of
Regulation S-X under the Act).
(j) The General Partner is the sole general partner of the
Partnership
with a 0.55%
general partner interest in the Partnership; such general
partner interest
is duly authorized by the Partnership Agreement and was
validly issued
to the General Partner. The General Partner owns such
general partner
interest free and clear of all liens, encumbrances,
security
interests, equities, charges or claims (except for such liens,
encumbrances,
security interests, equities, charges or claims as are not,
individually or
in the aggregate, material to such ownership or as
described in the
Final Memorandum).
(k) The General Partner is the sole general partner of the
Operating
Partnership with
a 1.0101% general partner interest in the Operating
Partnership;
such general partner interest is duly authorized by the
Operating
Partnership Agreement, and was validly issued to the General
Partner. The
General Partner owns such general partner interest free and
clear of all
liens, encumbrances, security interests, equities, charges or
claims (except
for such liens, encumbrances, security interests, equities,
charges or
claims as would not, individually or in the aggregate, be
material to such
ownership or as described in the Final Memorandum).
(l) The Partnership is the sole limited partner of the
Operating
Partnership with
a limited partner interest of 98.9899%; such limited
partner interest is
duly authorized by the Operating Partnership Agreement,
and was validly
issued to the Partnership and is fully paid and
nonassessable
(except as nonassessability may be affected by the legal
issues described
with respect to holders of the Common Units in the "Risk
Factors" section
of the Final Memorandum under the captions "Unitholders
may not have
limited liability in some circumstances" and "Unitholders may
have liability
to repay distributions"). The Partnership owns such limited
partner interest
free and clear of all liens, encumbrances, security
interests,
equities, charges or claims (except for such liens,
encumbrances,
security interests, equities, charges or claims as would not,
individually or in the aggregate,
be material to such ownership or as
described in the
Final Memorandum).
(m) All of the outstanding shares of capital stock of Finance
Corp.
have been duly
authorized and are fully paid and nonassessable. The issued
shares of
capital stock of Finance Corp. are owned by the Partnership,
free
and clear of all
liens, encumbrances, security interests, equities, charges
or other claims.
All of the outstanding membership interests of the General
Partner are
owned by management and other key employees of the Partnership.
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(n) All of the outstanding shares of capital stock of each of
the
Subsidiaries
have been duly authorized and are fully paid and
nonassessable.
The issued shares of capital stock of each of the
Subsidiaries are
owned by the Operating Partnership, free and clear of all
liens,
encumbrances, security interests, equities, charges or other
claims.
All of the outstanding
membership interests of the General Partner are
owned by
management and other key employees of the Partnership.
(o) The Partnership has an authorized capitalization as set forth
in
the Final
Memorandum, and all of the issued and outstanding Common Units
of
the Partnership
have been duly and validly authorized and issued, are fully
paid and
nonassessable (except as nonasessability may be affected by the
legal issues
described with respect to holders of the Common Units in the
"Risk Factors"
section of the Final Memorandum under the captions
"Unitholders may
not have limited liability in some circumstances" and
"Unitholders may
have liability to repay distributions") and conform to the
description of
the Common Units contained in the Final Memorandum.
(p) The execution, delivery and performance by each of the Issuers
and
the Operating
Partnership (with respect to Section 7 hereof) of this
Agreement and
the other Transaction Documents, the issuance and sale of the
Notes and the
compliance by the Issuers with all of the provisions of the
Notes, the
Indenture, the Escrow and Security Agreement, the Registration
Rights Agreement
and this Agreement and compliance by the Operating
Partnership with
the provisions of Section 7 hereof, and the consummation
of the
transactions contemplated hereby and thereby and the consummation
of
the Acquisition
will not (i) conflict with or result in a breach or
violation of any
of the terms or provisions of, or constitute a default
under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or
instrument to which either of the Issuers, the Operating
Partnership or
any of the Subsidiaries is a party or by which either of the
Issuers, the
Operating Partnership or any of the Subsidiaries is bound or
to which any of
the property or assets of either of the Issuers, the
Operating
Partnership or any of the Subsidiaries is subject, (ii) result
in
any violation of
the provisions of the Partnership Agreement, the Operating
Partnership
Agreement, the Certificate of Incorporation or the By-laws or
any statute or
any order, rule or regulation of any court or governmental
agency or body
having jurisdiction over either of the Issuers, the
Operating
Partnership or any of the Subsidiaries or any of their
properties,
except for breaches, violations or defaults (other than those
relating to the
Partnership Agreement, the Operating Partnership Agreement
or the
Certificate of Incorporation) that would not, individually or in
the
aggregate, have
a Material Adverse Effect or impair the Partnership's
ability to
consummate the transactions herein contemplated. No consent,
approval,
authorization, order, registration or qualification of or with
any such court
or governmental agency or body is required for the issue and
sale of the
Notes or the consummation by the Issuers of the transactions
contemplated by
this Agreement and the Operating Partnership with the
provisions in
Section 7 hereof, except such consents, approvals,
authorizations,
registrations or qualifications as may be required under
state securities
or Blue Sky laws in connection with the offer or sale of
the Notes and by
federal and state securities laws with respect to the
obligations of
the Issuers under the Registration Rights Agreement.
(q) The financial statements and pro forma financial data,
together
with related
schedules and notes, included or incorporated by reference in
the Final
Memorandum present
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fairly (i) the
consolidated financial condition of the Partnership and the
combined
financial condition of Agway Energy, in each case as of the
respective dates
thereof, and (ii) the consolidated results of operations
and cash flows
of the Partnership and the combined results of operations
and cash flows
of Agway Energy, in each case for the respective periods
covered thereby;
such statements and related schedules and notes have been
prepared in
accordance with generally accepted accounting principles
consistently
applied throughout the entire period involved, except as
otherwise
disclosed in the Final Memorandum; and the other financial and
statistical
information included or incorporated by reference in the Final
Memorandum are
accurately presented and prepared on a basis consistent with
such financial
statements and the books and records of the Partnership. No
other financial
statements or schedules of the Partnership are required by
the Act, the
Exchange Act or the rules and regulations of the Commission
under such acts
to be included in the Final Memorandum.
(r) Each of the Issuers and the Operating Partnership (with respect
to
Section 7
hereof) has all necessary partnership or corporate power (as
applicable) to
enter into the Transaction Documents to which it is a party
and to carry out
all the terms and provisions hereof and thereof to be
carried out by
it.
(s) This Agreement has been duly authorized, executed and delivered
by
each of the
Issuers and the Operating Partnership and constitutes a valid
and binding
agreement of each of the Issuers and the Operating Partnership
and is
enforceable against each of the Issuers and the Operating
Partnership in
accordance with its terms; provided that such enforceability
may be limited
(i) by bankruptcy, insolvency, fraudulent transfer,
moratorium and
similar laws relating to or affecting creditors' rights
generally and by
general principles of equity (regardless of whether such
enforceability
is considered in a proceeding in equity or at law) and (ii)
as to rights to
indemnification or contribution by considerations of public
policy related
to federal or state securities laws.
(t) The Partnership Agreement has been duly authorized, executed
and
delivered by the
General Partner and is a valid and legally binding
agreement of the
General Partner, enforceable against the General Partner
in accordance
with its terms; the Operating Partnership Agreement has been
duly authorized,
executed and delivered by each of the General Partner and
the Partnership,
and is a valid and legally binding agreement of the
General Partner
and the Partnership, enforceable against each of them in
accordance with
its terms; provided that, with respect to each such
agreement, the
enforceability thereof may be limited by bankruptcy,
insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws relating to
or affecting creditors' rights generally and by general
principles of
equity (regardless of whether such enforceability is
considered in a
proceeding in equity or at law).
(u) None of the Issuers, the Operating Partnership, the
Subsidiaries
or the General
Partner is in violation of its certificate of incorporation,
certificate of
formation, by-laws, partnership agreement or limited
liability
company agreement, or in default in the performance or
observance
of any material
obligation, agreement, covenant or condition contained in
any indenture,
mortgage, deed of trust, loan agreement, lease or other
agreement or
instrument to which it is a party or by which it or any of its
properties may
be bound, except for such defaults that, individually or in
the aggregate,
would not have a Material Adverse Effect.
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(v) The statements set forth in the Final Memorandum under the
caption
"Description of
Notes," insofar as they purport to constitute a summary of
the terms of the
Notes, and under the captions "Description of Certain
Indebtedness,"
"Certain U.S. Federal Tax Considerations" and "Plan of
Distribution,"
insofar as they purport to describe the provisions of the
laws and
documents referred to therein, are accurate and complete in all
material
respects.
(w) Each of the Issuers, the Operating Partnership and the
Subsidiaries (i)
is in compliance with any and all applicable foreign,
federal, state
and local laws and regulations relating to the protection of
human health and
safety, the environment or hazardous or toxic substances
or wastes,
pollutants, or contaminants ("Environmental Laws"), (ii) has
received all
permits, licenses or other approvals required of it under
applicable
Environmental Laws to conduct its respective businesses and
(iii) is in
compliance with all terms and conditions of any such permit,
license or
approval, except where such noncompliance with Environmental
Laws, failure to
receive required permits, licenses or other approvals or
failure to
comply with the terms and conditions of such permits, licenses
or approvals
would not, individually or in the aggregate, have a Material
Adverse
Effect.
(x) There are no costs or liabilities associated with
Environmental
Laws (including,
without limitation, any capital or operating expenditures
required for
clean up, closure or properties or compliance with
Environmental
Laws or any permit, license or approval, any related
constraints on
operating activities and any potential liabilities to third
parties) which
would, individually or in the aggregate, have a Material
Adverse
Effect.
(y) Other than as set forth in the Preliminary Memorandum and
the
Final
Memorandum, there are no legal or governmental proceedings pending
to
which the
Issuers, the Operating Partnership or any of the Subsidiaries
is
a party or of
which any property of the Issuers, the Operating Partnership
or any of the
Subsidiaries is the subject which, if determined adversely to
the Issuers, the
Operating Partnership or any of the Subsidiaries, would,
individually or in the
aggregate, have a Material Adverse Effect. To the
knowledge of the
Partnership's management, no such proceedings are
threatened or
contemplated by governmental authorities or threatened by
others.
(z) None of the Issuers or the Operating Partnership is, nor,
after
giving effect to
the offering and sale of the Notes, will be, (i) an
"investment
company," as such term is defined in the Investment Company Act
of 1940, as
amended (the "Investment Company Act"), or (ii) subject to
regulation as a
"holding company" or a "subsidiary company" of a holding
company or
"affiliate" thereof, under the Public Utility Holding Company
Act of 1935, as
amended (the "PUHCA").
(aa) Each of the Issuers, the Operating Partnership and the
Subsidiaries has
such permits, consents, licenses, franchises, certificates
and
authorizations of governmental or regulatory authorities
("permits") as
are necessary to
own its properties and to conduct its business in the
manner described
in the Memorandum, subject to such qualifications as may
be set forth in
the Memorandum and except for such permits the failure of
which to have
obtained would not have, individually or in the aggregate, a
Material Adverse
Effect; each of the Issuers, the Operating Partnership and
each of the
Subsidiaries has fulfilled and performed all its material
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obligations with
respect to such permits and no event has occurred which
allows, or after
notice or lapse of time would allow, revocation or
termination
thereof or results in any impairment of the rights of the
holder of any
such permit, except for such revocations, terminations and
impairments that
would not have a Material Adverse Effect. Except as
described in the
Memorandum, none of such permits contains any restriction
that is
materially burdensome to the Issuers, the Operating Partnership
and
the Subsidiaries
considered as a whole.
(bb) None of the Issuers or the Operating Partnership nor any of
their
respective
affiliates does business with the government of Cuba or with
any
person or
affiliate located in Cuba within the meaning of Section
517.075,
Florida
Statutes.
(cc) Each of the Issuers and the Operating Partnership maintains
a
system of
internal accounting controls sufficient to provide reasonable
assurances that
(i) transactions are executed in accordance with
management's
general or specific authorizations; (ii) transactions are
recorded as
necessary to permit preparation of financial statements in
conformity with
generally accepted accounting principles and to maintain
accountability
for assets; (iii) access to assets is permitted only in
accordance with
management's general or specific authorization; and (iv)
the recorded
accountability for assets is compared with existing assets at
reasonable
intervals and appropriate action is taken with respect to any
differences.
(dd) The Partnership has established and maintains disclosure
controls
and procedures
(as such term is defined in Rule 13a-15 under the Exchange
Act), which (i)
are designed to ensure that material information relating
to the
Partnership, including its consolidated subsidiaries, is made
known
to its principal
executive officer and its principal financial officer by
others within
those entities, particularly during the periods in which the
periodic reports
required under the Exchange Act are being prepared; (ii)
have been
evaluated for effectiveness as of the date of the filing of the
Partnership's
most recent annual or quarterly report filed with the
Commission; and
(iii) are effective in all material respects to perform the
functions for
which they were established.
(ee) Based on the evaluation of its disclosure controls and
procedures, the
Partnership is not aware of (i) any significant deficiency
in the design or
operation of internal control over financial reporting
which are
reasonably likely to adversely affect the Partnership's ability
to record,
process, summarize and report financial data or any material
weaknesses in
internal controls; or (ii) any fraud, whether or not
material, that
involves management or other employees who have a
significant role
in the Partnership's internal control over financial
reporting.
(ff) Since the date of the most recent evaluation of such
disclosure
controls and
procedures, there have been no significant changes in internal
control over
financial reporting or in other factors that could
significantly
affect internal control over financial reporting, including
any corrective
actions with regard to significant deficiencies and material
weaknesses.
(gg) For each taxable year of the Partnership, less than 10% of
the
gross income of
the Partnership has been derived from sources other than
(i) the
exploration, development, production, processing, refining,
transportation
or marketing of any mineral or natural resource,
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<PAGE>
including oil,
gas or products thereof, or (ii) other items of qualifying
income within
the meaning of Section 7704(d) of the Internal Revenue Code
of 1986, as
amended.
(hh) PricewaterhouseCoopers LLP, who have certified certain
financial
statements of
the Partnership and Agway Energy, are independent public
accountants as
required by the Act and the rules and regulations of the
Commission
thereunder.
(ii) Each of the Indenture, the Escrow and Security Agreement and
the
Registration
Rights Agreement have been duly authorized by each of the
Issuers and, on
the Closing Date, will have been duly executed and
delivered by
each of the Issuers, and will constitute the valid and binding
obligations of
each of the Issuers, enforceable against each of the Issuers
in accordance
with their respective terms, except as may be limited (i) by
bankruptcy,
insolvency, fraudulent transfer, moratorium and similar laws
relating to or
affecting creditors' rights generally and by general
principles of
equity (regardless of whether such enforceability is
considered in a
proceeding in equity or at law) and (ii) as to rights to
indemnification
or contribution by considerations of public policy related
to federal or
state securities laws. The Escrow and Security Agreement, the
Indenture and
the Registration Rights Agreement will conform to the
description
thereof in the Final Memorandum.
(jj) The Indenture conforms to the requirements of the Trust
Indenture
Act of 1939, as
amended (the "Trust Indenture Act"), and to the rules and
regulations of
the Commission applicable to an indenture that is qualified
thereunder.
(kk) The Notes have been duly authorized by each of the Issuers
and,
on the Closing
Date, when executed and authenticated by each of the Issuers
in the manner
provided for in the Indenture and delivered to and paid for
by the Initial
Purchasers as provided in this Agreement, will constitute
the legal, valid
and binding obligations of each of the Issuers,
enforceable
against each of the Issuers in accordance with their terms,
except as the
enforcement thereof may be limited (i) by bankruptcy,
insolvency,
fraudulent transfer, moratorium and similar laws relating to or
affecting
creditors' rights generally and by general principles of equity
(regardless of
whether such enforceability is considered in a proceeding in
equity or at
law) and (ii) as to rights to indemnification or contribution
by
considerations of public policy related to federal or state
securities
laws, and will
be entitled to the benefits of the Indenture and the
Registration
Rights Agreement; the Exchange Notes (as defined in the
Registration
Rights Agreement) have been duly authorized and, when executed
and
authenticated in the manner provided for in the Registration
Rights
Agreement and
the Indenture, will constitute the legal, valid and binding
obligations of
the Issuers, enforceable against the Issuers in accordance
with their
terms, except as the enforcement thereof may be limited (A) by
bankruptcy,
insolvency, fraudulent transfer, moratorium and similar laws
relating to or
affecting creditors' rights generally and by general
principles of
equity (regardless of whether such enforceability is
considered in a
proceeding in equity or at law) and (B) as to rights to
indemnification
or contribution by considerations of public policy related
to federal or
state securities laws, and will be entitled to the benefits
of the Indenture
and the Registration Rights Agreement; and the Notes and
the Exchange
Notes will conform to the descriptions thereof in the Final
Memorandum.
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<PAGE>
(ll) Each of the Issuers is not now nor after giving effect to
the
issuance of the
Notes and the execution, delivery and performance of the
Transaction
Documents and the consummation of the transactions contemplated
thereby or
described in the Preliminary Memorandum or the Final
Memorandum,
will be (i)
insolvent, (ii) left with unreasonably small capital with which
to engage in its
anticipated business or (iii) incurring debts or other
obligations
beyond its ability to pay such debts or obligations as they
become due.
(mm) No "prohibited transaction" (as defined in Section 406 of
the
Employee
Retirement Income Security Act of 1974, as amended, including
the
regulations and
published interpretations thereunder ("ERISA"), or Section
4975 of the
Internal Revenue Code of 1986, as amended from time to time
(the "Code")) or
"accumulated funding deficiency" (as defined in Section
302 of ERISA) or
any of the events set forth in Section 4043(c) of ERISA
(other than
events with respect to which the 30-day notice requirement
under Section
4043 of ERISA has been waived) has occurred, exists or is
reasonably
expected to occur with respect to any employee benefit plan (as
defined in
Section 3(3) of ERISA) which the Partnership or any of its
subsidiaries
maintains, contributes to or has any obligation to contribute
to, or with
respect to which the Partnership or any of its subsidiaries has
any liability,
direct or indirect, contingent or otherwise (a "Plan"); each
Plan is in
compliance in all material respects with applicable law,
including ERISA
and the Code; none of the Partnership or any of its
subsidiaries has
incurred or expects to incur liability under Title IV of
ERISA with
respect to the termination of, or withdrawal from, any Plan;
and
each Plan that
is intended to be qualified under Section 401(a) of the Code
is so qualified
in all material respects and nothing has occurred, whether
by action or
failure to act, which could reasonably be expected to cause
the loss of such
qualification.
(nn) No holder of securities of the Issuers or any Subsidiary will
be
entitled to have
such securities registered under the registration
statements
required to be filed by the Issuers pursuant to the
Registration
Rights Agreement
other than as expressly permitted thereby.
(oo) The Partnership and its Affiliates (as defined in Rule 501(b)
of
Regulation D
under the Securities Act ("Regulation D")) have not
distributed and,
prior to the later of (i) the Closing Date and (ii) the
completion of
the distribution of the Notes, will not distribute any
offering
material in connection with the offering and sale of the Notes
other than the
Preliminary Memorandum, the Final Memorandum or any
amendment or
supplement thereto.
(pp) Within the preceding six months, none of the Partnership or
any
of its
Affiliates has, directly or through any agent, made offers or
sales
of any security
of the Partnership, or solicited offers to buy or otherwise
negotiated in
respect of any securities of the Partnership of the same
class (within
the meaning of Rule 144A under the Securities Act) as the
Notes, other
than the Notes offered or sold to the Initial Purchasers
hereunder.
(qq) None of the Partnership, any of its Affiliates, nor any
person
acting on its or
their behalf (other than the Initial Purchasers, as to
which no
statement is made), has engaged in any directed selling efforts
with respect to
the Notes, and each of them has complied with the offering
restrictions
requirement of Regulation S under the Securities Act
("Regulation
S"). Terms used in this paragraph have the meanings given to
them by
Regulation S.
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<PAGE>
(rr) None of the Partnership or any of its Affiliates has
taken,
directly or
indirectly, any action designed to cause or result in, or which
has constituted
or which might reasonably be expected to cause or result
in,
stabilization or manipulation of the price of any security of
the
Partnership to
facilitate the sale or resale of the Notes; nor has the
Partnership or
any of its Affiliates paid or agreed to pay to any person
any compensation
for soliciting another to purchase any securities of the
Partnership
(except as contemplated by this Agreement).
(ss) The Notes satisfy the eligibility requirements of Rule
144A(d)(3)
under the
Securities Act.
(tt) Assuming the accuracy of the representations and warranties
of
the Initial
Purchasers in Section 3 hereof and compliance by the Initial
Purchasers with
the procedures set forth in Section 3 hereof, it is not
necessary in
connection with the offer, sale and delivery of the Notes to
the Initial
Purchasers in the manner contemplated by this
