EXHIBIT 99


<PAGE>





                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549




                                    FORM 11-K


                     ANNUAL REPORT PURSUANT TO SECTION 15(D)


                                     OF THE


                         SECURITIES EXCHANGE ACT OF 1934



                     FOR THE FISCAL YEAR ENDED JUNE 30, 1999



                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN
                  ---------------------------------------------
                            (FULL TITLE OF THE PLAN)


                                   AGWAY INC.
          ------------------------------------------------------------
          (NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN)



                               333 BUTTERNUT DRIVE
                             DEWITT, NEW YORK 13214
               ---------------------------------------------------
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES OF THE PLAN
                        AND THE ISSUER OF THE SECURITIES)







<PAGE>














                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                     Report on Audited Financial Statements

                        for the year ended June 30, 1999
     -----------------------------------------------------------------------






<PAGE>

<TABLE>
<CAPTION>

                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                             JUNE 30, 1999 AND 1998
     -----------------------------------------------------------------------




                                      INDEX
                                      -----
<S>                                                                                                 <C>
Report of Independent Accountants.................................................................              F-2


Financial Statements:

         Statements of Net Assets Available for Benefits
                  as of June 30, 1999 and 1998....................................................              F-3

         Statements of Changes in Net Assets Available for Benefits
                  for the years ended June 30, 1999 and 1998......................................              F-4

         Notes to Financial Statements............................................................      F-5 to F-15


Supplemental Schedules (Form 5500 information):

         Item 27a.  Schedule of Assets Held for Investment Purposes
                       as of June 30, 1999........................................................  S-1.1 and S-1.2

         Item 27d.  Schedule of Reportable Transactions
                       for the year ended June 30, 1999...........................................            S-2.1




</TABLE>














                                       F-1

<PAGE>









                        REPORT OF INDEPENDENT ACCOUNTANTS


To the Employee Benefit Plans
     Administration Committee,
     Agway, Inc.

In our opinion, the accompanying statements of net assets available for benefits
and the  related  statements  of changes in net assets  available  for  benefits
present fairly, in all material respects,  the net assets available for benefits
of the AGWAY INC.  EMPLOYEES'  THRIFT  INVESTMENT  PLAN (the "Plan") at June 30,
1999 and 1998,  and the changes in net assets  available  for  benefits  for the
years then ended, in conformity with generally accepted  accounting  principles.
These financial statements are the responsibility of the Plan's management;  our
responsibility  is to express an opinion on these financial  statements based on
our audits.  We conducted  our audits of these  statements  in  accordance  with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable  assurance about whether the financial statements are
free of material  misstatement.  An audit includes  examining,  on a test basis,
evidence  supporting the amounts and  disclosures  in the financial  statements,
assessing the  accounting  principles  used and  significant  estimates  made by
management,  and evaluating the overall  financial  statement  presentation.  We
believe  that our audits  provide a reasonable  basis for the opinion  expressed
above.

Our audit was  performed  for the  purpose  of  forming  an opinion on the basic
financial statements taken as a whole. The supplemental  schedules listed in the
accompanying index are presented for the purpose of additional  analysis and are
not a  required  part of the  basic  financial  statements  but  are  additional
information required by the Employee Retirement Income Security Act of 1974. The
fund  information  in notes 7 and 8 is  presented  for  purposes  of  additional
analysis  rather  than to present  the net assets  available  for  benefits  and
changes in net assets  available  for  benefits of each fund.  The  supplemental
schedules and fund  information  have been subjected to the auditing  procedures
applied in the audit of the basic financial  statements and, in our opinion, are
fairly  stated in all  material  respects  in  relation  to the basic  financial
statements taken as a whole.




Syracuse, New York
August 20, 1999





                                       F-2

<PAGE>
<TABLE>
<CAPTION>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                 STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS

                             June 30, 1999 and 1998
                                   -----------

                             (Thousands of Dollars)

                  ASSETS
                                                                           1999                1998
                                                                       -----------          -----------
<S>                                                                    <C>                  <C>
BGI U.S. Equity Market Fund                                            $    79,991          $    70,309

Agway, Inc., Preferred Securities                                           23,099               25,899

Agway Financial Corporation, Subordinated
     Money Market Certificates                                              26,795               22,773

Agway Financial Corporation, Subordinated
     Debentures                                                              1,580                1,830

BGI Government/Corporate Bond Index Fund                                     3,409                2,910

Collective Cash Investment Funds                                             3,065                2,328

Loans to participants                                                        1,322                1,144
                                                                       -----------          -----------

         TOTAL INVESTMENTS                                                 139,261              127,193

Accrued income                                                               2,092                1,982

Contributions receivable, employer                                           1,005                  903
                                                                       -----------          -----------

         TOTAL ASSETS                                                      142,358              130,078

Accrued Liabilities                                                            183                    0
                                                                       -----------          -----------

         TOTAL LIABILITIES                                                     183                    0
                                                                       -----------          -----------

NET ASSETS AVAILABLE FOR BENEFITS                                      $   142,175          $   130,078
                                                                       ===========          ===========


</TABLE>



The  accompanying   notes  are  an  integral  part of the financial statements.

                                       F-3

<PAGE>
<TABLE>
<CAPTION>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

           STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS

                   for the years ended June 30, 1999 and 1998
                                   -----------

                             (Thousands of Dollars)


                                                                                  1999                1998
                                                                              ------------        -----------
<S>                                                                           <C>                 <C>
Net increase of interest in common collective trust funds                     $     13,679        $    15,996
Interest income                                                                      2,449              2,057
Dividend income                                                                      1,874              2,032
                                                                              ------------        -----------
         Total investment income                                                    18,002             20,085
                                                                              ------------        -----------

Contributions:
    Participants                                                                     9,371              6,131
    Agway, Inc.                                                                      1,498              1,349
                                                                              ------------        -----------
         Total contributions                                                        10,869              7,480
                                                                              ------------        -----------
         Total additions                                                            28,871             27,565
                                                                              ------------        -----------

Deductions:
    Benefit payments to participants                                                16,293              9,593
    Trustee fees, administrative and other expenses                                    481                291
                                                                              ------------        -----------
         Total deductions                                                           16,774              9,884
                                                                              ------------        -----------
         Net additions                                                              12,097             17,681

Net assets available for benefits:
         Beginning of year                                                         130,078            112,397
                                                                              ------------        -----------

Net assets available for benefits:
         End of year                                                          $    142,175        $   130,078
                                                                              ============        ===========




</TABLE>








The accompanying   notes  are  an  integral  part  of  the financial statements.

                                       F-4

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

1.       DESCRIPTION OF THE PLAN
         The following brief  description of the Agway,  Inc.  Employees' Thrift
         Investment  Plan (the  "Plan")  is  provided  for  general  information
         purposes only.  Participants should refer to the Plan document for more
         complete information of benefits provided under the Plan.

         General
         The Plan is a defined  contribution  plan  covering  substantially  all
         full-time  employees of Agway,  Inc. (the  "Sponsor" or "Company")  and
         part-time  employees who have reached their first  anniversary date (as
         defined  in the Plan) and  worked  1,000  hours.  It is  subject to the
         provisions of the Employee  Retirement  Income Security Act of 1974, as
         amended ("ERISA").

         Description of Plan
         The Plan was  amended  in May 1999 to  reflect  the  conversion  of the
         Plan's administration to a daily valuation process. In addition,  other
         miscellaneous  items  were  amended  as part of  this  conversion.  The
         following  items  represent  changes  to the  Plan as a  result  of the
         amendments:

         -       Participant account balances will be valued on a daily basis.

         -       Expenses will be accrued daily based on an established accrual
                 factor.

         -       Participants  may  change  investment  options  or  elect  to
                 transfer employee accumulated balances daily.

         -       Participants may direct employee contributions in 1% increments
                 in any of the four funds.  This changed from 25%.

         -       The minimum employee contribution changed from 2% to 1%.

         Contributions
         Participants may elect to contribute "regular  investments" of 1% to 6%
         of annual  compensation (as defined in the Plan). These investments can
         be made on a "pre-tax"  basis,  an  "after-tax"  basis or a combination
         thereof,  subject to  Internal  Revenue  Service  ("IRS")  limitations.
         Pre-tax  regular  investments are designed to take advantage of Section
         401(k) of the Internal  Revenue Code ("IRC") and are contributed to the
         Plan  before  being  subject to federal  income tax and, in most cases,
         state income tax. After-tax regular  investments are contributed to the
         Plan after being subject to federal and state income taxes.



                                       F-5

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

1.       DESCRIPTION OF THE PLAN (CONTINUED)

         Contributions (continued)
         Participants  may invest an additional 1% to 9% of annual  compensation
         (as defined in the Plan) as "additional investments" on a pre-tax basis
         (subject to IRS limitations) if the participant contributes the maximum
         6%  of  regular  investments.  Amounts  exceeding  the  annual  pre-tax
         contribution  limit of  $10,000  established  by the IRS are made on an
         after-tax basis based on the election of the participant.

         Participants  may also contribute  amounts  representing  distributions
         from other qualified defined benefit or contribution plans.

         The Sponsor  shall  contribute an amount equal to at least 10%, but not
         more than 50%, of each participant's regular investment to the Plan not
         to   exceed  6%  of  the   participant   compensation.   All   employer
         contributions   are  invested  in  the  Company   Security   Fund.  The
         discretionary  percentage of Sponsor  contributions  above 10% for each
         year of  operation  of the Plan  shall be  determined  by the  Board of
         Directors of the Sponsor. The Sponsor's  contribution will be made each
         pay period at a rate of 10% of the  participant's  regular  investment.
         Any  amount  of the  Sponsor's  contribution  greater  than  10% of the
         participant's   regular  investment  as  determined  by  the  Board  of
         Directors  will be paid not later than the time  prescribed  by law for
         filing the  Sponsor's  federal  income  tax  return for the  applicable
         taxable year, including extensions for such filing.

         Participant Accounts
         Each   participant's   account  is  credited  with  the   participant's
         contributions and allocations of (a) the Sponsor's  contributions,  (b)
         plan  earnings,  and (c)  administrative  expenses.  Allocation of plan
         earnings  is done on a daily  basis and is based on each  fund's  daily
         earning  percentage  (fund earnings divided by fund market value) times
         the participant's  accumulated  investments and earnings to date in the
         fund.  The  benefit to which a  participant  is entitled is the benefit
         that can be provided from the participant's vested account.



                                       F-6

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

1.       DESCRIPTION OF THE PLAN (CONTINUED)

         Vesting
         Participants  vest  immediately  in  their  contributions  plus  actual
         earnings thereon and the Sponsor contributions and earnings thereon.

         Investment Options
         The Plan provides for the following separate investment fund choices to
         participants: the Stock Fund, Company Security Fund, Bond Fund and Cash
         Fund.  All   participant   contributions   and  earnings   thereon  are
         participant-directed.  Upon  enrollment in the Plan, a participant  may
         direct  employee  contributions  in 1 percent  increments in any of the
         four funds.  A participant  may change  investment  options or elect to
         transfer employee contributions on a daily basis. Sponsor contributions
         and earnings  thereon may not be transferred  from the Company Security
         Fund to other  investment  funds. As of June 30, 1999, there were 4,749
         employees and former  employees  participating in this Plan. The number
         of  participants  under each  investment  fund at June 30, 1999,  is as
         follows:

         Stock Fund                 3,714        Bond Fund                  757
         Company Security Fund      4,723        Cash Fund                  410

         Stock Fund
         The Stock Fund,  including  earnings thereon,  shall be invested in any
         common stock(s), common stock fund(s), or any security convertible into
         common  stock  as  the  Sponsor's  Employee  Benefit  Plans  Investment
         Committee  ("EBPIC") may deem  advisable  from time to time,  but which
         shall not include shares of stock or other securities of the Sponsor or
         any of its subsidiaries or affiliates. The investment manager will make
         purchases of such securities in the open market at prices prevailing in
         such market on the day of purchase.  Short-term obligations of the U.S.
         Government or other investments of a short-term nature may be purchased
         and held pending the  selection  and  purchase of suitable  securities.
         Substantially  all of the Stock Fund  investments were in the "Barclays
         Global  Investors,  N.A.  ("BGI") U.S.  Equity Market Fund" at June 30,
         1999 and 1998, which is a common  collective trust fund. As there is no
         market  quotation   available,   the  fair  value  of  the  Stock  Fund
         investments  is based  on the  unit  market  value  established  by the
         investment  manager.  This unit value is calculated by dividing the net
         assets of the applicable  Market Fund,  stated at quoted market values,
         by the units outstanding.



                                       F-7

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

1.       DESCRIPTION OF THE PLAN (CONTINUED)

         Investment Options (continued)

         Company Security Fund
         It is explicitly  provided and intended that the Company  Security Fund
         be invested in qualified Agway, Inc. securities. These qualified Agway,
         Inc. securities include cumulative  preferred stock and Agway Financial
         Corporation   (AFC)   subordinated   money  market   certificates   and
         debentures.  However,  if at  any  time  when  the  Trustee  has  funds
         available for such  investment and such  prescribed  securities are not
         available for purchase  from the Sponsor,  the Trustee is authorized to
         hold such funds in an interest bearing account, or to invest such funds
         in one or more  securities  of other  corporations,  as  instructed  by
         EBPIC,  which  are  comparable  to  the  prescribed  securities  of the
         Sponsor.  Securities of Agway,  Inc. will be purchased from the Sponsor
         at par  value or  principal  amount,  since  the  market  value of such
         securities  is  maintained  as such by the  Sponsor  as a result of its
         practice of repurchasing outstanding securities at par whenever holders
         thereof elect to tender them for redemption.

         Bond Fund
         The Bond Fund is invested  primarily  in bonds of U.S.  Government  and
         investment   grade   bonds  of   industrial,   financial   and  utility
         corporations.  "Investment  Grade"  is a term  for  securities  of high
         quality  that are rated BAA or better by Moody's  Investor  Service and
         BBB or better by Standard & Poor's  Corporation.  Substantially  all of
         the Bond Fund  investments were in the BGI  "Government/Corporate  Bond
         Index  Fund" at June 30,  1999 and 1998,  which is a common  collective
         trust fund. As there is no market  quotation  available,  fair value of
         the Bond Fund investments is based on the unit market value established
         by the  investment  manager.  This unit value is calculated by dividing
         the net assets of the Bond Index Fund,  stated at quoted  market value,
         by the units outstanding.

         Cash Fund
         The Cash Fund  investment  objective is to preserve  capital and earn a
         competitive  day-to-day  interest  rate.  It invests  in high  quality,
         short-term money market instruments whose maturities  normally will not
         exceed  one  year  and  are,  on  average,   less  than  three  months.
         Investments  may be  made  in  U.S.  Treasury  or  agency  obligations;
         obligations issued by financial,  industrial,  public utility, or other
         companies;  bankers' acceptances,  bank certificates of deposit or time
         deposits; commercial paper; and other similar obligations. The majority
         of  investments of the Cash Fund were in the BGI "Money Market Fund" at
         June 30, 1999 and 1998, which is a common collective trust fund.



                                       F-8

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

1.       DESCRIPTION OF THE PLAN (CONTINUED)

         Loans to Participants
         The Plan also  includes  various  terms and  conditions  under  which a
         participating employee can obtain loans from the Plan. Participants may
         borrow up to 50% of their vested  account  balance.  Participant  loans
         must  be  no  less  than  $500  and  no  greater  than  $50,000.   Loan
         transactions  are treated as a transfer to (from) the investment  funds
         from (to) the participant loan fund. Loan terms range from 1 to 5 years
         or up to 20 years for the  purchase of a primary  residence.  The loans
         are  secured  by the  balance  in the  participant's  account  and bear
         interest at a rate of 1 percent over prime.  Principal and interest are
         paid ratably through payroll deductions.

         Payment of Benefits
         On  termination of service due to death,  disability or  retirement,  a
         participant  may elect,  in most  circumstances,  to  receive  either a
         lump-sum amount equal to the value of the participant's vested interest
         in his or her account,  and either monthly or annual  installments over
         periods  ranging from 5 to 20 years.  For termination of service due to
         other reasons, a participant  receives the value of the vested interest
         in his or her account as a lump-sum distribution.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         The  financial  statements  of the Plan are prepared  under the accrual
         basis of accounting in conformity  with generally  accepted  accounting
         principles.  The accounting  principles and practices  which affect the
         more significant elements of the financial statements are:

         Investment Valuation
         Agway, Inc.  preferred stock and AFC subordinated money market and debt
         securities are valued at par, which  approximates fair value,  since it
         has been the Sponsor's practice to repurchase outstanding securities at
         par when  redeemed.  All Agway,  Inc.  securities are also purchased at
         par. All other Plan investments are held in bank commingled trust funds
         ("common  collective  trust funds"),  shares of which are valued at the
         net asset value of shares held by the Plan at year-end as determined by
         the investment manager.  Purchases and sales of securities are recorded
         on a trade-date basis. Participant loans are valued at cost.

         Income Recognition
         Interest income from investments is recognized as earned. Dividends are
         recorded on the ex-dividend date. The Plan presents in the statement of
         changes in net assets the net increase in interest in common collective
         trust funds which  consists of current  year  realized  and  unrealized
         gains or losses, interest and dividends.


                                       F-9

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         Trustee Fees, Administrative and Other Expenses
         Trustee  fees,  administrative  expenses  and all  other  expenses  are
         recognized in the period incurred. The Plan incurred approximately $385
         in 1999 and $245 in 1998 in administrative expenses paid to the Sponsor
         during the year.

         Use of Estimates
         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions   that  affect  the  reported  amount  of  assets  and
         liabilities and disclosures of contingent assets and liabilities at the
         date of the financial  statements and the reported  amounts of revenues
         and expenses during the reporting  period.  Actual results could differ
         from those estimates.

         Risks and Uncertainties
         The Plan provides for various  investment options in any combination of
         three common  collective  trust funds (stock,  bond or cash) or Company
         securities. Investment securities are exposed to various risks, such as
         interest rate,  market and credit.  Due to the level of risk associated
         with certain investment securities and the level of uncertainty related
         to  changes  in the  value  of  investment  securities,  it is at least
         reasonably  possible  that  changes  in risks in the  near  term  would
         materially  affect  participants'  account  balances  and  the  amounts
         reported in the statement of net assets  available for benefits and the
         statement of changes in net assets available for benefits.





                                      F-10

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

3.       INVESTMENTS
         The Plan's investments are held by a bank-administered  trust fund. The
         following table presents the fair value of investments as determined by
         estimated market price. Investments that represent 5 percent or more of
         the Plan's net assets are listed separately.

<TABLE>
<CAPTION>
         INVESTMENTS AT ESTIMATED FAIR VALUE
                                                                                  1999                  1998
                                                                           ------------------    ---------------
         <S>                                                               <C>                   <C>
         Stock Fund:
              Equity Market Fund                                           $           79,991    $        70,309
         Company Security Fund:
              Agway, Inc., Preferred Securities:
                  8% cumulative preferred stock - Series B                             19,942             19,942
                  7% cumulative preferred stock - Series C                              3,157              5,957
                                                                           ------------------    ---------------
                                                                                       23,099             25,899
              AFC Subordinated Money Market Certificates                               26,795             22,773
              AFC Subordinated Debentures                                               1,580              1,830
         Bond Fund:
             BGI Government/Corporate Bond Index Fund                                   3,409              2,910
         Collective Cash Investment Funds                                               3,065              2,328
         Loans to participants                                                          1,322              1,144
                                                                           ------------------    ---------------

         TOTAL INVESTMENTS AT FAIR VALUE                                   $          139,261    $       127,193
                                                                           ==================    ===============
</TABLE>
         During 1999 and 1998, the Plan's  interest in common  collective  trust
         funds  (including  gains and losses on investments  bought and sold, as
         well as held  during  the year)  increased  in value for the Plan years
         ended June 30 as follows:
<TABLE>
<CAPTION>
              NET INCREASE IN INTEREST IN COMMON                                  1999                 1998
                                                                           ------------------    ---------------
              <S>                                                          <C>                   <C>
              COLLECTIVE TRUST FUNDS:

              BGI U.S. Equity Market Fund                                  $           13,485    $        15,635
              BGI Government/Corporate Bond Index Fund                                     88                252
              Collective Cash Investment Funds                                            106                109
                                                                           ------------------    ---------------

              Total                                                        $           13,679    $        15,996
                                                                           ==================    ===============

</TABLE>


                                      F-11

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

4.       PLAN TRUSTEE
         The cash and  investments  of the Plan are held by Boston Safe  Deposit
         and Trust Company (the  "Trustee")  under a trust agreement dated April
         1, 1995.  In general,  the duties of the Trustee  include:  (1) holding
         assets and collecting income therefrom; (2) investing the assets of the
         Plan as  directed by EBPIC or the  appointed  investment  manager;  (3)
         selling or exchanging the assets of the Plan;  and (4) paying  benefits
         to  participants  in the  Plan on the  written  order  of the  Employee
         Benefit Plans Administration Committee ("EBPAC"), which is appointed by
         the Board of Directors of the Sponsor.  The investment of assets in the
         Stock  Fund,  Bond Fund and Cash  Fund are  directed  by an  investment
         manager, Barclays Global Investors, N.A., San Francisco, California.

5.       PLAN TERMINATION
         The Sponsor may amend or terminate  the Plan.  Although the Sponsor has
         not  expressed any intent to do so, in the event the Plan is terminated
         or employer  contributions are  discontinued,  all of the assets of the
         Plan shall be used for the benefit of  participants  and  beneficiaries
         under the Plan.

6.       FEDERAL INCOME TAX STATUS
         A favorable  determination letter dated December 5, 1995, was issued by
         the IRS on  behalf of the Plan  which  stated  that the  Plan,  as then
         designed,  was in compliance  with the applicable  requirements  of the
         IRC.  The Plan has  been  amended  since  receiving  the  determination
         letter.  However,  the  plan  administrator  believes  that the Plan is
         designed  and is  currently  being  operated  in  compliance  with  the
         applicable  requirements  of the IRC.  Accordingly,  no  provision  for
         income taxes has been included in the Plan's financial statements.


                                      F-12

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

7.  ALLOCATION OF PLAN ASSETS AND LIABILITIES TO INVESTMENT PROGRAMS

<TABLE>
<CAPTION>
                                                    June 30, 1999
                                                    -------------
                                                                                                 Non-
                                                                                              Participant
                                                 Participant-Directed                          Directed
                          -----------------------------------------------------------------   -----------
                                          Company                                              Company
                              Stock      Security       Bond          Cash       Loans to      Security
                              Fund         Fund         Fund          Fund     Participants      Fund             Total
                           -----------   ---------   ----------   ----------   ------------   ------------   ------------
<S>                        <C>           <C>         <C>          <C>          <C>            <C>            <C>
Investments                $    79,991   $  36,205   $    3,409   $    2,068   $      1,322   $     16,266   $    139,261
Accrued income                       0       1,423            0           29              0            640          2,092
Contributions receivable,
     employer                        0           0            0            0              0          1,005          1,005
                           -----------   ---------   ----------   ----------   ------------   ------------   ------------

TOTAL ASSETS                    79,991      37,628        3,409        2,097          1,322         17,911        142,358

Accrued liabilities                (41)        (19)          (2)        (112)             0             (9)          (183)
                           -----------   ---------   ----------   ----------   ------------   ------------   ------------

NET ASSETS
AVAILABLE
FOR BENEFITS               $    79,950   $  37,609   $    3,407   $    1,985   $      1,322   $     17,902   $    142,175
                           ===========   =========   ==========   ==========   ============   ============   ============
</TABLE>

<TABLE>
<CAPTION>
                                                     June 30, 1998
                                                     -------------
                                                                                                  Non-
                                                                                              Participant
                                                     Participant-Directed                      Directed
                          -----------------------------------------------------------------   -----------
                                          Company                                              Company
                              Stock      Security       Bond          Cash       Loans to      Security
                              Fund         Fund         Fund          Fund     Participants     Fund             Total
                           -----------   ---------   ----------   ----------   ------------   -----------    ------------
<S>                        <C>           <C>         <C>          <C>          <C>            <C>            <C>
Investments                $    70,726   $  35,542   $    2,912   $    1,714   $      1,148   $    15,151    $    127,193
Accrued income                       2       1,386            0            0              0           594           1,982
Contributions receivable,
     employer                        0           0            0            0              0           903             903
                           -----------   ---------   ----------   ----------   ------------   -----------    ------------

TOTAL ASSETS                    70,728      36,928        2,912        1,714          1,148        16,648         130,078

Accrued liabilities                  0           0            0            0              0             0               0
                           -----------   ---------   ----------   ----------   ------------   -----------    ------------

NET ASSETS
AVAILABLE
FOR BENEFITS               $    70,728   $  36,928   $    2,912   $    1,714   $      1,148   $    16,648    $    130,078
                           ===========   =========   ==========   ==========   ============   ===========    ============
</TABLE>


                                      F-13

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

8.  ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT
    PROGRAMS
<TABLE>
<CAPTION>
                                            For the Year Ended June 30, 1999
                                            --------------------------------
                                                                                                    Non-
                                                                                                 Participant
                                                       Participant-Directed                       Directed
                             ----------------------------------------------------------------    -----------
                                            Company                                               Company
                                Stock      Security       Bond          Cash       Loans to       Security
                                Fund         Fund         Fund          Fund     Participants       Fund         Total
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------
<S>                          <C>          <C>          <C>          <C>          <C>             <C>           <C>
Net increase of interest
   in collective
     investment funds        $   13,485   $        0   $       88   $      106   $          0    $         0   $   13,679
Interest income                      21        1,607            0            0             99            722        2,449
Dividend income                       0        1,293            0            0              0            581        1,874
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------
                                 13,506        2,900           88          106             99          1,303       18,002
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------
Contributions:
   Participants                   5,780        2,995          448          148              0              0        9,371
   Agway, Inc.                        0            0            0            0              0          1,498        1,498
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------
                                  5,780        2,995          448          148              0          1,498       10,869
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------

     Total additions             19,286        5,895          536          254             99          2,801       28,871
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------

Deductions
   Benefit payments
     to participants              8,892        4,592          443          167            136          2,063       16,293
   Administrative
     expenses                       264          132           13            7              5             60          481
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------

     Total deductions             9,156        4,724          456          174            141          2,123       16,774
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------

Net increase (decrease)
   before interfund
     transfers                   10,130        1,171           80           80            (42)           678       12,097

Transfers (from) to
   other funds                     (908)          86          415          191            216              0            0

Net assets available
   for benefits,
     beginning of year           70,728       36,928        2,912        1,714          1,148         16,648      130,078
                             ----------   ----------   ----------   ----------   ------------    -----------   ----------

     Net assets available
       for benefits,
         end of year         $   79,950   $   38,185   $    3,407   $    1,985   $      1,322    $    17,326   $  142,175
                             ==========   ==========   ==========   ==========   ============    ===========   ==========

</TABLE>
                                                       F-14

<PAGE>


                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN

                          NOTES TO FINANCIAL STATEMENTS
                                   -----------

                             (Thousands of Dollars)

8.  ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS TO INVESTMENT
    PROGRAMS
<TABLE>
<CAPTION>
                        For the Year Ended June 30, 1998
                        --------------------------------
                                                                                                  Non-
                                                                                                Participant
                                                       Participant-Directed                      Directed
                            -----------------------------------------------------------------   -----------
                                            Company                                              Company
                                Stock      Security       Bond         Cash        Loans to      Security
                                Fund         Fund         Fund         Fund      Participants     Fund             Total
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------
<S>                         <C>           <C>          <C>          <C>          <C>            <C>             <C>
Net increase of interest
   in collective
     investment funds       $    15,635   $        0   $      252   $      109   $          0   $         0     $    15,996
Interest income                       0        1,369            0            0            101           587           2,057
Dividend income                       0        1,422            0            0              0           610           2,032
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------
                                 15,635        2,791          252          109            101         1,197          20,085
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------
Contributions:
   Participants                   3,769        1,941          285          136              0             0           6,131
   Agway, Inc.                        0            0            0            0              0         1,349           1,349
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------
                                  3,769        1,941          285          136              0         1,349           7,480
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------

     Total additions             19,404        4,732          537          245            101         2,546          27,565
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------

Deductions
   Benefit payments
     to participants              4,858        2,995          171          198             87         1,284           9,593
   Administrative
     expenses                       153           89            6            5              0            38             291
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------

     Total deductions             5,011        3,084          177          203             87         1,322           9,884
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------

Net increase (decrease)
   before interfund
     transfers                   14,393        1,648          360           42             14         1,224          17,681

Transfers (from) to
   other funds                      891       (1,084)         457         (319)            55             0               0

Net assets available
   for benefits,
     beginning of year           55,444       36,247        2,095        1,991          1,079        15,541         112,397
                            -----------   ----------   ----------   ----------   ------------   -----------     -----------

     Net assets available
       for benefits,
         end of year        $    70,728   $   36,811   $    2,912   $    1,714   $      1,148   $    16,765     $   130,078
                            ===========   ==========   ==========   ==========   ============   ===========     ===========
</TABLE>
                                      F-15

<PAGE>



                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN
     ITEM 27a of Form 5500 - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
                               as of June 30, 1999
                             (Thousands of Dollars)
<TABLE>
<CAPTION>
               Col. A                               Col. B                   Col. C                    Col. D
               ------                               ------                   ------                    ------
                                                Balance Held at
                                                Close of Period
                                               (Number of Shares                                     Market Value
           Name of Issuer                      or Principal Amount           Cost of               of Each Item at
         and Title of Issue                    of Bonds and Notes)          Each Item              Close of Period
-----------------------------------           --------------------         --------------          ----------------
<S>                                            <C>                         <C>                     <C>
Stock Fund:
   BGI U.S. Equity Market Fund                        2,698,529            $     71,366            $     79,991
Company Security Fund:
   Agway, Inc.:
     8% cumulative preferred
       stock - Series B                                 199,420                  19,942                  19,942
     7% cumulative preferred
       stock - Series C                                  31,570                   3,157                   3,157
    Agway Financial Corporation:
     8% subordinated money
       market certificates,
       due October 31, 2006                    $          7,195                   7,195                   7,195
     6% subordinated money
       market certificates,
       due October 31, 2013                                 400                     400                     400
     8% subordinated debentures,
       due July 1, 1999                                   1,130                   1,130                   1,130
     7-1/2% subordinated money
       market certificates,
       due October 31, 1999                               1,489                   1,489                   1,489
     9% subordinated money
       market certificates,
       due October 31, 2000                               3,234                   3,234                   3,234
     8% subordinated money
       market certificates,
       due October 31, 2002                               2,254                   2,254                   2,254
     7-1/2% subordinated money
       market certificates,
       due October 31, 2002                               1,930                   1,930                   1,930
     8-1/2% subordinated money
       market certificates,
       due October 31, 2001                               3,636                   3,636                   3,636
     7-1/2% subordinated debentures,
       due July 1, 2003                                     450                     450                     450
     8-1/2% subordinated money
       market certificates,
       due October 31, 2003                               4,931                   4,931                   4,931
     8% subordinated money
       market certificates,
       due October 31, 2005                               1,726                   1,726                   1,726
                                                                           -------------           ------------
         Total Company securities                                                51,474                  51,474
     TBC Inc. Pooled Employee Funds            $            997                     997                     997
                                                                           -------------           ------------
         Total Company Security Fund                                       $     52,471            $     52,471
                                                                           -------------           ------------
</TABLE>
                                      S-1.1

<PAGE>



                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN
               ITEM 27a of Form 5500 - SCHEDULE OF ASSETS HELD FOR
                         INVESTMENT PURPOSES, Continued
                               as of June 30, 1999
                             (Thousands of Dollars)
<TABLE>
<CAPTION>

         Col. A                                Col. B                  Col. C                  Col. D
         ------                                ------                  ------                  ------
                                               Balance Held at
                                               Close of Period
                                               (Number of Shares                               Market Value
         Name of Issuer                        or Principal Amount     Cost of                 of Each Item at
         and Title of Issue                    of Bonds and Notes)     Each Item               Close of Period
---------------------------------              -------------------     -----------             ---------------
<S>                                            <C>                     <C>                     <C>
Bond Fund
   BGI Government/Corporate
     Bond Index Fund                                    298,156        $     3,432             $         3,409


Cash Fund:
   BGI Money Market Fund                       $          1,974              1,974                       1,974
   TBC Inc. Pooled Employee Funds                            94                 94                          94
                                                                       -----------             ---------------
                                                                             2,068                       2,068


Loans to Participants:
   Participant Notes                           $          1,322              1,322                       1,322
                                                                       -----------             ---------------


       TOTAL INVESTMENTS                                               $   130,659             $       139,261
                                                                       ===========             ===============


</TABLE>




                                      S-1.2

<PAGE>
<TABLE>
<CAPTION>

                  AGWAY, INC. EMPLOYEES' THRIFT INVESTMENT PLAN
           ITEM 27d of Form 5500 - SCHEDULE OF REPORTABLE TRANSACTIONS
                        for the year ended June 30, 1999
                             (Thousands of Dollars)

                                                                                    Current Value
                                                                                    of Investment
                                                   Purchase           Selling      on Transaction         Net
                                                     Price             Price            Date           Gain(Loss)
                                                -------------       ------------   ---------------    ------------
<S>                                             <C>                 <C>             <C>               <C>
SINGLE SECURITY TRANSACTIONS IN
EXCESS OF 5% OF MARKET VALUE

8% subordinated money market
     certificates                               $      7,100        $         0     $      7,100      $         0

TBC Inc. Pooled Employee Fund                              0              7,100            7,100                0

BGI Equity Market Fund                                     0             71,905           31,096           40,809

BGI Equity Market Fund                                71,905                  0           71,905                0

SERIES OF SECURITY TRANSACTIONS
IN EXCESS OF 5% OF MARKET VALUE

8% subordinated money market
     certificates                               $      7,195        $         0     $      7,195      $         0

TBC Pooled Employee Fund                              34,076                  0           34,076                0

TBC Inc. Pooled Employee Funds                             0             33,599           33,599                0

BSDT Late Money Dep                                    3,388                  0            3,388                0

BSDT - Late Money Dep                                      0              3,388            3,388                0

BGI Equity Market Fund                                   600                  0              600                0

BGI Equity Market Fund                                     0             75,555           32,729           42,826

BGI Equity Market Fund                                74,598                  0           74,598                0

BGI Equity Market Fund                                     0              3,446            3,232              214


</TABLE>



                                      S-2.1