EXH 99.1

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF NEW YORK
- -----------------------------------------------------
In re Agway, Inc.,

- --------- Debtor.
- ----------------------------------------------------- CHAPTER 11
In re Agway General Agency, Inc., CASE NO. 02-65872 THROUGH
CASE NO. 02-65877
Debtor.
- -----------------------------------------------------
In re Brubaker Agronomic Consulting Service LLC, JOINTLY ADMINISTERED

Debtor.
- -----------------------------------------------------
In re Country Best Adams, LLC,

Debtor.
- -----------------------------------------------------
In re Country Best-DeBerry LLC,

Debtor.
- -----------------------------------------------------
In re Feed Commodities International LLC,

Debtor.
- -----------------------------------------------------

DEBTORS' SECOND AMENDED JOINT PLAN OF LIQUIDATION
UNDER CHAPTER 11 OF THE BANKRUPTCY CODE
---------------------------------------

- --------------------------------------------------------------------------------
MENTER, RUDIN & TRIVELPIECE, P.C. WEIL, GOTSHAL & MANGES LLP
500 South Salina Street, Suite 500 767 Fifth Avenue
Syracuse, New York 13202 New York, New York 10153
(315) 474-7541 (212) 310-8000

Co-Attorneys for Debtors and Co-Attorneys for Debtors and
Debtors-in-Possession Debtors-in-Possession

- --------------------------------------------------------------------------------

Dated: Syracuse, New York
April 20, 2004

TABLE OF CONTENTS

PAGE

INTRODUCTION ............................................................................ 1

ARTICLE I DEFINED TERMS............................................................... 1

1.01. Administrative Claim............................................................ 1

1.02. Agway........................................................................... 2

1.03. Agway, Inc...................................................................... 2

1.04. Agway Energy.................................................................... 2

1.05. Agway General Agency............................................................ 2

1.06. Agway Subordinated Debt Securities.............................................. 2

1.07. Agway Subordinated Debt Securities Claim........................................ 2

1.08. Allowed......................................................................... 2

1.09. Available Cash.................................................................. 2

1.10. Avoidance Actions............................................................... 3

1.11. Ballot.......................................................................... 3

1.12. Bankruptcy Code................................................................. 3

1.13. Bankruptcy Court................................................................ 3

1.14. Bankruptcy Rules................................................................ 3

1.15. Bar Date........................................................................ 3

1.16. BEP Claims...................................................................... 3

1.17. Brubaker........................................................................ 3

1.18. Business Day.................................................................... 3

1.19. Cash............................................................................ 4

1.20. Chapter 11 Cases................................................................ 4

1.21. Claim........................................................................... 4

1.22. Claims Agent.................................................................... 4

1.23. Class........................................................................... 4

1.24. Collateral...................................................................... 4

1.25. Committee....................................................................... 4

1.26. Confirmation Date............................................................... 4

1.27. Confirmation Hearing............................................................ 4

1.28. Confirmation Order.............................................................. 4

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1.29. Convenience Claim............................................................... 4

1.30. Country Best Adams.............................................................. 4

1.31. Country Best-DeBerry............................................................ 4

1.32. Cure Amount..................................................................... 4

1.33. D and O Policy.................................................................. 5

1.34. Death Benefit Claims............................................................ 5

1.35. Debtor.......................................................................... 5

1.36. Deficiency Claim................................................................ 5

1.37. DIP Credit Agreement............................................................ 5

1.38. DIP Obligations................................................................. 5

1.39. Disbursing Agent................................................................ 5

1.40. Disclosure Statement............................................................ 5

1.41. Disputed Claim.................................................................. 5

1.42. Disputed Claims Reserve......................................................... 6

1.43. DOL Litigation.................................................................. 6

1.44. Effective Date.................................................................. 6

1.45. Equity Custodian................................................................ 6

1.46. Equity Interests................................................................ 6

1.47. FCI............................................................................. 6

1.48. Fee Claim....................................................................... 6

1.49. Final Order..................................................................... 6

1.50. GE Capital...................................................................... 6

1.51. General Unsecured Claim......................................................... 6

1.52. Hopkinton Heifer Farm........................................................... 7

1.53. Indenture Trustee............................................................... 7

1.54. Insurance Carriers.............................................................. 7

1.55. Intercompany Claim.............................................................. 7

1.56. IRS............................................................................. 7

1.57. Lenders......................................................................... 7

1.58. Liquidating Trust............................................................... 7

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1.59. Liquidating Trustee............................................................. 7

1.60. Liquidating Trust Agreement..................................................... 7

1.61. Liquidating Trust Assets and Claims............................................. 7

1.62. PBGC............................................................................ 7

1.63. PBGC Reserve.................................................................... 7

1.64. Person.......................................................................... 8

1.65. Pension Plan.................................................................... 8

1.66. Pension Plan and Thrift Plan Administrator...................................... 8

1.67. Pension Plan Distribution Date.................................................. 8

1.68. Petition Date................................................................... 8

1.69. Pew Litigation Claims........................................................... 8

1.70. Plan............................................................................ 8

1.71. Plan Supplement................................................................. 8

1.72. Post 65 Retiree Medical Claims.................................................. 8

1.73. Postpetition Pension Eligible BEP Claim......................................... 8

1.74. Postpetition Pension Ineligible BEP Claim....................................... 8

1.75. Potential Derivative Claims..................................................... 8

1.76. Prepetition Pension Eligible BEP Claim.......................................... 9

1.77. Prepetition Pension Ineligible BEP Claim........................................ 9

1.78. Priority Claim.................................................................. 9

1.79. Priority Non-Tax Claim.......................................................... 9

1.80. Priority Tax Claim.............................................................. 9

1.81. Professional.................................................................... 9

1.82. Ratable Proportion.............................................................. 9

1.83. Releasees....................................................................... 9

1.84. Retiree Claims.................................................................. 9

1.85. Retiree Committee............................................................... 10

1.86. Retiree Pre-65 Surviving Spouse Medical Reimbursement Claims.................... 10

1.87. Schedules....................................................................... 10

1.88. Secured Claim................................................................... 10

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1.89. Section 510(b) Claims........................................................... 10

1.90. Seedgrowers Litigation Claims................................................... 10

1.91. Social Security Supplement Claims............................................... 10

1.92. Subsequent Distribution Date.................................................... 10

1.93. Tax Advance..................................................................... 11

1.94. Tax Code........................................................................ 11

1.95. Telmark......................................................................... 11

1.96. Thrift Plan .................................................................... 11

1.97. Thrift Plan Litigation Claims................................................... 11

1.98. Tort Claim...................................................................... 11

1.99. Treasury Regulations............................................................ 11

1.100. UST............................................................................. 11

1.101. Workers' Compensation Claims.................................................... 11

ARTICLE II TREATMENT OF ADMINISTRATIVE CLAIMS AND PRIORITY TAX CLAIMS................. 12

2.01. Administrative Claims in General................................................ 12

2.02. DIP Obligations................................................................. 12

2.03. Priority Tax Claims............................................................. 12

ARTICLE III CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS............................... 12

3.01. Agway Plan...................................................................... 12

3.02. FCI Plan........................................................................ 13

ARTICLE IV IDENTIFICATION OF IMPAIRED CLASSES OF CLAIMS AND EQUITY INTERESTS........... 13

4.01. Unimpaired Classes of Claims.................................................... 13

4.02. Impaired Classes of Claims and Equity Interests................................. 14

ARTICLE V TREATMENT OF CLASSES OF CLAIMS AND EQUITY INTERESTS......................... 14

AGWAY PLAN ............................................................................ 14

5.01. Agway Class 1 (Secured Claims).................................................. 14

(a) Impairment; Voting..................................................... 14

(b) Treatment.............................................................. 15

(d) Retention of Lien...................................................... 15

(e) Subclasses............................................................. 15

5.02. Agway Class 2 (Priority Non-Tax Claims)......................................... 15

(a) Impairment; Voting..................................................... 15

(b) Treatment.............................................................. 15

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5.03. Agway Class 3 (Postpetition Pension Eligible BEP Claims)........................ 16

(a) Impairment; Voting..................................................... 16

(b) Treatment.............................................................. 16

5.04. Agway Class 4A (Convenience Claims)............................................. 16

(a) Impairment; Voting..................................................... 16

(b) Treatment.............................................................. 16

5.05. Agway Class 4B (Workers' Compensation Claims)................................... 16

(a) Impairment; Voting..................................................... 16

(b) Treatment.............................................................. 16

5.06. Agway Class 4C (General Unsecured Claims)....................................... 16

(a) Impairment; Voting..................................................... 17

(b) Treatment.............................................................. 17

5.07. Agway Class 5A (Retiree Claims)................................................. 18

(a) Impairment; Voting..................................................... 18

(b) Treatment.............................................................. 18

5.08. Agway Class 5B (Post 65 Retiree Medical Claims)................................. 18

(a) Impairment; Voting..................................................... 18

(b) Treatment.............................................................. 18

5.09. Agway Class 6 (Section 510(b) Claims) .......................................... 19

(a) Impairment; Voting..................................................... 19

(b) Treatment.............................................................. 19

5.10. Agway Class 7 (Equity Interests)................................................ 19

(a) Impairment; Voting..................................................... 19

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(b) Treatment.............................................................. 19

FCI PLAN ............................................................................ 19

5.11. FCI Class 1 (Secured Claims).................................................... 19

(a) Impairment; Voting..................................................... 19

(b) Treatment.............................................................. 19

(d) Subclasses............................................................. 20

5.12. FCI Class 2 (Priority Non-Tax Claims)........................................... 20

(a) Impairment; Voting..................................................... 20

(b) Treatment.............................................................. 20

5.13. FCI Class 3A (Convenience Claims)............................................... 20

(a) Impairment; Voting..................................................... 20

(b) Treatment.............................................................. 20

5.14. FCI Class 3B (Workers' Compensation Claims)..................................... 20

(a) Impairment; Voting..................................................... 20

(b) Treatment.............................................................. 20

5.15. FCI Class 3C (General Unsecured Claims)......................................... 21

(a) Impairment; Voting..................................................... 21

(b) Treatment.............................................................. 21

5.16. FCI Class 4 (Equity Interests).................................................. 21

(a) Impairment; Voting..................................................... 22

(b) Treatment.............................................................. 22

ARTICLE VI PROVISIONS GOVERNING DISTRIBUTIONS.......................................... 22

6.01. Record Date for Distributions................................................... 22

6.02. Date of Distributions........................................................... 22

6.03. Disbursing Agent................................................................ 22

6.04. Subsequent Distributions........................................................ 22

6.05. Distributions of Cash........................................................... 23

6.06. Allocations After Effective Date................................................ 23

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6.07. Delivery of Distributions and Undeliverable Distributions....................... 23

6.08. Compliance With Tax Requirements................................................ 23

6.09. Time Bar to Cash Payments....................................................... 24

6.10. Setoffs......................................................................... 24

6.11. Professional Fees and Expenses.................................................. 24

6.12. Transactions on Business Days................................................... 24

6.13. Minimum Distributions........................................................... 25

6.14. Allocation of Distributions..................................................... 25

6.15. Rights and Powers of Disbursing Agent........................................... 25

(a) Powers of the Disbursing Agent......................................... 25

(b) Expenses Incurred After the Effective Date............................. 25

ARTICLE VII MEANS FOR IMPLEMENTATION AND EXECUTION OF THE PLAN.......................... 25

7.01. Liquidating Trust............................................................... 25

(a) Establishment of the Liquidating Trust................................. 25

(b) Purpose of the Liquidating Trust....................................... 26

(d) Funding Expenses of the Liquidating Trust.............................. 26

(e) Transfer of Assets..................................................... 26

(f) Liquidation of Assets, Responsibilities of Liquidating Trustee......... 27

(g) Valuation of Assets.................................................... 28

(h) Investment Powers...................................................... 29

(i) Semi-Annual Distribution; Withholding.................................. 29

(j) Reporting Duties....................................................... 29

(k) Trust Implementation................................................... 30

(l) Registry of Beneficial Interests; Non-Assignability.................... 30

(m) Termination............................................................ 31

(n) Implementation of ACE Settlement Agreement............................. 31

7.02. Deemed Substantive Consolidation of Agway for Plan Purposes Only................ 31

7.03. Pension Plan.................................................................... 32

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(a) Enhancement of Claims Under Pension Plan............................... 32

(b) Reserve for the PBGC................................................... 32

7.04. The Debtors' and Liquidating Trustee's Post-Confirmation Role................... 33

(a) Administration of Taxes................................................ 33

(b) Transfers to Liquidating Trust......................................... 33

7.05. Books and Records............................................................... 33

7.06. Corporate Action................................................................ 34

7.07. Effectuating Documents and Further Transactions................................. 34

7.08. Closing of the Chapter 11 Cases................................................. 34

ARTICLE VIII PROCEDURES FOR RESOLVING AND TREATING DISPUTED CLAIMS....................... 34

8.01. No Distribution Pending Allowance............................................... 34

8.02. Resolution of Disputed Claims................................................... 35

8.03. Estimation...................................................................... 35

8.04. Allowance of Disputed Claims.................................................... 35

8.05. Release of Funds from Disputed Claims Reserve................................... 36

ARTICLE IX TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES....................... 36

9.01. Generally....................................................................... 36

9.02. Approval of Assumption and Assignment or Rejection of Executory
Contracts and Unexpired Leases............................................... 36

9.03. Claims for Damages.............................................................. 36

9.04. Postpetition Executory Contracts and Unexpired Leases........................... 37

ARTICLE X CONDITIONS TO CONFIRMATION AND EFFECTIVE DATE............................... 37

10.01. Conditions Precedent to Effective Date of Plan.................................. 37

(a) Confirmation Order..................................................... 37

(b) Execution and Delivery of Other Documents.............................. 37

10.02. Waiver of Conditions Precedent.................................................. 37

10.03. Effect of Failure of Conditions................................................. 37

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ARTICLE XI EFFECTS OF CONFIRMATION..................................................... 38

11.01. Vesting of Assets in Liquidating Trust.......................................... 38

11.02. Release of Assets............................................................... 38

11.03. Binding Effect.................................................................. 38

11.04. Term of Injunctions or Stays.................................................... 38

11.05. Rights of Action................................................................ 38

11.06. Injunction...................................................................... 39

11.07. Dissolution of Retiree Committee................................................ 39

ARTICLE XII RELEASES.................................................................... 39

12.01. Release of Releasees by Debtors................................................. 39

12.02. Release of Released Parties..................................................... 39

ARTICLE XIII RETENTION OF JURISDICTION................................................... 40

ARTICLE XIV ADDITIONAL PROVISIONS....................................................... 42

14.01. Effectuating Documents and Further Transactions................................. 42

14.02. Membership Action............................................................... 42

14.03. Exemption from Transfer Taxes................................................... 43

14.04. Special Provisions Regarding Intercompany Claims and
Subsidiary Interests.......................................................... 43

14.05. Voting of Claims and Equity Interests........................................... 43

14.06. Confirmability and Severability of Plan......................................... 43

14.07. Nonconsensual Confirmation...................................................... 43

14.08. Exculpation..................................................................... 44

14.09. Post-Confirmation Date Fees and Expenses........................................ 44

(a) Fees and Expenses of Professionals..................................... 44

(b) Fees and Expenses of Liquidating Trustee and Disbursing Agent.......... 44

(c) Cancellation of the Indenture and Discharge of
the Indenture Trustee................................................ 44

14.10. Fee Claims...................................................................... 45

14.11. Professional Fee Holdback....................................................... 45

14.12. Bar on Post-Effective Fee Claims by the Committee and Retiree Committee......... 45

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14.13. Payment of Statutory Fees....................................................... 46

14.14. Amendments or Modifications of Plan............................................. 46

14.15. Effect of Withdrawal or Revocation.............................................. 46

14.16. Severability of Plan Provisions................................................. 46

14.17. Successors and Assigns.......................................................... 46

14.18. Notices......................................................................... 46

14.19. Governing Law................................................................... 47

14.20. Tax Reporting and Compliance.................................................... 48

14.21. Filing of Additional Documents.................................................. 48

14.22. Rules of Interpretation and Computation of Time................................. 48

14.23. Conflict of Terms............................................................... 49

INTRODUCTION

Agway, Inc., a Delaware corporation, and the other debtors in
the above-captioned jointly administered chapter 11 cases, as debtors and
debtors in possession, hereby propose the following joint plan of liquidation
pursuant to section 1121(a) of the Bankruptcy Code. The Debtors are proponents
of the Plan within the meaning of section 1129 of the Bankruptcy Code.

The Debtors' Chapter 11 Cases have been consolidated for
procedural purposes and are being jointly administered pursuant to an order of
the Bankruptcy Court. This Plan contemplates two distinct chapter 11 plans. One
plan contemplates the deemed substantive consolidation of the bankruptcy estates
of Agway, Inc., Agway General Agency, Brubaker, Country Best Adams and Country
Best De-Berry (collectively, "Agway") into one chapter 11 estate solely for the
purposes of distribution and voting under this Plan, and the establishment of a
Liquidating Trust to administer the Agway liquidation. The other chapter 11 plan
is solely applicable to Feed Commodities International LLC. For all other
purposes, the Debtors will continue to maintain their separate corporate
existence, except as otherwise expressly provided for in the Plan. In addition,
any obligation of any Debtor other than FCI and all guarantees thereof executed
by one or more of the Debtors will be deemed to be one obligation of the deemed
substantively consolidated Debtors; any Claims filed or to be filed in
connection with any such obligation and such guarantees will be deemed one Claim
against the deemed consolidated Debtors and each and every Claim filed in the
individual Chapter 11 Cases of any of Agway, Inc., Agway General Agency,
Brubaker, Country Best Adams and Country Best De-Berry will be deemed filed
against the deemed consolidated estates of Agway, Inc., Agway General Agency,
Brubaker, Country Best Adams and Country Best De-Berry.

Reference is made to the Disclosure Statement, distributed
contemporaneously herewith, for a discussion of the Debtors' history,
businesses, properties, certain postpetition events, issues which may affect
estimated distributions, and for a summary and analysis of the Plan and certain
related matters. All holders of Claims against the Debtors entitled to vote on
the Plan are advised to read the Plan and the Disclosure Statement in their
entirety before voting to accept or reject the Plan.

ARTICLE I

DEFINED TERMS

As used in the Plan, capitalized terms have the meanings set
forth below. Any term that is not otherwise defined in the Plan, but that is
used in the Bankruptcy Code or the Bankruptcy Rules, will have the meaning given
to that term in the Bankruptcy Code or the Bankruptcy Rules, as applicable.

1.01. ADMINISTRATIVE CLAIM means any right to payment constituting a cost
or expense of administration of any of the Chapter 11 Cases allowed under
sections 503(b) and 507(a)(1) of the Bankruptcy Code, including, without
limitation, (a) any actual and necessary costs and expenses of preserving the
Debtors' estates, (b) any actual and necessary costs and expenses of operating

the Debtors' businesses, (c) any indebtedness or obligations incurred or assumed
by the Debtors, as debtors in possession, during the Chapter 11 Cases, (d) any
allowances of compensation and reimbursement of expenses to the extent allowed
by Final Order under sections 330 or 503 of the Bankruptcy Code, (e) any
Postpetition Pension Ineligible BEP Claims and (f) any Allowed Reclamation
Claims, pursuant to section 546(c) of the Bankruptcy Code, as specified in
Exhibit A to the Plan Supplement.

1.02. AGWAY means, collectively, Agway, Inc., Agway General Agency,
Brubaker, Country Best Adams and Country Best De-Berry.

1.03. AGWAY, INC. means Agway, Inc., a Delaware corporation, one of the
Debtors, and the direct parent company of each of the other Debtors.

1.04. AGWAY ENERGY means Agway Energy Products LLC, Agway Energy Services,
Inc. and Agway Energy Services-PA, Inc., each of which are wholly owned,
non-debtor subsidiaries of Agway, Inc., as renamed subsequent to the closing of
the sale of Agway Energy.

1.05. AGWAY GENERAL AGENCY means Agway General Agency, Inc., one of the
Debtors.

1.06. AGWAY SUBORDINATED DEBT SECURITIES means, collectively, those certain
unsecured subordinated debt securities, subordinated member debt securities and
subordinated debentures issued from time-to-time by Agway and its predecessors,
but shall not include any Section 510(b) Claims relating to Agway subordinated
debt securities.

1.07. AGWAY SUBORDINATED DEBT SECURITIES CLAIM means a Claim arising on
account of Agway Subordinated Debt Securities, including any interest accrued
and owing thereon as of September 30, 2002.

1.08. ALLOWED means, with reference to any Claim, (a) any Claim against any
Debtor which has been listed by such Debtor in the Schedules, as such Schedules
may be amended by the Debtors from time to time in accordance with Bankruptcy
Rule 1009, as liquidated in amount and not disputed or contingent and for which
no contrary proof of Claim has been filed, (b) any Claim as to which no
objection to allowance has been timely interposed in accordance with section 502
of the Bankruptcy Code and Bankruptcy Rule 3007, pursuant to section 8.02 of
this Plan, or such other applicable period of limitation fixed by the Bankruptcy
Code, the Bankruptcy Rules, or the Bankruptcy Court, or as to which any
objection has been determined by a Final Order to the extent such objection is
determined in favor of the respective holder, (c) any Claim as to which, upon
the lifting of the automatic stay pursuant to section 362 of the Bankruptcy
Code, the liability of the Debtors, allowance and the amount thereof are
determined by final order of a court of competent jurisdiction other than the
Bankruptcy Court, or (d) any Claim expressly allowed pursuant to this Plan.

1.09. AVAILABLE CASH means, as of the Effective Date, as to the Debtors
comprising Agway, or as to FCI, all Cash of each such Debtor realized from its
business operations, the sale or other disposition of its assets, the interest
earned on invested funds or from any other source, less (i) the amount of Cash

estimated and reserved by Agway or FCI to fund adequately the administration of
its Plan, its Chapter 11 Case, and as to Agway, Inc. the Liquidating Trust
(including the Disputed Claims Reserve), on and after the Effective Date and
(ii) the amount of Cash required by Agway and FCI to satisfy in full their
respective Allowed Administrative Claims, Allowed Priority Tax Claims, Allowed
Priority Non-Tax Claims and Allowed Secured Claims.

1.10. AVOIDANCE ACTIONS means, without limitation, any and all actions,
causes of action, liabilities, obligations, rights, suits, debts, sums of money,
damages, judgments, Claims and demands whatsoever, whether known or unknown, in
law (including, without limitation, pursuant to sections 510, 544, 547, 548,
549, 550 and 553 of the Bankruptcy Code or equivalent provisions of applicable
non-bankruptcy law), equity or otherwise.

1.11. BALLOT means the forms distributed by the Voting Agent to each holder
of an impaired Claim that is entitled to vote on which form the holder of such
Claim is to indicate acceptance or rejection of the Plan.

1.12. BANKRUPTCY CODE means title 11 of the United States Code as now in
effect or hereafter amended, as applicable to the Chapter 11 Cases.

1.13. BANKRUPTCY COURT means the United States Bankruptcy Court for the
Northern District of New York in which the Chapter 11 Cases were commenced on
October 1, 2002, or any other court with jurisdiction over the Chapter 11 Cases.

1.14. BANKRUPTCY RULES means the Federal Rules of Bankruptcy Procedure and
the local rules of the Court, as now in effect or hereafter amended.

1.15. BAR DATE means the applicable deadline by which a proof of Claim
shall have been, or shall be, filed, as established by the Confirmation Order
and any other order of the Court (including (i) the Order (A) Establishing May
30, 2003, as the Final Date for Filing Proofs of Claim Against the Debtors, (B)
Approving Proposed Proof of Claim Form and (C) Approving Proposed Notice and
Publication Procedures, (ii) the Order Establishing October 2, 2003 as the
Deadline for Filing of Proofs of Claim Relating to Indemnity Rights Arising
Under the Debtors' By-laws or Employment Agreements, and (iii) the order
establishing the employee bar date that the Debtors anticipate will be entered
following the filing of this Plan with the Bankruptcy Court).

1.16. BEP CLAIMS means any claims related to obligations (i) under Agway,
Inc.'s benefit equalization plan, including the thrift component and the pension
component thereunder and/or (ii) for deferred compensation.

1.17. BRUBAKER means Brubaker Agronomic Consulting Service LLC, one of the
Debtors.

1.18. BUSINESS DAY means any day other than a Saturday, Sunday or any other
day on which banking institutions in New York, New York are required or
authorized to close by law or executive order.

1.19. CASH means legal tender of the United States of America.

1.20. CHAPTER 11 CASES means the Debtors' jointly administered chapter 11
cases pending in the Court.

1.21. CLAIM means a "claim" as defined in section 101(5) of the Bankruptcy
Code, against any Debtor.

1.22. CLAIMS AGENT means Donlin, Recano & Company, Inc., the official
Claims Agent appointed in the Chapter 11 Cases.

1.23. CLASS means a category of holders of Claims or Equity Interests, as
described in Sections 3.01 and 3.02 of the Plan.

1.24. COLLATERAL means any property or interest in property of the estate
of any Debtor subject to a lien, charge, or other encumbrance to secure the
payment or performance of a Claim, which lien, charge, or other encumbrance is
not subject to avoidance under the Bankruptcy Code.

1.25. COMMITTEE means the official committee of the Debtors' unsecured
creditors appointed in the Chapter 11 Cases pursuant to section 1102 of the
Bankruptcy Code, which Committee was disbanded by the UST effective February 4,
2004.

1.26. CONFIRMATION DATE means the date on which the Clerk of the Court
enters the Confirmation Order on the docket of the Bankruptcy Court.

1.27. CONFIRMATION HEARING means the hearing to be held by the Bankruptcy
Court regarding confirmation of the Plan, as such hearing may be adjourned or
continued from time to time.

1.28. CONFIRMATION ORDER means the order of the Bankruptcy Court confirming
the Plan pursuant to section 1129 of the Bankruptcy Code.

1.29. CONVENIENCE CLAIM means any General Unsecured Claim against any of
the Debtors in an amount (a) equal to or less than $1,000 or (b) greater than
$1,000, but which the holder of such Claim chooses to reduce to $1,000 by
written election made on a validly executed and timely delivered Ballot for the
Plan.

1.30. COUNTRY BEST ADAMS means Country Best Adams, LLC, one of the Debtors.

1.31. COUNTRY BEST-DEBERRY means Country Best-DeBerry LLC, one of the
Debtors.

1.32. CURE AMOUNT means the amount of Cash required for the assumption of
an unexpired lease or executory contract pursuant to section 365(b) of the
Bankruptcy Code equal to all accrued, due, and unpaid monetary obligations,
without interest, or such other amount as may be agreed to by the parties

thereto or ordered by the Bankruptcy Court, under such executory contract or
lease to the extent such obligations are enforceable under the Bankruptcy Code
and applicable non-bankruptcy law.

1.33. D AND O POLICY means that certain Executive Protection Policy between
Agway, Inc. and Federal Insurance Company, effective March 17, 1998, as amended.

1.34. DEATH BENEFIT CLAIMS means the actuarial equivalent of any Claims, as
calculated on the effective date of the Pension Plan amendment, related to
obligations incurred pursuant to the Pension Plan to provide an additional death
benefit payment effective July 1, 2002 in the amount of $5,000 upon the death of
the eligible retiree.

1.35. DEBTOR means any of the above-captioned debtors and debtors in
possession.

1.36. DEFICIENCY CLAIM means the portion, if any, of a Secured Claim that
exceeds the value of the collateral securing such Claim.

1.37. DIP CREDIT AGREEMENT means that certain Senior Secured,
Super-Priority Debtor-in-Possession Credit Agreement in the amount of $65
million by and among the Debtors, Agway Energy, GE Capital (for itself, as Agent
and Lender), and the other Lenders party thereto, dated as of October 4, 2002,
as amended, and all related documents, instruments and agreements.

1.38. DIP OBLIGATIONS means any indebtedness outstanding under the DIP
Credit Agreement.

1.39. DISBURSING AGENT means Donlin, Recano & Company, Inc., in its
capacity as disbursing agent under the Disbursing Agent Agreement, which is to
be included in the Plan Supplement.

1.40. DISCLOSURE STATEMENT means the written disclosure statement
(including all schedules to such disclosure statement) that relates to the Plan,
as the same may be amended, modified or supplemented from time to time, as
approved by the Bankruptcy Court pursuant to section 1125 of the Bankruptcy
Code.

1.41. DISPUTED CLAIM means, with reference to a Claim, any Claim (a) which
has been or hereafter is listed on the Schedules as unliquidated, disputed, or
contingent, and which has not been resolved by written agreement of the parties
or by an order of the Bankruptcy Court, (b) which is disputed under the Plan,
(c) as to which any of the Debtors has interposed a timely objection and/or
request for estimation in accordance with section 502(c) of the Bankruptcy Code
and Bankruptcy Rule 3018, or section 8.02 of this Plan, which objection and/or
request for estimation has not been withdrawn or determined by a Final Order,
(d) any Claim, proof of which was filed in an amount greater than the amount
reflected for such Claim as listed on the Schedules and for which the time to
file an objection has not yet expired, (e) any Claim proof of which was required
to be filed by order of the Bankruptcy Court but as to which a proof of Claim
was not timely or properly filed, and (f) any Tort Claim.

1.42. DISPUTED CLAIMS RESERVE has the meaning assigned to such term in
Section 7.01(j) hereof.

1.43. DOL LITIGATION means the potential litigation under consideration by
the Secretary of the United States Department of Labor arising from and related
to possible alleged violations of ERISA.

1.44. EFFECTIVE DATE means the first Business Day on which all conditions
precedent to the Effective Date specified in Section 10.01 of the Plan shall
have been satisfied or waived as provided in Section 10.02 of the Plan.

1.45. EQUITY CUSTODIAN means one or more Persons selected by the Debtors to
hold the one share of common stock of Agway, Inc. in accordance with Section
5.10 of the Plan.

1.46. EQUITY INTERESTS means the interest of any holder of an equity
security of any of the Debtors represented by any issued and outstanding shares
of common or preferred stock or other instrument evidencing a present ownership
interest in any of the Debtors, whether or not transferable, or any option,
warrant, or right, contractual or otherwise, to acquire any such interest.

1.47. FCI means Feed Commodities International LLC n/k/a PQR LLC, one of
the Debtors.

1.48. FEE CLAIM means an Administrative Claim under section 330(a), 331,
503 or 1103 of the Bankruptcy Code for compensation of a Professional or other
entity for services rendered or expenses incurred in the Chapter 11 Cases on or
prior to the Effective Date (including expenses of the members of the Committee
incurred in discharge of their duties prior to February 4, 2004).

1.49. FINAL ORDER means an order which has not been reversed, stayed,
modified or amended and as to which the time to appeal, petition for certiorari,
or move for re-argument or rehearing has expired and as to which no appeal,
petition for certiorari, or other proceedings for re-argument or rehearing shall
then be pending; provided, however, that the possibility that a motion under
Rule 59 or 60 of the Federal Rules of Civil Procedure, or any analogous rule
under the Bankruptcy Rules, may be filed with respect to such order shall not
preclude such order from being a Final Order.

1.50. GE CAPITAL means General Electric Capital Corporation.

1.51. GENERAL UNSECURED CLAIM means any unsecured, non-priority Claim
against the Debtors that is not an Administrative Claim, Priority Tax Claim,
Priority Non-Tax Secured Claim, Convenience Claim, or Intercompany Claim,
including any Agway Subordinated Debt Securities Claim, and includes any claim
based upon any deductible and self-insured retention amounts under the Debtors'
insurance policies, which are not otherwise covered under the Debtors' insurance
policies.

1.52. HOPKINTON HEIFER FARM means Agway's heifer farm located in Hopkinton,
New York.

1.53. INDENTURE TRUSTEE means J.P.Morgan Chase & Co.

1.54. INSURANCE CARRIERS means Pacific Employers Insurance Company, Bankers
Standard Fire & Marine Insurance Company, Insurance Company of North America and
ACE American Insurance Company (collectively, "ACE"), The Travelers Insurance
Company, National Union Fire Insurance Company of Pittsburgh, PA (AIG), and
Reliance Insurance Company,

1.55. INTERCOMPANY CLAIM means: (a) any account reflecting intercompany
indebtedness by one Debtor with respect to any other Debtor incurred prior to
the Petition Date, or (b) any Claim not reflected in such book entries that was
held by a Debtor against any other Debtor prior to the Petition Date.

1.56. IRS means the U.S. Internal Revenue Service.

1.57. LENDERS means the lenders from time to time party to the DIP Credit
Agreement.

1.58. LIQUIDATING TRUST means the liquidating trust for Agway described in
Article VII of the Plan and governed by the Liquidating Trust Agreement.

1.59. LIQUIDATING TRUSTEE means one or more Persons selected by the UST, in
consultation with the constituents whose input the UST deems appropriate and
necessary (including Agway, Inc.), and subject to Court approval, to act as the
trustee of the Liquidating Trust pursuant to the terms and conditions of the
Plan and the Liquidating Trust Agreement.

1.60. LIQUIDATING TRUST AGREEMENT means that certain agreement, dated as of
the Effective Date, between Agway, Inc. and the Liquidating Trustee that governs
the operation of the Liquidating Trust, included in the Plan Supplement.

1.61. LIQUIDATING TRUST ASSETS AND CLAIMS means any property interests,
Claims or causes of action or potential causes of action belonging to Agway,
including, but not limited to (i) the Potential Derivative Claims, (ii)
potential causes of action against the Debtors' prepetition professionals, such
as auditors or independent accountants, and (iii) Agway, Inc.'s real property,
equity interests in the other Debtors and its non-debtor subsidiaries, and
member interests in any entity, following the dissolution of Agway, Inc. (or
sooner, at the discretion of the Liquidating Trustee), but excluding (w) the
Available Cash, (x) the Thrift Plan, (y) the Pension Plan, and (z) operating
assets of active businesses, if any.

1.62. PBGC means the Pension Benefit Guaranty Corporation.

1.63. PBGC RESERVE means the $36.3 million that the Debtors will deposit
into a separate segregated account within the Disputed Claims Reserve on the
Effective Date as a reserve against the asserted claims of the PBGC.

1.64. PERSON means an individual, partnership, corporation, cooperative,
trust, unincorporated organization, association, joint venture or a government
or agency or political subdivision thereof.

1.65. PENSION PLAN means that certain Employees' Retirement Plan of Agway,
Inc., as amended

1.66. PENSION PLAN AND THRIFT PLAN ADMINISTRATOR means the Liquidating
Trustee on and after the Effective Date.

1.67. PENSION PLAN DISTRIBUTION DATE means the first Business Day after all
of the steps necessary have occurred under applicable law and the Pension Plan
governing documents in order to permit and effectuate the termination of the
Pension Plan and the distribution of the Pension Plan assets.

1.68. PETITION DATE means October 1, 2002.

1.69. PEW LITIGATION CLAIMS means all claims for damages asserted in that
certain complaint filed on May 12, 2003, as the same may be amended, by John
Pew, Jr., Barbara E. Pew, Harold Pew, Donna Pew, et al., against certain current
and former officers and directors of Agway and PricewaterhouseCoopers, LLP.

1.70. PLAN means this joint chapter 11 plan of liquidation for the Debtors,
and all exhibits, supplements, and schedules to the Plan, as the same may be
amended, modified or supplemented.

1.71. PLAN SUPPLEMENT means the supplement to the Plan containing certain
documents relevant to the implementation of such Plan or the treatment of
Allowed Claims thereunder, including, but not limited to, the Liquidating Trust
Agreement, the Disbursing Agent Agreement and restated and amended bylaws and
charter for Agway, Inc. The Plan Supplement will be filed with the Bankruptcy
Court no later than 10 days before the Confirmation Hearing.

1.72. POST 65 RETIREE MEDICAL CLAIMS means any claims of eligible retirees
or employees pursuant to Agway's over age 65 retiree medical program.

1.73. POSTPETITION PENSION ELIGIBLE BEP CLAIM means any claim related to
obligations accrued following the Petition Date under Agway Inc.'s benefit
equalization plan, including the thrift component and the pension component
thereunder, which is eligible to be included in the Pension Plan.

1.74. POSTPETITION PENSION INELIGIBLE BEP CLAIM means total claims related
to obligations accrued following the Petition Date under Agway's benefit
equalization plan, including the thrift component and the pension component
thereunder, less the Postpetition Pension Eligible BEP Claims.

1.75. POTENTIAL DERIVATIVE CLAIMS means potential claims, if any, for
damages that Agway might have against former officers and directors for breach
of fiduciary duty.

1.76. PREPETITION PENSION ELIGIBLE BEP CLAIM means any claim related to
obligations accrued prior to the Petition Date (i) under Agway, Inc.'s benefit
equalization plan, including the thrift component and the pension component
thereunder and/or (ii) for deferred compensation which, when multiplied by 62.5%
is eligible to be included in the Pension Plan. See section VII.A.2 of the
Disclosure Statement, incorporated herein by reference, for an illustration of
how an employee's Prepetition Pension Eligible BEP Claim is calculated.

1.77. PREPETITION PENSION INELIGIBLE BEP CLAIM means total claims related
to obligations accrued prior to the Petition Date (i) under Agway, Inc.'s
benefit equalization plan, including the thrift component and the pension
component thereunder and/or (ii) for deferred compensation, less the Prepetition
Pension Eligible BEP Claims. See section VII.A.2 of the Disclosure Statement,
incorporated herein by reference, for an illustration of how an employee's
Prepetition Pension Ineligible BEP Claim is calculated.

1.78. PRIORITY CLAIM means a Priority Tax Claim or Priority Non-Tax Claim.

1.79. PRIORITY NON-TAX CLAIM means any Claim, other than an Administrative
Expense Claim or a Priority Tax Claim, entitled to priority in payment under
section 507(a) of the Bankruptcy Code.

1.80. PRIORITY TAX CLAIM means a Claim of a governmental unit of the kind
specified in sections 502(i) and 507(a)(8) of the Bankruptcy Code.

1.81. PROFESSIONAL means (i) any professional employed in the Chapter 11
Cases pursuant to section 327, 328, 1103 or 1114 of the Bankruptcy Code and (ii)
any professional or other entity seeking compensation or reimbursement of
expenses in connection with the Chapter 11 Cases pursuant to section 503(b)(4)
of the Bankruptcy Code.

1.82. RATABLE PROPORTION means a proportionate share, so that the ratio of
(a) the amount of property distributed to the holder of an Allowed Claim, or
allocated to the Disputed Claims Reserve on behalf of a holder of a Disputed
Claim, in a Class, to (b) the amount distributed to the holders of all Allowed
Claims, or allocated to the Disputed Claims Reserve on behalf of all holders of
Disputed Claims, in such Class, is the same as the ratio (x) such Claim bears to
(y) the total amount of all Claims (including Disputed Claims) in such Class.

1.83. RELEASEES means the officers and directors of the Debtors and any of
their non-debtor subsidiaries holding office at any time prior to the Effective
Date, GE Capital, the Lenders, the Committee, the Retiree Committee, the
Indenture Trustee, and each of their respective agents, employees, advisors
(including any attorneys, financial advisors, investment bankers and other
professionals retained by such persons or entities in connection with these
Chapter 11 Cases), affiliates and representatives.

1.84. RETIREE CLAIMS means any Prepetition Pension Eligible BEP Claims,
Social Security Supplement Claims, Retiree Pre-65 Surviving Spouse Medical
Reimbursement Claims and/or Death Benefit Claims.

1.85. RETIREE COMMITTEE means the statutory committee of retirees appointed
by the Bankruptcy Court pursuant to section 1114 of the Bankruptcy Code.

1.86. RETIREE PRE-65 SURVIVING SPOUSE MEDICAL REIMBURSEMENT CLAIMS means
the net present value of any Claims for obligations to provide the Surviving
Spouse Medical Reimbursement Program benefit of $300 per month until the spouse
reaches age 65, (but not to exceed 10 years of benefits) to eligible retiree
spouses who are receiving reimbursement payments under the program as of the
effective date of the Pension Plan amendment.

1.87. SCHEDULES means the schedules of assets and liabilities, the list of
holders of Equity Interests, and the statements of financial affairs filed by
the Debtors under section 521 of the Bankruptcy Code and Bankruptcy Rule 1007,
and all amendments and modifications to such schedules, lists, and statements
through the Confirmation Date.

1.88. SECURED CLAIM means a Claim that is secured by a lien on property in
which an estate has an interest, or that is subject to a set-off under section
553 of the Bankruptcy Code, to the extent of the value of the Claim holder's
interest in such estate's interest in such property or to the extent of the
amount subject to a set-off, as applicable, as determined pursuant to section
506(a) of the Bankruptcy Code or, in the case of a set-off, pursuant to section
553 of the Bankruptcy Code.

1.89. SECTION 510(B) CLAIMS means any Claims for damages or rescission
arising from the purchase or sale of a security of a Debtor, or for
reimbursement or contribution allowed under section 502 of the Bankruptcy Code
on account of such a Claim, that is subordinated to other Claims or Equity
Interests in accordance with section 510(b) of the Bankruptcy Code.

1.90. SEEDGROWERS LITIGATION CLAIMS means all claims for damages asserted
in that certain first amended complaint served on August 14, 2002, as the same
may be amended, index no. 02-CV-136-J, pending in the United States District
Court for the District of Wyoming filed by Stotzman, Inc., Markegard, L&L, Inc.,
Eric Markegard, John Markegard, et al., against Agway, Inc., a New York
Corporation, d/b/a/ Allied Seed Cooperative, Inc. a/k/a Allied Seed, a division
of Agway, Allied Seed Cooperative, Inc., a New York Corporation a/k/a Allied
Seed Cooperative, Inc., a division of Agway, Inc.; and John Does I through X,
identities currently unknown and unavailable.

1.91. SOCIAL SECURITY SUPPLEMENT CLAIMS means the net present value of any
claims related to obligations incurred pursuant to the Pension Plan to provide a
social security supplement payment effective January 1, 2003 in the amount of
$600 per month to retirees who were enrolled in the under age 65 medical plan in
2002, and certain other eligible employees.

1.92. SUBSEQUENT DISTRIBUTION DATE means, following the Effective Date, a
date which shall occur at the end of each subsequent six-month period, or more
frequently as may be determined by the Liquidating Trustee, on which a Ratable
Proportion of the additional distributable Cash held in the Liquidating Trust is
distributed to the holders of Allowed Claims and allocated to the Disputed
Claims Reserve, in accordance with Article VI of the Plan.

1.93. TAX ADVANCE means an allocation made by the Liquidating Trustee to
the Disputed Claims Reserve in the event that the Disputed Claims Reserve does
not have sufficient Cash to pay its required taxes, which advance (including
accrued interest) of funds in respect of taxes shall be repaid by the Disputed
Claims Reserve in accordance with the Plan.

1.94. TAX CODE means title 26 of the United States Code, as amended from
time to time.

1.95. TELMARK means, collectively, Telmark LLC, a wholly owned non-debtor
subsidiary of Agway, Inc., and Telease Financial Services, Ltd., Telmark Lease
Funding II LLC and Telmark Lease Funding III LLC, each of which are wholly
owned, non-debtor subsidiaries of Telmark LLC.

1.96. THRIFT PLAN means Agway, Inc.'s 401(k) Thrift Investment Plan.

1.97. THRIFT PLAN LITIGATION CLAIMS means all claims that have been or may
be brought against non-debtor parties by or on behalf of (i) the Thrift Plan,
(ii) participants of such Plan, (iii) a fiduciary of such Plan or (iv)
beneficiaries of the Thrift Plan, including without limitation, all claims
described in that certain complaint filed on August 26, 2003, as may be amended,
by State Street Bank & Trust Company, as independent fiduciary of the company
security fund for the Thrift Plan, against, among others, certain former and
current members of the Agway Employee Benefit Plan Investment Committee, Agway's
Employee Benefit Plans Administration Committee and Agway's Board of Directors
(No. 5:03-CV-1060 (HGM/GJB) (as may be amended, the "Thrift Plan Complaint"),
and all claims related to or arising under any facts, acts, failure to act or
transactions mentioned in the Thrift Plan Complaint.

1.98. TORT CLAIM means any Claim (but excluding the Seedgrowers Litigation
Claims) that has not been compromised and settled or otherwise resolved (a)
relating to personal injury, wrongful death, property damage, products
liability, or other similar Claim asserted against any of the Debtors, or (b)
arising under any federal, state or local statute, rule, regulation or ordinance
governing, regulating or relating to health, safety, hazardous substances or the
environment, including, in each case, unasserted and other intangible Claims.

1.99. TREASURY REGULATIONS means final, temporary and proposed regulations
promulgated by the U.S. Treasury Department in respect of the Tax Code.

1.100. UST means the Office of the United States Trustee, authorized to
monitor and administer chapter 11 cases filed under the Bankruptcy Code.

1.101. WORKERS' COMPENSATION CLAIMS means Claims based in whole or in part
for: (i) workers' compensation, and/or (ii) Claims for fees and costs associated
therewith.

ARTICLE II

TREATMENT OF ADMINISTRATIVE CLAIMS
AND PRIORITY TAX CLAIMS

2.01. ADMINISTRATIVE CLAIMS IN GENERAL. On the Effective Date, or as soon
thereafter as is reasonably practicable, except to the extent that a holder of
an Allowed Administrative Expense Claim against any of the Debtors agrees to a
different treatment, each holder of an Allowed Administrative Expense Claim
shall receive Cash in an amount equal to such Claim; provided, however, that
Allowed Administrative Expense Claims representing liabilities incurred in the
ordinary course of business by the Debtors, as debtors in possession, shall be
paid by the Debtors in the ordinary course of business, consistent with past
practice and in accordance with the terms and subject to the conditions of any
agreements governing, instruments evidencing, or other documents relating to
such transactions.

2.02. DIP OBLIGATIONS. All DIP Obligations shall be deemed Allowed
Administrative Expense Claims and paid in full in Cash on the Effective Date in
accordance with this Section 2.02 of the Plan, or otherwise in accordance with
the terms of the DIP Credit Agreement.

2.03. PRIORITY TAX CLAIMS. On the Effective Date, or as soon thereafter as
is reasonably practicable, pursuant to section 1129(a)(9) of the Bankruptcy
Code, unless otherwise agreed to by the holder of an Allowed Priority Tax Claim
and the Debtors, each holder of an Allowed Priority Tax Claim shall be paid in
full, in Cash, in an amount equal to such Allowed Priority Tax Claim.

ARTICLE III

CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS

Pursuant to section 1122 of the Bankruptcy Code, set forth
below is a designation of classes of Claims against and Equity Interests in
Agway and FCI.

In accordance with section 1123(a)(1) of the Bankruptcy Code,
Administrative Claims and Priority Tax Claims have not been classified, and are
accorded treatment as set forth in Article II. Except as set forth above, all
Claims and Equity Interests are classified for all purposes, including voting,
confirmation and distribution pursuant to the Plan, as follows:

3.01. AGWAY PLAN:

Agway Class 1 Agway Class 1 consists of all Secured Claims against Agway.

Agway Class 2 Agway Class 2 consists of all Priority Non-Tax Claims
against Agway.

Agway Class 3 Agway Class 3 consists of all Postpetition Pension
Eligible BEP Claims against Agway.

Agway Class 4A Agway Class 4A consists of all Convenience Claims against
Agway.

Agway Class 4B Agway Class 4B consists of all Workers' Compensation
Claims against Agway.

Agway Class 4C Agway Class 4C consists of all General Unsecured Claims
against Agway.

Agway Class 5A Agway Class 5A consists of all Retiree Claims.

Agway Class 5B Agway Class 5B consists of all Post 65 Retiree Medical
Claims.

Agway Class 6 Agway Class 6 consists of all Section 510(b) Claims
against Agway.

Agway Class 7 Agway Class 7 consists of all Equity Interests in Agway.

3.02. FCI PLAN:

FCI Class 1 FCI Class 1 consists of all Secured Claims against FCI.

FCI Class 2 FCI Class 2 consists of all Priority Non-Tax Claims against
FCI.

FCI Class 3A FCI Class 3A consists of all Convenience Claims against FCI.

FCI Class 3B FCI Class 3B consists of all Workers' Compensation Claims
against FCI.

FCI Class 3C FCI Class 3C consists of all General Unsecured Claims
against FCI.

FCI Class 4 FCI Class 4 consists of all Equity Interests in FCI.

ARTICLE IV

IDENTIFICATION OF IMPAIRED CLASSES OF CLAIMS AND EQUITY INTERESTS

4.01. UNIMPAIRED CLASSES OF CLAIMS. Classes described in this Section are
not impaired under the Plan:

AGWAY PLAN:

Agway Class 1 (Secured Claims)
Agway Class 2 (Priority Non-Tax Claims)

Agway Class 3 (Postpetition Pension Eligible BEP Claims)
Agway Class 4A (Convenience Claims)
Agway Class 4B (Workers' Compensation Claims)

FCI PLAN:

FCI Class 1 (Secured Claims)
FCI Class 2 (Priority Non-Tax Claims)
FCI Class 3A (Convenience Claims)
FCI Class 3B (Workers' Compensation Claims)

4.02. IMPAIRED CLASSES OF CLAIMS AND EQUITY INTERESTS. Classes described in
this Section are impaired under this Plan:

AGWAY PLAN:

Agway Class 4C (General Unsecured Claims)
Agway Class 5A (Retiree Claims)
Agway Class 5B (Post 65 Retiree Medical Claims)
Agway Class 6 (Section 510(b) Claims)
Agway Class 7 (Equity Interests)

FCI PLAN:

FCI Class 3C (General Unsecured Claims)1
FCI Class 4 (Equity Interests)

ARTICLE V

TREATMENT OF CLASSES OF CLAIMS AND EQUITY INTERESTS

AGWAY PLAN
- ----------

5.01. AGWAY CLASS 1 (SECURED CLAIMS).

(a) Impairment; Voting. Agway Class 1 Claims are unimpaired by the Plan.
-------------------
Each holder of an Allowed Secured Claim is conclusively presumed to have
accepted the Plan and is not entitled to vote to accept or reject the Plan.

- ---------------------------------
1. It is possible that FCI Class 3C will be unimpaired by the Plan, but, because
they may be impaired, will be allowed to vote on the Plan. Agway, Inc. is the
holder of 100% of FCI Class 4 (Equity Interests) and will not vote on the plan.
Should holders of FCI Class 3C Claims be unimpaired, any recovery otherwise
distributable on or after the Effective Date to FCI Class 4 (Equity Interests)
will be distributed to the Liquidating Trust.

(b) Treatment. On the Effective Date, or as soon thereafter as is
----------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
Secured Claim, each holder of an Allowed Secured Claim shall receive (i) the
amount of the proceeds actually realized from the sale of any Collateral
securing such Claim, less the actual costs and expenses of disposing of such
Collateral; and/or (ii) the Collateral securing such Claim, but in neither case
in an amount greater than necessary to pay such Allowed Secured Claim in full,
plus any interest (including post-petition interest to the extent permitted
under the Bankruptcy Code) on such Allowed Secured Claim and any reasonable
fees, costs or charges provided for under the governing agreements, to be
allowed and paid pursuant to section 506(b) of the Bankruptcy Code. To the
extent that the amount of a secured claim exceeds the value of the Collateral
securing such Claim, that portion of the Claim shall be treated as an unsecured
Deficiency Claim in Agway Class 4C.

(c) Sale of Collateral After Effective Date. Subject to the terms of the
-----------------------------------------
Liquidating Trust Agreement, the Liquidating Trustee shall have the right, at
any time subsequent to the Effective Date (i) to satisfy in full the obligations
owed in respect of an Allowed Secured Claim by conveying to the holder of such
Claim all of the right, title and interest in and to the property that is
subject to the lien securing such Claim and/or (ii) to sell any property subject
to a lien securing such Claim on the terms and subject to the conditions
specified in the orders of the Bankruptcy Court and section 363 and the other
applicable provisions of the Bankruptcy Code and the Bankruptcy Rules.

(d) Retention of Lien. Except as otherwise provided by an order of the
------------------
Bankruptcy Court and section 363(f) of the Bankruptcy Code, the holder of an
Allowed Secured Claim shall retain the lien securing the Claim as of the
Confirmation Date until distributions have been made to such holder provided for
above in Section 5.01(b) to satisfy such Secured Claim in full.

(e) Subclasses. Each Secured Claim shall be deemed to be separately
----------
classified in a subclass of Agway Class 1 and shall have all rights associated
with separate classification under the Bankruptcy Code.

5.02. AGWAY CLASS 2 (PRIORITY NON-TAX CLAIMS).

(a) Impairment; Voting. Agway Class 2 is unimpaired by the Plan. Each
--------------------
holder of an Allowed Priority Non-Tax Claim in Agway Class 2 is conclusively
presumed to have accepted the Plan and is not entitled to vote to accept or
reject the Plan.

(b) Treatment. On the Effective Date, or as soon thereafter as is
---------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
Priority Non-Tax Claim in Agway Class 2, each holder of an Allowed Priority
Non-Tax Claim shall receive in full satisfaction of such Claim, Cash, in an
amount equal to such Allowed Priority Non-Tax Claim.

5.03. AGWAY CLASS 3 (POSTPETITION PENSION ELIGIBLE BEP CLAIMS)

(a) Impairment; Voting. Agway Class 3 is unimpaired by the Plan. Each
-------------------
holder of a Postpetition Pension Eligible BEP Claim in Agway Class 3 is
conclusively presumed to have accepted the Plan and is not entitled to vote to
accept or reject the Plan.

(b) Treatment. On the Pension Plan Distribution Date, or as soon thereafter
----------
as is reasonably practicable, each holder of a Postpetition Pension Eligible BEP
Claim will receive a lump sum payment or lifetime annuity based on 100% of its
Postpetition Pension Eligible BEP Claim. The option of a lump sum payment or
lifetime annuity will be given to such holder in accordance with applicable law
and the options available under the Pension Plan. In the event the participant
fails to make an election, the Pension Plan generally requires the plan to
provide the benefit as a lifetime annuity.

To the extent a Postpetition BEP Claim is determined after the
Effective Date to be ineligible to be included in the Pension Plan, it will be
treated as an Administrative Claim and the distribution on account of such Claim
shall be paid in accordance with Section 2.01 hereof as soon as reasonably
practicable after such determination. Such distributions will be made in an
amount equal to the distributions previously made to like claims, as if such
Postpetition BEP Claim had been determined to be ineligible for inclusion in the
Pension Plan on the Effective Date.

5.04. AGWAY CLASS 4A (CONVENIENCE CLAIMS).

(a) Impairment; Voting. Agway Class 4A is unimpaired by the Plan. Each
-------------------
holder of an Allowed Convenience Claim in Agway Class 4A is conclusively
presumed to have accepted the Plan and is not entitled to vote to accept or
reject the Plan.

(b) Treatment. On the Effective Date, or as soon thereafter as is
---------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
Convenience Claim, each holder of an Allowed Convenience Claim shall receive
Cash in the full amount of such Allowed Convenience Claim.

5.05. AGWAY CLASS 4B (WORKERS' COMPENSATION CLAIMS).

(a) Impairment; Voting. Agway Class 4B is unimpaired by the Plan. Each
--------------------
holder of a Workers' Compensation Claim in Agway Class 4B with an Allowed
Workers' Compensation Claim is not entitled to vote to accept or reject the
Plan.

(b) Treatment. Workers' Compensation Claims will continue to be determined
----------
by the administrative procedures established in each state. A final,
non-appealable administrative determination will result in an Allowed Workers'
Compensation Claim. Holders of Allowed Workers' Compensation Claims will be paid
by the applicable Insurance Carrier or state entity outside of the Plan in
accordance with applicable insurance contracts and/or applicable law.

5.06. AGWAY CLASS 4C (GENERAL UNSECURED CLAIMS).

(a) Impairment; Voting. Agway Class 4C is impaired by the Plan. Each
-------------------
General Unsecured Creditor in Agway Class 4C with an Allowed General Unsecured
Claim is entitled to vote to accept or reject the Plan.

(b) Treatment. On the Effective Date, or as soon thereafter as is
---------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
General Unsecured Claim, each holder of an Allowed General Unsecured Claim in
Agway Class 4C will receive a distribution of its Ratable Proportion of
Available Cash.

In addition, each holder of an Allowed General Unsecured Claim
in Agway Class 4C shall receive on the Effective Date its Ratable Proportion of
the beneficial interests in the Liquidating Trust, and after the Effective Date,
any additional distributable Cash, if any, from the Liquidating Trust.

(c) Tort Claims. All Tort Claims are Disputed Claims. Any Tort Claim as to
-----------
which a proof of Claim was timely filed in the Chapter 11 Cases will be
determined and liquidated either in the administrative or judicial tribunal in
which it is pending on the Effective Date or, if no action is pending on the
Effective Date, in any administrative or judicial tribunal of appropriate
jurisdiction, or in accordance with any alternative dispute resolution or
similar proceedings as the same may be approved by order of the Bankruptcy
Court. The Debtors, however, reserve the right to seek estimation of any and all
Tort Claims in a court or courts of competent jurisdiction. To the extent that a
Tort Claim is determined and liquidated pursuant to a final, nonappealable
judgment in such a tribunal or in any such alternative dispute resolution or
similar proceeding such Tort Claim, subject to the following paragraph, shall be
deemed an Allowed General Unsecured Claim in such liquidated amount and, if such
Tort Claim is against Agway, satisfied in accordance with the treatment
specified in Agway Class 4C for holders of General Unsecured Claims against
Agway.

To the extent that any holder of a Tort Claim has recourse to
any insurance policy issued to or for the benefit of the Debtors, for amounts in
excess of the Debtors' deductible and self-insured retention amounts, if any,
the holder of such Claim must first, to the satisfaction of the Debtors or the
Liquidating Trustee, use its best efforts to collect that portion of its Allowed
Claims in excess of the Debtors' deductible and self-insured retention amounts
from the Insurance Carrier. Any remaining unpaid portion of such Tort Claim
shall be treated as an Allowed General Unsecured Claim. Any liquidated and
determined Tort Claim shall be the obligation of, and satisfied by, any
applicable insurance agreement providing coverage for the Tort Claim in excess
of any applicable Debtors' deductible or self-insured retention. The holder of
such a Tort Claim may not recover from the Insurance Carrier the difference
between the amount of any distribution paid to the holder of such Claim pursuant
to the Plan and the balance of the Debtors' deductible and self-insured
retention amount. Any allowed Tort Claim which falls within the Debtors'
deductible and self-insured retention amounts shall be asserted solely against
the Liquidating Trust and not against any Insurance Carrier.

5.07. AGWAY CLASS 5A (RETIREE CLAIMS)

(a) Impairment; Voting. Agway Class 5A is impaired by the Plan. Each holder
------------------
of an Agway Class 5A Claim with an Allowed Retiree Claim is entitled to vote to
accept or reject the Plan.

(b) Treatment. On the Pension Plan Distribution Date, or as soon thereafter
----------
as is reasonably practicable, each holder of an Allowed Retiree Claim will
receive either a lump sum payment or lifetime annuity based on 62.5% of its
Allowed Retiree Claim payable from the Pension Plan. Upon the payment to a
holder of an Allowed Retiree Claim from the Pension Plan, such holder's Allowed
Retiree Claim shall be deemed satisfied and, thus, will be expunged as a claim
against Agway, Inc.'s estate. The option of a lump sum payment or lifetime
annuity will be given to such holder in accordance with applicable law and the
options available under the Pension Plan. In the event the participant fails to
make an election, the Pension Plan generally requires the plan to provide the
benefit as a lifetime annuity.

Notwithstanding the foregoing, to the extent a prepetition
Retiree Claim is determined after the Effective Date to be ineligible to be
included in the Pension Plan, the distributions on account of such Claim shall
be paid from the Liquidating Trust as soon as reasonably practicable after such
determination as a General Unsecured Claim in accordance with Section 5.06(b)
hereof. Such distributions will be made in an amount equal to the distributions
previously made to like claims, as if such Retiree Claim had been determined to
be ineligible for inclusion in the Pension Plan on the Effective Date.

5.08. AGWAY CLASS 5B (POST 65 RETIREE MEDICAL CLAIMS)

(a) Impairment; Voting. Agway Class 5B is impaired by the Plan. Each holder
------------------
of an Agway Class 5B Claim with an Allowed Post 65 Retiree Medical Claim is
entitled to vote to accept or reject the Plan.

(b) Treatment. On the Pension Plan Distribution Date, or as soon thereafter
---------
as is reasonably practicable, holders of Allowed Post 65 Retiree Medical Claim
will receive either a lump sum payment or lifetime annuity based on the
following: (x) current enrollees in the Post 65 Retiree Medical Plan shall
receive their Ratable Proportion of $4.1 million payable from the Pension Plan,
and (y) each holder of an Allowed Post 65 Retiree Medical Claim that opted out
of the Post 65 Retiree Medical Plan will receive its Ratable Proportion of $1.9
million payable from the Pension Plan, as described more fully in Section
VII.A.7 of the Disclosure Statement. Upon the payment to a holder of an Allowed
Post 65 Retiree Medical Claim from the Pension Plan, such holder's Allowed Post
65 Retiree Medical Claim shall be deemed satisfied and, thus, will be expunged
as a claim against Agway, Inc.'s estate. The option of a lump sum payment or
lifetime annuity will be given to such holder in accordance with applicable law
and the options available under the Pension Plan. In the event the participant
fails to make an election, the Pension Plan generally requires the plan to
provide the benefit as a lifetime annuity.

Notwithstanding the foregoing, to the extent a Post 65 Retiree
Medical Claim is determined after the Effective Date to be ineligible to be
included in the Pension Plan, the distributions on account of such Claim shall

be paid from the Liquidating Trust as soon as reasonably practicable after such
determination as a General Unsecured Claim in accordance with Section 5.06(b)
hereof. Such distributions will be made in an amount equal to the distributions
previously made to like claims, as if such Post 65 Retiree Medical Claim had
been determined to be ineligible for inclusion in the Pension Plan on the
Effective Date.

5.09. AGWAY CLASS 6 (SECTION 510(B) CLAIMS) .

(a) Impairment; Voting. Agway Class 6 is impaired by the Plan. Each holder
-------------------
of an Allowed Section 510(b) Claim is conclusively presumed to have rejected the
Plan and is not entitled to vote to accept or reject the Plan.

(b) Treatment. There will be no distribution to holders of Allowed Section
---------
510(b) Claims.

5.10. AGWAY CLASS 7 (EQUITY INTERESTS).

(a) Impairment; Voting. Agway Class 7 is impaired by the Plan. Each holder
-------------------
of an Equity Interest is conclusively presumed to have rejected the Plan and is
not entitled to vote to accept or reject the Plan.

(b) Treatment. On the Effective Date, all Equity Interests in Agway, Inc.
---------
shall be deemed canceled and one new share of common stock of Agway, Inc. will
be issued to the Equity Custodian (who may be the Liquidating Trustee or any
other person designated by the Debtors), who will hold such share for the
benefit of such former holders in Agway, Inc. consistent with these holders'
former economic entitlements. Except as provided in the preceding sentence, each
holder of an Equity Interest in Agway, Inc. shall neither receive nor retain any
property or interest in property on account of such Equity Interest. On or
promptly after the Effective Date, Agway, Inc. will file with the Securities and
Exchange Commission a Form 15 for the purpose of terminating the registration of
any of its publicly traded securities. All common stock of Agway, Inc.
outstanding after the Effective Date shall be canceled on the date Agway is
dissolved in accordance with Section 7.04(c) of the Plan.

FCI PLAN
- --------

5.11. FCI CLASS 1 (SECURED CLAIMS).

(a) Impairment; Voting. FCI Class 1 Claims are unimpaired by the Plan. Each
-------------------
holder of an Allowed Secured Claim is conclusively presumed to have accepted the
Plan and is not entitled to vote to accept or reject the Plan.

(b) Treatment. On the Effective Date, unless otherwise agreed to by the
---------
holder of an Allowed Secured Claim, each holder of an Allowed Secured Claim
shall receive (i) the amount of the proceeds actually realized from the sale of
any Collateral securing such Claim, less the actual costs and expenses of
disposing of such Collateral; and/or (ii) the Collateral securing such Claim,
but in neither case in an amount greater than necessary to pay such Allowed
Secured Claim in full, plus any interest (including post-petition interest to
the extent permitted under the Bankruptcy Code) on such Allowed Secured Claim

and any reasonable fees, costs or charges provided for under the governing
agreements, to be allowed and paid pursuant to section 506(b) of the Bankruptcy
Code. To the extent that the amount of a Secured Claim exceeds the value of the
Collateral securing such Allowed Secured Claim that portion of such Claim shall
be treated as an unsecured Deficiency Claim in FCI Class 3C.

(c) Retention of Lien. Except as otherwise provided by an order of the
------------------
Bankruptcy Court and section 363(f) of the Bankruptcy Code, the holder of an
Allowed Secured Claim shall retain the lien securing the Claim as of the
Confirmation Date until distributions have been made to such holder provided for
above in Section 5.11(b) to satisfy such Claim in full.

(d) Subclasses. Each Secured Claim shall be deemed to be separately
-----------
classified in a subclass of FCI Class 1 and shall have all rights associated
with separate classification under the Bankruptcy Code.

5.12. FCI CLASS 2 (PRIORITY NON-TAX CLAIMS).

(a) Impairment; Voting. FCI Class 2 is unimpaired by the Plan. Each holder
-------------------
of an Allowed Priority Non-Tax Claim in FCI Class 2 is conclusively presumed to
have accepted the Plan and is not entitled to vote to accept or reject the Plan.

(b) Treatment. On the Effective Date, or as soon thereafter as is
---------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
Priority Non-Tax Claim in FCI Class 2, each holder of an Allowed Priority
Non-Tax Claim shall receive in full satisfaction of such Claim, Cash, in an
amount equal to such Allowed Priority Non-Tax Claim.

5.13. FCI CLASS 3A (CONVENIENCE CLAIMS).

(a) Impairment; Voting. FCI Class 3A is unimpaired by the Plan. Each holder
------------------
of an Allowed Convenience Claim in FCI Class 3A is conclusively presumed to have
accepted the Plan and is not entitled to vote to accept or reject the Plan.

5.14. FCI CLASS 3B (WORKERS' COMPENSATION CLAIMS).

(a) Impairment; Voting. FCI Class 3B is unimpaired by the Plan. Each holder
------------------
of a Workers' Compensation Claim in FCI Class 3B with an Allowed Workers'
Compensation Claim is not entitled to vote to accept or reject the Plan

(b) Treatment. On the Effective Date or as soon thereafter as the Workers'
---------
Compensation Claim is resolved by the applicable insurance company, each holder

of an Allowed Workers' Compensation Claim in FCI Class 3B will continue to
receive his or her benefits unimpaired by the Plan.

5.15. FCI CLASS 3C (GENERAL UNSECURED CLAIMS).

(a) Impairment; Voting. FCI Class 3C is impaired by the Plan. Each General
-------------------
Unsecured Creditor in FCI Class 3C with an Allowed General Unsecured Claim is
entitled to vote to accept or reject the Plan.

(b) Treatment. On the Effective Date, or as soon thereafter as is
---------
reasonably practicable, unless otherwise agreed to by the holder of an Allowed
General Unsecured Claim, each holder of an Allowed General Unsecured Claim in
FCI Class 3C will receive a distribution of its Ratable Proportion of Available
Cash.

(c) Tort Claims. All Tort Claims are Disputed Claims. Any Tort Claim as to
-----------
which a proof of Claim was timely filed in the Chapter 11 Cases will be
determined and liquidated either in the administrative or judicial tribunal in
which it is pending on the Effective Date or, if no action is pending on the
Effective Date, in any administrative or judicial tribunal of appropriate
jurisdiction, or in accordance with any alternative dispute resolution or
similar proceedings as the same may be approved by order of the Bankruptcy
Court. The Debtors, however, reserve the right to seek estimation of any and all
Tort Claims in a court or courts of competent jurisdiction. To the extent that a
Tort Claim is determined and liquidated pursuant to a final, nonappealable
judgment in such a tribunal or in any such alternative dispute resolution or
similar proceeding, such Tort Claim shall, subject to Section 5.15(c) of the
Plan, be deemed an Allowed General Unsecured Claim in such liquidated amount
and, if such Tort Claim is against FCI, satisfied in accordance with the
treatment specified in FCI Class 3C for holders of General Unsecured Claims
against FCI.

5.16. FCI CLASS 4 (EQUITY INTERESTS).

(a) Impairment; Voting. FCI Class 4 is impaired by the Plan. Each holder of
------------------
an Equity Interest is conclusively presumed to have rejected the Plan and is not
entitled to vote to accept or reject the Plan.

(b) Treatment. Holders of Allowed Equity Interests in FCI will retain their
---------
Equity Interests until the occurrence of the Effective Date, upon which such
Equity Interests shall be extinguished. It is anticipated that there will be no
distribution to holders of Allowed Equity Interests in FCI. To the extent that
there is any cash or property after all holders of Allowed Claims against FCI
have been paid in full, such excess cash or property shall be distributed to the
Liquidating Trust.

ARTICLE VI

PROVISIONS GOVERNING DISTRIBUTIONS

6.01. RECORD DATE FOR DISTRIBUTIONS. As of April 1, 2004, the various
transfer registers for each of the Classes of Claims or Equity Interests as
maintained by the Debtors or their respective agents shall be deemed closed for
distribution purposes, and there shall be no further changes made to reflect any
new record holders of any Claims or Equity Interests. The Debtors shall have no
obligation to recognize any transfer of Claims or Equity Interests occurring on
or after such date.

6.02. DATE OF DISTRIBUTIONS. Unless otherwise provided herein, any
distributions and deliveries to be made hereunder to the holders of Allowed
Claims shall be made on the Effective Date or the Pension Plan Distribution
Date, as the case may be, or as soon thereafter as is reasonably practicable.

6.03. DISBURSING AGENT. All distributions under the Plan shall be made by
the Disbursing Agent (or the Liquidating Trustee if otherwise provided) or such
other entity designated by the Debtors or Liquidating Trustee as a Disbursing
Agent. The Disbursing Agent shall not be required to give any bond or surety or
other security for the performance of its duties unless otherwise ordered by the
Bankruptcy Court; and, in the event that the Disbursing Agent is so otherwise
ordered, the Liquidating Trust shall pay its share of the costs and expenses of
procuring any such bond or surety.

6.04. SUBSEQUENT DISTRIBUTIONS. After the Effective Date, to the extent
Cash and other property not subject to any lien is available from (i) the
Disputed Claims Reserve following the disallowance or reduction of any Disputed
Claims, (ii) undeliverable, time-barred or unclaimed distributions to holders of
Allowed Claims, or (iii) the proceeds of Liquidating Trust Assets and Claims,
the Liquidating Trustee shall, on each Subsequent Distribution Date, allocate
such Cash and other property among the holders of Allowed General Unsecured
Claims that were Allowed on the Effective Date or subsequently have become
Allowed on or before such Subsequent Distribution Date and the holders of any
still pending Disputed Claims (to the extent provided by the Plan); with the
Cash and other property allocated to Allowed General Unsecured Claims

distributed to holders of such Claims and the Cash and other property allocated
to pending Disputed Claims retained in the Disputed Claims Reserve to be
administered in accordance with Article VIII of the Plan; provided, however,
that any amounts released from the Disputed Claims Reserve shall be net of
certain costs and expenses as provided in the Plan and subject to the prior
repayment of any outstanding Tax Advance associated with the released funds in
accordance with the Plan. In no event shall the Liquidating Trustee be obligated
to make a distribution if, in the reasonable business judgment of the
Liquidating Trustee, the amount then on hand and the ultimate distribution to be
made would not be justified, taking into account all of the attendant costs of
such distribution. In such case, any undistributed amount may be held over to
the next Subsequent Distribution Date.

6.05. DISTRIBUTIONS OF CASH. Any payment of Cash made by the Disbursing
Agent pursuant to the Plan may be made at the option of the Disbursing Agent
either by check drawn on a domestic bank or by wire transfer from a domestic
bank.

6.06. ALLOCATIONS AFTER EFFECTIVE DATE. Allocations made after the
Effective Date to the Disputed Claims Reserve for the benefit of the holders of
Disputed Claims that later become Allowed Claims shall be deemed to have been
made on the Effective Date.

6.07. DELIVERY OF DISTRIBUTIONS AND UNDELIVERABLE DISTRIBUTIONS.
Distributions to holders of Allowed Claims shall be made at the address of each
such holder as set forth on the Schedules filed with the Bankruptcy Court,
unless superseded by a new address as set forth (a) on a proof of claim filed by
a holder of an Allowed Claim, or (b) in another writing notifying the
Liquidating Trustee (at the addresses set forth in the Plan) of a change of
address. If any holder's distribution is returned as undeliverable, no further
distributions to such holder shall be made unless and until the Liquidating
Trustee is notified of such holder's then-current address, at which time all
missed distributions shall be made to such holder, without interest. All Claims
for undeliverable distributions shall be made on or before the earlier of (i)
with respect to the initial distributions made on or after the Effective Date,
one hundred and eighty (180) days after the date such initial undeliverable
distribution was made, or (ii) with respect to the distributions made on a
Subsequent Distribution Date, one hundred and eighty (180) days after the date
such undeliverable distribution was made. If a distribution cannot be made
pursuant to the preceding sentence, any such holder's Claim shall be expunged.

6.08. COMPLIANCE WITH TAX REQUIREMENTS. In connection with the Plan, to the
extent applicable, the Disbursing Agent or the Liquidating Trustee (as
applicable), in making distributions under the Plan, shall comply with all tax
withholding and reporting requirements imposed on it by any governmental unit,
and all distributions pursuant to the Plan shall be subject to such withholding
and reporting requirements. The Disbursing Agent or the Liquidating Trustee, as
applicable, may withhold the entire distribution due to any holder of an Allowed
Claim until such time as such holder provides the necessary information to
comply with any withholding requirements of any governmental unit. Any property
so withheld will then be paid by the Disbursing Agent or the Liquidating
Trustee, as applicable, to the appropriate authority. If the holder of an
Allowed Claim fails to provide the information necessary to comply with any
withholding requirements of any governmental unit within six months from the
date of first notification to the Person in need for such information or for the
Cash necessary to comply with any applicable withholding requirements, then the

holder's distribution shall be treated as an undeliverable distribution in
accordance with this Article VI.

6.09. TIME BAR TO CASH PAYMENTS. Checks issued by the Disbursing Agent or
the Liquidating Trustee in respect of Allowed Claims shall be null and void if
not negotiated within one hundred and eighty (180) days after the date of
issuance thereof. Requests for reissuance of any check shall be made to the
Disbursing Agent or the Liquidating Trustee by the holder of the Allowed Claim
to whom such check originally was issued. Any claim in respect of such a voided
check shall be made on or before the thirty (30) days after the expiration of
the one hundred and eighty day period following the date of issuance of such
check.

6.10. SETOFFS. The Disbursing Agent in consultation with the Liquidating
Trustee shall, in accordance with section 553 of the Bankruptcy Code and
applicable non-bankruptcy law, set off against any Allowed Claim and the
distributions to be made pursuant to the Plan on account of such Claim (before
any distribution is made on account of such Claim), the claims, rights and
causes of action of any nature that any of the Debtors or the Liquidating Trust
may hold against the holder of such Allowed Claim; provided, however, that
neither the failure to effect such a setoff nor the allowance of any Claim
hereunder shall constitute a waiver or release by the Disbursing Agent on behalf
of any of the Debtors or the Liquidating Trust (or any successor thereto) of any
such claims, rights and causes of action that any of the Debtors or the
Liquidating Trust (or any successor thereto) may possess against such holder;
and provided further, however, that any claims of any of the Debtors (or any
successor thereto, including, without limitation, the Liquidating Trust),
arising before the Petition Date shall first be setoff against Claims against
such Debtor (or any successor thereto) arising before the Petition Date.

Notwithstanding anything contained herein to the contrary and
notwithstanding the transfer of the Liquidating Trust Assets and Claims to the
Liquidating Trust, in the event that a claimant in an action brought by the
Liquidating Trustee for and on behalf of the Liquidating Trust (i) is required
by a Final Order to make payment to the Liquidating Trust (the "Judgment
Amount"), and (ii) has an Allowed right of setoff under section 553 of the
Bankruptcy Code or applicable non-bankruptcy law, then the Judgment Amount shall
be offset against any amount such claimant owes to the Liquidating Trust.

6.11. PROFESSIONAL FEES AND EXPENSES. Each professional person or firm
retained with approval by order of the Bankruptcy Court or requesting
compensation in the Chapter 11 Cases pursuant to sections 330, 331 or 503(b) of
the Bankruptcy Code, with the exception of any ordinary course professionals
retained by the Debtors pursuant to an order of the Court, shall be required to
file an application for an allowance of final compensation and reimbursement of
expenses in the Chapter 11 Cases incurred through the Confirmation Date on or
before a date to be set in the notice of a hearing for Approval of Final Fee
Applications by the Bankruptcy Court in the Confirmation Order, which shall be
no later than sixty (60) days after the Confirmation Date. Objections to any
such application shall be filed on or before a date to be set by the Bankruptcy
Court in the Confirmation Order.

6.12. TRANSACTIONS ON BUSINESS DAYS. If the Effective Date, the Pension
Plan Distribution Date or any other date on which a transaction may occur under

the Plan shall occur on a day that is not a Business Day, the transactions
contemplated by the Plan to occur on such day shall instead occur on the next
succeeding Business Day.

6.13. MINIMUM DISTRIBUTIONS. If a distribution to be made to or on behalf
of a holder of a Claim on or after the Effective Date, the Pension Plan
Distribution Date or any Subsequent Distribution Date would be $100 or less in
the aggregate, notwithstanding any contrary provision of the Plan, no such
distribution will be made to or on behalf of such holder unless a request
therefor is made in writing to the Disbursing Agent or the Liquidating Trustee,
as applicable (at the addresses provided in the Plan). Any undistributed amount
shall be held over to the next Subsequent Distribution Date; provided, the
foregoing shall not apply to Convenience Claims.

6.14. ALLOCATION OF DISTRIBUTIONS. Distributions to any holder of an
Allowed Claim shall be allocated first to the principal amount of any such
Allowed Claim, as determined for federal income tax purposes, and then, to the
extent the consideration exceeds such amount, to the remainder of such Claim
comprising interest, if any (but solely to the extent that interest is an
allowable portion of such Allowed Claim).

6.15. RIGHTS AND POWERS OF DISBURSING AGENT.

(a) Powers of the Disbursing Agent. The Disbursing Agent shall be empowered
------------------------------
to (i) effect all actions and execute all agreements, instruments, and other
documents necessary to perform its duties under the Plan, (ii) make all
distributions contemplated hereby, (iii) employ professionals to represent it
with respect to its responsibilities, and (iv) exercise such other powers as may
be vested in the Disbursing Agent by order of the Bankruptcy Court, pursuant to
the Plan, or as deemed by the Disbursing Agent to be necessary and proper to
implement the provisions hereof.

(b) Expenses Incurred After the Effective Date. Except as otherwise ordered
------------------------------------------
by the Bankruptcy Court, the amount of any reasonable fees and expenses incurred
by the Disbursing Agent on or after the Effective Date (including, without
limitation, taxes) and any reasonable compensation and expense reimbursement
claims (including, without limitation, reasonable attorney fees and expenses)
made by the Disbursing Agent shall be paid in Cash by the Liquidating Trustee
from the Liquidating Trust.

ARTICLE VII

MEANS FOR IMPLEMENTATION AND EXECUTION OF THE PLAN

7.01. LIQUIDATING TRUST.

(a) Establishment of the Liquidating Trust. On or before the Effective
-----------------------------------------
Date, Agway, Inc. shall execute a Liquidating Trust Agreement with the
Liquidating Trustee and shall take all other steps necessary to establish a
Liquidating Trust. On the Effective Date, and in accordance with Section 7.01(e)
hereof, Agway, Inc. shall transfer to the Liquidating Trust all of its right,
title and interest in the Liquidating Trust Assets and Claims and an amount of
Cash for funding the Liquidating Trust as provided in Section 7.01(d) hereof. In
connection with the above-described rights and causes of action, any

attorney-client privilege, work-product privilege, or other privilege or
immunity attaching to any documents or communications (whether written or oral)
transferred to Liquidating Trust shall vest in the Liquidating Trustee and its
representatives. Notwithstanding the occurrence of the Effective Date, to the
extent that operating assets of active businesses remain unsold, such asset/s
may be retained by Agway, Inc. and not delivered into the Liquidating Trust
pending the liquidation of such asset/s. Notwithstanding anything herein to the
contrary, including, without limitation, the distributions to be made to a
holder of an Allowed General Unsecured Claim in accordance with Section 7.01(f)
hereof, in the unlikely event that distributions of Cash and the value of such
holder's interest in the Liquidating Trust Assets, in accordance with Section
7.01(f) hereof, are equal to or in excess of one hundred percent (100%) of such
holder's Allowed General Unsecured Claim, then the amount of Cash and the fair
market value of the holder's interest in the Liquidating Trust Assets remaining
to be distributed to such holder in excess of one hundred percent (100%) shall
be deemed re-transferred to the Liquidating Trustee on behalf of and for the
benefit of the holders of Allowed General Unsecured Claims and then for the
benefit of all other Claims in accordance with the Bankruptcy Code. The
Liquidating Trustee appointed by the UST shall be the representative of the
estate under section 1123(b)(3) of the Bankruptcy Code.

(b) Purpose of the Liquidating Trust. The Liquidating Trust shall be
----------------------------------
established for the sole purpose of liquidating its assets, in accordance with
Treasury Regulation section 301.7701-4(d), with no objective to continue or
engage in the conduct of a trade or business.

(c) Reserve Accounts for Disputed Claims. On and after the Effective Date,
------------------------------------
the Liquidating Trustee shall allocate to the Disputed Claims Reserve: (i) Cash
in an aggregate amount sufficient to pay to each holder of a Disputed Unsecured
Claim the amount that such holder would have been entitled to receive under the
Plan if such Claim had been an Allowed Claim on the Effective Date or any
Subsequent Distribution Date, (ii) net earnings on such Cash and (iii) any other
property distributed in respect of such beneficial interests in the Liquidating
Trust. All Cash and Cash equivalents and earnings thereon shall be used to
satisfy any expenses incurred in connection with the maintenance of the Disputed
Claims Reserve, including taxes payable by the Disputed Claims Reserve, if any,
and repayment of any Tax Advances.

(d) Funding Expenses of the Liquidating Trust. In accordance with the
--------------------------------------------
Liquidating Trust Agreement and any other agreements entered into in connection
therewith, on the Effective Date, Agway, Inc. shall, without limiting its
obligation to transfer assets in accordance with 7.01(e) of the Plan, transfer
an amount of Cash (in addition to any Cash allocated to the Disputed Claims
Reserve) to the Liquidating Trust reasonably necessary to fund the
administrative expenses of the Liquidating Trust. To the extent such amount
subsequently proves insufficient, subject to the terms of the Liquidating Trust
Agreement the Liquidating Trustee may borrow additional amounts to fund any
reasonably necessary administrative expenses (including, but not limited to, any
taxes imposed on the Liquidating Trust or fees and expenses in connection with
its liquidations).

(e) Transfer of Assets. The transfer by Agway, Inc. of the Liquidating
-------------------
Trust Assets and Claims (and an amount of Cash as provided in Section 7.01(d)

hereof) to the Liquidating Trust shall be made, as provided herein, for the
benefit of holders of Allowed General Unsecured Claims against Agway whether
Allowed on or after the Effective Date. In this regard, the assets to be held by
the Liquidating Trust initially will be deemed transferred to holders of Allowed
Claims against Agway, and, in respect of any Disputed Claims, allocated to the
Disputed Claims Reserve. Immediately thereafter and on behalf of such
recipients, Agway, Inc. shall transfer such assets to the Liquidating Trust in
exchange for the undivided beneficial interests in the Liquidating Trust for the
benefit of holders of such Claims, in accordance with the Plan. Upon transfer of
the Liquidating Trust Assets and Claims, Agway shall have no interest in or with
respect to the Liquidating Trust Assets and Claims or the Liquidating Trust.

It is the intention of Agway, Inc. that all of its right,
title and interest in the Liquidating Trust Assets and Claims be transferred to
the Liquidating Trust on the Effective Date. The failure to transfer one or more
assets constituting a Liquidating Trust Asset or Claim on the Effective Date,
however, shall not preclude Agway, Inc. from effecting such transfer at a later
date. In furtherance thereof, Agway, Inc. by any of its authorized
representatives and/or by the Liquidating Trustee shall be authorized and
empowered to execute, deliver and cause the recording of such deeds, titles or
other instruments of conveyance as are necessary to effect the transfer of such
Liquidating Trust Assets and Claims to the Liquidating Trust.

For federal income tax purposes, all parties including,
without limitation, the Debtors, the Liquidating Trustee and the holders of
Allowed General Unsecured Claims who are beneficiaries of the Liquidating Trust,
shall treat the transfer of assets to the Liquidating Trust, in accordance with
the terms of the Plan and the Liquidating Trust Agreement (and in respect of the
Disputed Claims, the Disputed Claims Reserve), as a transfer to the holders of
Allowed General Unsecured Claims in satisfaction of such Claims, followed by a
transfer by such holders to the Liquidating Trust, and the beneficiaries of the
Liquidating Trust shall be treated as the grantors and owners thereof.

(f) Liquidation of Assets, Responsibilities of Liquidating Trustee. In
------------------------------------------------------------------
accordance with the provisions of the Liquidating Trust Agreement, the
Liquidating Trustee, in its reasonable business judgment, shall, in an
expeditious but orderly manner, liquidate and convert to Cash the assets of the
Liquidating Trust, make timely distributions and not unduly prolong the duration
of the Liquidating Trust. The liquidation of the Liquidating Trust Assets and
Claims may be accomplished either through the sale, prosecution, compromise and
settlement, abandonment or dismissal of the Liquidating Trust Assets and Claims.
Subject to the terms of the Liquidating Trust Agreement, the Liquidating Trustee
shall be entitled to determine whether or not to pursue any of the claims
comprising the Liquidating Trust Assets and Claims, as it determines is in the
best interests of the beneficiaries of the Liquidating Trust and consistent with
the purposes of the Liquidating Trust and subject to the terms of the
Liquidating Trust Agreement. To the extent that the Liquidating Trustee takes or
fails to take any action that a creditor believes is appropriate or
inappropriate, as the case may be, such creditor may seek relief from the
Bankruptcy Court. Additionally, to the extent that a holder of a beneficial
interest in the Liquidating Trust receives a recovery in respect of its Claim
from a source other than the Liquidating Trust, such as the proceeds of Agway,
Inc.'s insurance policies (but excluding recoveries with respect to the Thrift
Plan Litigation Claims, the DOL Litigation, or the Seedgrowers Litigation
Claims), the Liquidating Trustee may, in its reasonable discretion, and after

written notice and an opportunity to be heard by the Bankruptcy Court in
accordance with section 102 of the Bankruptcy Code, reduce such holder's Claim
against Agway by the amount of such recovery to effectuate a more equitable
distribution among the holders of General Unsecured Claims in Agway Class 4C, or
to ensure that no such holder (including a holder of a Thrift Plan Litigation
Claim, DOL Litigation Claim or the Seedgrowers Litigation Claims) obtains an
aggregate recovery exceeding 100% of its Claim (or, (i) with respect to a holder
of a Thrift Plan Litigation Claim or DOL Litigation Claim, an aggregate net
recovery exceeding 100% of its entitlement to be made whole under ERISA, or (ii)
with respect to the Seedgrowers Litigation Claims, an aggregate recovery
exceeding 100% of their Claims under applicable non-bankruptcy law). The
Liquidating Trustee may incur any reasonable and necessary expenses arising from
or related to the liquidation and conversion to Cash of the Liquidating Trust
Assets and Claims. The professional fees of the Liquidating Trustee, as well as
any compensation proposed to be paid to the Liquidating Trustee in respect of
the services to be rendered pursuant to the Liquidating Trust Agreement shall be
subject to Court approval.

The Liquidating Trustee shall be designated in the
Confirmation Order and the Liquidating Trust Agreement and shall have the power
to (i) liquidate or prosecute for the benefit of the Liquidating Trust the
Liquidating Trust Assets and Claims (whether such suits are brought in the name
of the Liquidating Trust or otherwise) and (ii) administer the assets of the
Liquidating Trust and otherwise perform the functions and take the actions
provided for or permitted in the Liquidating Trust Agreement or in any other
agreement executed by the Liquidating Trustee pursuant to the Plan. Any and all
proceeds generated from the various Liquidating Trust Assets and Claims shall
constitute the property of the Liquidating Trust.

The Liquidating Trustee may request an expedited determination
of taxes of the Liquidating Trust (including tax issues related to the Disputed
Claims Reserve) under section 505(b) of the Bankruptcy Code for all returns
filed for, or on behalf of, the Liquidating Trust for all taxable periods
through the dissolution of the Liquidating Trust.

The Liquidating Trustee shall be selected by the UST, in
consultation with the constituents whose input the UST deems appropriate and
necessary (including Agway, Inc.), and subject to Court approval. The
Liquidating Trustee or the Liquidating Trust may also serve as the Disbursing
Agent, the Equity Custodian, and the Pension Plan and Thrift Plan Administrator.

The rights and responsibilities of the Liquidating Trustee
shall be governed by the Liquidating Trust Agreement. If any of the provisions
herein relating to the rights and responsibilities of the Liquidating Trustee
conflicts with the Liquidating Trust Agreement, the provisions of the
Liquidating Trust Agreement govern.

(g) Valuation of Assets. As soon as possible after the Effective Date, but
--------------------
in no event later than ninety (90) days thereafter, (i) the Liquidating Trustee
shall inform, in writing, the Disbursing Agent of the value of the Liquidating
Trust Assets and Claims and the Cash transferred to the Liquidating Trust
pursuant to the Plan and (ii) the Disbursing Agent shall apprise, in writing,
the original beneficiaries of the Liquidating Trust of such valuation. The
valuation shall be used consistently by all parties (including Agway, the
Liquidating Trustee and the beneficiaries of the Liquidating Trust) for all
federal income tax purposes.

(h) Investment Powers. The right and power of the Liquidating Trustee to
------------------
invest any Cash transferred to the Liquidating Trust (including Cash allocated
to the Disputed Claims Reserve), the Cash proceeds from the realization or
disposition of any of the Liquidating Trust Assets and Claims, and any income
earned by the Liquidating Trust, shall be limited to the right and power to
invest such Cash (pending periodic distributions in accordance with Section
7.01(i) of the Plan) in United States Treasury Bills, interest-bearing
certificates of deposit, tax exempt securities or investments permitted by
section 345 of the Bankruptcy Code or otherwise authorized by the Bankruptcy
Court, using prudent efforts to enhance the rates of interest earned on such
Cash without inordinate credit risk or interest rate risk; provided, however,
that (a) the scope of any such permissible investments shall be limited to
include only those investments, or shall be expanded to include any additional
investments, as the case may be, that a liquidating trust, within the meaning of
Treasury Regulation section 301.7701-4(d), may be permitted to hold, pursuant to
the Treasury Regulations, or any modification in the IRS guidelines, whether set
forth in IRS rulings, other IRS pronouncements or otherwise, and (b) the
Liquidating Trustee may expend the Cash of the Liquidating Trust (i) as
reasonably necessary to meet contingent liabilities and to maintain the value of
the assets of the Liquidating Trust during liquidation, (ii) to pay reasonable
administrative expenses (including, but not limited to, any taxes imposed on the
Liquidating Trust or fees and expenses in connection with litigation concerning
any Claims held by a Liquidating Trust) and (iii) to satisfy other liabilities
incurred by the Liquidating Trust in accordance with the Plan or the Liquidating
Trust Agreement.

(i) Semi-Annual Distribution; Withholding. The Liquidating Trustee shall
---------------------------------------
distribute at least semi-annually to the holders of the beneficial interests in
the Liquidating Trust, in accordance with such holders' Ratable Proportion of
the beneficial interests in the Liquidating Trust, all Cash on hand (including,
without limitation, all net Cash income plus all net Cash proceeds realized from
the liquidation of the Liquidating Trust Assets and Claims and, including as
Cash for this purpose, all permitted investments under Section 7.01(h) of the
Plan); provided, however, that the Liquidating Trust may retain such amounts (i)
as are reasonably necessary to meet contingent liabilities and to maintain the
value of the assets of the Liquidating Trust during liquidation, (ii) to pay
reasonable administrative expenses (including, but not limited to, any taxes
imposed on the Liquidating Trust or in respect of the assets of the Liquidating
Trust), and (iii) to satisfy other liabilities incurred by the Liquidating Trust
in accordance with the Plan or the Liquidating Trust Agreement. The Liquidating
Trustee may withhold from amounts distributable to any Person any and all
amounts, determined in the Liquidating Trustee's reasonable discretion, to be
required by any law, regulation, rule, ruling, directive, or other governmental
requirement.

(j) Reporting Duties. The Liquidating Trustee shall file returns for the
-----------------
Liquidating Trust as a grantor trust pursuant to Treasury Regulation section
1.671-4(a). The Liquidating Trustee shall also annually send to each holder of a
beneficial interest in the Liquidating Trust a separate statement setting forth
the holder's share of items of income, gain, loss, deduction, or credit and will
instruct all such holders to report such items on their federal income tax
returns or to forward the appropriate information to the beneficial holders
instructing them to report such items on their federal income tax returns. The
Liquidating Trust's taxable income will be allocated among the holders of
beneficial interests in a Liquidating Trust based upon each holder's Ratable
Proportion of the beneficial interests in the Liquidating Trust.

Subject to definitive guidance from the IRS or a court of
competent jurisdiction to the contrary (including the receipt by the Liquidating
Trustee of a private letter ruling if the Liquidating Trustee so requests one,
or the receipt of an adverse determination by the IRS upon audit if not
contested by the Liquidating Trustee), the Liquidating Trustee shall (a) treat
any Liquidating Trust Assets allocable to, or retained on account of, Disputed
Claims as held by one or more discrete trusts for federal income tax purposes
(the "Disputed Claims Reserve"), consisting of separate and independent shares
to be established in respect of each Disputed Claim, in accordance with the
trust provisions of the Tax Code (section 641 et seq.), (b) treat as taxable
income or loss of the Disputed Claims Reserve, with respect to any given taxable
year, the portion of the taxable income or loss of the Liquidating Trust that
would have been allocated to the holders of Disputed Claims had such Claims been
Allowed on the Effective Date (but only for the portion of the taxable year with
respect to which such Claims are unresolved), (c) treat as a distribution from
the Disputed Claims Reserve any increased amounts distributed by the Liquidating
Trust as a result of any Disputed Claims resolved earlier in the taxable year,
to the extent such distributions relate to taxable income or loss of the
Disputed Claims Reserve determined in accordance with the provisions hereof, and
(d) to the extent permitted by applicable law, report consistent with the
foregoing for state and local income tax purposes. All holders of General
Unsecured Claims shall report, for tax purposes, consistent with the foregoing.

In addition, the Liquidating Trustee shall file (or cause to
be filed) any other statements returns or disclosures relating to the
Liquidating Trust that are required by any governmental unit.

(k) Trust Implementation. On the Effective Date, the Liquidating Trust will
---------------------
become effective for the benefit of the applicable holders of Allowed General
Unsecured Claims and, in respect of any Disputed Claims, the Disputed Claims
Reserve. The Liquidating Trust Agreement shall be included in the Plan
Supplement and shall contain provisions customary to trust agreements utilized
in comparable circumstances, including, but not limited to, any and all
provisions necessary to ensure the continued treatment of the Liquidating Trust
as a grantor trust for federal income tax purposes. All parties (including
Agway, the Liquidating Trustee and holders of Allowed General Unsecured Claims
against Agway) shall execute any documents or other instruments as necessary to
cause title to the Liquidating Trust Assets and Claims to be transferred to the
Liquidating Trust.

(l) Registry of Beneficial Interests; Non-Assignability. To evidence each
----------------------------------------------------
holder's beneficial interest in the Liquidating Trust, the Liquidating Trustee
shall maintain a registry of such holders. A holder's beneficial interest shall
not be certificated and may not be assigned or otherwise transferred by any
holder other than (i) to any relative, spouse or relative of the spouse of such
holder, (ii) to any trust or estate in which such holder has a majority of the
beneficial interest (excluding contingent interests), (iii) to any corporation,
partnership or other organization in which such holder is the beneficial owner
of a majority of the voting securities or equity interest, or which owns a
majority of the voting securities or beneficial interest of such holder, and
(iv) upon the death or dissolution of such holder in accordance with the
operation of law; provided, that any such transfer pursuant to clause (iv) shall
be effected in compliance with the Securities Act of 1933, as amended, and the
rules and regulations of the Securities and Exchange Commission thereunder, and

any other applicable federal or state securities law. Notwithstanding the
foregoing, on or after the Effective Date, the Liquidating Trustee will be
entitled, in the exercise of its reasonable discretion, to cause the Liquidating
Trust to be re-established as a certificated trust subject to compliance with
all applicable securities laws. The Liquidating Trustee may take whatever steps
may be deemed to be reasonable and necessary to effectuate such certification,
including seeking a "no action" letter from the SEC with regard to compliance
with the Act, taking into consideration the costs and other administrative
burdens which may be incurred by the Liquidating Trust as a result of pursuing
and obtaining such relief.

(m) Termination. The Liquidating Trust will terminate no later than the
-----------
third (3rd) anniversary of the Effective Date, provided, however, that, on or
prior to the date six (6) months prior to such termination, the Bankruptcy
Court, upon motion by a party in interest, may extend the term of the
Liquidating Trust for a fixed period if it is necessary to facilitate or
complete the liquidation of its Liquidating Trust Assets and Claims.
Notwithstanding the foregoing, additional extensions can be obtained so long as
Bankruptcy Court approval is obtained at least six (6) months prior to the
expiration of each previously extended term; provided, however, that the
aggregate of all such extensions shall not exceed five (5) years, unless the
Liquidating Trustee receives a favorable ruling from the IRS that any further
extension would not adversely affect the status of the Liquidating Trust as a
grantor trust for federal income tax purposes.

(n) Implementation of ACE Settlement Agreement. (i) The May 21, 2003 Order
------------------------------------------
of the Bankruptcy Court approving the Settlement Agreement between the Debtors
and ACE remains in full force and effect. All of the Policies and the Program
Agreement, including any policies issued post-petition and any Program Agreement
related thereto, remain in full force and effect. The Settlement Agreement is
deemed to be amended to include all ACE insurance policies which became
effective during 2003. The Liquidating Trust shall assume the Debtors' rights
and obligations under the Settlement Agreement, as amended hereby, including all
of the policies and program agreements relating thereto, and the Liquidating
Trustee shall be recognized as the representative of the Debtors under insurance
policies, except that nothing contained herein shall make the Liquidating
Trustee an insured under any of the ACE insurance policies.

(ii) In the event ACE performs services to administer and
resolve claims under the Plan, the Debtors and/or the Liquidating Trustee, as
the case may be, shall pay for those services as part of the Plan administrative
expenses

7.02. DEEMED SUBSTANTIVE CONSOLIDATION OF AGWAY FOR PLAN PURPOSES ONLY.
Subject to the occurrence of the Effective Date, Agway shall be deemed
substantively consolidated for purposes of voting and determining distributions
under the Plan. Any obligation of Agway, Inc., Agway General Agency, Brubaker,
Country Best Adams, or Country Best De-Berry and all guarantees thereof executed
by one or more of Agway, Inc., Agway General Agency, Brubaker, Country Best
Adams, or Country Best De-Berry will be deemed to be one obligation of deemed
consolidated Agway; any Claims filed or to be filed in connection with any such
obligation and such guarantees will be deemed one Claim against deemed
consolidated Agway and each and every Claim filed in the individual Chapter 11
Cases of any of Agway, Inc., Agway General Agency, Brubaker, Country Best Adams,

or Country Best De-Berry will be deemed filed against deemed consolidated Agway.

Such deemed consolidation, however, shall not (other than for
purposes related to funding distributions under the Plan and as set forth above
in this section) affect: (i) the legal and organizational structure of Agway;
(ii) pre- and post-chapter 11 guaranties, liens, and security interests that are
required to be maintained (A) in connection with executory contracts or
unexpired leases that were entered into during the Chapter 11 Cases or that have
been or will be assumed, or (B) pursuant to the Plan; and (iii) distributions to
holders of claims paid from insurance policies or proceeds of such policies.

7.03. PENSION PLAN.

(a) Enhancement of Claims Under Pension Plan. The Debtors are proposing to
--------------------------------------------
effectuate certain modifications to the Pension Plan and provide for
distributions to claimants with benefit claims pursuant to the Debtors' chapter
11 Plan. Certain of the Debtors' benefits programs result in employee claims
against the Pension Plan (which is separate from Agway, Inc.'s chapter 11
estate) whereas other benefits programs result in claims only against Agway,
Inc. Moreover, with respect to certain of the benefits, the Debtors have always
reserved the right to modify or terminate those benefits. Under the Debtors'
proposed approach to benefit claims, all of the benefit claims will be treated
under the modified Pension Plan in a manner consistent with the recoveries to
other creditors under the Plan. A significant benefit of the foregoing is to
enhance the treatment of benefit claims and at the same time reduce the number
and value of claims against Agway's estate by including them in the Pension
Plan, which the Debtors believe is overfunded.

IT IS IMPORTANT TO NOTE THAT THE PROPOSED MODIFICATIONS
DESCRIBED HEREIN WILL HAVE NO IMPACT, AND IN FACT ARE CONDITIONED ON, THE
ABILITY OF THE PENSION PLAN ASSETS TO MEET ITS VESTED BENEFIT OBLIGATIONS TO
PLAN PARTICIPANTS.

(b) Reserve for the PBGC. The PBGC has advised the Debtors that it believes
--------------------
the Pension Plan is under funded. In order to address the PBGC's concerns, the
Debtors have created the PBGC Reserve. The Debtors believe that the Pension Plan
is over-funded, and anticipate that the PBGC Reserve will be released to the
Debtors or Liquidating Trustee, as applicable. The PBGC Reserve will be
maintained until the earlier of (i) the completion by the PBGC of its audit of
the standard termination of the Pension Plan, or (ii) six (6) months following
the filing by Agway of its form 501 certification.

(c) Termination of the Pension Plan. Agway, Inc. will submit to the PBGC a
--------------------------------
standard termination application with respect to the Pension Plan. The Debtors
anticipate approving a standard termination of the Pension Plan by and with an
effective date of May 31, 2004. Appropriate notices thereof will be sent to
Pension Plan participants and beneficiaries. In addition, Agway will execute and
provide to the PBGC a commitment to make the Pension Plan sufficient, within the
meaning of PBGC regulation section 4041.21(b).

7.04. THE DEBTORS' AND LIQUIDATING TRUSTEE'S POST-CONFIRMATION ROLE. On or
before the Effective Date, the UST, in consultation with the constituents whose
input the UST deems appropriate and necessary (including Agway, Inc.), and
subject to Court approval, shall select the Liquidating Trustee and the
Disbursing Agent to implement the distributions and transfers contemplated by
the Plan. After the Effective Date, the Liquidating Trustee shall administer the
Disputed Claims Reserve.

Agway and/or the Liquidating Trustee, as the case may be,
shall perform each of the following acts as soon as practicable on or after the
Effective Date:

(a) Administration of Taxes. The Liquidating Trustee shall be responsible
-----------------------
for administering all tax matters of the Liquidating Trust, including the
Disputed Claims Reserve. After the Effective Date, the Liquidating Trustee shall
be authorized to exercise all powers regarding Agway's tax matters, including
filing tax returns, to the same extent as if the Liquidating Trustee were the
debtor in possession. The Liquidating Trustee shall be solely responsible to (i)
complete and file Agway's federal, state and local tax returns, (ii) request an
expedited determination of any unpaid tax liability of Agway under section
505(b) of the Bankruptcy Code for all tax periods of Agway ending after the
Petition Date through the liquidation of Agway as determined under applicable
tax laws, and (iii) represent the interest and account of Agway before any
taxing authority in all matters including, but not limited to, any action, suit,
proceeding or audit.

(b) Transfers to Liquidating Trust. On the Effective Date, all of Agway,
-------------------------------
Inc.'s rights, title and interests in and to all of, the Liquidating Trust
Assets and Claims and such Cash as provided under Section 7.01(d) of the Plan,
shall be transferred and assigned absolutely and unconditionally to the
Liquidating Trust by operation of the Plan. Upon such assignments, Agway, Inc.
shall have no further responsibilities with respect to making distributions
under the Plan.

(c) Dissolution. Within thirty (30) days after the Liquidating Trust Assets
-----------
have been transferred in full to the Liquidating Trust, or as soon thereafter as
is practicable, each Debtor, other than Agway, Inc., that has not yet been
dissolved either (i) shall be deemed dissolved for all purposes without the
necessity for any other or further actions to be taken by or on behalf of such
Debtor, provided, however, that each such Debtor shall file with the office of
the Secretary of State or other appropriate office for the state of its
organization a certificate of cancellation or dissolution, or (ii) be merged
with and into another Debtor and, in that case, file an appropriate certificate
of merger with the appropriate office for the state of its organization. Agway,
Inc. shall be deemed dissolved once the Pension Plan and Thrift Plan have been
terminated and all assets of such plans are fully distributed. So long as the
Thrift Plan is not otherwise being terminated, Agway will remain the sponsor of
the Thrift Plan, unless and until the sponsorship is transferred to the
Liquidating Trust, consistent with applicable law.

7.05. BOOKS AND RECORDS. Upon the Effective Date, Agway, Agway Energy,
Telmark and FCI shall transfer and assign to the Liquidating Trust full title
to, and the Liquidating Trust shall be authorized to take possession of, all
such entities' books and records. The Liquidating Trust shall have the
responsibility of storing and maintaining books and records transferred

hereunder. Agway, Agway Energy, Telmark, and FCI shall cooperate with the
Liquidating Trustee (or Disbursing Agent) to facilitate the delivery and storage
of the books and records in accordance herewith. The Liquidating Trustee and
Agway, Agway Energy, Telmark, and FCI (or any of their successors) shall be
entitled to reasonable access to any books and records transferred to the
Liquidating Trust for all necessary corporate purposes, including, without
limitation, defending or prosecuting litigation, determining insurance coverage,
filing tax returns, and addressing personnel matters. For the purpose of this
section, books and records include computer generated or computer maintained
books and records and computer data, as well as electronically generated or
maintained books and records or data, along with books and records of Agway,
Agway Energy, Telmark, and FCI maintained by or in possession of third parties
and all of the claims and rights of Agway, Agway Energy, Telmark, and FCI in and
to their books and records, wherever located.

7.06. CORPORATE ACTION. Upon the Effective Date, Agway and FCI shall
perform each of the actions and effect each of the transfers required by the
terms of the Plan, in the time period allocated therefor.

7.07. EFFECTUATING DOCUMENTS AND FURTHER TRANSACTIONS. Each of the officers
of Agway and FCI is authorized and directed to execute, deliver, file, or record
such contracts, instruments, releases, indentures, and other agreements or
documents, including without limitation, the Plan Supplement, and take such
actions as may be necessary or appropriate to effectuate and further evidence
the terms and conditions of the Plan.

7.08. CLOSING OF THE CHAPTER 11 CASES. When all Disputed Claims filed
against Agway and FCI have either been expunged or become Allowed Claims and the
Plan has been substantially consummated the Liquidating Trustee may seek
authority from the Bankruptcy Court to close the Chapter 11 Cases in accordance
with the Bankruptcy Code and the Bankruptcy Rules.

ARTICLE VIII

PROCEDURES FOR RESOLVING AND TREATING DISPUTED CLAIMS

8.01. NO DISTRIBUTION PENDING ALLOWANCE. Notwithstanding any other
provision hereof, if any portion of a Claim is a Disputed Claim, no payment or
distribution provided hereunder shall be made on account of such Claim unless
and until such Disputed Claim becomes an Allowed Claim (other than the transfer
of the Liquidating Trust Assets to the Liquidating Trust). Until such time, with
respect to General Unsecured Claims, the Liquidating Trustee shall withhold from
the property to be distributed to holders of beneficial interests in the
Liquidating Trust the portion of such property allocable to Disputed Claims and
shall hold such property in the Disputed Claims Reserve in accordance with
Article VII. If any Disputed Claims are disallowed, the Cash held in the
Disputed Claims Reserve shall be released as and to the extent the Liquidating
Trustee determines such property is no longer necessary to fund unresolved
Disputed Claims, and such Cash shall be distributed in accordance with Article
VI hereof.

8.02. RESOLUTION OF DISPUTED CLAIMS. Unless otherwise ordered by the
Bankruptcy Court after notice and a hearing, Agway, Inc. and FCI and, following
the Effective Date, the Liquidating Trustee, shall have the right to the
exclusion of all others (except as to applications for allowances of
compensation and reimbursement of expenses under sections 330 and 503 of the
Bankruptcy Code) to make and file objections to Claims against the Debtors and
shall serve a copy of each objection upon the holder of the Claim to which the
objection is made as soon as practicable, but in no event later than 120 days
after the Effective Date, except that, with respect to the Seedgrowers
Litigation Claims, objections shall be made no later than 30 days after the
Effective Date. Following the Effective Date, all objections to claims asserted
by Agway, Inc. and FCI shall be deemed made by the Liquidating Trustee, who
thereafter shall have the right to the exclusion of all others to prosecute or
settle such objections. From and after the Confirmation Date, all objections
shall be litigated to a Final Order except to the extent the Liquidating Trustee
elects to withdraw any such objection or the Liquidating Trustee and the
claimant elect to compromise, settle or otherwise resolve any such objection, in
which event they may settle, compromise or otherwise resolve any Disputed Claim.
Any such settlement resulting in an Allowed Claim against Agway in excess of $1
million shall require approval of the Bankruptcy Court.

8.03. ESTIMATION. FCI, Agway, Inc. and, following the Effective Date, the
Liquidating Trustee may request that the Bankruptcy Court estimate any Disputed
Claim pursuant to section 502(c) of the Bankruptcy Code regardless of whether
FCI, Agway or the Liquidating Trustee (as applicable) have previously objected
to such Claim, and the Bankruptcy Court will retain jurisdiction to estimate any
Claim at any time. In the event that the Bankruptcy Court estimates any Disputed
Claim, that estimated amount may constitute either the Allowed amount of such
Claim or a maximum limitation on such Claim, as determined by the Bankruptcy
Court. If the estimated amount constitutes a maximum limitation on such Claim,
FCI, Agway (or the Liquidating Trustee) may elect to pursue any supplemental
proceedings to object to any ultimate payment of such Claim. All of the
aforementioned Claims objection, estimation and resolution procedures are
cumulative and not necessarily exclusive of one another. On and after the
Confirmation Date, Claims that have been estimated may be compromised, settled,
withdrawn or otherwise resolved subsequently, without further order of the
Bankruptcy Court.

8.04. ALLOWANCE OF DISPUTED CLAIMS. If, on or after the Effective Date, any
Disputed Claim becomes an Allowed Claim, the Liquidating Trustee shall, on the
Subsequent Distribution Date following the date on which the Claim becomes an
Allowed Claim, distribute to the holder of such Allowed Claim (i) Cash in an
aggregate amount sufficient to pay to each holder of a Disputed Claim the amount
that such holder would have been entitled to receive under the Plan if such
Claim had been an Allowed Claim on the Effective Date or any Subsequent
Distribution Date, and earnings on such Cash, reduced by (ii) a Cash amount
equal to such Claim's proportionate share of all expenses of the Disputed Claims
Reserve, including without limitation, any taxes imposed by any governmental
unit with respect to income generated by or attributable to property held in the
Disputed Claims Reserve (including any outstanding Tax Advances) and reasonable
reserves.

If and when a claimant becomes entitled to a distribution in
respect of its beneficial interest in the Liquidating Trust, the holder of such

Allowed Claim shall have thirty (30) Business Days in which to pay in Cash such
holder's Ratable Proportion of the Tax Advance. If a payment in full in Cash is
not received in such thirty (30) day period, the Liquidating Trustee shall be
entitled to reduce and permanently adjust the distributions that would otherwise
be made to such holder, accordingly.

8.05. RELEASE OF FUNDS FROM DISPUTED CLAIMS RESERVE. To the extent a
Disputed Claim is disallowed, the Cash and other property that would otherwise
be distributed pursuant to Section 8.04 hereof will instead be distributed or
allocated in accordance with Section 6.04 hereof; provided, however, that if the
Disputed Claims Reserve owes the Liquidating Trust for funds advanced or a Tax
Advance, any beneficial interests in the Liquidating Trust otherwise
distributable will not be distributed to the holder of the subject Allowed Claim
until such time that such holder reimburses the Liquidating Trust for the Cash
shortfall allocable to such Allowed Claim.

ARTICLE IX

TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES

9.01. GENERALLY. Except as otherwise provided in Section 9.02 of the Plan,
pursuant to sections 365 and 1123(b) of the Bankruptcy Code, all prepetition
executory contracts and unexpired leases that exist between the Debtors and any
person shall be deemed rejected by the Debtors on the Effective Date (with such
rejection effective as of the Confirmation Date), except for any executory
contract and unexpired lease:

(a) which has been assumed, assumed and assigned, or rejected, as
applicable, pursuant to an order of the Bankruptcy Court entered prior to the
Confirmation Date; or

(b) as to which a motion for approval of the assumption, assumption and
assignment, or rejection, as applicable, of such contract or lease has been
filed and/or served prior to the Confirmation Date; or

(c) which is being assumed or assumed and assigned as set forth in Schedule
9.01 (to be filed by the Debtors 15 days prior to the Confirmation Hearing). The
listing of a document on Schedule 9.01 to the Plan shall not constitute an
admission by the Debtors that such document is an executory contract or an
unexpired lease or that the Debtors have any liability under such contract or
lease.

9.02. APPROVAL OF ASSUMPTION AND ASSIGNMENT OR REJECTION OF EXECUTORY
CONTRACTS AND UNEXPIRED LEASES. The occurrence of the Effective Date shall
constitute, as of the Confirmation Date, the approval, pursuant to sections 365
and 1123(b) of the Bankruptcy Code, of the assumption and assignment, or
rejection, as applicable, of the executory contracts and unexpired leases
assumed and assigned, or rejected pursuant to Article IX of the Plan.

9.03. CLAIMS FOR DAMAGES. Notwithstanding the prior orders establishing the
deadlines for filing Claims against the Debtors, Claims arising out of the
rejection of an executory contract or unexpired lease pursuant to the Plan shall
be filed and served on FCI, Agway, Inc. or the Liquidating Trustee, pursuant to
the procedures specified in the Confirmation Order, no later than 30 days after

the entry of the Confirmation Order. Any Claims not filed within such time will
be forever barred from assertion against the Debtors, their estates, successors
or properties, or against the Liquidating Trust or the Disbursing Agent. All
Claims arising from the rejection of executory contracts and unexpired leases
shall be treated as General Unsecured Claims under the Plan. Objections to any
such Claims shall be filed no later than 120 days after such Claim is filed and
served, and the Bankruptcy Court shall determine any such objections. If the
Bankruptcy Court overrules any timely objection to such Claim, then that Claim,
to the extent Allowed, shall be classified as an Allowed General Unsecured Claim
and paid in accordance with the provisions of the Plan on the later of (i) the
next Subsequent Distribution Date and (ii) ten business days after the Claim has
been Allowed by a Final Order; provided that no such payments shall be made
prior to the entry of the Confirmation Order.

9.04. POSTPETITION EXECUTORY CONTRACTS AND UNEXPIRED LEASES. All rights in
connection with all executory contracts and unexpired leases assumed by the
Debtors or entered into after the Petition Date that have not been assigned to a
third party shall vest in the Liquidating Trust, pursuant to section 1141(b) of
the Bankruptcy Code.

ARTICLE X

CONDITIONS TO CONFIRMATION AND EFFECTIVE DATE

10.01. CONDITIONS PRECEDENT TO EFFECTIVE DATE OF PLAN. The occurrence of
the Effective Date of this Plan is subject to satisfaction of the following
conditions precedent:

(a) Confirmation Order. The Clerk of the Bankruptcy Court shall have
-------------------
entered the Confirmation Order and there shall be no stay of the Confirmation
Order in effect.

(b) Execution and Delivery of Other Documents. All other actions and all
------------------------------------------
agreements, instruments or other documents necessary to implement the terms and
provisions of the Plan, including without limitation the Liquidating Trust
Agreement and the documents comprising the Plan Supplement that are necessary
for the effectuation of the Plan, shall have been duly and validly executed and
delivered by the parties thereto and all conditions to their effectiveness shall
have been satisfied or waived.

10.02. WAIVER OF CONDITIONS PRECEDENT. The conditions precedent in Section
10.01(b) of the Plan may be waived, in whole or in part, by the Debtors. Any
such waivers of a condition precedent in Section 10.01(b) of the Plan may be
effected at any time, without notice, without leave or order of the Bankruptcy
Court and without any formal action.

10.03. EFFECT OF FAILURE OF CONDITIONS. In the event that the conditions
specified in Section 10.01(b) have not been satisfied or waived in the manner
provided in Section 10.02 on or before 120 days after the Confirmation Date,
then upon written notification filed by the Debtors with the Bankruptcy Court
(a) the Confirmation Order shall be vacated, (b) no distributions under the Plan
shall be made, (c) the Debtors and all holders of Claims and Equity Interests
shall be restored to the status quo ante as of the day immediately preceding the
Confirmation Date as though the Confirmation Date had never occurred, (d) the
time within which the Debtors may assume, assume and assign, or reject all

prepetition executory contracts and unexpired leases shall be extended for a
period of 30 days after the date the Confirmation Order is vacated and (e) all
the Debtors' obligations with respect to the Claims and Equity Interests shall
remain unchanged and nothing contained herein shall be deemed to constitute a
waiver or release of any Claims by or against the Debtors or any other person or
to prejudice in any manner the rights of the Debtors or any person in any
further proceedings involving the Debtors.

ARTICLE XI

EFFECTS OF CONFIRMATION

11.01. VESTING OF ASSETS IN LIQUIDATING TRUST.

(a) As of the Effective Date, the property of Agway, Inc.'s estate
comprising assets of the Liquidating Trust shall vest in Agway and, in
accordance with Article VII of the Plan, shall be transferred to the Liquidating
Trust.

(b) From and after the Effective Date, the Liquidating Trustee may dispose
of the assets of the Liquidating Trust, free of any restrictions of the
Bankruptcy Code, but in accordance with the provisions of the Plan and the
Liquidating Trust Agreement.

(c) As of the Effective Date, all assets of the Liquidating Trust shall be
free and clear of all Claims, except as provided in the Plan or the Confirmation
Order.

11.02. RELEASE OF ASSETS. Until the Effective Date, the Bankruptcy Court
shall retain jurisdiction of the Debtors, their assets and properties.
Thereafter, jurisdiction of the Bankruptcy Court shall be limited to the subject
matter set forth in Article XIII of the Plan, and the Liquidating Trustee shall
perform and wind up the affairs of the Liquidating Trust as provided in the
Plan.

11.03. BINDING EFFECT. Except as otherwise provided in section 1141(d)(3)
of the Bankruptcy Code, on and after the Confirmation Date, the provisions of
the Plan shall bind any holder of a Claim against, or Equity Interest in, the
Debtors and their respective successors and assigns, whether or not the Claim or
Equity Interest of such holder is impaired under the Plan and whether or not
such holder has accepted the Plan.

11.04. TERM OF INJUNCTIONS OR STAYS. Unless otherwise provided, all
injunctions or stays provided for in the Chapter 11 Cases pursuant to sections
105 or 362 of the Bankruptcy Code, or otherwise, and in existence on the
Confirmation Date, shall remain in full force and effect until the Effective
Date.

11.05. RIGHTS OF ACTION. Except as otherwise provided elsewhere in the
Plan, on and after the Effective Date, the Liquidating Trustee will have the
exclusive right to enforce any and all present or future rights, claims or
causes of action of Agway, Telmark, or Agway Energy against any Person and
rights of the Debtors that arose before or after the Effective Date, including,
but not limited to, rights, claims, causes of action, avoiding powers, suits and

proceedings arising under sections 544, 545, 547, 548, 549, 550 and 553 of the
Bankruptcy Code, where applicable. The Liquidating Trustee, subject to the terms
of the Liquidating Trust Agreement may pursue, abandon, settle or release any or
all such rights of action, as it deems appropriate, without the need to obtain
approval or any other or further relief from the Bankruptcy Court. The
Liquidating Trustee may, in its sole discretion, offset any such claim held
against a person against any payment due such person under the Plan.

11.06. INJUNCTION. On and after the Confirmation Date, all Persons are
permanently enjoined from commencing or continuing in any manner any action or
proceeding (whether directly, indirectly, derivatively or otherwise) on account
of or respecting any claim, debt, right or cause of action of Agway for which
the Liquidating Trustee retains sole and exclusive authority to pursue in
accordance with the Plan.

11.07. DISSOLUTION OF RETIREE COMMITTEE. On the Pension Plan Distribution
Date, the appointment of the Retiree Committee shall terminate and its members
will be released of all of their duties, responsibilities and obligations in
connection with the Chapter 11 Cases, the Disclosure Statement, the Plan and its
implementation, provided, however, that the Retiree Committee shall continue in
existence following the Pension Plan Distribution Date solely as to matters in
connection with applications for payment and reimbursement of professional fees
and expenses.

ARTICLE XII

RELEASES

12.01. RELEASE OF RELEASEES BY DEBTORS. As of the first anniversary of the
Effective Date, each of the Releasees shall be deemed released by the Debtors,
on behalf of themselves and their Subsidiaries, from any and all claims, debts,
obligations, rights, suits, damages, judgments, actions, causes of action,
remedies, and liabilities whatsoever, whether known or unknown, foreseen or
unforeseen, existing as of the first anniversary of the Effective Date or
thereafter arising, in law, at equity, or otherwise (except for (i) willful
misconduct, including, but not limited to, conduct that results in a personal
profit at the expense of the Debtors' estates, (ii) gross negligence, (iii)
Potential Derivative Claims, and (iv) all other claims asserted against any of
the Releasees as of the first anniversary of the Effective Date) that the
Debtors, or any of their Subsidiaries, would have been legally entitled to
assert in their own right (whether individually or collectively) or that any
holder of a Claim or Equity Interest or other person or entity would have been
able to assert on behalf of the Debtors or any of their Subsidiaries, based in
whole or in part upon any act or omission, transaction, agreement, event, or
other occurrence, related to the Debtors or their Subsidiaries, taking place on
or before the Effective Date.

12.02. RELEASE OF RELEASED PARTIES. In consideration for the distributions
received under the Plan all holders of Claims, except holders of the Pew
Litigation Claims, the Thrift Plan Litigation Claims, the DOL Litigation Claims,
the Seedgrowers Litigation Claims, claims for breach of fiduciary duty with
respect to the Pension Plan, and any other claimant who has asserted claims
against any of the Releasees on or before the Effective Date shall be deemed to

have released, remised and forever discharged: (a) the Debtors, the present and
former stockholders, directors, officers, agents or employees, attorneys,
advisors, successors and assigns of the foregoing; and (b) the Releasees, and
any person or entity claimed to be liable derivatively through any of the
foregoing (such parties described in the preceding clauses (a) and (b) above,
collectively, the "Released Parties") of and from all debts, demands, actions,
causes of action, suits, accounts, covenants, contracts, agreements, promises,
damages, claims and liabilities whatsoever, known or unknown, arising from a
Claim or based upon the same subject matter as a claim or Equity Interest and
existing on the Petition Date or which thereafter could arise based on any fact,
transaction, cause, matter or thing which occurred prior to the Petition Date.
Subject to sections 524 and 1141 of the Bankruptcy Code, the releases described
herein shall not preclude, police, federal tax, or regulatory agencies from
fulfilling their statutory duties. Except as provided above, any person
accepting any distribution pursuant to the Plan shall be presumed conclusively
to have released the Released Parties from any cause of action arising from or
based on the same subject matter as the Claim or Equity Interest. The release
described in the preceding sentence shall be enforceable as a matter of
contract. The releases described herein are in addition to, and not in lieu of,
any other release separately given, conditionally or unconditionally, by the
Debtors to any other person or entity.

ARTICLE XIII

RETENTION OF JURISDICTION

Until the Chapter 11 Cases are closed by entry of a final
decree pursuant to Bankruptcy Rule 3022, the Bankruptcy Court will retain
jurisdiction over all matters arising out of or relating to the Chapter 11
Cases, including jurisdiction to:

(a) Allow, disallow, determine, liquidate, classify, estimate, or establish
the priority or secured or unsecured status of any Claim or Equity Interest and
to determine and resolve any objections to the allowance or priority of Claims
or Equity Interests;

(b) Determine requests for payment of Claims entitled to priority under
section 507(a)(1) of the Bankruptcy Code;

(d) Hear and determine all applications for allowance of compensation and
reimbursement of expenses of Professionals under sections 330, 331 and 503(b) of
the Bankruptcy Code for periods ending on or before the Effective Date;

(e) Determine any motions pending on the Confirmation Date for the
rejection, assumption or assignment of executory contracts and unexpired leases
and the allowance of any Claim allegedly resulting therefrom;

(f) Recover all assets of the Debtors, property of the Debtors' estates and
the assets of the Liquidating Trust, wherever located;

(g) Ensure that distributions to holders of Allowed Claims are accomplished
pursuant to the provisions of the Plan;

(h) Determine or resolve any motions, adversary proceedings, contested, or
litigated matters, and any other matters and grant or deny any applications and
motions involving the Debtors that may be pending in the Bankruptcy Court on or
initiated after the Confirmation Date;

(i) Enforce all orders, judgments, injunctions, and rulings entered in
connection with the Chapter 11 Cases;

(j) Determine such other matters and such other purposes as the
Confirmation Order may provide;

(k) Issue such orders as may be necessary or appropriate to implement,
execute, and consummate the Plan and all contracts, instruments, releases, and
other agreements or documents created in connection with the Plan, the
Disclosure Statement, or the Confirmation Order;

(l) Hear and resolve any cases, controversies, suits, or disputes that may
arise in connection with the consummation, implementation, enforcement or
interpretation of the Plan, whether by the Debtors, the Liquidating Trustee, or
otherwise, or any contract, instrument, release, or other agreement or document
that is executed or created pursuant to the Plan, including but not limited to
the Liquidating Trust, or any entity's rights arising from or obligations
incurred in connection with the Plan or such documents;

(m) To hear and determine any litigation commenced by the Liquidating
Trustee and to hear any disputes after the Effective Date in connection with any
actions that may be taken pursuant section 7.01(f) of the Plan, including to
adjust the recoveries that the holder of a claim against Agway, Inc. may
otherwise be entitled to receive under the Plan;

(n) Modify the Plan before or after the Effective Date pursuant to section
1127 of the Bankruptcy Code or modify the Disclosure Statement, the Confirmation
Order, or any contract, instrument, release, or other agreement or document
created in connection with the Plan, the Disclosure Statement, or the
Confirmation Order, or remedy any defect or omission or reconcile any
inconsistency in any Bankruptcy Court order, the Plan, the Disclosure Statement,
the Confirmation Order, or any contract, instrument, release, or other agreement
or document created in connection with the Plan, the Disclosure Statement, or
the Confirmation Order, in such manner as may be necessary or appropriate to
consummate the Plan;

(o) Issue injunctions, enter and implement other orders, or take such other
actions as may be necessary or appropriate to restrain interference by any
entity with consummation, implementation, or enforcement of the Plan or the
Confirmation Order;

(p) Hear and determine Avoidance Actions by or on behalf of the Debtors or
the Liquidating Trustee;

(q) Hear and determine matters under sections 346, 505 and 1146 of the
Bankruptcy Code with respect to any tax, fine, penalty or addition to tax,
including determinations regarding any tax liability arising in connection with
the liquidation of assets of the estates pursuant to the Plan (including any
request for expedited determination pursuant to section 505(b) of the Bankruptcy
Code filed, or to be filed, with respect to the returns for any and all taxable
periods ending after the Petition Date through the closing of the Chapter 11
Cases, and, with respect to the Liquidating Trust, for all taxable periods
throughout the termination of the Liquidating Trust);

(r) Enter an order establishing Bar Dates in respect of any Claims for
which Bar Dates have not been established as of the Confirmation Date;

(s) Determine compromises and settlements of Claims against the Debtors or
the estates;

(t) Determine all questions and disputes regarding title to the assets of
the Debtors, the estates or the Liquidating Trust;

(u) Enter and implement such orders as are necessary or appropriate if the
Confirmation Order is for any reason or in any respect modified, stayed,
reversed, revoked, or vacated or distributions pursuant to the Plan are enjoined
or stayed;

(v) Determine any other matters that may arise in connection with or relate
to the Plan, the Disclosure Statement, the Confirmation Order, or any contract,
instrument, release, or other agreement or document created in connection with
the Plan, the Disclosure Statement, or the Confirmation Order; and

(w) Enter an order or final decree closing the Chapter 11 Cases.

ARTICLE XIV

ADDITIONAL PROVISIONS

14.01. EFFECTUATING DOCUMENTS AND FURTHER TRANSACTIONS. Each of the Debtors
and the Liquidating Trustee is authorized to execute, deliver, file or record
such contracts, instruments, releases, and other agreements or documents and
take such actions as may be necessary or appropriate to effectuate, implement
and further evidence the terms and conditions of the Plan.

14.02. MEMBERSHIP ACTION. Prior to, on or after the Effective Date (as
appropriate), all matters provided for under the Plan that would otherwise
require approval of the members or directors of one or more of the Debtors or
their successors in interest under the Plan, including, without limitation (i)
the distribution of Cash pursuant to the Plan, (ii) the adoption, execution,
delivery, and implementation of all contracts, leases, instruments, releases,
and other agreements or documents related to the Plan and (iii) the adoption,
execution, and implementation of other matters provided for under the Plan
involving the company structure of any Debtor or membership or other action to

be taken by or required of any Debtor, shall be deemed to have occurred and
shall be in effect prior to, on or after the Effective Date (as appropriate)
pursuant to the Delaware corporation or limited liability company law (as
applicable) without any requirement of further action by the members or
directors of the Debtors.

14.03. EXEMPTION FROM TRANSFER TAXES. Pursuant to section 1146(c) of the
Bankruptcy Code (i) the creation of any mortgage, deed of trust, lien, pledge,
or other security interest, or (ii) the making or assignment of any lease or
sublease, or (iii) the making or delivery of any deed or other instrument of
transfer under, in furtherance of, or in connection with, the Plan, including,
without limitation, any restructuring, disposition, liquidation, or dissolution,
deeds, bills of sale, transfers of tangible property will not be subject to any
stamp tax, recording tax, personal property tax, real estate transfer tax, sales
or use tax, or other similar tax. Unless the Bankruptcy Court orders otherwise,
all sales, transfers and assignments of owned and leased real and personal
property, approved by the Bankruptcy Court on or prior to the Effective Date
shall be deemed to have been in furtherance of, or in connection with, the Plan.

14.04. SPECIAL PROVISIONS REGARDING INTERCOMPANY CLAIMS AND SUBSIDIARY
INTERESTS. All Intercompany Claims shall be eliminated except as to Intercompany
Claims between FCI, on the one hand, and Agway, Inc. on the other hand, which
Claims shall be Allowed General Unsecured Claims in the amounts reflected in the
books and records of the respective Debtor and listed on the Schedules. No
proofs of Claim evidencing Intercompany Claims must be filed. No proofs of
Equity Interest evidencing Equity Interests of a Debtor held by another Debtor
need be filed.

14.05. VOTING OF CLAIMS AND EQUITY INTERESTS. Each holder of an Allowed
Claim in an impaired Class of Claims that is receiving a distribution pursuant
to the Plan shall be entitled to vote to accept or reject the Plan as provided
in the order approving the Disclosure Statement. For purposes of calculating the
number of Allowed Claims in a Class that has voted to accept or reject the Plan
under section 1126(c) of the Bankruptcy Code, all Allowed Claims in such Class
held by one entity or its "affiliate" (as defined in the Securities Act of 1933
and the rules and regulations promulgated with respect to such Act) shall be
aggregated and treated as one Allowed Claim in such Class; provided, however,
that Claims acquired by an entity from unrelated entities shall not be
aggregated for purposes of voting or Convenience Class election.

14.06. CONFIRMABILITY AND SEVERABILITY OF PLAN. The confirmation
requirements of section 1129 of the Bankruptcy Code must be satisfied separately
with respect to each of Agway's and FCI's chapter 11 plans. Therefore,
notwithstanding the incorporation of the separate plans of liquidation for Agway
and FCI in a single joint plan of liquidation for purposes of, among other
things, economy and efficiency (i) Sections 5.01 - 5.10 shall be deemed a
separate plan of liquidation for Agway and (ii) Sections 5.11 - 5.16 shall be
deemed a separate plan of liquidation for FCI. Should either of the Agway or FCI
chapter 11 Plans not be confirmed, the Debtors may elect to alter, amend, revoke
or withdraw the separate plan of Agway or FCI or to seek confirmation thereof.

14.07. NONCONSENSUAL CONFIRMATION. If any impaired Class does not accept
the Plan by the requisite statutory majorities provided in sections 1126(c) or
1126(d) of the Bankruptcy Code, as applicable, or if any impaired Class is

deemed to have rejected the Plan, the Debtors reserve the right (a) to undertake
to have the Bankruptcy Court confirm the Plan under section 1129(b) of the
Bankruptcy Code and (b) to amend the Plan in accordance with Article X of the
Plan as necessary to obtain entry of the Confirmation Order.

14.08. EXCULPATION. The Debtors, the Committee, the Retiree Committee, the
Disbursing Agent, and their respective members, officers, directors, employees
and agents (including any attorneys, financial advisors, investment bankers and
other professionals retained by such Persons) shall have no liability to any
holder of any Claim or Equity Interest or any other Person for any act or
omission in connection with, or arising out of, the Disclosure Statement, the
Plan, the solicitation of votes for and the pursuit of confirmation of the Plan,
the consummation of the Plan, or the administration of the Plan or the property
to be distributed under the Plan, except for willful misconduct or gross
negligence as determined by a final court order and, in all respects, shall be
entitled to rely upon the advice of counsel with respect to their duties and
responsibilities under the Plan.

14.09. POST-CONFIRMATION DATE FEES AND EXPENSES.

(a) Fees and Expenses of Professionals. After the Confirmation Date, the
-----------------------------------
Liquidating Trustee shall, out of the assets in the Liquidating Trust, pay the
reasonable fees and expenses of the professional persons employed by the Debtors
and/or the Liquidating Trustee in connection with the implementation and
consummation of the Plan, the claims reconciliation process and any other
matters as to which such professionals may be engaged and, after the Effective
Date, enter into reasonable contingency fee arrangements with respect to
affirmative claims brought or maintained by the Liquidating Trustee against
third parties. The fees and expenses of such professionals shall be subject to
the approval of the Bankruptcy Court.

(b) Fees and Expenses of Liquidating Trustee and Disbursing Agent. The fees
-------------------------------------------------------------
and expenses of the Disbursing Agent and the Liquidating Trustee and any amounts
paid by either the Disbursing Agent or the Liquidating Trustee to professionals
(except as set forth in section 14.10 hereof) shall be subject to the approval
of the Bankruptcy Court.

(c) Cancellation of the Indenture and Discharge of the Indenture Trustee.
---------------------------------------------------------------------
On the Effective Date, the Indenture Trustee and its agents shall be discharged
of all their obligations associated with the Agway Subordinated Debt Securities,
the indenture governing the Agway Subordinated Debt Securities and any related
documents, and released from all Claims arising in the Chapter 11 Cases. As of
the Effective Date, the indenture with respect to the Agway Subordinated Debt
Securities shall be deemed cancelled, except that such cancellation shall not
impair the rights of the holders of the Agway Subordinated Debt Securities to
receive distributions under the Plan or the rights of the Indenture Trustee
under its charging lien pursuant to the indenture, to the extent that the
indenture trustee has not received payment as provided for herein. In accordance
with the terms of the stipulation entered into on or about February 23, 2004
between the Debtor and the Indenture Trustee, the Indenture Trustee shall be
compensated by the estate for services rendered during the period up to and
including the Effective Date of the Plan, including the reasonable compensation,
disbursements, and expenses of the agents and legal counsel, in connection with
the performance of its duties under the indenture upon presentation of
reasonably detailed invoices. Copies of such invoices will be shared with the

UST and appropriate creditor representatives and the Debtors will consult with
the UST and such representatives before making any payment to the Indenture
Trustee. Upon payment in full of the reasonable fees and expenses of the
indenture trustee, the Indenture Trustee's liens on the distributions to the
holders of the Agway Subordinated Debt Securities shall be released and
extinguished.

14.10. FEE CLAIMS. Professionals or other entities asserting Fee Claims
shall file and serve on the Debtors and such other entities that are designated
by the Bankruptcy Rules, the Confirmation Order, or other order of the
Bankruptcy Court, applications for final allowance of such Fee Claims no later
than 60 days after the Effective Date; provided, however, that any Professional
who may receive compensation or reimbursement of expenses pursuant to any of the
Orders Authorizing the Debtors to Employ Professionals Utilized in the Ordinary
Course of Business, may continue to receive such compensation and reimbursement
of expenses for services rendered before the Effective Date, without further
Bankruptcy Court review or approval. Holders of Fee Claims that are required to
file and serve applications for final allowance of their Fee Claims and that do
not file and serve such applications within the time period set forth in this
Section shall be forever barred from asserting such Claims against the Debtors,
the Liquidating Trust and their respective properties and such Fee Claims shall
be deemed discharged as of the Effective Date. Objections to any Fee Claim shall
be filed and served on the Liquidating Trustee and the party requesting payment
of a Fee Claim on a date to be specified in the notice of hearing for Approval
of Final Fee Applications. To the extent necessary, entry of the Confirmation
Order shall amend and supersede any previously entered order of the Bankruptcy
Court, including the Order Establishing Procedures for Interim Monthly
Compensation and Reimbursement of Expenses of Professionals, dated November 14,
2002 regarding the payment of Allowed Fee Claims.

14.11. PROFESSIONAL FEE HOLDBACK. On or as soon as reasonably practicable
after the Effective Date and entry of an order of the Bankruptcy Court
authorizing the Liquidating Trustee to pay to Professionals their Fee Claims for
all outstanding amounts relating to prior periods through the Confirmation Date,
the Liquidating Trustee shall pay such amounts to such Professionals in
accordance with such order; provided, however, that Professionals shall continue
to prepare monthly fee applications in accordance with the Order Establishing
Procedures for Interim Monthly Compensation and Reimbursement of Expenses of
Professionals, dated November 14, 2002, up to the Effective Date. On the
Effective Date, the Liquidating Trustee shall reserve an amount equal to the
aggregate amount of outstanding fee applications not ruled upon by the
Bankruptcy Court as of the Effective Date, plus the aggregate amount of all
actual and estimated fees and expenses due for periods that have not been billed
through the Confirmation Date and an estimate of the fees and expenses that will
be due through the projected Effective Date. Such reserve shall be used by the
Debtors to pay the remaining Fee Claims owing to the Professionals as and when
Allowed by the Bankruptcy Court. When all Fee Claims have been paid in full, any
remaining reserved amounts shall be distributed in accordance with the Plan.

14.12. BAR ON POST-EFFECTIVE FEE CLAIMS BY THE COMMITTEE AND RETIREE
COMMITTEE. The respective Professionals retained by either the Committee or the
Retiree Committee shall not be entitled to assert any Fee Claim for any services
rendered or expenses incurred after the Effective Date, except for services

rendered and expenses incurred in connection with the post-Effective Date
matters specified in Section 11.07 hereof.

14.13. PAYMENT OF STATUTORY FEES. All fees under 28 U.S.C. ss. 1930, as
determined by the Bankruptcy Court at the Plan-confirmation hearing, shall be
paid on the Effective Date.

14.14. AMENDMENTS OR MODIFICATIONS OF PLAN. The Debtors reserve the right,
in accordance with the Bankruptcy Code and Bankruptcy Rules, to amend or modify
the Plan at any time prior to the entry of the Confirmation Order. After the
entry of the Confirmation Order, the Debtors, may upon order of the Bankruptcy
Court, amend or modify the Plan, in accordance with section 1127(b) of the
Bankruptcy Code, or remedy any defect or omission or reconcile any inconsistency
in the Plan in such manner as may be necessary to carry out the purpose and
intent of the Plan. A holder of an Allowed Claim that is deemed to have accepted
the Plan shall be deemed to have accepted the Plan as modified if the proposed
modification does not materially and adversely change the treatment of the Claim
of such holder.

14.15. EFFECT OF WITHDRAWAL OR REVOCATION. If the Debtors revoke or
withdraw the Plan prior to the Confirmation Date, or if the Confirmation Date
does not occur, then the Plan shall be deemed null and void. In such event,
nothing contained in the Plan shall be deemed to constitute a waiver or release
of any Claim by or against, or any Equity Interest in, the Debtors or any other
person or to prejudice in any manner the rights of the Debtors or any other
person in any further proceedings involving the Debtors.

14.16. SEVERABILITY OF PLAN PROVISIONS. If, prior to the Confirmation Date,
any term or provision of the Plan is determined by the Bankruptcy Court to be
invalid, void, or unenforceable, the Bankruptcy Court will have the power to
alter and interpret such term or provision to make it valid or enforceable to
the maximum extent practicable, consistent with the original purpose of the term
or provision held to be invalid, void, or unenforceable, and such term or
provision will then be applicable as altered or interpreted. Notwithstanding any
such holding, alteration, or interpretation, the remainder of the terms and
provisions of the Plan will remain in full force and effect and will in no way
be affected, impaired, or invalidated by such holding, alteration, or
interpretation. The Confirmation Order will constitute a judicial determination
and will provide that each term and provision of the Plan, as it may have been
altered or interpreted in accordance with the foregoing, is valid and
enforceable pursuant to its terms.

14.17. SUCCESSORS AND ASSIGNS. The Plan shall be binding upon and inure to
the benefit of the Debtors, the holders of Claims and Equity Interests, the
Liquidating Trustee and their respective successors and assigns.

14.18. NOTICES. Any notice required or permitted under the Plan shall be in
writing and, unless otherwise expressly provided in the Plan, shall be deemed to
have been duly given or made when actually delivered or, in the case of notice
by facsimile transmission, when received and telephonically confirmed, addressed
to the following parties:

If to the Debtors:

AGWAY, INC.
Post Office Box 4933
Syracuse, New York 13221-4933
Telephone: (315) 449-6352
Fax: (315) 449-6682
Attn: Michael R. Hopsicker
with copies to:

MENTER, RUDIN & TRIVELPIECE, P.C.
Co-Attorneys for the Debtors
and Debtors in Possession
500 South Salina Street, Suite 500
Syracuse, New York 13202
Telephone: (315) 474-7541
Facsimile: (315) 474-4040
Attn: Jeffrey A. Dove, Esq.

WEIL GOTSHAL & MANGES, LLP
Co-Attorneys for the Debtors
and Debtors in Possession
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
Attn: Marvin E. Jacob, Esq.
Judy G.Z. Liu, Esq.

If to the Retiree Committee:

MARTIN, MARTIN & WOODARD LLC
One Lincoln Center
Suite 300
Syracuse, NY 13202
Telephone: (315) 478-2222
Facsimile: (315) 478-4318
Attn: Lee E. Woodard, Esq.

14.19. GOVERNING LAW. Except to the extent the Bankruptcy Code, the
Bankruptcy Rules or other federal law is applicable, the rights and obligations
arising under the Plan and any agreements, documents and instruments executed in
connection with the Plan shall be governed by, and construed and enforced in

accordance with, the laws of the State of New York, without giving effect to the
principles of conflicts of law of such jurisdiction.

14.20. TAX REPORTING AND COMPLIANCE. The Debtors and the Liquidating
Trustee shall comply with all withholding and reporting requirements imposed by
any federal, state, local or foreign taxing authority and all distributions
under the Plan shall be subject to any such withholding and reporting
requirements.

14.21. FILING OF ADDITIONAL DOCUMENTS. On or before substantial
consummation of the Plan, the Debtors shall file such agreements and other
documents, as may be necessary or appropriate to effectuate and further evidence
the terms and conditions of the Plan.

14.22. RULES OF INTERPRETATION AND COMPUTATION OF TIME. For purposes of the
Plan, unless otherwise provided in the Plan (i) whenever from the context it is
appropriate, each term, whether stated in the singular or the plural, will
include both the singular and the plural, (ii) any reference in the Plan to a
contract, instrument, release, or other agreement or document being in a
particular form or on particular terms and conditions means that such document
will be substantially in such form or substantially on such terms and
conditions, (iii) any reference in the Plan to an existing document or schedule
filed or to be filed means such document or schedule, as it may have been or may
be amended, modified, or supplemented pursuant to the Plan, (iv) any reference
to an entity as a holder of a Claim or Equity Interest includes that entity's
successors and assigns, (v) all references in the Plan to Sections, Articles,
and schedules are references to Sections, Articles, and schedules of or to the
Plan, (vi) captions and headings to Articles and Sections are inserted for
convenience of reference only and are not intended to be a part of or to affect
the interpretation of the Plan, (vii) the rules of construction set forth in
section 102 of the Bankruptcy Code will apply, and (viii) in computing any
period of time prescribed or allowed by the Plan, Bankruptcy Rule 9006(a) will
apply.

14.23. CONFLICT OF TERMS. In the event of a conflict between the terms of
this Plan and the Disclosure Statement, the terms of this Plan shall govern.

Dated: Syracuse, New York
April 21, 2004

Respectfully submitted,

By: /s/ MICHAEL R. HOPSICKER
----------------------------------------
Name: Michael R. Hopsicker
Title: President and Chief Executive
Officer of Agway, Inc.

Co-Attorneys for Debtors and Debtors-in-Possession:

MENTER, RUDIN & TRIVELPIECE, P.C.

By: /S/ JEFFREY A. DOVE
- ------------------------------------
Jeffrey A. Dove, Esq.
Bar No. 101532
500 South Salina Street, Suite 500
Syracuse, New York 13202
Telephone: (315) 474-7541

-and-

WEIL, GOTSHAL & MANGES LLP
Marvin E. Jacob, Esq. (508380)
Judy G.Z. Liu, Esq. (511552)
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007