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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549



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FORM 10-Q



|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------



For the quarterly period ended August 28, 2005



OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------



For the transition period from
 to
.



Commission File Number 333-111710



United Agri Products, Inc.

(Exact
Name of Registrant as Specified in Its Charter)



|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 47-0621017                          
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|7251 W. 4thStreet, Greeley,
Colorado                           |  | 80634                               
|(Address of Principal Executive Offices)                       |  | (Zip Code)                          



(970) 356-4400

(Registrants Telephone Number, Including Area Code)



Not applicable

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.



Yes  x    No ̈



Indicate
by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).



Yes ̈No  x



Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).



Yes ̈No  x



|                                        |  |                                
|--------------------------------------- |  | -------------------------------
|Class                                   |  | Outstanding at October 11, 2005
|Common Stock, par value $1.00 per share |  | 1,000 shares                   



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##### Table of Contents

TABLE OF CONTENTS



|                                                                                              |  |   
|--------------------------------------------------------------------------------------------- |  | --
|Part I. Financial Information                                                                 |  | 3 
|                                                                                              | 
|ITEM 1. FINANCIAL STATEMENTS                                                                  |  | 3 
|Report of Independent Registered Public Accounting Firm                                       |  | 3 
|Condensed Consolidated Balance Sheets                                                         |  | 4 
|Condensed Consolidated Statements of Earnings                                                 |  | 5 
|Condensed Consolidated Statements of Cash Flows                                               |  | 6 
|Condensed Consolidated Statement of Stockholders Equity                                      |  | 7 
|Notes to Condensed Consolidated Financial Statements                                          |  | 8 
|                                                                                              | 
|ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |  | 22
|                                                                                              | 
|ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                            |  | 30
|                                                                                              | 
|ITEM 4. CONTROLS AND PROCEDURES                                                               |  | 30
|                                                                                              | 
|Part II. Other Information                                                                    |  | 32
|                                                                                              | 
|ITEM 6. EXHIBITS                                                                              |  | 32
|                                                                                              | 
|SIGNATURES                                                                                    |  | 33



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PART I. FINANCIAL INFORMATION



|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors and Stockholder of United Agri Products, Inc.



Greeley, Colorado



We have reviewed the accompanying condensed
consolidated balance sheets of United Agri Products, Inc. and subsidiaries (the Company) as of August 28, 2005 and August 29, 2004, the related condensed consolidated statements of earnings for the 13-week and 26-week periods
ended August 28, 2005 and the 13-week and 27-week periods ended August 29, 2004, the condensed consolidated statements of cash flows for the 26-week period ended August 28, 2005 and the 27-week period ended August 29, 2004, and
the condensed consolidated statement of stockholders equity for the 26-week period ended August 28, 2005. These interim financial statements are the responsibility of the Companys management.



We conducted our reviews in accordance with the standards of the Public Company Accounting
Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do
not express such an opinion.



Based on our reviews, we are not aware of any
material modifications that should be made to such condensed consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.



We have previously audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the consolidated balance sheet of United Agri Products, Inc. and subsidiaries as of February 27, 2005, and the related consolidated statements of earnings, stockholders equity, and cash flows for the year
then ended (not presented herein) and in our report dated May 27, 2005, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance
sheet as of February 27, 2005 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.



DELOITTE & TOUCHE LLP



Denver, Colorado



October 6, 2005



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except share data)

UNAUDITED



|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|--------------------------------------------------------------------------------------------------------------- |  | --------------- | --------- | - | ----------------- | - | --------- | --------------- |  | - | --------- | -
|                                                                                                                |  | August 28, 2005 |           |   | February 27, 2005 |   |           | August 29, 2004 | 
|ASSETS                                                                                                          |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Current assets:                                                                                                 |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Cash and cash equivalents                                                                                       |  | $               | 57,642    |   |                   | $ | 48,201    |                 |  | $ | 20,203    |  
|Receivables, less allowance for doubtful accounts of $16,856, $13,749 and $21,499                               |  |                 | 798,184   |   |                   |   | 235,175   |                 |  |   | 706,795   |  
|Inventories                                                                                                     |  |                 | 515,352   |   |                   |   | 697,134   |                 |  |   | 449,602   |  
|Deferred income taxes                                                                                           |  |                 | 21,385    |   |                   |   | 17,263    |                 |  |   | 21,851    |  
|Vendor prepay                                                                                                   |  |                 | 18,958    |   |                   |   | 149,010   |                 |  |   | 27,585    |  
|Other current assets                                                                                            |  |                 | 3,474     |   |                   |   | 7,310     |                 |  |   | 12,267    |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Total current assets                                                                                            |  |                 | 1,414,995 |   |                   |   | 1,154,093 |                 |  |   | 1,238,303 |  
|Property, plant and equipment                                                                                   |  |                 | 110,324   |   |                   |   | 104,745   |                 |  |   | 105,789   |  
|Less accumulated depreciation                                                                                   |  |                 | (20,526   | ) |                   |   | (15,080   | )               |  |   | (9,451    | )
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Property, plant and equipment, net                                                                              |  |                 | 89,798    |   |                   |   | 89,665    |                 |  |   | 96,338    |  
|Goodwill                                                                                                        |  |                 | 34,645    |   |                   |   | 34,645    |                 |  |   | 41,407    |  
|Intangible assets, net                                                                                          |  |                 | 25,229    |   |                   |   | 25,894    |                 |  |   | 6,332     |  
|Deferred income taxes                                                                                           |  |                 | 1,361     |   |                   |   | 1,563     |                 |  |   | 5,172     |  
|Debt issue costs, net                                                                                           |  |                 | 15,789    |   |                   |   | 17,107    |                 |  |   | 18,420    |  
|Investment in unconsolidated affiliates                                                                         |  |                 | 3,593     |   |                   |   | 4,071     |                 |  |   | 3,871     |  
|Other assets                                                                                                    |  |                 | 746       |   |                   |   | 506       |                 |  |   | 4,174     |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Total assets                                                                                                    |  | $               | 1,586,156 |   |                   | $ | 1,327,544 |                 |  | $ | 1,414,017 |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                            |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Current liabilities:                                                                                            |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Short-term debt                                                                                                 |  | $               |          |   |                   | $ | 55        |                 |  | $ | 180,299   |  
|Intercompany borrowings                                                                                         |  |                 | 33,938    |   |                   |   | 25,287    |                 |  |   | 1,642     |  
|Accounts payable                                                                                                |  |                 | 855,376   |   |                   |   | 822,864   |                 |  |   | 556,575   |  
|Other accrued liabilities                                                                                       |  |                 | 201,506   |   |                   |   | 72,686    |                 |  |   | 166,561   |  
|Income taxes payable                                                                                            |  |                 | 27,960    |   |                   |   | 3,252     |                 |  |   |          |  
|Deferred income taxes                                                                                           |  |                 | 340       |   |                   |   | 108       |                 |  |   | 106       |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Total current liabilities                                                                                       |  |                 | 1,119,120 |   |                   |   | 924,252   |                 |  |   | 905,183   |  
|Long-term debt                                                                                                  |  |                 | 203,500   |   |                   |   | 203,500   |                 |  |   | 225,000   |  
|Other non-current liabilities                                                                                   |  |                 | 3,870     |   |                   |   | 2,871     |                 |  |   | 2,343     |  
|Deferred income taxes                                                                                           |  |                 | 22,892    |   |                   |   | 23,590    |                 |  |   | 38,801    |  
|Commitments and contingencies (note 9)                                                                          |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Stockholders equity:                                                                                           |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Common stock, $1.00 par value, 100,000 shares authorized, 1,000, issued and outstanding for each date presented |  |                 | 1         |   |                   |   | 1         |                 |  |   | 1         |  
|Additional paid-in capital                                                                                      |  |                 | 175,842   |   |                   |   | 175,842   |                 |  |   | 179,999   |  
|Retained earnings (deficit)                                                                                     |  |                 | 56,576    |   |                   |   | (5,802    | )               |  |   | 62,014    |  
|Accumulated other comprehensive income                                                                          |  |                 | 4,355     |   |                   |   | 3,290     |                 |  |   | 676       |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Stockholders equity                                                                                            |  |                 | 236,774   |   |                   |   | 173,331   |                 |  |   | 242,690   |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  
|Total liabilities and stockholders equity                                                                      |  | $               | 1,586,156 |   |                   | $ | 1,327,544 |                 |  | $ | 1,414,017 |  
|                                                                                                                |  |                 |           |   |                   |   |           |                 |  |   |           |  



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



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(dollars in thousands, except share data)

UNAUDITED



|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|-------------------------------------------------------- | --------------- | -------------------- | ------- | --------------- | ------------------------------------ | - | ------- | -------------------------------------- |  | - | --------- | - |  | - | --------- | -
|                                                         |                 | Thirteen Weeks Ended |         |                 | Twenty-SixWeeks EndedAugust 28, 2005 |   |         | Twenty-SevenWeeks EndedAugust 29, 2004 | 
|                                                         | August 28, 2005 |                      |         | August 29, 2004 |                                      |   |        
|Net sales                                                |                 | $                    | 757,459 |                 |                                      | $ | 703,981 |                                        |  | $ | 2,114,369 |   |  | $ | 1,962,470 |  
|Costs and expenses:                                      |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|Cost of goods sold                                       |                 |                      | 647,700 |                 |                                      |   | 596,959 |                                        |  |   | 1,835,858 |   |  |   | 1,719,714 |  
|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|Gross profit                                             |                 |                      | 109,759 |                 |                                      |   | 107,022 |                                        |  |   | 278,511   |   |  |   | 242,756   |  
|Selling, general and administrative expenses             |                 |                      | 72,685  |                 |                                      |   | 70,308  |                                        |  |   | 158,308   |   |  |   | 153,119   |  
|Gain on sale of assets                                   |                 |                      | (1,455  | )               |                                      |   | (32     | )                                      |  |   | (1,473    | ) |  |   | (604      | )
|Royalties, service charges and other income and expenses |                 |                      | (10,040 | )               |                                      |   | (10,762 | )                                      |  |   | (17,824   | ) |  |   | (13,435   | )
|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|Operating income                                         |                 |                      | 48,569  |                 |                                      |   | 47,508  |                                        |  |   | 139,500   |   |  |   | 103,676   |  
|Third party interest expense                             |                 |                      | 6,389   |                 |                                      |   | 7,801   |                                        |  |   | 12,114    |   |  |   | 16,229    |  
|Finance related and other charges                        |                 |                      |        |                 |                                      |   | 1,875   |                                        |  |   |          |   |  |   | 3,750     |  
|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|Income before income taxes                               |                 |                      | 42,180  |                 |                                      |   | 37,832  |                                        |  |   | 127,386   |   |  |   | 83,697    |  
|Income tax expense                                       |                 |                      | 16,713  |                 |                                      |   | 14,517  |                                        |  |   | 50,502    |   |  |   | 32,474    |  
|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  
|Net income                                               |                 | $                    | 25,467  |                 |                                      | $ | 23,315  |                                        |  | $ | 76,884    |   |  | $ | 51,223    |  
|                                                         |                 |                      |         |                 |                                      |   |         |                                        |  |   |           |   |  |   |           |  



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



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands)

UNAUDITED



|                                                                                            |  |                                        |         |   |                                        |   |          |  
|------------------------------------------------------------------------------------------- |  | -------------------------------------- | ------- | - | -------------------------------------- | - | -------- | -
|                                                                                            |  | Twenty-Six Weeks Ended August 28, 2005 |         |   | Twenty-SevenWeeks EndedAugust 29, 2004 |  
|Operations                                                                                  |  |                                        |         |   |                                        |   |          |  
|Net income                                                                                  |  | $                                      | 76,884  |   |                                        | $ | 51,223   |  
|Adjustments to reconcile net income to net cash provided by (used in) operating activities: |  |                                        |         |   |                                        |   |          |  
|Depreciation                                                                                |  |                                        | 5,594   |   |                                        |   | 6,539    |  
|Amortization of intangibles                                                                 |  |                                        | 665     |   |                                        |   | 745      |  
|Amortization of debt issuance costs                                                         |  |                                        | 1,968   |   |                                        |   | 1,654    |  
|Gain on sales of fixed assets                                                               |  |                                        | (1,473  | ) |                                        |   | (604     | )
|Deferred tax provision (benefit)                                                            |  |                                        | (4,386  | ) |                                        |   | 23,658   |  
|Change in operating assets and liabilities:                                                 |  |                                        | (73,668 | ) |                                        |   | (396,593 | )
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Net cash provided by (used in) operations                                                   |  |                                        | 5,584   |   |                                        |   | (313,378 | )
|Investing                                                                                   |  |                                        |         |   |                                        |   |          |  
|Acquisition payment to ConAgra Foods, Inc.                                                  |  |                                        |        |   |                                        |   | (58,236  | )
|Additions to property, plant and equipment                                                  |  |                                        | (6,417  | ) |                                        |   | (6,149   | )
|Proceeds from sales of assets                                                               |  |                                        | 2,191   |   |                                        |   | 968      |  
|Investment in unconsolidated affiliates                                                     |  |                                        | 478     |   |                                        |   | 87       |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Net cash used in investing activities                                                       |  |                                        | (3,748  | ) |                                        |   | (63,330  | )
|Financing                                                                                   |  |                                        |         |   |                                        |   |          |  
|Check float on zero balance accounts                                                        |  |                                        | 5,760   |   |                                        |   | 42,866   |  
|Net borrowings (repayments) of short-term debt                                              |  |                                        | (55     | ) |                                        |   | 180,299  |  
|Debt issuance costs                                                                         |  |                                        | (650    | ) |                                        |   |         |  
|Due to UAP Holding Corp.                                                                    |  |                                        | 8,652   |   |                                        |   | 1,642    |  
|Dividends paid                                                                              |  |                                        | (6,304  | ) |                                        |   |         |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Net cash provided by financing activities                                                   |  |                                        | 7,403   |   |                                        |   | 224,807  |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Net change in cash and cash equivalents                                                     |  |                                        | 9,239   |   |                                        |   | (151,901 | )
|Net effect of exchange rates on cash and cash equivalents                                   |  |                                        | 202     |   |                                        |   | 119      |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Net change in cash and cash equivalents                                                     |  |                                        | 9,441   |   |                                        |   | (151,782 | )
|Cash and cash equivalents at beginning of period                                            |  |                                        | 48,201  |   |                                        |   | 171,985  |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Cash and cash equivalents at end of period                                                  |  | $                                      | 57,642  |   |                                        | $ | 20,203   |  
|                                                                                            |  |                                        |         |   |                                        |   |          |  
|Supplemental disclosure of cash flow information:                                           |  |                                        |         |   |                                        |   |          |  
|Cash paid during the period for interest                                                    |  | $                                      | 11,006  |   |                                        | $ | 13,222   |  
|Net cash paid during the period for income taxes on behalf of parent                        |  | $                                      | 13,813  |   |                                        | $ | 20,287   |  
|Dividend declared and payable to parent                                                     |  | $                                      | 8,202   |   |                                        | $ |         |  



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



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY

(dollars in thousands)

UNAUDITED



|                                        |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  
|--------------------------------------- |  | ----------- | - | ------------------------ | - | ---------------- |  | - | ----------------------------------- | - | ------------------------ | - | ----- |  | - | ------- | -
|Twenty-Six Weeks Ended August 28, 2005  |  | CommonStock |   | AdditionalPaid inCapital |   | RetainedEarnings |  |   | AccumulatedOtherComprehensiveIncome |   | TotalStockholdersEquity |  
|                                        |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  
|Balance at February 27, 2005            |  | $           | 1 |                          | $ | 175,842          |  | $ | (5,802                              | ) |                          | $ | 3,290 |  | $ | 173,331 |  
|Dividends to stockholder                |  |             |  |                          |   |                 |  |   | (14,506                             | ) |                          |   |      |  |   | (14,506 | )
|Comprehensive income:                   |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  
|Net income                              |  |             |  |                          |   |                 |  |   | 76,884                              |   |                          |   |      |  |   | 76,884  |  
|Foreign currency translation adjustment |  |             |  |                          |   |                 |  |   |                                    |   |                          |   | 1,065 |  |   | 1,065   |  
|                                        |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  
|Total comprehensive income              |  |             |  |                          |   |                 |  |   |                                    |   |                          |   |      |  |   | 77,949  |  
|                                        |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  
|Balance at August 28, 2005              |  | $           | 1 |                          | $ | 175,842          |  | $ | 56,576                              |   |                          | $ | 4,355 |  | $ | 236,774 |  
|                                        |  |             |   |                          |   |                  |  |   |                                     |   |                          |   |       |  |   |         |  



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



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UNITED AGRI PRODUCTS, INC.



NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Thirteen and Twenty-Six Week Periods Ended August 28,
2005 and the Thirteen and Twenty-Seven

Week Periods Ended August 29, 2004



UNAUDITED



|1. | Description of the Business and Basis of Presentation
|-- | -----------------------------------------------------



Interim Financial Statements.The accompanying unaudited condensed consolidated financial statements of United Agri Products, Inc. (a wholly-owned
subsidiary of UAP Holding Corp.) and its subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and reflect all adjustments
(consisting of normal recurring accruals) which, in the opinion of management, are necessary for a fair presentation of the financial position, operating results, and cash flows for the periods presented. These financial statements should be read in
conjunction with the consolidated and combined financial statements and notes thereto contained in our Annual Report on Form 10-K for the fiscal year ended February 27, 2005.



Business.We are the largest distributor of agricultural and non-crop inputs in the United States and Canada. We market
a comprehensive line of products including chemicals, seed and fertilizer to growers and regional dealers. We have approximately 330 general distribution centers and sales locations. We also have three formulation facilities where we blend products
primarily for sale by our distribution facilities.



On November 24, 2003,
Apollo Management, L.P. (Apollo), UAP Holding Corp. and ConAgra Foods consummated a transaction in which UAP Holding Corp. acquired ConAgra Foods United States and Canadian Agricultural Products Businesses, excluding its wholesale
fertilizer and other international crop distribution businesses, which we refer to as the Acquisition. On November 29, 2004, UAP Holding Corp. consummated the initial public offering of its common stock (the Common Stock
Offering), which is traded under the symbol UAPH on the NASDAQ National Market.



Principles of Consolidation.The consolidated financial statements include our accounts and the accounts of all our wholly-owned subsidiaries. Significant intercompany balances and
transactions have been eliminated. Investments in 50% or less owned affiliates over which we do not have the ability to exercise significant control are accounted for using the equity method.



Fiscal Year.Our fiscal year operates on a 52- or 53-week period ending
on the last Sunday in February. Our fiscal year 2006 contains 52 weeks while our fiscal year 2005 contained 53 weeks. The additional week in fiscal year 2005 was included in the first quarter.



Seasonality.Our and our customers businesses are seasonal, based
upon the planting, growing, and harvesting cycles. Typically at least 75% of our net sales occur during the first and second fiscal quarters of each year because of the condensed nature of the planting season. As a result of the seasonality of
sales, we experience significant fluctuations in our revenues, income and net working capital levels. In addition, weather conditions can significantly vary quarterly results.



Since our suppliers typically operate on a crop year, which is a different year than our fiscal year, our rebate agreements with our
suppliers are estimated throughout our fiscal year and adjusted, as necessary, in our fourth fiscal quarter. These estimates can impact our margin percentages by quarter. Also, our receivables are seasonal since customers operate on a crop year and
payments are cyclical throughout the year. Accordingly, our results of operations over any one-quarter are not necessarily indicative of the results to be expected over the full fiscal year.



Use of Estimates.The preparation of financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions. These estimates or assumptions affect reported amounts of assets, liabilities, revenue and expenses as
reflected in the financial statements. Actual results could differ from those estimates and the differences could be material.



8



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##### Table of Contents

Earnings Per Share.Earning per share information is not presented, as the Company is a wholly owned
subsidiary of UAP Holding Corp.



Stock Based
Compensation.Certain of our employees participate in UAP Holding Corps stock option plan. We account for employee stock option plans in accordance with Accounting Principles Board Opinion No 25, Accounting
for Stock Issued to Employees. Accordingly, no stock based compensation expense is reflected in net income, as options granted under these plans have an exercise price equal to the market value of the underlying common stock on the date of the
grant.



The impact on our net income if we applied the fair value measurement
provisions of Statement of Financial Accounting Standards (SFAS) No. 123, Share-Based Payment would be as follows:



|                                                                                                                          |                 |                                                           |                 |                                        |   |                                          |  |   |        |  |   |       
|------------------------------------------------------------------------------------------------------------------------- | --------------- | --------------------------------------------------------- | --------------- | -------------------------------------- | - | ---------------------------------------- |  | - | ------ |  | - | ------
|Stock-Based Compensation                                                                                                  |                 | Thirteen Weeks Ended                                      |                 | Twenty-Six Weeks Ended August 28, 2005 |   | Twenty-Seven Weeks Ended August 29, 2004
|                                                                                                                          | August 28, 2005 |                                                           | August 29, 2004 |                                        |  
|                                                                                                                          |                 | (dollars in thousands, except earnings per share amounts)
|Net income as reported                                                                                                    |                 | $                                                         | 25,467          |                                        | $ | 23,315                                   |  | $ | 76,884 |  | $ | 51,223
|Less: Total stock-based employee compensation expense determined under fair-value-based method for all awards, net of tax |                 |                                                           | 12              |                                        |   | 36                                       |  |   | 24     |  |   | 71    
|                                                                                                                          |                 |                                                           |                 |                                        |   |                                          |  |   |        |  |   |       
|Pro forma net income                                                                                                      |                 | $                                                         | 25,455          |                                        | $ | 23,279                                   |  | $ | 76,860 |  | $ | 51,152
|                                                                                                                          |                 |                                                           |                 |                                        |   |                                          |  |   |        |  |   |       



Reclassifications.Certain prior period amounts in the condensed consolidated financial statements have been reclassified to conform to current period presentation. These reclassifications had no net
impact on previously reported results of operations. We reclassified royalties, service charges, other income and expenses and finance related and other charges which were previously included in other income and selling, general and administrative
expenses. We also reclassified cash, vendor prepay, other current assets, and deferred taxes.



|2. | Royalties, Service Charges and Other Income and Expenses
|-- | --------------------------------------------------------



The table below details royalties, service charges and other income and expenses.



|                                                         |                 |                        |         |                 |                                        |   |         |                                         |  |   |         |   |  |   |         |  
|-------------------------------------------------------- | --------------- | ---------------------- | ------- | --------------- | -------------------------------------- | - | ------- | --------------------------------------- |  | - | ------- | - |  | - | ------- | -
|Royalties, service charges and other income and expenses |                 | Thirteen Weeks Ended   |         |                 | Twenty-Six Weeks Ended August 28, 2005 |   |         | Twenty-SevenWeeks Ended August 29, 2004 | 
|                                                         | August 28, 2005 |                        |         | August 29, 2004 |                                        |   |        
|                                                         |                 | (dollars in thousands) |        
|Royalty income                                           |                 | $                      | (4,329  | )               |                                        | $ | (3,050  | )                                       |  | $ | (8,954  | ) |  | $ | (5,147  | )
|Service charge income                                    |                 |                        | (2,644  | )               |                                        |   | (2,929  | )                                       |  |   | (4,040  | ) |  |   | (3,900  | )
|Other income                                             |                 |                        | (3,067  | )               |                                        |   | (4,783  | )                                       |  |   | (4,830  | ) |  |   | (4,388  | )
|                                                         |                 |                        |         |                 |                                        |   |         |                                         |  |   |         |   |  |   |         |  
|Royalties, service charges and other income and expenses |                 | $                      | (10,040 | )               |                                        | $ | (10,762 | )                                       |  | $ | (17,824 | ) |  | $ | (13,435 | )
|                                                         |                 |                        |         |                 |                                        |   |         |                                         |  |   |         |   |  |   |         |  



|3. | Finance Related and Other Charges
|-- | ---------------------------------



Finance related and other charges are composed of costs and fees related to the Acquisition, the Common Stock Offering, and related financing activities. For the thirteen
and twenty-seven weeks ended August 29, 2004, these charges consisted of $1.9 million and $3.8 million, respectively, relating to the non-accountable charges paid to ConAgra Foods for the Acquisition.



|4. | Certain Asset Accounts
|-- | ----------------------



Receivables and Allowance for Doubtful Accounts.Our receivables include receivables from customers net of allowances for doubtful accounts, vendor rebates
receivable, and miscellaneous receivables. As of August 28, 2005, February 27, 2005, and August 29, 2004, the net receivables from customers were $623.8 million, $192.5 million, and $547.1 million, respectively, vendor rebates
receivable were $151.0 million, $23.2 million, and $129.4 million, respectively, and miscellaneous receivables were $23.3 million, $19.5 million, and $30.3 million, respectively. The net receivables from customers include receivables from
unconsolidated investees in the amounts of $2.0 million, $4.0 million, and $4.3 million as of August 28, 2005, February 27, 2005, and August 29, 2004, respectively.



9



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Inventories.Inventories consist primarily of chemicals, fertilizer, and seed, and are carried at the lower
of cost or market. As of August 28, 2005, February 27, 2005, and August 29, 2004, we had $8.6 million, $25.8 million, and $7.4 million, respectively, of allowances against inventory.



The cost of inventory at distribution locations is carried either at average cost or first
in, first out (FIFO). As of August 28, 2005, February 27, 2005, and August 29, 2004, approximately 58.1%, 23.5%, and 12.5%, respectively, of inventory was reported on the average cost basis.



Inventories are comprised of the following:



|                                  |  |                        |         |                   |   |                 |  |   |        
|--------------------------------- |  | ---------------------- | ------- | ----------------- | - | --------------- |  | - | -------
|                                  |  | August 28, 2005        |         | February 27, 2005 |   | August 29, 2004
|                                  |  | (dollars in thousands)
|Raw materials and work in process |  | $                      | 8,545   |                   | $ | 12,827          |  | $ | 10,504 
|Finished goods                    |  |                        | 506,807 |                   |   | 684,307         |  |   | 439,098
|                                  |  |                        |         |                   |   |                 |  |   |        
|Total                             |  | $                      | 515,352 |                   | $ | 697,134         |  | $ | 449,602
|                                  |  |                        |         |                   |   |                 |  |   |        



Goodwill. At
August 28, 2005, February 27, 2005, and August 29, 2004, goodwill totaled $34.6 million, $34.6 million, and $41.4 million, respectively, with no amortization. During the third quarter of fiscal 2005, we finalized the Acquisition
purchase price allocation with the assistance of a third party valuation of certain intangible assets that had been categorized as goodwill.



Debt Issuance Costs. Our debt issuance costs net of amortization were $15.8 million, $17.1 million, and $18.4 million as of August 28,
2005, February 27, 2005, and August 29, 2004, respectively. Our debt issuance costs consisted of costs associated with our revolving credit facility and the 81/4% Senior Notes due 2011 (the 81/4%
Senior Notes). Debt issuance costs of $0.6 million were recognized in the first half of fiscal year 2006, for the exchange offer relating to the 81/4% Senior Notes.



|5. | Costs Associated with Asset Retirement Obligations
|-- | --------------------------------------------------



We had Asset Retirement Obligations related to SFAS No. 143, Accounting for Asset Retirement Obligations as follows:



|                              |  |                                        |       |   |                                        |   |      
|----------------------------- |  | -------------------------------------- | ----- | - | -------------------------------------- | - | -----
|                              |  | Twenty-Six Weeks Ended August 28, 2005 |       |   | Twenty-SevenWeeks EndedAugust 29, 2004
|                              |  | (dollars in thousands)                
|Beginning fiscal year balance |  | $                                      | 2,411 |   |                                        | $ | 2,343
|Obligations incurred          |  |                                        |      |   |                                        |   |     
|Obligations settled           |  |                                        |      |   |                                        |   |     
|Accretion expense             |  |                                        | 44    |   |                                        |   | 44   
|Cash flow revision            |  |                                        | (9    | ) |                                        |   | 42   
|                              |  |                                        |       |   |                                        |   |      
|Ending Balance                |  | $                                      | 2,446 |   |                                        | $ | 2,429
|                              |  |                                        |       |   |                                        |   |      



|6. | Costs Associated with Exit or Disposal Activities
|-- | -------------------------------------------------



We consolidated two regional sales offices and two formulating plants during the second half of fiscal 2005. The tables below show the activity related to costs
associated with exit or disposal activities.



|                                                |  |                                      |      |   |                                        |   |      |  
|----------------------------------------------- |  | ------------------------------------ | ---- | - | -------------------------------------- | - | ---- | -
|                                                |  | Thirteen Weeks Ended August 28, 2005 |      |   | Twenty-Six Weeks Ended August 28, 2005 |  
|                                                |  | (dollars in thousands)               |     
|Expenses related to closure activities          |  |                                      |      |   |                                        |   |      |  
|Severance expenses                              |  | $                                    | 10   |   |                                        | $ | (55  | )
|Lease expense                                   |  |                                      | 52   |   |                                        |   | 52   |  
|Other cost of goods sold                        |  |                                      | 32   |   |                                        |   | 517  |  
|                                                |  |                                      |      |   |                                        |   |      |  
|Total cost of goods sold                        |  |                                      | 94   |   |                                        |   | 514  |  
|Other income                                    |  |                                      |     |   |                                        |   | (24  | )
|                                                |  |                                      |      |   |                                        |   |      |  
|Total closure expenses                          |  | $                                    | 94   |   |                                        | $ | 490  |  
|                                                |  |                                      |      |   |                                        |   |      |  
|                                                |  |                                     
|                                                |  | As of August 28, 2005                |      |   | As of February 27, 2005                |  
|                                                |  | (dollars in thousands)               |     
|Liability balance related to closure activities |  |                                      |      |   |                                        |   |      |  
|Beginning fiscal year balance                   |  | $                                    | (724 | ) |                                        | $ |     |  
|Additional expense recognized                   |  |                                      | (490 | ) |                                        |   | (903 | )
|Severance and other expenses settled            |  |                                      | 908  |   |                                        |   | 179  |  
|                                                |  |                                      |      |   |                                        |   |      |  
|Total                                           |  | $                                    | (306 | ) |                                        | $ | (724 | )
|                                                |  |                                      |      |   |                                        |   |      |  



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Total estimated closure expenses and total expenses recognized to date for the above consolidating activities are $1.4
million.



|7. | Income Taxes
|-- | ------------



We file a consolidated return with UAP Holding Corp. We provide income taxes as if we were a stand alone company. Our income tax provision for the thirteen and twenty-six weeks ended August 28, 2005, and the
thirteen and twenty-seven weeks ended August 29, 2004 differs from the federal statutory rate as follows:



|                            |                 |                        |                 |                                        |   |                                          |  |   |        |  |   |       
|--------------------------- | --------------- | ---------------------- | --------------- | -------------------------------------- | - | ---------------------------------------- |  | - | ------ |  | - | ------
|                            |                 | Thirteen Weeks Ended   |                 | Twenty-Six Weeks Ended August 28, 2005 |   | Twenty-Seven Weeks Ended August 29, 2004
|                            | August 28, 2005 |                        | August 29, 2004 |                                        |  
|                            |                 | (dollars in thousands)
|U.S. federal statutory rate |                 | $                      | 14,763          |                                        | $ | 13,241                                   |  | $ | 44,585 |  | $ | 29,294
|State income taxes          |                 |                        | 1,778           |                                        |   | 931                                      |  |   | 5,553  |  |   | 2,963 
|Foreign credits and other   |                 |                        | 172             |                                        |   | 345                                      |  |   | 364    |  |   | 217   
|                            |                 |                        |                 |                                        |   |                                          |  |   |        |  |   |       
|Total                       |                 | $                      | 16,713          |                                        | $ | 14,517                                   |  | $ | 50,502 |  | $ | 32,474
|                            |                 |                        |                 |                                        |   |                                          |  |   |        |  |   |       



The
components of our income tax provision are as follows:



|                                                      |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|----------------------------------------------------- | --------------- | ---------------------- | ------ | --------------- | -------------------------------------- | - | ------ | --------------------------------------- |  | - | ------ | - |  | - | ------
|Income tax provision (benefit)                        |                 | Thirteen Weeks Ended   |        |                 | Twenty-Six Weeks Ended August 28, 2005 |   |        | Twenty-SevenWeeks Ended August 29, 2004
|                                                      | August 28, 2005 |                        |        | August 29, 2004 |                                        |   |       
|                                                      |                 | (dollars in thousands)
|Current:                                              |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|U.S. federal                                          |                 | $                      | 13,579 |                 |                                        | $ | 318    |                                         |  | $ | 45,314 |   |  | $ | 4,155 
|U.S. state                                            |                 |                        | 1,817  |                 |                                        |   | (174   | )                                       |  |   | 6,112  |   |  |   | 536   
|Outside United States                                 |                 |                        | 1,647  |                 |                                        |   | 1,754  |                                         |  |   | 3,441  |   |  |   | 4,125 
|Effect of foreign currency exchange on deferred taxes |                 |                        | 28     |                 |                                        |   |       |                                         |  |   | 20     |   |  |   |      
|                                                      |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|Total current                                         |                 |                        | 17,071 |                 |                                        |   | 1,898  |                                         |  |   | 54,887 |   |  |   | 8,816 
|Deferred:                                             |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|U.S. federal                                          |                 |                        | (291   | )               |                                        |   | 11,515 |                                         |  |   | (3,806 | ) |  |   | 21,232
|U.S. state                                            |                 |                        | (39    | )               |                                        |   | 1,104  |                                         |  |   | (559   | ) |  |   | 2,426 
|Outside United States                                 |                 |                        |       |                 |                                        |   |       |                                         |  |   |       |   |  |   |      
|Effect of foreign currency exchange on deferred taxes |                 |                        | (28    | )               |                                        |   |       |                                         |  |   | (20    | ) |  |   |      
|                                                      |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|Total deferred                                        |                 |                        | (358   | )               |                                        |   | 12,619 |                                         |  |   | (4,385 | ) |  |   | 23,658
|                                                      |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       
|Total                                                 |                 | $                      | 16,713 |                 |                                        | $ | 14,517 |                                         |  | $ | 50,502 |   |  | $ | 32,474
|                                                      |                 |                        |        |                 |                                        |   |        |                                         |  |   |        |   |  |   |       



|8. | Debt
|-- | ----



Total current and long-term debt as of August 28, 2005, February 27, 2005, and August 29, 2004, consisted of the following:



|                          |  |                        |         |                   |   |                 |  |   |        
|------------------------- |  | ---------------------- | ------- | ----------------- | - | --------------- |  | - | -------
|Total debt                |  | August 28, 2005        |         | February 27, 2005 |   | August 29, 2004
|                          |  | (dollars in thousands)
|Revolving credit facility |  | $                      |        |                   | $ | 55              |  | $ | 180,299
|81/4%
Senior Notes        |  |                        | 203,500 |                   |   | 203,500         |  |   | 225,000
|                          |  |                        |         |                   |   |                 |  |   |        
|Total debt                |  |                        | 203,500 |                   |   | 203,555         |  |   | 405,299
|Less: current portion     |  |                        |         |                   |   |                 |  |   |        
|Revolving credit facility |  |                        |        |                   |   | 55              |  |   | 180,299
|                          |  |                        |         |                   |   |                 |  |   |        
|Total long-term debt      |  | $                      | 203,500 |                   | $ | 203,500         |  | $ | 225,000
|                          |  |                        |         |                   |   |                 |  |   |        



11



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Our $500.0 million asset based revolving credit facility will mature in 2008.



At August 28, 2005, there was $500.0 million of borrowing availability under the
revolving credit facility and we had borrowing capacity thereunder of $486.7 million (after giving effect to $13.3 million of letters of credit under the sub-facility).



On December 29, 2004, $21.5 million of the 81/4% Senior Notes were redeemed with proceeds from the Common Stock Offering. In addition, we may redeem some or all of the remaining 81/4% Senior Notes at a redemption price that may include a redemption premium and a make-whole premium.



|9. | Commitments and Contingencies
|-- | -----------------------------



We are a party to a number of lawsuits and claims arising out of the operation of our businesses. After taking into account liabilities recorded, management believes the
ultimate resolution of such matters should not have a material adverse effect on our financial condition, results of operations or liquidity.



|10. | Employee Benefit Plans
|--- | ----------------------



Management Incentive Program.We have a management incentive plan for key officers and employees, based on growth, profitability, individual performance of
each operating center and key performance metrics. Amounts charged to expense totaled $7.8 million and $27.1 million for the thirteen and twenty-six weeks ended August 28, 2005, respectively, and $10.7 million and $29.9 million for the thirteen
and twenty-seven weeks ended August 29, 2004, respectively.



Retirement Program for Canadian Employees.United Agri Products Canada, Inc., (UAP Canada) one of our subsidiaries, currently has two retirement plans for employees of UAP Canada. They are eligible to participate
in these plans after completing one year of service. One plan is an optional RRSP/DPSD Defined Contribution plan. UAP Canada matches 50% of an employees first 6% of contributions to the plan.



The second plan is a defined benefit plan. UAP Canada is responsible for funding this plan
and is currently contributing at a rate of 7.10% of payroll. Benefits are based on years of credited service and average compensation in the last 5 years of service. Components of the UAP Canada pension plan are reported below.



The change in pension benefit costs is as follows:



|                                                   |                 |                        |     |                 |                                        |   |     |                                          |  |   |     |   |  |   |     |  
|-------------------------------------------------- | --------------- | ---------------------- | --- | --------------- | -------------------------------------- | - | --- | ---------------------------------------- |  | - | --- | - |  | - | --- | -
|Pension benefit costs                              |                 | Thirteen Weeks Ended   |     |                 | Twenty-Six Weeks Ended August 28, 2005 |   |     | Twenty-Seven Weeks Ended August 29, 2004 | 
|                                                   | August 28, 2005 |                        |     | August 29, 2004 |                                        |   |    
|                                                   |                 | (dollars in thousands) |    
|Service cost for benefits earned during the period |                 | $                      | 93  |                 |                                        | $ | 107 |                                          |  | $ | 162 |   |  | $ | 214 |  
|Interest cost on benefit obligations               |                 |                        | 48  |                 |                                        |   | 51  |                                          |  |   | 83  |   |  |   | 102 |  
|Assumed return on plan assets                      |                 |                        | (38 | )               |                                        |   | (47 | )                                        |  |   | (66 | ) |  |   | (94 | )
|                                                   |                 |                        |     |                 |                                        |   |     |                                          |  |   |     |   |  |   |     |  
|Total pension benefit costs                        |                 | $                      | 103 |                 |                                        | $ | 111 |                                          |  | $ | 179 |   |  | $ | 222 |  
|                                                   |                 |                        |     |                 |                                        |   |     |                                          |  |   |     |   |  |   |     |  



12



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|11. | Equity
|--- | ------



Stock Options. Certain of our management, directors, and employees participate in UAP Holding Corp.s stock option plans. The changes in the outstanding stock options under the two stock option
plans during the twenty-six weeks ended August 28, 2005, and the twenty-seven weeks ended August 29, 2004, are summarized below:



|                             |  |                          |   |  |                                           |     
|---------------------------- |  | ------------------------ | - |  | ----------------------------------------- | ----
|Stock options                |  | Shares subject to option |   |  | Weighted-average Exercise price per share
|Balance at February 27, 2005 |  | 3,359,535                |   |  | $                                         | 2.56
|Granted                      |  |                         |   |  |                                           |     
|Exercised                    |  | (37,259                  | ) |  | $                                         | 2.56
|Forfeited / lapsed           |  | (13,550                  | ) |  | $                                         | 2.56
|                             |  |                          |   |  |                                           |     
|Balance at August 28, 2005   |  | 3,308,726                |   |  | $                                         | 2.56
|                             |  |                          |   |  |                                           |     
|Vested at August 28, 2005    |  | 2,504,568                |   |  | $                                         | 2.56
|                             |  |                          |   |  |                                           |     
|Balance at February 22, 2004 |  | 2,789,115                |   |  | $                                         | 2.56
|Granted                      |  | 629,047                  |   |  | $                                         | 2.56
|Exercised                    |  |                         |   |  |                                           |     
|Forfeited / lapsed           |  |                         |   |  |                                           |     
|                             |  |                          |   |  |                                           |     
|Balance at August 29, 2004   |  | 3,418,162                |   |  | $                                         | 2.56
|                             |  |                          |   |  |                                           |     
|Vested at August 29, 2004    |  | 351,762                  |   |  | $                                         | 2.56
|                             |  |                          |   |  |                                           |     



Deferred Compensation
Plans. UAP Holding Corp. maintains two deferred compensation plans for the benefit of certain members of our management, the 2003 Deferred Compensation Plan (the 2003 DCP), which was adopted in connection with the Acquisition and
the 2004 Deferred Compensation Plan (the 2004 DCP), which was adopted on April 2, 2004. The 2003 DCP provides for the crediting of deferred shares for each executive who entered into a retention agreement at the time of the
Acquisition. The 2004 DCP provides for the crediting of deferred shares for each member of management who waived the right to receive a portion of their cash bonus for the 2004 fiscal year. Each deferred share represents the right to receive one
share of common stock on the applicable payment date, subject to adjustment in the event of a stock split or similar event affecting UAP Holding Corp.s common stock. Deferred shares become payable upon a termination of the executives
employment, certain changes in control of UAP Holding Corp. and certain offerings of UAP Holding Corp.s common stock (based upon certain piggyback rights contained in the Management Incentive Agreement). The plans prohibit the assignment of
the deferred shares except upon an executives death. UAP Holding Corp. established a trust (the Rabbi Trust) to hold the assets of the 2003 DCP and the 2004 DCP. The assets of the Rabbi Trust are subject to the claims of UAP
Holding Corp.s creditors in the event of UAP Holding Corp.s insolvency. As of August 28, 2005, there were 1,804,625 shares of UAP Holding Corp. common stock remaining in the Rabbi Trust.



Dividends Declared and Paid.On July 18, 2005, UAP Holding
Corp.s board of directors declared a quarterly dividend on its common stock in the amount of $0.1625 per share of common stock. The record date for the dividend payment was August 15, 2005, and the payment date was September 1, 2005.
Also on July 18, 2005, our board declared a dividend on our common stock of $8.2 million to provide UAP Holding Corp. with the funds necessary to pay the dividend on September 1, 2005. We also paid a dividend of $6.3 million on
June 1, 2005 to provide UAP Holding Corp. with the funds necessary to pay the previously declared dividend on its common stock in the amount of $0.125 per share of common stock.



Long-Term Incentive Plan. During the thirteen weeks ended August 28, 2005, 2,000 restricted stock units
(RSUs) were granted to certain employees and management pursuant to the UAP Holding Corp. 2004 Long-Term Incentive Plan. A total of 249,575 RSUs have been granted and 250 RSUs have been forfeited in the twenty-six weeks
ended August 28, 2005. There were 249,325 RSUs outstanding at August 28, 2005. The RSUs vest ratably over four years, 25% on each of the four anniversaries of the grant date. We recorded $0.3 million and $0.4 million as
compensation expense for the thirteen and twenty-six week periods ended August 28, 2005.



On April 29, 2005, UAP Holding Corp.s board of directors adopted a directors deferred compensation plan (the Director DCP). The Director DCP allows non-employee directors to elect to defer
payment of all or a portion of their fees and have such amounts credited under the plan in the form of deferred shares. UAP Holding Corp.s board of directors (or its compensation committee) may also grant its non-employee directors deferred
shares under the Director DCP. Each deferred share represents the right to receive one share of common stock on the applicable payment date, subject to adjustment in the event of a stock split or similar event affecting UAP Holding Corp.s
common stock. Deferred shares become payable immediately upon termination of the directors service. Shares delivered under the Director DCP in respect of an award of deferred shares are charged against the share limits of the 2004 Long-Term
Incentive Plan. The Director DCP prohibits the assignment of the deferred shares except upon a directors death. There were no restricted stock units outstanding under the Director DCP as of August 28, 2005.



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|12. | Business Segment and Related Information
|--- | ----------------------------------------



We operate in one segment. Net sales and long-lived assets by geographical area are as follows:



|              |                |                        |                |                                      |   |                                         |  |   |           |  |   |          
|------------- | -------------- | ---------------------- | -------------- | ------------------------------------ | - | --------------------------------------- |  | - | --------- |  | - | ---------
|Net sales     |                | Thirteen Weeks Ended   |                | Twenty-Six WeeksEndedAugust 28, 2005 |   | Twenty-Seven WeeksEnded August 29, 2004
|              | August 28,2005 |                        | August 29,2004 |                                      |  
|              |                | (dollars in thousands)
|United States |                | $                      | 727,350        |                                      | $ | 676,444                                 |  | $ | 2,049,850 |  | $ | 1,903,033
|Canada        |                |                        | 30,109         |                                      |   | 27,537                                  |  |   | 64,519    |  |   | 59,437   
|              |                |                        |                |                                      |   |                                         |  |   |           |  |   |          
|Total         |                | $                      | 757,459        |                                      | $ | 703,981                                 |  | $ | 2,114,369 |  | $ | 1,962,470
|              |                |                        |                |                                      |   |                                         |  |   |           |  |   |          



|                  |  |                        |         |                  |   |                |  |   |        
|----------------- |  | ---------------------- | ------- | ---------------- | - | -------------- |  | - | -------
|Long-lived assets |  | August 28,2005         |         | February 27,2005 |   | August 29,2004
|                  |  | (dollars in thousands)
|United States     |  | $                      | 167,220 |                  | $ | 169,353        |  | $ | 171,687
|Canada            |  |                        | 3,941   |                  |   | 4,098          |  |   | 4,027  
|                  |  |                        |         |                  |   |                |  |   |        
|Total             |  | $                      | 171,161 |                  | $ | 173,451        |  | $ | 175,714
|                  |  |                        |         |                  |   |                |  |   |        



Net sales by product category are as
follows:



|                              |                |                        |                |                                     |   |                                       |  |   |           |  |   |          
|----------------------------- | -------------- | ---------------------- | -------------- | ----------------------------------- | - | ------------------------------------- |  | - | --------- |  | - | ---------
|Net sales by product category |                | Thirteen Weeks Ended   |                | Twenty-SixWeeks EndedAugust 28,2005 |   | Twenty-SevenWeeks EndedAugust 29,2004
|                              | August 28,2005 |                        | August 29,2004 |                                     |  
|                              |                | (dollars in thousands)
|Chemicals                     |                | $                      | 570,455        |                                     | $ | 533,623                               |  | $ | 1,293,995 |  | $ | 1,257,721
|Fertilizer                    |                |                        | 146,844        |                                     |   | 128,536                               |  |   | 483,271   |  |   | 409,269  
|Seed                          |                |                        | 22,671         |                                     |   | 26,360                                |  |   | 298,969   |  |   | 259,971  
|Other                         |                |                        | 17,489         |                                     |   | 15,462                                |  |   | 38,134    |  |   | 35,509   
|                              |                |                        |                |                                     |   |                                       |  |   |           |  |   |          
|Total                         |                | $                      | 757,459        |                                     | $ | 703,981                               |  | $ | 2,114,369 |  | $ | 1,962,470
|                              |                |                        |                |                                     |   |                                       |  |   |           |  |   |          



Net
sales by geographical area are based on the location of the facility producing the sales.



Long-lived assets consist of property, plant and equipment net of depreciation, goodwill, intangible assets net of amortization, deferred income taxes, debt issuance costs net of amortization, investment in
unconsolidated affiliates, and other assets. Long-lived assets by geographical area are based on the location of our facilities.



|13. | Guarantor/Non-Guarantor Financial Information
|--- | ---------------------------------------------



The 81/4% Senior Notes issued by
us are fully and unconditionally guaranteed on a joint and several basis pursuant to guarantees by all of our domestic subsidiaries (the Guarantors), except as noted below. Each of our direct and indirect subsidiaries is 100% owned by
us. The 81/4% Senior Notes are not guaranteed by either UAP Holding Corp., or the Canadian distribution
business. Condensed consolidating financial information for the Guarantors and the Non-Guarantors, excluding UAP Holding Corp., is as follows:



14



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING BALANCE SHEET

August 28, 2005

(dollars in thousands)

UNAUDITED



|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|-------------------------------------------------------------------------------------- |  | ------------------------ | ------- | ---------- | - | --------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | -------- | - |  | - | --------- | -
|                                                                                       |  | United AgriProducts,Inc. |         | Guarantors |   |           | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |         
|ASSETS                                                                                 |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current assets:                                                                        |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Cash and cash equivalents                                                              |  | $                        |        |            | $ | 52,856    |                                            |  | $ | 4,786                     |   |  | $     |         |   |  | $ | 57,642    |  
|Receivables, net                                                                       |  |                          |        |            |   | 768,908   |                                            |  |   | 29,276                    |   |  |       |         |   |  |   | 798,184   |  
|Inventories                                                                            |  |                          |        |            |   | 498,151   |                                            |  |   | 17,201                    |   |  |       |         |   |  |   | 515,352   |  
|Deferred income taxes                                                                  |  |                          |        |            |   | 21,006    |                                            |  |   | 379                       |   |  |       |         |   |  |   | 21,385    |  
|Vendor prepay                                                                          |  |                          |        |            |   | 18,958    |                                            |  |   |                          |   |  |       |         |   |  |   | 18,958    |  
|Other current assets                                                                   |  |                          |        |            |   | 3,195     |                                            |  |   | 279                       |   |  |       |         |   |  |   | 3,474     |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current assets                                                                   |  |                          |        |            |   | 1,363,074 |                                            |  |   | 51,921                    |   |  |       |         |   |  |   | 1,414,995 |  
|Property, plant and equipment                                                          |  |                          |        |            |   | 106,035   |                                            |  |   | 4,289                     |   |  |       |         |   |  |   | 110,324   |  
|Less accumulated depreciation                                                          |  |                          |        |            |   | (19,935   | )                                          |  |   | (591                      | ) |  |       |         |   |  |   | (20,526   | )
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Property, plant and equipment, net                                                     |  |                          |        |            |   | 86,100    |                                            |  |   | 3,698                     |   |  |       |         |   |  |   | 89,798    |  
|Goodwill                                                                               |  |                          |        |            |   | 34,645    |                                            |  |   |                          |   |  |       |         |   |  |   | 34,645    |  
|Intangible assets, net                                                                 |  |                          |        |            |   | 25,229    |                                            |  |   |                          |   |  |       |         |   |  |   | 25,229    |  
|Deferred income taxes                                                                  |  |                          |        |            |   | 1,118     |                                            |  |   | 243                       |   |  |       |         |   |  |   | 1,361     |  
|Debt issue costs, net                                                                  |  |                          | 15,789  |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 15,789    |  
|Investment in unconsolidated affiliates                                                |  |                          |        |            |   | 3,593     |                                            |  |   |                          |   |  |       |         |   |  |   | 3,593     |  
|Investment in affiliates                                                               |  |                          | 452,686 |            |   |          |                                            |  |   |                          |   |  |       | (452,686 | ) |  |   |          |  
|Other assets                                                                           |  |                          |        |            |   | 746       |                                            |  |   |                          |   |  |       |         |   |  |   | 746       |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total assets                                                                           |  | $                        | 468,475 |            | $ | 1,514,505 |                                            |  | $ | 55,862                    |   |  | $     | (452,686 | ) |  | $ | 1,586,156 |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                   |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current liabilities:                                                                   |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Intercompany borrowings                                                                |  | $                        | 20,000  |            | $ | 15,112    |                                            |  | $ | (1,174                    | ) |  | $     |         |   |  | $ | 33,938    |  
|Accounts payable                                                                       |  |                          |        |            |   | 840,119   |                                            |  |   | 15,257                    |   |  |       |         |   |  |   | 855,376   |  
|Other accrued liabilities                                                              |  |                          | 8,201   |            |   | 189,335   |                                            |  |   | 3,970                     |   |  |       |         |   |  |   | 201,506   |  
|Income taxes payable                                                                   |  |                          |        |            |   | 25,744    |                                            |  |   | 2,216                     |   |  |       |         |   |  |   | 27,960    |  
|Deferred income taxes                                                                  |  |                          |        |            |   | 340       |                                            |  |   |                          |   |  |       |         |   |  |   | 340       |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current liabilities                                                              |  |                          | 28,201  |            |   | 1,070,650 |                                            |  |   | 20,269                    |   |  |       |         |   |  |   | 1,119,120 |  
|Long-term debt                                                                         |  |                          | 203,500 |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 203,500   |  
|Other non-current liabilities                                                          |  |                          |        |            |   | 3,870     |                                            |  |   |                          |   |  |       |         |   |  |   | 3,870     |  
|Deferred income taxes                                                                  |  |                          |        |            |   | 22,892    |                                            |  |   |                          |   |  |       |         |   |  |   | 22,892    |  
|Commitments and contingencies (note 9)                                                 |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity:                                                                  |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Common stock, $1.00 par value, 100,000 shares authorized, 1,000 issued and outstanding |  |                          | 1       |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 1         |  
|Additional paid-in capital                                                             |  |                          | 175,842 |            |   | 289,574   |                                            |  |   | 22,834                    |   |  |       | (312,408 | ) |  |   | 175,842   |  
|Retained (deficit) earnings                                                            |  |                          | 56,576  |            |   | 127,519   |                                            |  |   | 8,396                     |   |  |       | (135,915 | ) |  |   | 56,576    |  
|Accumulated other comprehensive income (loss)                                          |  |                          | 4,355   |            |   |          |                                            |  |   | 4,363                     |   |  |       | (4,363   | ) |  |   | 4,355     |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity                                                                   |  |                          | 236,774 |            |   | 417,093   |                                            |  |   | 35,593                    |   |  |       | (452,686 | ) |  |   | 236,774   |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total liabilities and stockholders equity                                             |  | $                        | 468,475 |            | $ | 1,514,505 |                                            |  | $ | 55,862                    |   |  | $     | (452,686 | ) |  | $ | 1,586,156 |  
|                                                                                       |  |                          |         |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  



15



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING BALANCE SHEET

February 27, 2005

(dollars in thousands)

UNAUDITED



|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|-------------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | ---------- | - | --------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | -------- | - |  | - | --------- | -
|                                                                                       |  | United AgriProducts,Inc. |         |   | Guarantors |   |           | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |         
|ASSETS                                                                                 |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current assets:                                                                        |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Cash and cash equivalents                                                              |  | $                        |        |   |            | $ | 37,430    |                                            |  | $ | 10,771                    |   |  | $     |         |   |  | $ | 48,201    |  
|Receivables, net                                                                       |  |                          |        |   |            |   | 228,158   |                                            |  |   | 7,017                     |   |  |       |         |   |  |   | 235,175   |  
|Inventories                                                                            |  |                          |        |   |            |   | 668,973   |                                            |  |   | 28,161                    |   |  |       |         |   |  |   | 697,134   |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 16,896    |                                            |  |   | 367                       |   |  |       |         |   |  |   | 17,263    |  
|Vendor prepay                                                                          |  |                          |        |   |            |   | 149,010   |                                            |  |   |                          |   |  |       |         |   |  |   | 149,010   |  
|Other current assets                                                                   |  |                          | 3,282   |   |            |   | 2,059     |                                            |  |   | 1,969                     |   |  |       |         |   |  |   | 7,310     |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current assets                                                                   |  |                          | 3,282   |   |            |   | 1,102,526 |                                            |  |   | 48,285                    |   |  |       |         |   |  |   | 1,154,093 |  
|Property, plant and equipment                                                          |  |                          |        |   |            |   | 100,434   |                                            |  |   | 4,311                     |   |  |       |         |   |  |   | 104,745   |  
|Less accumulated depreciation                                                          |  |                          |        |   |            |   | (14,632   | )                                          |  |   | (448                      | ) |  |       |         |   |  |   | (15,080   | )
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Property, plant and equipment, net                                                     |  |                          |        |   |            |   | 85,802    |                                            |  |   | 3,863                     |   |  |       |         |   |  |   | 89,665    |  
|Goodwill                                                                               |  |                          |        |   |            |   | 34,645    |                                            |  |   |                          |   |  |       |         |   |  |   | 34,645    |  
|Intangible assets, net                                                                 |  |                          |        |   |            |   | 25,894    |                                            |  |   |                          |   |  |       |         |   |  |   | 25,894    |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 1,328     |                                            |  |   | 235                       |   |  |       |         |   |  |   | 1,563     |  
|Debt issue costs, net                                                                  |  |                          | 17,107  |   |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 17,107    |  
|Investment in unconsolidated affiliates                                                |  |                          |        |   |            |   | 4,071     |                                            |  |   |                          |   |  |       |         |   |  |   | 4,071     |  
|Investment in affiliates                                                               |  |                          | 373,549 |   |            |   |          |                                            |  |   |                          |   |  |       | (373,549 | ) |  |   |          |  
|Other assets                                                                           |  |                          |        |   |            |   | 506       |                                            |  |   |                          |   |  |       |         |   |  |   | 506       |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total assets                                                                           |  | $                        | 393,938 |   |            | $ | 1,254,772 |                                            |  | $ | 52,383                    |   |  | $     | (373,549 | ) |  | $ | 1,327,544 |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                   |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current liabilities:                                                                   |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Short-term debt                                                                        |  | $                        |        |   |            | $ | 55        |                                            |  | $ |                          |   |  | $     |         |   |  | $ | 55        |  
|Intercompany borrowings                                                                |  |                          | 17,107  |   |            |   | 1,585     |                                            |  |   | 6,595                     |   |  |       |         |   |  |   | 25,287    |  
|Accounts payable                                                                       |  |                          |        |   |            |   | 812,148   |                                            |  |   | 10,716                    |   |  |       |         |   |  |   | 822,864   |  
|Other accrued liabilities                                                              |  |                          |        |   |            |   | 70,652    |                                            |  |   | 2,034                     |   |  |       |         |   |  |   | 72,686    |  
|Income taxes payable                                                                   |  |                          |        |   |            |   |          |                                            |  |   | 3,252                     |   |  |       |         |   |  |   | 3,252     |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 108       |                                            |  |   |                          |   |  |       |         |   |  |   | 108       |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current liabilities                                                              |  |                          | 17,107  |   |            |   | 884,548   |                                            |  |   | 22,597                    |   |  |       |         |   |  |   | 924,252   |  
|Long-term debt                                                                         |  |                          | 203,500 |   |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 203,500   |  
|Other non-current liabilities                                                          |  |                          |        |   |            |   | 2,871     |                                            |  |   |                          |   |  |       |         |   |  |   | 2,871     |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 23,590    |                                            |  |   |                          |   |  |       |         |   |  |   | 23,590    |  
|Commitments and contingencies (note 9)                                                 |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity:                                                                  |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Common stock, $1.00 par value, 100,000 shares authorized, 1,000 issued and outstanding |  |                          | 1       |   |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 1         |  
|Additional paid-in capital                                                             |  |                          | 175,842 |   |            |   | 289,574   |                                            |  |   | 22,834                    |   |  |       | (312,408 | ) |  |   | 175,842   |  
|Retained (deficit) earnings                                                            |  |                          | (5,802  | ) |            |   | 54,189    |                                            |  |   | 3,654                     |   |  |       | (57,843  | ) |  |   | (5,802    | )
|Accumulated other comprehensive income (loss)                                          |  |                          | 3,290   |   |            |   |          |                                            |  |   | 3,298                     |   |  |       | (3,298   | ) |  |   | 3,290     |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity                                                                   |  |                          | 173,331 |   |            |   | 343,763   |                                            |  |   | 29,786                    |   |  |       | (373,549 | ) |  |   | 173,331   |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total liabilities and stockholders equity                                             |  | $                        | 393,938 |   |            | $ | 1,254,772 |                                            |  | $ | 52,383                    |   |  | $     | (373,549 | ) |  | $ | 1,327,544 |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  



16



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##### Table of Contents

UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING BALANCE SHEET

August 29, 2004

(dollars in thousands)

UNAUDITED



|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|-------------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | ---------- | - | --------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | -------- | - |  | - | --------- | -
|                                                                                       |  | United AgriProducts,Inc. |         |   | Guarantors |   |           | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |         
|ASSETS                                                                                 |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current assets:                                                                        |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Cash and cash equivalents                                                              |  | $                        |        |   |            | $ | 6,305     |                                            |  | $ | 13,898                    |   |  | $     |         |   |  | $ | 20,203    |  
|Receivables, net                                                                       |  |                          |        |   |            |   | 679,852   |                                            |  |   | 26,943                    |   |  |       |         |   |  |   | 706,795   |  
|Inventories                                                                            |  |                          |        |   |            |   | 431,624   |                                            |  |   | 17,978                    |   |  |       |         |   |  |   | 449,602   |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 21,851    |                                            |  |   |                          |   |  |       |         |   |  |   | 21,851    |  
|Vendor prepay                                                                          |  |                          |        |   |            |   | 27,585    |                                            |  |   |                          |   |  |       |         |   |  |   | 27,585    |  
|Other current assets                                                                   |  |                          |        |   |            |   | 15,813    |                                            |  |   | (3,546                    | ) |  |       |         |   |  |   | 12,267    |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current assets                                                                   |  |                          |        |   |            |   | 1,183,030 |                                            |  |   | 55,273                    |   |  |       |         |   |  |   | 1,238,303 |  
|Property, plant and equipment                                                          |  |                          |        |   |            |   | 101,462   |                                            |  |   | 4,327                     |   |  |       |         |   |  |   | 105,789   |  
|Less accumulated depreciation                                                          |  |                          |        |   |            |   | (9,151    | )                                          |  |   | (300                      | ) |  |       |         |   |  |   | (9,451    | )
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Property, plant and equipment, net                                                     |  |                          |        |   |            |   | 92,311    |                                            |  |   | 4,027                     |   |  |       |         |   |  |   | 96,338    |  
|Goodwill                                                                               |  |                          |        |   |            |   | 41,407    |                                            |  |   |                          |   |  |       |         |   |  |   | 41,407    |  
|Intangible assets, net                                                                 |  |                          |        |   |            |   | 6,332     |                                            |  |   |                          |   |  |       |         |   |  |   | 6,332     |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 5,172     |                                            |  |   |                          |   |  |       |         |   |  |   | 5,172     |  
|Debt issue costs, net                                                                  |  |                          | 9,216   |   |            |   | 9,204     |                                            |  |   |                          |   |  |       |         |   |  |   | 18,420    |  
|Investment in unconsolidated affiliates                                                |  |                          |        |   |            |   | 3,871     |                                            |  |   |                          |   |  |       |         |   |  |   | 3,871     |  
|Investment in affiliates                                                               |  |                          | 457,547 |   |            |   |          |                                            |  |   |                          |   |  |       | (457,547 | ) |  |   |          |  
|Other assets                                                                           |  |                          |        |   |            |   | 4,174     |                                            |  |   |                          |   |  |       |         |   |  |   | 4,174     |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total assets                                                                           |  | $                        | 466,763 |   |            | $ | 1,345,501 |                                            |  | $ | 59,300                    |   |  | $     | (457,547 | ) |  | $ | 1,414,017 |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|LIABILITIES AND STOCKHOLDERS EQUITY                                                   |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Current liabilities:                                                                   |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Short-term debt                                                                        |  | $                        |        |   |            | $ | 170,257   |                                            |  | $ | 10,042                    |   |  | $     |         |   |  | $ | 180,299   |  
|Intercompany borrowings                                                                |  |                          | (4,866  | ) |            |   | 3,829     |                                            |  |   | 2,679                     |   |  |       |         |   |  |   | 1,642     |  
|Accounts payable                                                                       |  |                          |        |   |            |   | 545,466   |                                            |  |   | 11,109                    |   |  |       |         |   |  |   | 556,575   |  
|Other accrued liabilities                                                              |  |                          | 3,939   |   |            |   | 159,103   |                                            |  |   | 3,519                     |   |  |       |         |   |  |   | 166,561   |  
|Income taxes payable                                                                   |  |                          |        |   |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   |          |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 106       |                                            |  |   |                          |   |  |       |         |   |  |   | 106       |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total current liabilities                                                              |  |                          | (927    | ) |            |   | 878,761   |                                            |  |   | 27,349                    |   |  |       |         |   |  |   | 905,183   |  
|Long-term debt                                                                         |  |                          | 225,000 |   |            |   |          |                                            |  |   |                          |   |  |       |         |   |  |   | 225,000   |  
|Other non-current liabilities                                                          |  |                          |        |   |            |   | 2,343     |                                            |  |   |                          |   |  |       |         |   |  |   | 2,343     |  
|Deferred income taxes                                                                  |  |                          |        |   |            |   | 38,801    |                                            |  |   |                          |   |  |       |         |   |  |   | 38,801    |  
|Commitments and contingencies (note 9)                                                 |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity:                                                                  |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Common stock, $1.00 par value, 100,000 shares authorized, 1,000 issued and outstanding |  |                          | 1       |   |            |   |          |                                            |  |   |                          |   |  |       |          |   |  |   | 1         |  
|Additional paid-in capital                                                             |  |                          | 179,999 |   |            |   | 358,494   |                                            |  |   | 27,445                    |   |  |       | (385,939 | ) |  |   | 179,999   |  
|Retained (deficit) earnings                                                            |  |                          | 62,014  |   |            |   | 67,102    |                                            |  |   | 3,830                     |   |  |       | (70,932  | ) |  |   | 62,014    |  
|Accumulated other comprehensive income (loss)                                          |  |                          | 676     |   |            |   |          |                                            |  |   | 676                       |   |  |       | (676     | ) |  |   | 676       |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Stockholders equity                                                                   |  |                          | 242,690 |   |            |   | 425,596   |                                            |  |   | 31,951                    |   |  |       | (457,547 | ) |  |   | 242,690   |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  
|Total liabilities and stockholders equity                                             |  | $                        | 466,763 |   |            | $ | 1,345,501 |                                            |  | $ | 59,300                    |   |  | $     | (457,547 | ) |  | $ | 1,414,017 |  
|                                                                                       |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |          |   |  |   |           |  



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS

Twenty-Six Weeks Ended
August 28, 2005

(dollars in thousands)

UNAUDITED



|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|-------------------------------------------------------- |  | ------------------------ | ------ | - | ---------- | - | --------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | ------- | - |  | - | --------- | -
|                                                         |  | United AgriProducts,Inc. |        |   | Guarantors |   |           | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |        
|Net sales                                                |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Costs and expenses:                                      |  | $                        |       |   |            | $ | 2,049,850 |                                            |  | $ | 64,519                    |   |  | $     |        |   |  | $ | 2,114,369 |  
|Cost of goods sold                                       |  |                          |       |   |            |   | 1,785,171 |                                            |  |   | 50,687                    |   |  |       |        |   |  |   | 1,835,858 |  
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Gross profit                                             |  |                          |       |   |            |   | 264,679   |                                            |  |   | 13,832                    |   |  |       |        |   |  |   | 278,511   |  
|Selling, general and administrative expenses             |  |                          | 605    |   |            |   | 152,629   |                                            |  |   | 5,074                     |   |  |       |        |   |  |   | 158,308   |  
|(Gain) loss on sale of assets                            |  |                          |       |   |            |   | (1,533    | )                                          |  |   | 60                        |   |  |       |        |   |  |   | (1,473    | )
|Royalties, service charges and other income and expenses |  |                          |       |   |            |   | (17,613   | )                                          |  |   | (211                      | ) |  |       |        |   |  |   | (17,824   | )
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Operating income (loss)                                  |  |                          | (605   | ) |            |   | 131,196   |                                            |  |   | 8,909                     |   |  |       |        |   |  |   | 139,500   |  
|Third party interest expense                             |  |                          | 1,363  |   |            |   | 10,025    |                                            |  |   | 726                       |   |  |       |        |   |  |   | 12,114    |  
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Income (loss) before income taxes                        |  |                          | (1,968 | ) |            |   | 121,171   |                                            |  |   | 8,183                     |   |  |       |        |   |  |   | 127,386   |  
|Income tax expense (benefit)                             |  |                          | (780   | ) |            |   | 47,841    |                                            |  |   | 3,441                     |   |  |       |        |   |  |   | 50,502    |  
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Net income (loss)                                        |  |                          | (1,188 | ) |            |   | 73,330    |                                            |  |   | 4,742                     |   |  |       |        |   |  |   | 76,884    |  
|Equity in earnings of consolidated affiliates            |  |                          | 78,072 |   |            |   |          |                                            |  |   |                          |   |  |       | (78,072 | ) |  |   |          |  
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Net Income                                               |  | $                        | 76,884 |   |            | $ | 73,330    |                                            |  | $ | 4,742                     |   |  | $     | (78,072 | ) |  | $ | 76,884    |  
|                                                         |  |                          |        |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING STATEMENT OF EARNINGS

Twenty-Seven Weeks Ended
August 29, 2004

(dollars in thousands)

UNAUDITED



|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|-------------------------------------------------------- |  | ------------------------ | ------- | - | ---------- | - | --------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | ------- | - |  | - | --------- | -
|                                                         |  | United AgriProducts,Inc. |         |   | Guarantors |   |           | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |        
|Net sales                                                |  | $                        |        |   |            | $ | 1,903,033 |                                            |  | $ | 59,437                    |   |  | $     |        |   |  | $ | 1,962,470 |  
|Costs and expenses:                                      |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Cost of goods sold                                       |  |                          |        |   |            |   | 1,673,609 |                                            |  |   | 46,105                    |   |  |       |        |   |  |   | 1,719,714 |  
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Gross profit                                             |  |                          |        |   |            |   | 229,424   |                                            |  |   | 13,332                    |   |  |       |        |   |  |   | 242,756   |  
|Selling, general and administrative expenses             |  |                          |        |   |            |   | 148,414   |                                            |  |   | 4,705                     |   |  |       |        |   |  |   | 153,119   |  
|(Gain) on sale of assets                                 |  |                          |        |   |            |   | (591      | )                                          |  |   | (13                       | ) |  |       |        |   |  |   | (604      | )
|Royalties, service charges and other income and expenses |  |                          |        |   |            |   | (13,288   | )                                          |  |   | (147                      | ) |  |       |        |   |  |   | (13,435   | )
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Corporate allocations:                                   |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Operating income                                         |  |                          |        |   |            |   | 94,889    |                                            |  |   | 8,787                     |   |  |       |        |   |  |   | 103,676   |  
|Third party interest expense                             |  |                          | 10,289  |   |            |   | 5,353     |                                            |  |   | 587                       |   |  |       |        |   |  |   | 16,229    |  
|Finance related and other charges                        |  |                          |        |   |            |   | 3,750     |                                            |  |   |                          |   |  |       |        |   |  |   | 3,750     |  
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Income (loss) before income taxes                        |  |                          | (10,289 | ) |            |   | 85,786    |                                            |  |   | 8,200                     |   |  |       |        |   |  |   | 83,697    |  
|Income tax expense (benefit)                             |  |                          | (3,797  | ) |            |   | 32,146    |                                            |  |   | 4,125                     |   |  |       |        |   |  |   | 32,474    |  
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Net income                                               |  |                          | (6,492  | ) |            |   | 53,640    |                                            |  |   | 4,075                     |   |  |       |        |   |  |   | 51,223    |  
|Equity in earnings of consolidated affiliates            |  |                          | 57,715  |   |            |   |          |                                            |  |   |                          |   |  |       | (57,715 | ) |  |   |          |  
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  
|Net Income                                               |  | $                        | 51,223  |   |            | $ | 53,640    |                                            |  | $ | 4,075                     |   |  | $     | (57,715 | ) |  | $ | 51,223    |  
|                                                         |  |                          |         |   |            |   |           |                                            |  |   |                           |   |  |       |         |   |  |   |           |  



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Twenty-Six Weeks Ended
August 28, 2005

(dollars in thousands)

UNAUDITED



|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|--------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | ---------- | - | ------- | ------------------------------------------ |  | - | ------------------------- | - |  | ----- | ------- | - |  | - | ------- | -
|                                                                                  |  | United AgriProducts,Inc. |         |   | Guarantors |   |         | CanadianDistributionBusinessNon-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |        
|Operations                                                                        |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net income (loss)                                                                 |  | $                        | 76,884  |   |            | $ | 73,330  |                                            |  | $ | 4,742                     |   |  | $     | (78,072 | ) |  | $ | 76, 884 |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Equity earnings of consolidated subsidiaries                                      |  |                          | (78,072 | ) |            |   |        |                                            |  |   |                          |   |  |       | 78,072  |   |  |   |        |  
|Depreciation                                                                      |  |                          |        |   |            |   | 5,465   |                                            |  |   | 129                       |   |  |       |        |   |  |   | 5,594   |  
|Amortization of intangibles                                                       |  |                          |        |   |            |   | 665     |                                            |  |   |                          |   |  |       |        |   |  |   | 665     |  
|Amortization of debt issuance costs                                               |  |                          | 1,968   |   |            |   |        |                                            |  |   |                          |   |  |       |        |   |  |   | 1,968   |  
|Gain on sales of fixed assets                                                     |  |                          |        |   |            |   | (1,413  | )                                          |  |   | (60                       | ) |  |       |        |   |  |   | (1,473  | )
|Deferred tax provision (benefit)                                                  |  |                          |        |   |            |   | (4,386  | )                                          |  |   |                          |   |  |       |        |   |  |   | (4,386  | )
|Change in operating assets and liabilities:                                       |  |                          | 3,281   |   |            |   | (73,583 | )                                          |  |   | (3,366                    | ) |  |       |        |   |  |   | (73,668 | )
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net cash provided by operations                                                   |  |                          | 4,061   |   |            |   | 78      |                                            |  |   | 1,445                     |   |  |       |        |   |  |   | 5,584   |  
|Investing                                                                         |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Additions to property, plant and equipment                                        |  |                          |        |   |            |   | (6,357  | )                                          |  |   | (60                       | ) |  |       |        |   |  |   | (6,417  | )
|Proceeds from sales of assets                                                     |  |                          |        |   |            |   | 1,996   |                                            |  |   | 195                       |   |  |       |        |   |  |   | 2,191   |  
|Investment in unconsolidated affiliates                                           |  |                          |        |   |            |   | 478     |                                            |  |   |                          |   |  |       |        |   |  |   | 478     |  
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net cash provided by (used in) investing activities                               |  |                          |        |   |            |   | (3,883  | )                                          |  |   | 135                       |   |  |       |        |   |  |   | (3,748  | )
|Financing                                                                         |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Check float on zero balance accounts                                              |  |                          |        |   |            |   | 5,760   |                                            |  |   |                          |   |  |       |        |   |  |   | 5,760   |  
|Net repayments of short-term debt                                                 |  |                          |        |   |            |   | (55     | )                                          |  |   |                          |   |  |       |        |   |  |   | (55     | )
|Debt issuance costs                                                               |  |                          | (650    | ) |            |   |         |                                            |  |   |                          |   |  |       |        |   |  |   | (650    | )
|Due to (from) affiliates                                                          |  |                          | 2,893   |   |            |   | 13,527  |                                            |  |   | (7,768                    | ) |  |       |        |   |  |   | 8,652   |  
|Common stock dividend paid                                                        |  |                          | (6,304  | ) |            |   |        |                                            |  |   |                          |   |  |       |        |   |  |   | (6,304  | )
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net cash provided by (used in) financing activities                               |  |                          | (4,061  | ) |            |   | 19,232  |                                            |  |   | (7,768                    | ) |  |       |        |   |  |   | 7,403   |  
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net change in cash and cash equivalents                                           |  |                          |        |   |            |   | 15,427  |                                            |  |   | (6,188                    | ) |  |       |        |   |  |   | 9,239   |  
|Net effect of exchange rates on cash and cash equivalents                         |  |                          |        |   |            |   |        |                                            |  |   | 202                       |   |  |       |        |   |  |   | 202     |  
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Net change in cash and cash equivalents                                           |  |                          |        |   |            |   | 15,427  |                                            |  |   | (5,986                    | ) |  |       |        |   |  |   | 9,441   |  
|Cash and cash equivalents at beginning of period                                  |  |                          |        |   |            |   | 37,430  |                                            |  |   | 10,771                    |   |  |       |        |   |  |   | 48,201  |  
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  
|Cash and cash equivalents at end of period                                        |  | $                        |        |   |            | $ | 52,857  |                                            |  | $ | 4,785                     |   |  | $     |        |   |  | $ | 57,642  |  
|                                                                                  |  |                          |         |   |            |   |         |                                            |  |   |                           |   |  |       |         |   |  |   |         |  



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UNITED AGRI PRODUCTS, INC.

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Twenty-Seven Weeks Ended
August 29, 2004

(dollars in thousands)

UNAUDITED



|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|------------------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | ---------- | - | -------- | ------------------------------------------- |  | - | ------------------------- | - |  | ----- | ------- | - |  | - | -------- | -
|                                                                                            |  | United AgriProducts,Inc. |         |   | Guarantors |   |          | CanadianDistributionBusiness Non-Guarantors |  |   | Eliminations /Adjustments |   |  | Total |        
|Operations                                                                                  |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net income (loss)                                                                           |  | $                        | 51,223  |   |            | $ | 53,640   |                                             |  | $ | 4,075                     |   |  | $     | (57,715 | ) |  | $ | 51,223   |  
|Adjustments to reconcile net income to net cash provided by (used in) operating activities: |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Equity earnings of consolidated subsidiaries                                                |  |                          | (57,715 | ) |            |   |         |                                             |  |   |                          |   |  |       | 57,715  |   |  |   |         |  
|Depreciation                                                                                |  |                          |        |   |            |   | 6,357    |                                             |  |   | 182                       |   |  |       |        |   |  |   | 6,539    |  
|Amortization of intangibles                                                                 |  |                          |        |   |            |   | 745      |                                             |  |   |                          |   |  |       |        |   |  |   | 745      |  
|Amortization of debt issuance costs                                                         |  |                          | 1,654   |   |            |   |         |                                             |  |   |                          |   |  |       |        |   |  |   | 1,654    |  
|Gain on sales of fixed assets                                                               |  |                          |        |   |            |   | (591     | )                                           |  |   | (13                       | ) |  |       |        |   |  |   | (604     | )
|Deferred tax provision (benefit)                                                            |  |                          |        |   |            |   | 23,658   |                                             |  |   |                          |   |  |       |        |   |  |   | 23,658   |  
|Change in operating assets and liabilities:                                                 |  |                          | 67,940  |   |            |   | (455,776 | )                                           |  |   | (8,757                    | ) |  |       |         |   |  |   | (396,593 | )
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net cash provided by (used in) operations                                                   |  |                          | 63,102  |   |            |   | (371,967 | )                                           |  |   | (4,513                    | ) |  |       |        |   |  |   | (313,378 | )
|Investing                                                                                   |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Acquisition payment to ConAgra Foods Inc.                                                   |  |                          | (58,236 | ) |            |   |         |                                             |  |   |                          |   |  |       |        |   |  |   | (58,236  | )
|Additions to property, plant and equipment                                                  |  |                          |        |   |            |   | (6,027   | )                                           |  |   | (122                      | ) |  |       |        |   |  |   | (6,149   | )
|Proceeds from sales of assets                                                               |  |                          |        |   |            |   | 956      |                                             |  |   | 12                        |   |  |       |        |   |  |   | 968      |  
|Investment in unconsolidated affiliates                                                     |  |                          |        |   |            |   | 87       |                                             |  |   |                          |   |  |       |        |   |  |   | 87       |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net cash used in investing activities                                                       |  |                          | (58,236 | ) |            |   | (4,984   | )                                           |  |   | (110                      | ) |  |       |        |   |  |   | (63,330  | )
|Financing                                                                                   |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Check float on zero balance accounts                                                        |  |                          |        |   |            |   | 42,866   |                                             |  |   |                          |   |  |       |        |   |  |   | 42,866   |  
|Net borrowings of short-term debt                                                           |  |                          |        |   |            |   | 170,257  |                                             |  |   | 10,042                    |   |  |       |        |   |  |   | 180,299  |  
|Due to (from) affiliates                                                                    |  |                          | (4,866  | ) |            |   | 3,829    |                                             |  |   | 2,679                     |   |  |       |        |   |  |   | 1,642    |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net cash provided by (used in) financing activities                                         |  |                          | (4,866  | ) |            |   | 216,952  |                                             |  |   | 12,721                    |   |  |       |        |   |  |   | 224,807  |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net change in cash and equivalents                                                          |  |                          |        |   |            |   | (159,999 | )                                           |  |   | 8,098                     |   |  |       |        |   |  |   | (151,901 | )
|Net effect of exchange rates on cash and equivalents                                        |  |                          |        |   |            |   |         |                                             |  |   | 119                       |   |  |       |        |   |  |   | 119      |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Net change in cash and cash equivalents                                                     |  |                          |        |   |            |   | (159,999 | )                                           |  |   | 8,217                     |   |  |       |        |   |  |   | (151,782 | )
|Cash and cash equivalents at beginning of period                                            |  |                          |        |   |            |   | 166,304  |                                             |  |   | 5,681                     |   |  |       |        |   |  |   | 171,985  |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  
|Cash and cash equivalents at end of period                                                  |  | $                        |        |   |            | $ | 6,305    |                                             |  | $ | 13,898                    |   |  | $     |        |   |  | $ | 20,203   |  
|                                                                                            |  |                          |         |   |            |   |          |                                             |  |   |                           |   |  |       |         |   |  |   |          |  



|14. | Subsequent Events
|--- | -----------------



On September 19, 2005, we announced a restructuring of our organization and management. As part of the restructuring, we consolidated ten of our regional distribution organizations into five, closed one regional
finance center, and further centralized and consolidated various accounting and administrative functions. Further, we have terminated approximately 100 employees located throughout the United States. We anticipate completing the majority of the
restructuring in the third quarter of our fiscal year 2006.



We anticipate
these activities will result in a total restructuring charge of approximately $1.1 to $1.5 million, primarily related to the payment of one-time termination benefits. The entire amount of this restructuring charge is expected to be paid in cash over
the next twelve months.



On October 6, 2005, UAP Holding Corp.s
board of directors declared a quarterly dividend on its common stock in the amount of $0.1625 per share. The record date for the dividend payment will be November 15, 2005, and the payment date will be December 1, 2005. Also on
October 6, 2005, our board declared a dividend on our common stock of $8.2 million to provide UAP Holding Corp. with the funds necessary to pay the dividend on December 1, 2005.



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|ITEM 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
|------- | --------------------------------------------------------------------------------------



On November 29, 2004, UAP Holding Corp. consummated the initial public offering of its common stock (the Common Stock
Offering), which consisted of a primary offering of 3,125,000 shares of common stock by UAP Holding Corp. and a secondary offering of 28,428,125 shares of UAP Holding Corp.s common stock by UAP Holding Corp.s equity sponsor and
certain members of its management (collectively, the selling stockholders).



Unless the context requires otherwise, all references to Company, we, us, and our, refer specifically to United Agri Products, Inc. and its consolidated subsidiaries.
Additionally, all references to UAP Holding Corp. refer specifically only to UAP Holding Corp., the parent of United Agri Products, Inc., excluding its subsidiaries, and all references to United Agri Products, Inc. refer
specifically to United Agri Products, Inc., excluding its subsidiaries.



The purpose of this section is to discuss and analyze our condensed consolidated financial condition, liquidity and capital resources and results of operations for the periods presented. You should read this analysis in conjunction with
our condensed consolidated financial statements and notes thereto appearing elsewhere in this report. The results of operations for the thirteen and twenty-six weeks ended August 28, 2005, are not necessarily indicative of the results to be
expected for other interim periods or for the full fiscal year. This section should also be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended February 27, 2005.



Overview



We operate in the highly competitive agricultural inputs distribution industry. Our principal competitors in the distribution of crop
production inputs include agricultural cooperatives, national fertilizer producers, major grain companies and independent distributors and brokers. We, along with other agricultural input distributors, represent the main route-to-market for
agricultural input manufacturers, and fill a critical need in the U.S. and Canadian agricultural input markets by allowing suppliers to economically access a highly fragmented customer base of growers, dealers and non-crop customers.



The three primary product areas of the agricultural and non-crop input markets are chemicals,
seed, and fertilizer. Our industry in general is affected by a number of factors including but not limited to, cost to distribute products, customer financial condition, local and national laws and regulations, economic conditions, employment,
inflation, political climate, interest rates, fuel prices and weather patterns.



Our business depends on farm expenditures for crop inputs, which in turn is dependent upon planted acreage in the United States and Canada. Over the last ten years, agricultural inputs have grown 3% per year, and planted acreage has
been virtually flat, leading to a relatively stable but very competitive industry for crop inputs. Our opportunities within the industry will include the use of our national distribution network to further participate in the growing seed market,
grow fertilizer volumes as we extend that product offering to existing customers, continue to expand our private label lines of seed and chemicals and continue to look for more efficiencies in expenses and working capital.



Background



We market a comprehensive line of products including chemicals, seed, and fertilizer to growers and regional dealers. In addition to our
product offering, we provide a broad array of value-added services including crop management, biotechnology advisory services, custom blending, inventory management and custom applications of crop inputs. The products and services we offer are
critical to growers because they lower the overall cost of crop production and improve crop quality and yield. As a result of our broad scale and scope, we provide leading agricultural input companies with an efficient means to access a highly
fragmented customer base of farmers and growers.



We will continue to seek to
grow our business, improve margins and reduce working capital through the following principal strategies:



| |  |  | Leveraging our scale;
| | - |  | ---------------------



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| |  |  | Expanding our presence in seed, fertilizer, branded and non-crop products; and
| | - |  | ------------------------------------------------------------------------------



| |  |  | Targeting continued margin enhancement and working capital management.
| | - |  | ----------------------------------------------------------------------



Recent Initiatives



Improving our Nationwide Network.One of our key initiatives is to grow our business by leveraging our size and leading market share across North America. We study our market share by state,
county, and customer, and develop sales initiatives at a local and regional level to address any gaps and opportunities we have in our network on chemical, seed, and fertilizer. Where our data indicates an opportunity, we have the potential to add
sales personnel and/or locations and assets to fill in gaps in our coverage. We have addressed the non-crop markets with a focused management team, and have made modifications to our sales coverage and asset base in those markets.



Proprietary and Private Label Business.Our proprietary and private
label products offer significantly higher margins than the branded products that we sell. We currently market over 220 proprietary branded products and have a broad proprietary product offering in each of our core product areas, including non-crop.
We continue to work with nearly all of our suppliers on additional private label opportunities.



Seed and Fertilizer Revenue Growth. We have experienced revenue growth in both of these product areas and believe there are significant growth opportunities going forward. As seed varieties continue to
be enhanced through biotechnology we believe they will serve as a growth platform due to the increased value-added nature of their sale to the customer. We intend to leverage our growth in the seed business through: advanced technical training of
our sales-force, hiring and strategically placing experienced salespeople, using incentive compensation plans, incorporating seed-specific performance goals, nurturing our relationships with our seed suppliers and targeting new retail and wholesale
opportunities to enhance our sales presence in regions where gaps exist. We will also leverage our growth in the fertilizer business by nurturing relationships with fertilizer suppliers and by making modest investments in storage and blending
facilities in regions where gaps exist.



Working Capital and
Administrative Expense Reduction. We believe we are well positioned to continue to improve the financial performance of our business. We monitor performance regularly on key operating statistics such as credit, inventory efficiency,
operating expenses, gross profit generation and overall return on invested capital. This information will continue to enable us to reduce administrative expense and average levels of working capital by concentrating on the following: earlier
collection of supplier rebates, extending payable terms with key suppliers, continuing inventory efficiencies through SKU reduction efforts and centralized purchasing, evaluating our suppliers on a total return basis including working capital
reductions, continuing to focus on credit policies and procedures to maximize profitability and using competition and best practices among our operating divisions to drive overall focus on working capital and expense reduction that are tied to
variable compensation plans.



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RESULTS OF OPERATIONS



Analysis of Condensed Consolidated Statements of Earnings



|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|-------------------------------------------------------- | --------------- | ----------------------------------------- | ------- | --------------- | ------------- | - | ------- | ----------------------------------- |  | ------ | ------------------------------------- |  | - | ------------- | - |  | - | --------- | - |  | ----- | -
|                                                         |                 | Thirteen Weeks Ended                      |         |                 | PercentChange |   |         | Twenty-SixWeeks EndedAugust 28,2005 |  |        | Twenty-SevenWeeks EndedAugust 29,2004 |  |   | PercentChange |  
|                                                         | August 28, 2005 |                                           |         | August 29, 2004 |               |   |         |                                     | 
|                                                         |                 | (dollars in thousands, except share data) |        
|Net Sales                                                |                 | $                                         | 757,459 |                 |               | $ | 703,981 |                                     |  | 7.6    | %                                     |  | $ | 2,114,369     |   |  | $ | 1,962,470 |   |  | 7.7   | %
|Cost of goods sold                                       |                 |                                           | 647,700 |                 |               |   | 596,959 |                                     |  | 8.5    | %                                     |  |   | 1,835,858     |   |  |   | 1,719,714 |   |  | 6.8   | %
|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|Gross profit                                             |                 |                                           | 109,759 |                 |               |   | 107,022 |                                     |  | 2.6    | %                                     |  |   | 278,511       |   |  |   | 242,756   |   |  | 14.7  | %
|Selling, general and administrative expenses             |                 |                                           | 72,685  |                 |               |   | 70,308  |                                     |  | 3.4    | %                                     |  |   | 158,308       |   |  |   | 153,119   |   |  | 3.4   | %
|Gain on sale of assets                                   |                 |                                           | (1,455  | )               |               |   | (32     | )                                   |  | 4446.9 | %                                     |  |   | (1,473        | ) |  |   | (604      | ) |  | 143.9 | %
|Royalties, service charges and other income and expenses |                 |                                           | (10,040 | )               |               |   | (10,762 | )                                   |  | -6.7   | %                                     |  |   | (17,824       | ) |  |   | (13,435   | ) |  | 32.7  | %
|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|Operating income                                         |                 |                                           | 48,569  |                 |               |   | 47,508  |                                     |  | 2.2    | %                                     |  |   | 139,500       |   |  |   | 103,676   |   |  | 34.6  | %
|Third party interest expense                             |                 |                                           | 6,389   |                 |               |   | 7,801   |                                     |  | -18.1  | %                                     |  |   | 12,114        |   |  |   | 16,229    |   |  | -25.4 | %
|Finance related and other charges                        |                 |                                           |        |                 |               |   | 1,875   |                                     |  | NM     |                                       |  |   |              |   |  |   | 3,750     |   |  | NM    |  
|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|Income before income taxes                               |                 |                                           | 42,180  |                 |               |   | 37,832  |                                     |  | 11.5   | %                                     |  |   | 127,386       |   |  |   | 83,697    |   |  | 52.2  | %
|Income tax expense                                       |                 |                                           | 16,713  |                 |               |   | 14,517  |                                     |  | 15.1   | %                                     |  |   | 50,502        |   |  |   | 32,474    |   |  | 55.5  | %
|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|Net income                                               |                 | $                                         | 25,467  |                 |               | $ | 23,315  |                                     |  | 9.2    | %                                     |  | $ | 76,884        |   |  | $ | 51,223    |   |  | 50.1  | %
|                                                         |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|NM = Not Meaningful                                      |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|                                                         |                 |                                           |         |                 |               |  
|Effective tax rate                                       |                 |                                           | 39.6    | %               |               |   | 38.4    | %                                   |  |        |                                       |  |   | 39.6          | % |  |   | 38.8      | % |  |       |  
|                                                         |                 |                                           |         |                 |               |  
|Comparison as a Percent of Net Sales:                    |                 |                                           |         |                 |               |   |         |                                     |  |        |                                       |  |   |               |   |  |   |           |   |  |       |  
|Gross margin                                             |                 |                                           | 14.5    | %               |               |   | 15.2    | %                                   |  |        |                                       |  |   | 13.2          | % |  |   | 12.4      | % |  |       |  
|Selling, general and administrative expenses             |                 |                                           | 9.6     | %               |               |   | 10.0    | %                                   |  |        |                                       |  |   | 7.5           | % |  |   | 7.8       | % |  |       |  
|Operating income                                         |                 |                                           | 6.4     | %               |               |   | 6.7     | %                                   |  |        |                                       |  |   | 6.6           | % |  |   | 5.3       | % |  |       |  
|Income before income taxes                               |                 |                                           | 5.6     | %               |               |   | 5.4     | %                                   |  |        |                                       |  |   | 6.0           | % |  |   | 4.3       | % |  |       |  
|Net income                                               |                 |                                           | 3.4     | %               |               |   | 3.3     | %                                   |  |        |                                       |  |   | 3.6           | % |  |   | 2.6       | % |  |       |  



Thirteen Weeks Ended
August 28, 2005, Compared to Thirteen Weeks Ended August 29, 2004



Net Sales.Sales increased to $757.5 million in the thirteen weeks ended August 28, 2005, compared to $704.0 million for the thirteen weeks ended August 29, 2004.



Sales of chemicals increased to $570.5 million in the thirteen weeks ended August 28,
2005, from $533.6 million in the thirteen weeks ended August 29, 2004. Share gains in the Midwest, Texas, and the Midsouth, helped overcome lower sales in the North Plains. Also, we now bill directly the Monsanto bulk herbicide business which
during fiscal 2005 were commissioned agent transactions. Higher volumes of glyphosate herbicides more than offset lower end user unit prices for glyphosate products, while insecticide and fungicide treatments were up compared to last year due to an
increase in disease and insect infestations. Sales of fertilizer increased to $146.8 million in the thirteen weeks ended August 28, 2005, from $128.5 million in the thirteen weeks ended August 29, 2004. The increase was due to higher
pricing offsetting slightly lower volumes as growers marginally reduced fertilizer applications due to higher prices. Sales of seed decreased to $22.7 million in the thirteen weeks ended August 28, 2005, from $26.4 million in the thirteen weeks
ended August 29, 2004. The decrease was due primarily to lower sales of soybean seed in the Midwest because of earlier seasonal plantings. Sales of other products increased slightly to $17.5 million in the thirteen weeks ended August 28,
2005, from $15.5 million in the thirteen weeks ended August 29, 2004, due to an increase in application fees.



Cost of Goods Sold. Cost of goods sold was $647.7 million in the thirteen weeks ended August 28, 2005, compared to $597.0 million in the thirteen weeks
ended August 29, 2004. Gross profit (net sales less cost of goods sold) was $109.8 million in the thirteen weeks ended August 28, 2005, compared to $107.0 million in the thirteen weeks ended August 29, 2004. Gross margin (gross profit
as a percentage of net sales) was 14.5% in the thirteen weeks ended August 28, 2005, compared to 15.2% in the thirteen weeks ended August 29, 2004. The increase in gross profit was primarily due to lower supply chain costs and slightly
better application margins, which were offset by the volume



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decline in seed and some erosion in the profitability of glyphosate herbicides. The decrease in gross margin is due primarily to higher fertilizer prices as
well as lower glyphosate margins. Gross profit includes supplier rebates, which are accrued monthly based on actual sales at the most likely estimated rates by supplier, then finalized in our fourth quarter and the accrual adjusted as necessary.



Selling, General and Administrative Expenses.Selling, general
and administrative (SG&A) expenses increased to $72.7 million in the thirteen weeks ended August 28, 2005, from $70.3 million in the thirteen weeks ended August 29, 2004. SG&A expenses were 9.6% of sales during the thirteen weeks
ended August 28, 2005, and 10.0% of sales during the thirteen weeks ended August 29, 2004. The increase in expenses was due to higher personnel costs and professional expenses associated with becoming an independent public company, fewer
recoveries of bad debt and increased vehicle expenses including fuel as compared to the thirteen weeks ended August 29, 2004. The SG&A expenses for the thirteen weeks ended August 29, 2004, include $0.3 million of management fees paid
to Apollo Management.



Royalties, Service Charges and Other Income and
Expenses.These items include royalty income generated by our proprietary products group, service charge income paid by customers who do business with us on terms, and equity earnings in an unconsolidated subsidiary, as well as other items.
Other income decreased to $10.0 million in the thirteen weeks ended August 28, 2005, from $10.8 million in the thirteen weeks ended August 29, 2004. Higher royalty income during the thirteen weeks ended August 28, 2005, was offset by
a gain on a post closing settlement of an acquisition during the thirteen weeks ended August 29, 2004. Higher royalties are a result of the market success of those products from which we receive royalty payments.



Third Party Interest Expense.Interest expense decreased $1.4 million to $6.4
million in the thirteen weeks ended August 28, 2005, from $7.8 million for the thirteen weeks ended August 29, 2004. The decrease was due to interest relating to $21.5 million of 81/4% Senior Notes which were redeemed in December 2004.



Finance Related and Other Charges. Finance related and other charges for the thirteen weeks ended August 29, 2004, consist of $1.9 million of
transition services agreement expenses with ConAgra Foods related to the Acquisition.



Income Taxes.The effective income tax rate was 39.6% for the thirteen weeks ended August 28, 2005, versus 38.4% for the thirteen weeks ended August 29, 2004.



Twenty-Six Weeks Ended August 28, 2005, Compared to Twenty-Seven Weeks Ended
August 29, 2004



Net Sales.Sales increased to $2,114.4
million in the twenty-six weeks ended August 28, 2005, compared to $1,962.5 million for the twenty-seven weeks ended August 29, 2004. Sales of proprietary chemical and seed products were 14.6% of total chemical and seed sales in the
twenty-six weeks ended August 28, 2005, compared to 14.4% for the twenty-seven weeks ended August 29, 2004, reflecting our strategy to grow sales of proprietary products.



Sales of chemicals increased to $1,294.0 million in the twenty-six weeks ended August 28, 2005, from $1,257.7 million in the
twenty-seven weeks ended August 29, 2004. Share gains in the Midwest, Texas, the Midsouth and Southeast, helped overcome lower non-crop sales and slightly lower chemical tolling revenue due to the rationalization of two non-strategic
formulation facilities that had provided toll-manufacturing services. Also, we now bill directly the Monsanto bulk herbicide business which during fiscal 2005 were commissioned agent transactions. Higher volumes of glyphosate herbicides more than
offset lower end user unit prices for glyphosate products, while insecticide and fungicide treatments were up compared to last year due to an increase in disease and insect infestations. Sales of fertilizer increased to $483.3 million in the
twenty-six weeks ended August 28, 2005, from $409.3 million in the twenty-seven weeks ended August 29, 2004. The increase was due to higher pricing, offsetting slightly lower volumes. The slightly lower fertilizer volumes are due to lower
in season applications as a result of higher prices, partially offset by higher early season fertilizer applications that normally occur in the fall and winter but were delayed into the spring due to wet weather. Sales of seed increased to $299.0
million in the twenty-six weeks ended August 28, 2005, from $260.0 million in the twenty-seven weeks ended August 29, 2004. The increase was due primarily to sales growth on both third party and proprietary brands and higher prices due to
increased sales of seed with enhanced traits. Sales of other products increased slightly to $38.1 million in the



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twenty-six weeks ended August 28, 2005, from $35.5 million in the twenty-seven weeks ended August 29, 2004, due to an increase in application fees.



Cost of Goods Sold.Cost of goods sold was $1,835.9 million in
the twenty-six weeks ended August 28, 2005, compared to $1,719.7 million in the twenty-seven weeks ended August 29, 2004. Gross profit (net sales less cost of goods sold) was $278.5 million in the twenty-six weeks ended August 28,
2005, compared to $242.8 million in the twenty-seven weeks ended August 29, 2004. Gross margin (gross profit as a percentage of net sales) was 13.2% in the twenty-six weeks ended August 28, 2005, compared to 12.4% in the twenty-seven weeks
ended August 29, 2004. The increase in gross profit and gross margin was due partially to an increase in cost of sales of $17.4 million in the twenty-seven weeks ended August 29, 2004, resulting from purchase accounting for the
Acquisition. At the Acquisition, the inventory on our books was written up $21.1 million to fair market value. As this inventory was sold, it increased cost of sales by $17.4 million in the twenty-seven weeks ended August 29, 2004. The
remaining increase in gross profit was due primarily to lower supply chain costs, growth in seed and fertilizer sales, and growth in insecticide and fungicide sales. These gains were partially offset by some erosion in the profitability of
glyphosate herbicides and plant growth regulators. Gross profit includes rebates, which are accrued monthly based on actual sales at the most likely estimated rates by supplier, then finalized in our fourth quarter and the accrual adjusted as
necessary.



Selling, General and Administrative Expenses.Selling, general and administrative (SG&A) expenses increased to $158.3 million in the twenty-six weeks ended August 28, 2005 from $153.1 million in the twenty-seven weeks ended August 29, 2004. SG&A expenses decreased
slightly to 7.5% of sales during the twenty-six weeks ended August 28, 2005, from 7.8% of sales during the twenty-seven weeks ended August 29, 2004. The increase in expenses was due to higher personnel costs and professional expenses
associated with becoming an independent public company, higher insurance costs, fewer recoveries of bad debt, and increased vehicle expenses including fuel. These increases were partially offset by having one less week of operating expenses in the
twenty-six weeks ended August 28, 2005. The SG&A expenses for the twenty-seven weeks ended August 29, 2004 include $0.5 million of management fees paid to Apollo Management.



Royalties, Service Charges and Other Income and Expenses.These items include royalty income generated by our proprietary
products group, service charge income paid by customers who do business with us on terms, and equity earnings in an unconsolidated subsidiary, as well as other items. Other income increased to $17.8 million in the twenty-six weeks ended
August 28, 2005, from $13.4 million in the twenty-seven weeks ended August 29, 2004. The increase was due to higher royalty income during the twenty-six weeks ended August 28, 2005, slightly offset by a gain on a post closing
settlement of an acquisition during the twenty-seven weeks ended August 29, 2004. Higher royalties are a result of the market success of those products from which we receive royalty payments.



Third Party Interest Expense.Interest expense was $4.1 million lower at $12.1
million in the twenty-six weeks ended August 28, 2005, compared to $16.2 million for the twenty-seven weeks ended August 29, 2004. The twenty-seven weeks ended August 29, 2004, included interest expense relating to $21.5 million of
the 81/4% Senior Notes redeemed in December 2004, and $1.9 million of interest paid to ConAgra Foods for the
acquisition.



Finance Related and Other Charges. Finance
related and other charges for the twenty-seven weeks ended August 29, 2004, consist of $3.8 million transition services agreement expenses with ConAgra Foods related to the Acquisition.



Income Taxes.The effective income tax rate was 39.6% for the twenty-six weeks
ended August 28, 2005, versus 38.8% for the twenty-seven weeks ended August 29, 2004.



LIQUIDITY AND CAPITAL RESOURCES



Overview



Our principal liquidity requirements are for working
capital, consisting primarily of receivables, inventories, pre-paid expenses, reduced by accounts payable and accrued expenses, capital expenditures, debt service, and dividends on our common stock. We will fund our liquidity needs, including
dividend payments, with cash generated from operations and, to the extent necessary, through borrowings under our revolving credit facility. In addition, we



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expect to fund any growth capital expenditures with cash generated from operations, reductions in working capital and incremental debt.



We believe that our cash flows from operating activities and borrowing capabilities under our
revolving credit facility will be sufficient to meet our liquidity requirements in the foreseeable future, including funding of capital expenditures, debt service payments, and our intended dividend payments on our common stock. If our cash flows
from operating activities are insufficient to fund dividend payments at intended levels, we will need to reduce or eliminate dividends or, to the extent we are permitted to do so under our debt agreements, fund dividends with borrowings or from
other sources. If we use working capital or permanent borrowings to fund dividends, we will have less cash available for future dividends and other purposes, which could negatively impact our financial condition, our results of operations and our
ability to maintain or expand our business. Additionally, our revolving credit facility will mature in 2008. If we are unable to refinance such indebtedness prior to its stated maturity, we will be required to use cash to repay such indebtedness,
and we may not have sufficient cash available to us at that time. Even if we have sufficient cash, such a repayment would sufficiently decrease the amount of cash, if any, that is available to pay dividends.



Cash Flows



Our ongoing operations require availability of funds to service debt, fund working capital and meet capital expenditure requirements. We
currently finance and expect to continue to finance these activities through cash flows from operations and from amounts available under our revolving credit facility.



Cash flows provided (used) by operating activities totaled $5.6 million in the twenty-six weeks ended August 28, 2005, compared to
($313.4) million in the twenty-seven weeks ended August 29, 2004. The improvement in net cash provided by operating activities in the current period versus the prior period is due primarily to better overall payment terms from suppliers and a
change in the timing of prepayments to chemical and seed suppliers. We made larger prepayments to chemical and seed suppliers in the fourth quarter of fiscal 2005, significantly reducing payment obligations to suppliers in the twenty-six weeks ended
August 28, 2005. However, in the fourth quarter of fiscal 2004, we decided not to make significant prepayments to suppliers. Instead, we primarily paid on regular trade terms during the twenty-seven weeks ended August 29, 2004, resulting
in more payments to suppliers. This was partially offset by higher trade receivables from increased sales and higher inventories. Inventories were up due to higher levels of fungicide products and higher fertilizer inventory levels resulting from
increased fertilizer costs per ton.



Cash flows used in investing activities
totaled $3.7 million for the twenty-six weeks ended August 28, 2005, and $63.3 million for the twenty-seven weeks ended August 29, 2004. Additions to property, plant and equipment were $6.4 million in the twenty-six weeks ended
August 28, 2005, compared to $6.1 million in the twenty-seven weeks ended August 29, 2004. Capital spending during the twenty-six weeks ended August 28, 2005 was for a variety of projects; the largest was related to a fertilizer
terminal expansion project. During the twenty-seven weeks ended August 29, 2004, the company made the final acquisition payment to ConAgra Foods for $58.2 million.



Cash flows provided by financing activities were $7.4 million in the twenty-six weeks ended August 28, 2005, compared to $224.8 million
in the twenty-seven weeks ended August 29, 2004. Cash flows provided by financing activities for August 29, 2004, reflect borrowings under our revolving credit facility used to accommodate our seasonal working capital needs. We actively
manage our cash balances which results in check float on zero balance accounts. The net change in float was $5.8 million and $42.9 million for the periods ending August 28, 2005, and August 29, 2004, respectively. The dividend paid to our
stockholder of $6.3 million for the twenty-six weeks ended August 28, 2005 funded our stockholders dividend to its shareholders. No dividends were paid in the twenty-seven weeks ended August 29, 2004.



Credit Facility.At August 28, 2005, there was $500.0 million of borrowing
availability under the revolving credit facility and we had borrowing capacity thereunder of $486.7 million after giving effect to $13.3 million of letters of credit under the sub-facility. At August 28, 2005, we had no short-term debt
outstanding under our revolving credit facility compared to an outstanding balance of $180.3 million at August 29, 2004. We were able to reduce our borrowings compared to the same period a year ago by increasing our terms with our suppliers



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Since inception of the credit facility, we have been in compliance with its financial covenants. During the fifty-two weeks ended August 28, 2005,
outstanding borrowings (net of cash on hand) reached a period end peak of $275.2 million on October 24, 2004, while cash on hand reached a period end peak of $57.6 million on August 28, 2005. Our average period end borrowings (net of cash
on hand) for the fifty-two week period ended August 28, 2005, were approximately $61.7 million.



Obligations and Commitments



As part of
our ongoing operations, we enter into arrangements that obligate us to make future payments under contracts such as lease agreements, debt agreements and unconditional purchase obligations (i.e., obligations to transfer funds in the future for fixed
or minimum quantities of goods or services at fixed or minimum prices, such as take-or-pay contracts). We enter into unconditional purchase obligation arrangements in the normal course of business to ensure that adequate levels of
sourced product are available to us. There were no material changes outside of the ordinary course of business during the thirteen or twenty-six weeks ended August 28, 2005.



UAP Holding Corp.s Dependence on Us to Service its Obligations



As a holding company with no significant assets other than the ownership of 100% of our common stock, UAP Holding Corp. depends on our cash
flows to service its debt and to pay dividends (if any) on its common stock. UAP Holding Corp. intends to pay quarterly cash dividends on its common stock at an annual rate of $0.65 per share. The declaration of such dividends is at the complete
discretion of UAP Holding Corp.s board of directors, and depends upon many factors, including its financial condition, earnings, legal requirements, restrictions in its debt agreement, and other factors that its board of directors deems
relevant. Because our parent, UAP Holding Corp., is a holding company, its primary source of funds to fund its dividend payments will be cash distributions received from us. To the extent we make such distributions to UAP Holding Corp., the amount
of cash available to us to pay principal of, and interest on, our outstanding debt, including the 81/4% Senior
Notes, will be reduced, and we would have less cash available for other purposes, which could negatively impact our financial condition, our results of operations and our ability to maintain or expand our business. A failure to pay principal of, or
interest on, our debt, including the 81/4% Senior Notes, would constitute an event of default under the
applicable debt agreements, giving the holders of that debt the right to accelerate its maturity. If any of our debt is accelerated, we may not have sufficient cash available to repay it in full and we may be unable to refinance it on satisfactory
terms or at all.



UAP Holding Corp. is substantially more
leveraged than us. As of August 28, 2005, UAP Holding Corp. had $301.2 million of total indebtedness. As described above, UAP Holding Corp. will rely on distributions from us in order to pay amounts due in respect of its 103/4% Senior Discount Notes due 2012, (which will require cash interest payments at the rate of 103/4% per annum, commencing on July 15, 2008) and to pay dividends, if any, on its outstanding common stock.
However, our ability to make distributions to UAP Holding Corp. is restricted by covenants contained in our revolving credit facility and the indenture governing the 81/4% Senior Notes. While the restrictions in the indenture governing the 81/4% Senior Notes cover a wide variety of arrangements which have traditionally been used to effect highly leveraged transactions, the indenture governing the 81/4% Senior Notes may not afford the holders of the 81/4% Senior Notes protection in all circumstances from the adverse aspects of a highly leveraged transaction, reorganization, restructuring, merger or similar
transaction. While UAP Holding Corp. has no current intention to engage in these types of transactions, there can be no assurance that it will not do so in the future if permitted under the terms of the revolving credit facility and the indenture
governing the 81/4% Senior Notes.



Dividend Policy



Currently we intend to pay quarterly cash dividends on our common stock sufficient to provide UAP Holding Corp. with the funds necessary to
pay the dividends it may declare. On July 18, 2005, our board declared a quarterly dividend on our common stock in the amount of $8.2 million. The record date for the dividend payment was August 15, 2005, and the payment date was
September 1, 2005. We paid a $6.3 million dividend on June 1, 2005.



There are no assurances that we will declare or pay any cash dividends in the future. The declaration and payment of future dividends to our common stock holder is at the discretion of our board of directors and depends upon many factors,
including our financial condition, earnings, legal requirements, restrictions in our debt agreements and other factors our board of directors deems relevant. The terms of our indebtedness, including the revolving credit facility



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and the indentures governing the 81/4% Senior Notes, may also restrict us from paying cash dividends on our common stock under some circumstances.



In the past, cash flow provided by our operating activities has been highly variable, resulting in negative cash flow during certain periods. Because of the variability,
if our cash flows from operating activities are insufficient to fund dividend payments at intended levels, we may need to reduce or eliminate dividends or, to the extent permitted by our debt agreements fund all or part of the dividends with
additional debt or other sources of cash. To the extent we pay dividends, the amount of cash available to us to pay the principal and interest on our outstanding debt will be reduced. A failure to pay the principal or interest on our debt would
constitute an event of default under the applicable debt agreements, giving the holders of the debt the right to accelerate its maturity. If any of our debt is accelerated, we may not have sufficient cash available to repay it in full and we may be
unable to refinance it on satisfactory terms or at all. An event of default under debt agreements, or an acceleration of the debt thereunder, could also trigger an event of default under other debt agreements. Furthermore, if we fund dividends with
additional debt, our interest expense will increase, which may cause a further reduction in the amount of cash available for operations. Subject to certain restrictions in the indenture governing the 81/4% Senior Notes, additional debt could be secured and therefore effectively be senior to the 81/4% Senior Notes.



Critical Accounting Policies



The process of preparing financial statements requires the use of estimates on the part of management. The estimates used by management are based on our historical
experiences combined with managements understanding of current facts and circumstances. Certain of our accounting policies are considered critical as they are both important to the portrayal of our financial condition and results of operations
and require significant or complex judgment on the part of management. There has been no material change in accounting policies considered critical by our management. However, we have refined our methodology for estimating chemical rebates
receivable in response to changes in supplier rebate programs.



Forward-Looking Statements



This report includes
forward-looking statements that involve risks and uncertainties. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures,
financing needs, plans or intentions relating to acquisitions, business trends and other information that is not historical information and, in particular, appear under the heading Managements Discussion and Analysis of Financial
Condition and Results of Operations. When used in this report, the words estimates, expects, anticipates, projects, plans, intends, believes,
forecasts, foresees, likely, may, should, goal, target, and variations of such words or similar expressions are intended to identify forward-looking statements. All
forward-looking statements are based upon information available to us on the date of this report.



These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from the results discussed in the
forward-looking statements including, among other things, the matters discussed in this report under this Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations. Such risks, uncertainties and
other factors may include, among others:



| |  |  | general economic and business conditions;
| | - |  | -----------------------------------------



| |  |  | industry trends;
| | - |  | ----------------



| |  |  | restrictions contained in our debt agreements;
| | - |  | ----------------------------------------------



| |  |  | our substantial leverage, including the inability to generate the necessary amount of cash to service our existing debt and the incurrence of substantial indebtedness in the future;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the seasonality of our business and weather conditions;
| | - |  | -------------------------------------------------------



| |  |  | the possibility of liability for pollution and other damage that is not covered by insurance or that exceeds our insurance coverage;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | increased competition in the markets in which we operate;
| | - |  | ---------------------------------------------------------



| |  |  | our dependence on rebate programs to attain profitability;
| | - |  | ----------------------------------------------------------



| |  |  | our dependence on a limited number of key executives who we may not be able to adequately replace if they leave our company;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------



| |  |  | changes in government regulations, agricultural policy and environmental, health and safety laws and regulations;
| | - |  | -----------------------------------------------------------------------------------------------------------------



| |  |  | changes in business strategy, development plans or cost savings plans;
| | - |  | ----------------------------------------------------------------------



| |  |  | the loss of any of our major suppliers or the bankruptcy or financial distress of our customers;
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | the ability to attain and maintain any price increases for our products;
| | - |  | ------------------------------------------------------------------------



| |  |  | availability, terms and deployment of capital; and
| | - |  | --------------------------------------------------



| |  |  | other factors over which we have little or no control.
| | - |  | ------------------------------------------------------



These risks and certain other uncertainties are discussed in more detail in our Annual Report on Form 10-K for the fiscal year ended February 27, 2005 under the
caption Item 7. Managements Discussion and Analysis of Financial Condition and Results of OperationsRisk Factors.



There may be other factors, including those discussed elsewhere in this report, which could cause our actual results to differ materially from the results referred to in
the forward-looking statements. All forward-looking statements attributable to us or persons acting on our behalf apply only as of the date of this report and are expressly qualified in their entirety by the cautionary statements included in this
report. We undertake no obligation to publicly update or revise forward-looking statements to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.



|ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
|------- | -----------------------------------------------------------



Market risks affecting our business are exposure to changes in energy prices foreign currency risks and interest rate risks.



Our average period end borrowings under the revolving credit agreement (net of cash on hand)
for the fifty-two week period ended August 28, 2005, were approximately $61.7 million. The revolving credit facility is affected by changes in interest rates. Based upon the amount of our average period end borrowings (net of cash on hand) for
the fifty-two week period ended August 28, 2005, a one percentage point change in the assumed weighted average interest rate on such credit facility would change our annual interest expense by $0.6 million.



Our foreign currency risk is limited primarily to the exchange rate differential in the
Canadian and US dollar. The exchange rate was 0.8339, 0.8074, and 0.7603, at August 28, 2005, February 27, 2005, and August 29, 2004, respectively. The exchange rate has been between 0.7851 and 0.8430 for the twenty-six weeks
ended August 28, 2005. A 1% change in the exchange rate has approximately a $0.4 million impact on the balance sheet value.



Changes in energy prices have a direct impact on our fuel costs. Over the past year the national weekly average per gallon price of diesel has increased from
approximately $1.87 to $2.59 and gasoline has increased from $1.83 to $2.58 as of August 28, 2005. These price increases impact our supply chain and selling expenses. Based on our usage mix of these two fuels, we estimate that on average we
have experienced a 30% increase in fuel prices year over year through the second quarter. Based on our historic usage a $0.15 increase in the annual average per gallon price of fuel would increase our fuel expense by $1.0 million. Higher fuel prices
also affect our customers such that higher expenses for fuel and higher prices for fertilizer inputs may reduce the cash or credit available to our customers with which they purchase other inputs or services from us.



|ITEM 4. | CONTROLS AND PROCEDURES.
|------- | ------------------------



As of the end of the period covered by this report, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures as
they related to our business (Disclosure Controls). This evaluation



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(Controls Evaluation) was done under the supervision and with the participation of management, including our Chief Executive Officer
(CEO) and Chief Financial Officer (CFO).



Our
management, including the CEO and CFO, does not expect that our Disclosure Controls or our internal controls over financial reporting (Internal Controls) will prevent all error and all fraud. A control system, no matter how
well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits
of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by
collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the
inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.



Based upon the Controls Evaluation, the CEO and CFO have concluded that the Disclosure Controls are effective as of the end of the period covered by this report. There
have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to the date we carried out this evaluation. In addition, there have been no changes in our internal control
over financial reporting that have occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



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PART II. OTHER INFORMATION



Items 1, 2, 3, 4 and 5
are not applicable and have been omitted.



|ITEM 6. | EXHIBITS
|------- | --------



|     |  |                                                                                                                                                                                  
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | 
|31.1 |  | Certification of Chief Executive Officer pursuant to Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|     | 
|31.2 |  | Certification of Chief Financial Officer pursuant to Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|     | 
|32.1 |  | Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                       
|     | 
|32.2 |  | Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                       



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SIGNATURES



Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Date: October 11, 2005



UNITED AGRI PRODUCTS, INC.(Registrant)By:

/s/ David W. BullockDavid W. BullockExecutive Vice President and Chief Financial Officer (Principal Financial Officer and duly authorized signatory on behalf of Registrant)




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