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(1)

Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(f)(2) under the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to Rule 457(p) under the Securities Act, a registration fee of $3.75 paid by the registrants in connection with its registration statement on Form S-4, File No. 333-72986, filed on November 8, 2001, is offset against the registration fee due with respect to this registration statement.

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The exchange offer expires at 5:00 p.m., New York City time, on             , 2003, unless extended.

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We will exchange all old notes that are validly tendered and not validly withdrawn prior to the expiration of the exchange offer.

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You may withdraw tendered old notes at any time prior to the expiration of the exchange offer.

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Each broker-dealer that receives registered notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such registered notes.

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The only conditions to completing the exchange offer are that the exchange offer not violate any applicable law or applicable interpretation of the staff of the Commission and no injunction, order or decree has been or is issued that would prohibit, prevent or materially impair our ability to proceed with the exchange offer.

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We will not receive any cash proceeds from the exchange offer.

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There is no active trading market for the notes and we do not intend to list the registered notes on any securities exchange or to seek approval for quotations through any automated quotation system.

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adverse weather conditions resulting in reduced demand for propane;

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price volatility and availability of propane, and the capacity to transport to market areas;

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changes in laws and regulations, including safety, tax and accounting matters;

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large supplier, counterparty or customer defaults;

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competitive pressures from the same and alternative energy sources;

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failure to acquire new customers, thereby reducing or limiting any increase in revenues;

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liability for environmental claims;

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customer conservation measures and improvements in energy efficiency and technology resulting in reduced demand;

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adverse labor relations;

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inability to make business acquisitions on economically acceptable terms, resulting in failure to acquire new customers and thereby limiting any increase in revenues;

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liability for personal injury and property damage arising from explosions and other catastrophic events, including acts of terrorism, resulting from operating hazards and risks incidental to transporting, storing and distributing propane, butane and ammonia, including liability in excess of insurance coverage;

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political, regulatory and economic conditions in the United States and in foreign countries; and

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interest rate fluctuations and other capital market conditions.

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•

“AmeriGas Partners,” “we,” “us,” and “our” are sometimes used as abbreviated references to AmeriGas Partners, L.P. itself or AmeriGas Partners, L.P. and our consolidated subsidiaries, which include AP Eagle Finance Corp., the co-obligor of the notes, and our operating partnership, AmeriGas Propane, L.P. and its subsidiary AmeriGas Eagle Propane, L.P., formerly Columbia Propane, L.P.;

•

references to our “general partner” refer to AmeriGas Propane, Inc.; references to our “operating partnership” refer to AmeriGas Propane, L.P. and its subsidiary AmeriGas Eagle Propane, L.P., formerly Columbia Propane, L.P.; and

•

references to the “notes” refer to the old notes, which include the Series C notes and the Series A notes, and the registered notes.

Registered Notes

$88,015,000 aggregate principal amount of Series B 8 7/8% Senior Notes due 2011. The terms of the registered notes are substantially identical to the terms of the old notes, except that the registered notes have been registered under the Securities Act and will not bear legends restricting their transfer under the Securities Act. In addition, certain transfer restrictions, registration rights and additional interest payment provisions relating to the old notes will not apply to the registered notes.

Old Notes

$88 million aggregate principal amount of Series C 8 7/8% Senior Notes due 2011, which were issued in a private placement on December 3, 2002, and $15,000 aggregate principal amount of Series A 8 7/8% Senior Notes due 2011, which were issued in a private placement on August 21, 2001.

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The Exchange Offer

We are offering to exchange $1,000 principal amount of our registered notes for each $1,000 principal amount of our old notes. We are making this exchange offer with respect to the Series C notes to satisfy our obligations under a registration rights agreement that we entered into with the initial purchasers of the Series C notes in connection with the private placement of the Series C notes. We are making this exchange offer with respect to the Series A notes on a voluntary basis in order to offer the holders of such notes the opportunity to exchange those notes for registered notes.

Registration Rights Agreement

If you hold Series C notes, you are entitled under the registration rights agreement to exchange your Series C notes for registered notes with substantially identical terms. The exchange offer is intended to satisfy these rights. After the exchange offer is complete, except as set forth in the next paragraph, you will no longer be entitled to any exchange or registration rights with respect to your Series C notes.

Resales of the Registered Notes

Whether you hold Series C notes or Series A notes, we believe that you may resell, offer for resale, or otherwise transfer any registered notes issued to you in the exchange offer without complying with the registration and prospectus delivery requirements of the Securities Act if you meet all of the following conditions:

(1)

you acquired the registered notes in the ordinary course of your business;

(2)

you are not engaging in and do not intend to engage in a distribution of the registered notes;

(3)

you do not have an arrangement or understanding with any person to participate in the distribution of the Registered notes; and

(4)

you are not an affiliate of ours, as the term “affiliate” is defined in Rule 405 under the Securities Act.

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Expiration Date

The exchange offer will expire at 5:00 p.m., New York City time, on                   , 2003, unless we decide to extend the exchange offer. We do not intend to extend the exchange offer, although we reserve the right to do so.

Conditions to the Exchange Offer

We will complete the exchange offer only if it will not violate applicable law or any applicable interpretation of the staff of the Commission and no injunction, order or decree has been issued that would prohibit, prevent or materially impair our ability to proceed with the exchange offer. See “The Exchange Offer—Conditions.”

Procedures for Tendering Old Notes Held in the Form of Book-Entry Interests

The old notes were issued as global securities in fully registered form without coupons. Beneficial interests in the old notes that are held by direct or indirect participants in The Depository Trust Company (the “DTC”) through certificateless depositary interests are shown on, and transfers of the old notes can be made only through, records maintained in book-entry form by the DTC with respect to its participants.

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National Association, as exchange agent, on or prior to the expiration of the exchange offer either:

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a written or facsimile copy of a properly completed and executed letter of transmittal for your series of notes and all other required documents to the address set forth on the cover page of the letter of transmittal; or

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a computer-generated message transmitted by means of the DTC’s Automated Tender Offer Program system and forming a part of a confirmation of book-entry transfer in which you acknowledge and agree to be bound by the terms of the letter of transmittal for your series of notes.

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a timely confirmation of book-entry transfer of your old notes into the exchange agent’s account at the DTC, in accordance with the procedure for book-entry transfers described in this prospectus under the heading “The Exchange Offer—Book-Entry Transfer;” or

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the documents necessary for compliance with the guaranteed delivery procedures described below.

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you are acquiring the registered notes in the exchange offer in the ordinary course of your business;

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you are not engaging in and do not intend to engage in a distribution of the registered notes;

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you do not have an arrangement or understanding with any person to participate in the distribution of the registered notes; and

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you are not our affiliate.

Procedures for Tendering Certificated Notes

No certificated notes are issued and outstanding as of the date of this prospectus. If you are a holder of book-entry interests in old notes, you are entitled to receive, in limited circumstances, in exchange for your book-entry interests, certificated notes in principal amounts equal to your book-entry interests. See “Description of the Registered Notes—Form of Registered Notes.” If you acquire certificated old notes prior to the expiration of the exchange offer, you must tender your certificated old notes in accordance with the procedures described in “The Exchange Offer—Procedures for Tendering Certificated Old Notes.”

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Special  Procedures for Beneficial Owners

If you are the beneficial owner of old notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, and you wish to tender your old notes, you should promptly contact the person in whose name your old notes are registered and instruct that person to tender on your behalf. If you wish to tender on your own behalf, you must, prior to completing and executing the letter of transmittal for your series of notes and delivering your old notes, either make appropriate arrangements to register ownership of the old notes in your name or obtain a properly completed bond power from the person in whose name your old notes are registered. The transfer of registered ownership may take considerable time. See “The Exchange Offer—Procedures for Tendering—Procedures Applicable to All Holders.”

Guaranteed Delivery Procedures

If you wish to tender your old notes and you cannot get the required documents to the exchange agent on time, you may tender your old notes in accordance with the guaranteed delivery procedures for your series of old notes set forth in “The Exchange Offer—Procedures for Tendering—Guaranteed Delivery Procedures.”

Acceptance of Old Notes and Delivery of Registered Notes

Except under the circumstances summarized above under “Conditions to the Exchange Offer,” we will accept for exchange any and all old notes that are properly tendered in the exchange offer prior to 5:00 p.m., New York City time, on the expiration date for the exchange offer. The registered notes to be issued to you in the exchange offer will be delivered promptly following the expiration of the exchange offer. See “The Exchange Offer—Terms of the Exchange Offer.”

Withdrawal

You may withdraw any tender of your old notes at any time prior to 5:00 p.m., New York City time, on the expiration of the exchange offer. We will return to you any old notes not accepted for exchange for any reason without expense to you as promptly as we can after the expiration or termination of the exchange offer.

Exchange Agent

Wachovia Bank, National Association is serving as the exchange agent in connection with the exchange offer.

Consequences of Failure to Exchange

If you do not participate or properly tender your old notes in the exchange offer:

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you will retain old notes that are not registered under the Securities Act and that will continue to be subject to the restrictions on transfer that are described in the legend on the old notes;

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if you hold Series C notes, you will not be able, except in very limited instances, to require us to register your old notes under the Securities Act;

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if you hold Series A notes, you will not be able to require us to register your old notes under the Securities Act;

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you will not be able to offer to resell or transfer your old notes unless they are registered under the Securities Act or unless you offer to resell or transfer them pursuant to an exemption under the Securities Act; and

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the trading market for your old notes will become more limited to the extent that other holders of old notes participate in the exchange offer.

Federal Income Tax Consequences

Your exchange of old notes for registered notes in the exchange offer will not result in any gain or loss to you for U.S. federal income tax purposes. See “Certain United States Federal Income Tax Considerations.”

Co-Issuers

AmeriGas Partners, L.P. and AP Eagle Finance Corp.

Registered Notes

$88,015,000 principal amount of Series B 8 7/8% Senior Notes due 2011, which have been registered under the Securities Act. The forms and terms of the registered notes are substantially the same as the form and terms of the old notes except, generally, that the registered notes have been registered under the Securities Act and do not bear legends restricting their transfer. The registered notes will evidence the same indebtedness as the old notes. The registered notes are being offered under an indenture pursuant to which we have previously issued $328 million aggregate principal amount of 8 7/8% Senior Notes due 2011, including the old notes. The registered notes, any old notes remaining after the completion of the exchange offer and the notes previously issued under the indenture will be treated as a single class under the indenture.

Interest Rate and Payment Dates

Interest on the registered notes will accrue at the rate of 8 7/8% per annum and be paid, until maturity, semi-annually in arrears on each May 20 and November 20 to holders of record on each of the immediately preceding May 5 and November 5. The first interest payment on the registered notes will be made on May 20, 2003.

Maturity Date

The notes will mature on May 20, 2011.

Optional Redemption

We may, at our option, redeem the notes in whole or in part from time to time at the redemption prices determined as described in “Description of the Registered Notes—Optional Redemption.”

Repurchase Right—Change of Control

Upon a change of control as described in “Description of the Registered Notes—Offers to Purchase; Repurchase at the Option of the Noteholders—Change of Control Offer,” you will have the right to require us to repurchase some or all of your notes at 101% of the

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aggregate principal amount, plus accrued and unpaid interest to the date of purchase. We cannot assure you that upon a change of control we will have sufficient funds to repurchase your notes.

Repurchase Right—Asset Sales

In the event of certain asset sales by us, we may be required to make an offer to repurchase a portion of the notes under certain circumstances. For more details, see “Description of the Registered Notes—Offers to Purchase; Repurchase at the Option of the Noteholders—Asset Sales.”

Ranking

Our obligations with respect to the registered notes and those of AP Eagle Finance Corp. will be joint and several. The old notes are, and the registered notes will be, unsecured and effectively subordinated to the indebtedness of our operating partnership. As of September 30, 2002, we and our operating partnership, on a consolidated basis, had total indebtedness of approximately $955.8 million, consisting of $945.8 million of long-term debt (including current maturities of $60.4 million) and $10 million under a revolving credit facility, and partners’ capital of $228.4 million. Holders of our operating partnership’s indebtedness of $569.5 million as of September 30, 2002 will have superior rights to those of the noteholders. Our senior notes outstanding as of the date of this prospectus, consisting of an aggregate principal amount of $328 million of 8 7/8% Senior Notes due 2011 (which includes the old notes) and $60 million of 10% Senior Notes due 2006, or an aggregate principal amount of $388 million, will rank equally with the registered notes that we issue in exchange for the old notes. The registered notes will be non-recourse to our general partner.

Basic Covenants

We will issue the registered notes under the 8 7/8% Senior Notes Due 2011 Indenture dated August 21, 2001 with Wachovia Bank, National Association, successor to First Union National Bank, as trustee, as supplemented by a Supplemental Indenture dated December 3, 2002 between us and the trustee. The indenture, as supplemented, includes several covenants, which, among other things, restrict our ability and the ability of our restricted subsidiaries to:

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incur other indebtedness;

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make certain restricted payments or investments;

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incur liens;

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enter into transactions with affiliates;

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pay dividends or make other restricted payments affecting our subsidiaries;

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enter into sale and leaseback transactions;

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merge with or into other companies or sell all or substantially all of our properties or assets; and

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engage in other lines of business.

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Registration Rights; Liquidated Damages

In connection with the private placement of the Series C notes, and pursuant to the registration rights agreement, we agreed to file and use our reasonable best efforts to have a registration statement declared effective permitting us to offer to exchange the Series C notes for the registered notes. This exchange offer is intended to satisfy that obligation. We have also agreed to provide a shelf registration statement to cover the resale of the Series C notes under certain limited circumstances. If we fail to satisfy these obligations within the time periods specified in the registration rights agreement, we have agreed to pay liquidated damages to the holders of the Series C notes under certain circumstances.

Market for the Registered Notes

There is no active trading market for the registered notes and we do not intend to list the registered notes on any securities exchange or to seek approval for quotations through any automated quotation system. An active and liquid trading market for the notes may not develop.

Form of Notes

The registered notes will be represented by one or more global securities deposited with Wachovia Bank, National Association for the benefit of the DTC. You will not receive registered notes in certificated form unless one of the events set forth under the heading “Description of the Registered Notes—Form of Registered Notes” occurs. Instead, beneficial interests in the registered notes will be shown on, and transfer of these interests will be effected only through, records maintained in book-entry form by the DTC with respect to its participants.

Use of Proceeds

We will not receive any cash proceeds upon completion of the exchange offer.

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(a)

Includes cumulative effect of accounting changes associated with the Partnership’s changes in accounting for tank fee revenue and tank installation costs and the adoption of Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities.”

(b)

Pro forma net income and net income per limited partner unit after applying retroactively the changes in accounting for tank installation costs and tank fee revenue are as follows: 1998—$19,646 and $0.46; 1999—$26,091 and $0.62; 2000—$14,989 and $0.35, respectively.

(c)

SFAS No. 142, “Goodwill and Other Intangible Assets,” was adopted effective October 1, 2001. Net income and net income per limited partner unit adjusted to reflect the impact of SFAS No. 142 as if it had been adopted at the beginning of the periods presented are as follows: 1998—$44,884 and $1.06; 1999—$48,336 and $1.14; 2000—$38,313 and $0.90; 2001—$89,079 and $1.98, respectively.

(d)

For purposes of determining the ratio of earnings to fixed charges, earnings are defined as earnings (loss) before income taxes, minority interest and income (loss) from equity investees, plus distributed income of equity investees plus fixed charges. Fixed charges consist of interest expense and the portion of operating leases representing interest.

(e)

Revenues less cost of sales.

(f)

Deviation from average heating degree days during the 30-year period from 1961 – 1990, based upon national weather statistics provided by the National Oceanic and Atmospheric Administration for 335 airports in the continental United States.

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incur other indebtedness;

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engage in transactions with affiliates;

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incur liens;

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make certain restricted payments;

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enter into certain business combinations and asset sale transactions;

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engage in new lines of business; and

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make investments.

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make it more difficult for our operating partnership to distribute cash for us to satisfy our obligations with respect to the notes;

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limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and

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place us at a competitive disadvantage compared to our competitors that have proportionately less debt.

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incur other indebtedness;

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engage in transactions with affiliates;

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incur liens;

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make certain restricted payments;

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enter into certain business combinations and asset sale transactions;

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engage in new lines of business; and

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make investments.

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a liquid market for the notes will develop;

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you will be able to sell your notes;

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you will receive any specific price upon any sale of the notes.

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you will retain old notes that are not registered under the Securities Act and that will continue to be subject to restrictions on transfer that are described in the legend on the old notes;

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if you hold Series C notes, you will not be able, except in very limited instances, to require us to register your old notes under the Securities Act;

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If you hold Series A notes, you will not be able to require us to register your old notes under the Securities Act;

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you will not be able to offer to resell or transfer your old notes unless they are registered under the Securities Act or unless you offer to resell or transfer them pursuant to an exemption under the Securities Act; and

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the trading market for your old notes will become more limited to the extent that other holders of old notes participate in the exchange offer.

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prepay, defease, purchase or otherwise retire the intercompany note unless it is replaced by equivalent debt with no greater amortization;

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modify the intercompany note so as to eliminate or limit the recourse liability of Triarc;

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convert AmeriGas Eagle Propane, L.P. into a corporation for federal income tax purposes, including by way of any merger or consolidation;

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allow any third party to assume, guarantee, indemnify against or otherwise incur any liability relating to the intercompany note; or

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take or fail to take any action that would reduce the share of the intercompany note allocated to Triarc for federal income tax purposes.

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make any material change in certain federal income tax positions, methods, principles or elections of AmeriGas Eagle Propane, L.P.;

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sell or dispose of certain assets of AmeriGas Eagle Propane, L.P. if doing so would result in a gain of more than $5 million per year on a cumulative basis to be allocated to Triarc; or

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increase the carrying value of certain assets of AmeriGas Eagle Propane, L.P. for income tax purposes.

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the registered notes to be issued to you in the exchange offer are acquired in the ordinary course of your business;

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you are not engaging in and do not intend to engage in a distribution of the registered notes to be issued to you in the exchange offer; and

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you have no arrangement or understanding with any person to participate in the distribution of the registered notes to be issued to you in the exchange offer.

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you will retain old notes that are not registered under the Securities Act and that will continue to be subject to restrictions on transfer that are described in the legend on the old notes;

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if you hold Series C notes, you will not be able to require us to register your old notes under the Securities Act unless, as set forth above, you do not receive freely tradeable registered notes in the exchange offer or are not eligible to participate in the exchange offer, and we are obligated to file a shelf registration statement;

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if you hold Series A notes, you will not be able to require us to register your old notes under the Securities Act;

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you will not be able to offer to resell or transfer your old notes unless they are registered under the Securities Act or unless you offer to resell or transfer them pursuant to an exemption under the Securities Act; and

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the trading market for your old notes will become more limited to the extent that other holders of old notes participate in the exchange offer.

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to delay accepting any old notes or, if any of the conditions set forth below under “—Conditions” have not been satisfied or waived, to terminate the exchange offer by giving oral or written notice of such delay or termination to the exchange agent; or

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to amend the terms of the exchange offer in any manner by complying with Rule 14e-l(d) under the Exchange Act to the extent that rule applies.

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a written or facsimile copy of a properly completed and duly executed letter of transmittal for your series of notes, including all other documents required by such letter of transmittal, to the exchange agent at the address set forth on the cover page of the letter of transmittal; or

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a computer-generated message transmitted by means of the DTC’s Automated Tender Offer Program system and received by the exchange agent and forming a part of a confirmation of book-entry transfer, in which you acknowledge and agree to be bound by the terms of the letter of transmittal for your series of notes.

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a timely confirmation of book-entry transfer of such notes into the exchange agent’s account at the DTC pursuant to the procedure for book-entry transfers described below under “—Book-Entry Transfer” must be received by the exchange agent prior to the expiration date; or

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you must comply with the guaranteed delivery procedures for your series of notes described below.

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the certificates representing your old notes must be received by the exchange agent prior to the expiration date; or

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you must comply with the guaranteed delivery procedures for your series of notes described below.

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old notes tendered in the exchange offer are tendered either by a registered holder who has not completed the box entitled “Special Registration Instructions” or “Special Delivery Instructions” on the holder’s letter of transmittal or for the account of an eligible institution; and

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the box entitled “Special Registration Instructions” on the letter of transmittal has not been completed.

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you improperly tender your old notes;

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you have not cured any defects or irregularities in your tender; and

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we have not waived those defects, irregularities or improper tender.

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purchase or make offers for, or offer registered notes for, any old notes that remain outstanding subsequent to the expiration of the exchange offer;

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terminate the exchange offer; and

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to the extent permitted by applicable law, purchase notes in the open market, in privately negotiated transactions or otherwise.

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you tender through an eligible institution;

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on or prior to 5:00 p.m., New York City time, on the expiration date, the exchange agent receives from an eligible institution, a written or facsimile copy of a properly completed and duly executed letter of transmittal and notice of guaranteed delivery for your series of notes, substantially in the form provided by us; and

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the certificates for all certificated old notes, in proper form for transfer, or a book-entry confirmation, and all other documents required by the letter of transmittal for your series of notes, are received by the exchange agent within three New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery.

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your name and address;

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the amount of old notes you are tendering; and

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a statement that your tender is being made by the notice of guaranteed delivery and that you guarantee that within three New York Stock Exchange trading days after the execution of the notice of guaranteed delivery, the eligible institution will deliver the following documents to the exchange agent:

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the certificates for all certificated old notes being tendered, in proper form, for transfer or a book-entry confirmation of tender;

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a written or facsimile copy of the letter of transmittal for your series of notes; and

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any other documents required by the letter of transmittal for your series of notes.

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you cannot deliver a book-entry confirmation of book-entry delivery of your book-entry interests into the exchange agent’s applicable account at the DTC; or

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you cannot deliver all other documents required by the letter of transmittal for your series of notes to the exchange agent prior to the expiration date,

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state your name;

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identify the specific old notes to be withdrawn, including the series, the certificate number or numbers and the principal amount of the old notes to be withdrawn;

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be signed by you in the same manner as you signed the letter of transmittal for your series of notes when you tendered your old notes, including any required signature guarantees, or be accompanied by documents of transfer sufficient for the exchange agent to register the transfer of the old notes into your name; and

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specify the name in which the old notes are to be registered, if different from yours.

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any injunction, order or decree has been issued by any court or any governmental agency that would prohibit, prevent or otherwise materially impair our ability to proceed with the exchange offer; or

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the exchange offer violates any applicable law or any applicable interpretation of the staff of the Commission; and

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with respect to the Series A notes, any event that, in our discretion, makes it inadvisable to exchange Series A notes for registered notes.

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$53.8 million in each fiscal year from 2003 through 2008;

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$123.8 million in fiscal year 2009; and

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$93.8 million in fiscal year 2010.

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incur other indebtedness;

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engage in transactions with affiliates;

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incur liens;

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make restricted payments;

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enter into business combinations and asset sale transactions;

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engage in new lines of business; and

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make investments.

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•

are our unsecured general joint and several obligations;

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rank senior in right of payment to all our subordinated indebtedness;

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rank equally in right of payment with all our other senior indebtedness;

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are structurally subordinated to, which means they rank behind, the indebtedness of the operating partnership, including the bank credit facilities and first mortgage notes, and the claims of the preferred stockholders of our consolidated subsidiaries, including our operating subsidiary; and

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are non-recourse to the property and assets of our general partner, AmeriGas Propane, Inc.

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be issued in registered form, without coupons, and in denominations of $1,000;

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accrue interest at the annual rate of 8 7/8% from the most recent date to which interest has been paid, which interest will be computed on the basis of a 360-day year comprised of twelve 30-day months;

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pay interest semi-annually in arrears on May 20 and November 20 to holders of record on the immediately preceding May 5 and November 5; and

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mature on May 20, 2011.

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we do not file a registration statement relating to the registered exchange offer;

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a registration statement is not declared effective on a timely basis; or

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certain other conditions are not satisfied.

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There is a sale, lease, conveyance or other disposition of all or substantially all of the assets of the partnership or the operating partnership to any entity other than UGI Corporation, our indirect parent, which is a public company, and its subsidiaries, or any entity in which UGI Corporation and its subsidiaries beneficially own at least 51% of such entity’s voting stock. In this regard, the meaning of “all or substantially all” varies according to the facts and circumstances of the subject transaction and has no clearly established meaning under New York law, which is the law that governs the indenture. Therefore, in some transactions, it may be unclear whether a change of control has occurred;

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There is a merger or consolidation of the partnership or the operating partnership, or a successor to either entity, with any entity other than UGI Corporation and its subsidiaries or any entity in which UGI Corporation and its subsidiaries beneficially own at least 51% of that entity’s voting stock;

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There is a liquidation or dissolution of the partnership or AmeriGas Propane, Inc., our general partner, or a successor to the general partner; or

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There is any transaction or series of transactions that results in UGI Corporation and its subsidiaries beneficially owning in the aggregate, directly or indirectly, less than 51% of the voting stock of our general partner, or a successor to the general partner.

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the sale, lease, conveyance or other disposition of any assets other than sales of inventory in the ordinary course of business and consistent with past practice; or

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the issuance or sale of capital stock of any subsidiary that is not an Unrestricted Subsidiary.

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the amount of any liabilities on the partnership’s or any Restricted Subsidiary’s balance sheet that are assumed by the transferee of the assets; and

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the amount of any notes or other obligations received by the partnership or the Restricted Subsidiary from the transferee that is immediately converted by the partnership or the Restricted Subsidiary into cash, to the extent of the cash received.

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Indebtedness evidenced by the $200 million of notes under the indenture and $60 million of 10% senior notes;

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Indebtedness outstanding on April 19, 1995;

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Indebtedness of the operating partnership evidenced by the first mortgage notes; provided that the aggregate principal amount, exclusive of any unamortized premium, of this Indebtedness outstanding at any time may not exceed $518 million;

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Indebtedness of the partnership or a Restricted Subsidiary incurred for the making of expenditures for the improvement or repair, to the extent the improvements or repairs may be capitalized in accordance with generally accepted accounting principles (“GAAP”), or additions, including by way of acquisitions of businesses and related assets, to the property and assets of the partnership and its Restricted Subsidiaries, including, without limitation, Indebtedness incurred under the acquisition facility, or

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incurred by assumption in connection with additions, including additions by way of acquisitions or capital contributions of businesses and related assets, to the property and assets of the partnership and its Restricted Subsidiaries; provided that the aggregate principal amount of this Indebtedness outstanding at any time may not exceed $75 million;

•

Indebtedness of the partnership or a Restricted Subsidiary incurred for any purpose permitted under the revolving credit facility of the operating partnership’s bank credit facilities, provided that the aggregate principal amount of this Indebtedness outstanding at any time may not exceed an amount equal to the greater of $175 million or the Consolidated Borrowing Base Amount; and provided, further, that the outstanding balance of this Indebtedness may not exceed 50% of such greater amount for 30 consecutive days during each fiscal year;

•

Indebtedness of the partnership owed to our general partner or an affiliate of our general partner that is unsecured and that is subordinated in right of payment to the notes; provided that the aggregate principal amount of this Indebtedness outstanding at any time may not exceed $50 million;

•

Indebtedness of the partnership or a Restricted Subsidiary for the purpose of the payment of certain liabilities of Petrolane, Incorporated, a subsidiary of our general partner; provided that the aggregate amount of such Indebtedness outstanding at any time may not exceed $30 million;

•

Indebtedness owed by the partnership or any Restricted Subsidiary to the operating partnership or a wholly owned subsidiary of the partnership;

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Indebtedness under any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or similar arrangement designed to protect the partnership or any Restricted Subsidiary from fluctuations in interest rates;

•

Permitted Refinancing Indebtedness;

•

the incurrence by the partnership or a Restricted Subsidiary of Indebtedness owing directly to its insurance carriers, without duplication, in connection with the partnership’s, its subsidiaries’ or its Affiliates’ self-insurance programs or other similar forms of retained insurable risks for their respective businesses, consisting of reinsurance agreements and indemnification agreements, and guarantees of the foregoing, secured by letters of credit; provided that any Consolidated Fixed Charges associated with the Indebtedness evidenced by the reinsurance agreements, indemnification agreements, guarantees and letters of credit will be included, without duplication, in any determination of the Consolidated Fixed Charge Coverage Ratio test set forth in the covenant in the indenture entitled “Limitation on Additional Indebtedness;”

•

Indebtedness of the partnership and its Restricted Subsidiaries in respect of Capital Leases, meaning, generally, any lease of any property which would be required to be classified and accounted for as a capital lease on a balance sheet of the lessor; provided that the aggregate amount of the Indebtedness outstanding at any time may not exceed $10 million;

•

Indebtedness of the partnership and its Restricted Subsidiaries represented by letters of credit supporting obligations under workmen’s compensation laws, obligations to suppliers of propane (provided that the aggregate amount of this Indebtedness outstanding at any time may not exceed $15 million) and the repayment of Permitted Indebtedness; or

•

surety bonds and appeal bonds required in the ordinary course of business or in connection with the enforcement of rights or claims of the partnership or any of its subsidiaries or in connection with judgments that do not result in a “Default” or “Event of Default.” The terms “Default” or “Event of Default” are defined in the indenture and summarized below under the caption “Events of defaults and remedies.”

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declare or pay any dividend or any other distribution or payment on or with respect to capital stock of the partnership or any of its Restricted Subsidiaries or any payment made to the direct or indirect holders, in their capacities as such, of capital stock of the partnership or any of its Restricted Subsidiaries other than dividends or distributions payable solely in capital stock of the partnership, other than redeemable capital stock, or in options, warrants or other rights to purchase capital stock of the partnership, other than redeemable capital stock; declare or pay a dividend or other distribution to the extent declared or paid to the partnership or any Restricted Subsidiary of the partnership; or declare or pay a dividend or other distribution by any Restricted Subsidiary of the partnership to all holders of capital stock of that Restricted Subsidiary on a pro rata basis, including, in the case of the operating partnership, to its general partner;

•

purchase, redeem, defease or otherwise acquire or retire for value any Capital Stock of the partnership or any of its Restricted Subsidiaries, other than any capital stock owned by a wholly owned Restricted Subsidiary of the partnership;

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make any principal payment on, or purchase, defease, repurchase, redeem or otherwise acquire or retire for value, prior to any scheduled maturity, scheduled repayment, scheduled sinking fund payment or other stated maturity, any subordinated indebtedness, other than any such Indebtedness owned by the partnership or a wholly owned Restricted Subsidiary of the partnership; or

•

make any investment, other than a Permitted Investment, in any entity, unless, at the time of and after giving effect to the proposed Restricted Payment, no Default or Event of Default shall have occurred and be continuing, and the Restricted Payment, together with the aggregate of all other Restricted Payments made by the partnership and its Restricted Subsidiaries during the fiscal quarter during which the Restricted Payment is made, will not exceed:

•

if the Consolidated Fixed Charge Coverage Ratio of the partnership is greater than 1.75 to 1, an amount equal to Available Cash as of the end of the immediately preceding fiscal quarter; or

•

if the Consolidated Fixed Charge Coverage Ratio of the partnership is equal to or less than 1.75 to 1, an amount equal to the sum of $24 million, less the aggregate amount of all Restricted Payments made by the partnership and its Restricted Subsidiaries in accordance with this clause during the period ending on the last day of the fiscal quarter of the partnership immediately preceding the date of the Restricted Payment and beginning on the first day of the sixteenth full fiscal quarter immediately preceding the date of the Restricted Payment plus the aggregate net cash proceeds of any substantially concurrent capital contribution to the partnership from any Person other than a Restricted Subsidiary of the partnership, or issuance and sale of shares of Capital Stock, other than redeemable capital stock, of the partnership to any entity other than to a Restricted Subsidiary of the partnership.

•

the payment of any dividend or distribution within 60 days after the date of its declaration if, at the date of declaration, the payment would be permitted as summarized above;

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the redemption, repurchase or other acquisition or retirement of any shares of any class of capital stock of the partnership or any Restricted Subsidiary of the partnership in exchange for, or out of the net cash proceeds of, a substantially concurrent capital contribution to the partnership from any entity other than a Restricted Subsidiary of the partnership; or issuance and sale of other capital stock, other than redeemable capital stock, of the partnership to any entity other than to a Restricted Subsidiary of the partnership; provided, however, that the amount of any net cash proceeds that are utilized for any redemption, repurchase or other acquisition or retirement will be excluded from the calculation of Available Cash; or

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any redemption, repurchase or other acquisition or retirement of subordinated indebtedness in exchange for, or out of the net cash proceeds of, a substantially concurrent capital contribution to the partnership from any entity other than a Restricted Subsidiary of the partnership; or issuance and sale of capital stock, other than redeemable capital stock, of the partnership to any entity other than to a Restricted Subsidiary of the partnership, or indebtedness of the partnership issued to any entity other than a Restricted Subsidiary or the partnership, so long as the indebtedness is Permitted Refinancing Indebtedness; provided, however, that the amount of any net cash proceeds that are utilized for any redemption, repurchase or other acquisition or retirement will be excluded from the calculation of Available Cash.

•

the transaction or series of related transactions are between the partnership and its wholly owned Restricted Subsidiaries or between two wholly owned Restricted Subsidiaries; or

•

the transaction or series of related transactions are on terms that are no less favorable to the partnership or the Restricted Subsidiary, as the case may be, than those which would have been obtained in a comparable transaction at such time from an entity that is not an affiliate of the partnership or Restricted Subsidiary, and, with respect to transaction(s) involving aggregate payments or value equal to or greater than $15 million, the partnership shall have delivered an officers’ certificate to the trustee certifying that the transaction(s) is on terms that are no less favorable to the partnership or the Restricted Subsidiary than those which would have been obtained from an entity that is not an affiliate of the partnership or Restricted Subsidiary and has been approved by a majority of the board of directors of our general partner, including a majority of the disinterested directors.

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pay dividends, in cash or otherwise, or make any other distributions on or with respect to its capital stock or any other interest or participation in, or measured by, its profits;

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pay any indebtedness owed to the partnership or any other Restricted Subsidiary;

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make loans or advances to, or any investment in, the partnership or any other Restricted Subsidiary;

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transfer any of its properties or assets to the partnership or any other Restricted Subsidiary; or

•

guarantee any Indebtedness of the partnership or any other Restricted Subsidiary.

•

applicable law;

•

any agreement in effect at or entered into on April 19, 1995, including the first mortgage notes outstanding and the bank credit facilities in effect on that date, or any agreement relating to any Permitted Indebtedness; provided, however, that the encumbrances and restrictions contained in the agreements governing the Permitted Indebtedness are no more restrictive with respect to the payment restrictions than those set forth in the agreements governing the first mortgage notes and the bank credit facilities as in effect on April 19, 1995;

•

customary non-assignment provisions of any contract or any lease governing a leasehold interest of the partnership or any Restricted Subsidiary;

•

certain purchase money obligations for property acquired in the ordinary course of business;

•

any agreement of an entity (or any it its Restricted Subsidiaries) acquired by the partnership or any Restricted Subsidiary, in existence at the time of the acquisition but not created in contemplation of the acquisition, which encumbrance or restriction is not applicable to any third party other than the entity; or

•

provisions contained instruments relating to Indebtedness which prohibit the transfer of all or substantially all of the assets of the obligor of the Indebtedness unless the transferee shall assume the obligations of the obligor under the agreement or instrument.

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the partnership is the surviving entity or the entity formed by or surviving the transaction, if other than the partnership, or the entity to which the sale was made is a corporation or partnership organized or existing under the laws of the United States, any state thereof or the District of Columbia;

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the entity formed by or surviving the transaction, if other than the partnership, or the entity to which the sale was made assumes all the obligations of the partnership in accordance with a supplemental indenture in a form reasonably satisfactory to the trustee, under the notes and the indenture;

•

immediately after the transaction no Default or Event of Default exists; and

•

the entity formed by or surviving the transaction, if other than the partnership, or the entity to which the sale was made will immediately have a Consolidated Net Worth equal to or greater than the Consolidated Net Worth of the partnership immediately preceding the transaction; and, at the time of the transaction and after giving pro forma effect to it as if the transaction had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional indebtedness in accordance with the Consolidated Fixed Charge Coverage Ratio described in the indenture covenant entitled “Limitation on Additional Indebtedness.”

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•

Default in the payment of the principal of or premium, if any, on any note when the same becomes due and payable, upon stated maturity, acceleration, optional redemption, required purchase, scheduled principal payment or otherwise;

•

Default in the payment of an installment of interest on, or liquidated damages, if any, with respect to, any of the notes, when the same becomes due and payable, which default continues for a period of 30 days;

•

failure to perform or observe any other term, covenant or agreement contained in the notes or the indenture, other than a default specified in either of the two clauses above, and the default continues for a period of 45 days after written notice of the default requiring us to remedy the same shall have been given to the partnership by the trustee or to us and the trustee by holders of 25% in aggregate principal amount of the applicable notes then outstanding;

•

Default or defaults under one or more agreements, instruments, mortgages, bonds, debentures or other evidences of indebtedness under which the partnership or any Restricted Subsidiary of the partnership then has outstanding indebtedness, if the default:

•

is caused by a failure to pay principal with respect to indebtedness of a Restricted Subsidiary at its stated maturity or within the applicable grace period, if any, provided with respect to the indebtedness; or principal, premium or interest with respect to indebtedness of the partnership within the applicable grace period, if any, provided in the indebtedness, which, collectively, is a “Payment Default;” or

•

results in the acceleration of the indebtedness prior to its stated maturity and, in each case, the principal amount of the indebtedness, together with the principal amount of any other indebtedness under which there has been a payment default or the maturity of which has been so accelerated, amounts to $10 million or more;

•

a final judgment or judgments, which is or are non-appealable and nonreviewable or which has or have not been stayed pending appeal or review or as to which all rights to appeal or review have expired or been exhausted, shall be rendered against the partnership, any Restricted Subsidiary, the general partner, or any significant subsidiary, as that term is defined in Rule 1.02(v) of Regulation S-X under the Securities Act, provided such judgment or judgments requires or require the payment of money in excess of $10 million in the aggregate and is not covered by insurance or discharged or stayed pending appeal or review within 60 days after entry of such judgment. In the event of a stay, the judgment shall not be discharged within 30 days after the stay expires; or

•

certain events of bankruptcy, insolvency or reorganization with respect to us or any of our respective significant subsidiaries has occurred. If any Event of Default occurs and is continuing, the trustee or the holders of at least 25% of principal amount of the applicable series of notes then outstanding may declare all the notes of that series to be due and payable immediately.

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the rights of holders of outstanding notes to receive payments with respect to any principal, premium, interest and liquidated damages on the notes when the payments are due;

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our obligations with respect to the notes concerning issuing temporary notes, registration of notes or mutilated, destroyed, lost or stolen notes;

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our obligation to maintain an office or agency for payment and money for security payments held in trust;

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the rights, powers, trusts, duties and immunities of the trustee, and our obligations in connection therewith; and

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the legal defeasance and covenant defeasance provisions of the indenture.

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•

reduce the principal amount of notes whose holders must consent to an amendment, supplement or waiver;

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reduce the principal of or change the fixed maturity of any note or alter the provisions with respect to the redemption of the notes, other than provisions relating to our obligation to repurchase the notes upon certain asset sales or a change of control;

•

reduce the rate of or change the time for payment of interest on any note;

•

waive a Default in the payment of principal or interest on the notes;

•

make any note payable in money other than that stated in the notes;

•

make any change in the provisions of the indenture relating to waivers of past Defaults or the rights of holders of notes to receive payments of principal, premium, if any, or interest on the notes; or

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make any change in the foregoing amendment and waiver provisions.

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•

cure any ambiguity, defect or inconsistency;

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provide for uncertificated notes in addition to or in place of certificated notes;

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provide for the assumption of our obligations to noteholders in the case of a merger or consolidation;

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make any change that could provide any additional rights or benefits to the noteholders that does not adversely affect the legal rights under the indenture of any such holder;

•

comply with requirements of the Commission in order to effect or maintain the qualification of the indenture under the Trust Indenture Act; or

•

to provide security for or add guaranties with respect to the notes.

•

we fail to file any of the registration statements required by the registration rights agreement on or before the date specified for such filing;

•

any of such registration statements are not declared effective by the Commission on or prior to the date specified for such effectiveness, known as the “Effectiveness Target Date”;

•

we fail to consummate the exchange offer within 30 business days after the Effectiveness Target Date with respect to the registration statement related to the exchange offer; or

•

the shelf registration statement or the exchange offer registration statement is declared effective but thereafter, subject to certain exceptions, ceases to be effective or usable in connection with resales of the registered notes during the periods specified in the registration rights agreement;

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•

an Investment by the partnership or any Restricted Subsidiary of the partnership in any other Person pursuant to which the Person shall become a Restricted Subsidiary of the partnership, or shall be merged with or into the partnership or any Restricted Subsidiary of the partnership;

•

the acquisition by the partnership or any Restricted Subsidiary of the partnership of the assets of any Person, other than a Restricted Subsidiary of the partnership, which constitute all or substantially all of the assets of such Person; or

•

the acquisition by the partnership or any Restricted Subsidiary of the partnership of any division or line of business of any Person, other than a Restricted Subsidiary of the partnership.

•

the sum of:

•

all cash of the partnership, the operating partnership and any subsidiaries thereof, treated as a single consolidated entity (together, the “partnership group”), on hand at the end of the quarter; and

•

all additional cash of the partnership group on hand on the date of determination of Available Cash with respect to the quarter resulting from borrowings subsequent to the end of the quarter;

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less the amount of cash reserves that is necessary or appropriate in the reasonable discretion of the general partner to:

•

provide for the proper conduct of the business of the partnership group, including reserves for future capital expenditures, subsequent to the quarter;

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•

provide funds for distributions under Section 5.3(a), (b) and (c) or 5.4(a) of our partnership agreement in respect of any one or more of the next four quarters; or

•

comply with applicable law or any debt instrument or other agreement or obligation to which any member of the partnership group is a party or its assets are subject.

•

70% of the face amount of Eligible Accounts Receivable of the partnership and its Restricted Subsidiaries; and

•

70% of the book value, calculated on a first-in, first-out basis, of the consolidated Inventory of the partnership and its Restricted Subsidiaries, in each case as determined in accordance with GAAP. To the extent that information is not available as to the amount of Eligible Accounts Receivable or Inventory as of a specific date, the partnership may utilize the most recent available information for purposes of calculating the Consolidated Borrowing Base Amount.

•

Consolidated Net Income;

•

Consolidated Non-cash Charges;

•

Consolidated Interest Expense; and

•

Consolidated Income Tax Expense.

•

the aggregate amount of Consolidated Cash Flow Available for Fixed Charges of the Person for the four full fiscal quarters immediately preceding the date of the transaction (the “Transaction Date”) giving rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio (the “Four Quarter Period”); to

•

the aggregate amount of Consolidated Fixed Charges of the Person for the Four Quarter Period.

•

the incurrence or repayment of any indebtedness, other than revolving credit borrowings, of the partnership or any of its Restricted Subsidiaries (and in the case of any incurrence, the application of the net proceeds thereof) during the period commencing on the first day of the Four Quarter Period to and including the Transaction Date (the “Reference Period”), including, without limitation, the incurrence of the indebtedness giving rise to the need to make the calculation (and the application of the net proceeds thereof), as if the incurrence (and application) occurred on the first day of the Reference Period; and

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•

any Asset Sales or Asset Acquisitions (including, without limitation, any Asset Acquisition giving rise to the need to make the calculation as a result of the partnership or one of its Restricted Subsidiaries, including any person who becomes a Restricted Subsidiary as a result of the Asset Acquisition, incurring, assuming or otherwise being liable for Acquired Indebtedness) occurring during the Reference Period, as if the Asset Sale or Asset Acquisition occurred on the first day of the Reference Period; provided, however, that:

•

Consolidated Fixed Charges will be reduced by amounts attributable to businesses or assets that are so disposed of or discontinued only to the extent that the obligations giving rise to such Consolidated Fixed Charges would no longer be obligations contributing to the Consolidated Fixed Charges subsequent to the date of Determination of the Consolidated Fixed Charge Coverage Ratio; and

•

Consolidated Cash Flow Available for Fixed Charges generated by an acquired business or asset shall be determined by the actual gross profit, which is equal to revenues minus cost of goods sold, of the acquired business or asset during the immediately preceding four full fiscal quarters in the Reference Period, minus the pro forma expenses that would have been incurred by the partnership and its Restricted Subsidiaries in the operation of the acquired business or asset during the period computed on the basis of personnel expenses for employees retained or to be retained by the partnership and its Restricted Subsidiaries in the operation of the acquired business or asset and non-personnel costs and expenses incurred by the partnership and its Restricted Subsidiaries in the operation of the partnership’s business at similarly situated facilities.

•

interest on outstanding indebtedness, other than indebtedness referred to in the point below, determined on a fluctuating basis as of the last day of the Four Quarter Period and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such indebtedness in effect on that date;

•

only actual interest payments associated with indebtedness incurred in accordance with the fifth and seventh clauses of the definition of Permitted Indebtedness and all Permitted Refinancing Indebtedness in respect thereof, during the Four Quarter Period shall be included in the calculation; and

•

if interest on any indebtedness actually incurred on the date may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the last day of the Four Quarter Period will be deemed to have been in effect during the period. “Consolidated Fixed Charges” means, with respect to the partnership and its Restricted Subsidiaries for any period, the sum of, without duplication:

•

the amounts for such period of Consolidated Interest Expense; and

•

the product of:

•

the aggregate amount of dividends and other distributions paid or accrued during the period in respect of preferred stock and redeemable capital stock of the partnership and its Restricted Subsidiaries on a consolidated basis; and

•

a fraction, the numerator of which is one and the denominator of which is one less the then applicable current combined federal, state and local statutory tax rate, expressed as a percentage.

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•

the interest expense of the partnership and its Restricted Subsidiaries for the period as determined on a consolidated basis in accordance with GAAP, including, without limitation:

•

any amortization of debt discount;

•

the net cost under Interest Rate Agreements;

•

the interest portion of any deferred payment obligation;

•

all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing; and

•

all accrued interest for all instruments evidencing Indebtedness; and

•

the interest component of Capital Leases paid or accrued or scheduled to be paid or accrued by the partnership and its Restricted Subsidiaries during the period as determined on a consolidated basis in accordance with GAAP.

•

net after-tax extraordinary gains or losses;

•

net after-tax gains or losses attributable to Asset Sales;

•

the net income or loss of any Person which is not a Restricted Subsidiary and which is accounted for by the equity method of accounting, provided that Consolidated Net Income shall include the amount of dividends or distributions actually paid to the partnership or any Restricted Subsidiary;

•

the net income or loss prior to the date of acquisition of any Person combined with the partnership or any Restricted Subsidiary in a pooling of interest;

•

the net income of any Restricted Subsidiary to the extent that dividends or distributions of that net income are not at the date of determination permitted by the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or other regulation; and

•

the cumulative effect of any changes in accounting principles.

•

the net book value of all assets of the subsidiary at the time of the designation in the case of a Restricted Subsidiary; and

•

the cost of acquisition or formation in the case of a newly acquired or formed subsidiary.

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•

any indebtedness for borrowed money and all obligations evidenced by any bond, note, debenture or other similar instrument or letter of credit, or reimbursement agreements in respect thereof, which the Person has, directly or indirectly, created, incurred or assumed;

•

any indebtedness for borrowed money and all obligations evidenced by any bond, note, debenture or other similar instrument secured by any lien in respect of property owned by the person, whether or not the person has assumed or become liable for the payment of the indebtedness; provided that the amount of the indebtedness, if the person has not assumed the same or become liable therefor, shall in no event be deemed to be greater than the fair market value from time to time, as determined in good faith by the person of the property subject to the lien;

•

any indebtedness, whether or not for borrowed money, excluding trade payables and accrued expenses arising in the ordinary course of business, with respect to which the person has become directly or indirectly liable and which represents the deferred purchase price, or a portion thereof, or has been incurred to finance the purchase price, or a portion thereof, of any property or service or business acquired by the person, whether by purchase, consolidation, merger or otherwise;

•

the principal component of any obligations under Capital Leases to the extent the obligations would, in accordance with GAAP, appear on the balance sheet of the person;

•

all Attributable Debt of the person in respect of Sale and Leaseback Transactions not involving a Capital Lease;

•

any indebtedness of the character referred to in the first five points of this definition deemed to be extinguished under GAAP but for which the person remains legally liable;

•

any indebtedness of any other Person of the character referred to in the first six points of this definition with respect to which the person whose indebtedness is being determined has become liable by way of a guaranty;

•

all redeemable capital stock of the person valued at the greater of its voluntary or involuntary maximum fixed repurchase price plus accrued dividends;

•

any preferred stock of any subsidiary of the person valued at the liquidation preference thereof or any mandatory redemption payment obligations in respect thereof plus, in either case, accrued dividends thereon; and

•

any amendment, supplement, modification, deferral, renewal, extension or refunding of any liability of the types referred to in the first nine points above.

•

any direct or indirect purchase or other acquisition by the person of stock or other securities of any other Person; or

•

any direct or indirect loan, advance or capital contribution by the person to any other person and any other item which would be classified as an “investment” on a balance sheet of the person prepared in accordance with GAAP, including without limitation any direct or indirect contribution by the person of property or assets to a joint venture, partnership or other business entity in which the person retains an

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interest, it being understood that a direct or indirect purchase or other acquisition by the person of assets of any other person, other than stock or other securities, shall not constitute an “Investment” for purposes of the indenture.

•

the aggregate amount of all Investments made after April 19, 1995 pursuant to the eighth clause of the definition of Permitted Investment, computed as provided in the last sentence of the definition of Investment; and

•

the aggregate of all Designation Amounts in connection with the designation of unrestricted subsidiaries, less all Designation Amounts in respect of unrestricted subsidiaries which have been designated as Restricted Subsidiaries and otherwise reduced in a manner consistent with the provisions of the last sentence of the definition of Investment.

•

brokerage commissions and other fees and expenses related to the Asset Sale, including, without limitation, fees and expenses of legal counsel and accountants and fees, expenses, discounts or commissions of underwriters, placement agents and investment bankers;

•

provisions for all taxes payable as a result of the Asset Sale;

•

amounts required to be paid to any person, other than the partnership or any Restricted Subsidiary of the partnership, owning a beneficial interest in the assets subject to the Asset Sale;

•

appropriate amounts to be provided by the partnership or any Restricted Subsidiary of the partnership, as the case may be, as a reserve required in accordance with GAAP against any liabilities associated with the Asset Sale and retained by the partnership or any Restricted Subsidiary of the partnership, as the case may be, after the Asset Sale, including, without limitation, pension and other post-employment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with the Asset Sale; and

•

amounts required to be applied to the repayment of indebtedness secured by any lien on the asset or assets sold in the Asset Sale.

•

Indebtedness of the Issuers evidenced by the Notes (other than Additional Notes);

•

Indebtedness of the Partnership and AmeriGas Eagle Finance Corp. evidenced by the 10% Notes;

•

Indebtedness outstanding on the 10 1/8% Notes Issue Date;

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Indebtedness of the Operating Partnership evidenced by the First Mortgage Notes; provided that the aggregate principal amount (exclusive of any unamortized premium) of such Indebtedness outstanding at any time may not exceed $518 million;

•

Indebtedness of the Partnership or a Restricted Subsidiary incurred (A) for the making of expenditures for the improvement or repair of (to the extent such improvements or repairs may be capitalized on the books of such Person in accordance with GAAP) or additions to (including additions by way of acquisitions of businesses and related assets) the property and assets of the Partnership and its Restricted Subsidiaries (including, without limitation, Indebtedness incurred under the Acquisition Facility) or (B) by assumption in connection with additions (including additions by way of acquisition or capital contributions of businesses and related assets) to the property and assets of the Partnership and its Restricted Subsidiaries; provided that the aggregate principal amount of such Indebtedness outstanding at any time may not exceed $75 million;

•

Indebtedness of the Partnership or a Restricted Subsidiary incurred for any purpose permitted under the Revolving Loan Facility; provided that the aggregate principal amount of such Indebtedness outstanding at any time may not exceed an amount equal to the greater of (i) $175 million and (ii) the Consolidated Borrowing Base Amount; and provided, further, that the outstanding balance of such Indebtedness shall not exceed 50% of such greater amount for 30 consecutive days during each fiscal year;

•

Indebtedness of the Partnership owing to the General Partner or an Affiliate of the General Partner that is unsecured and that is Subordinated Indebtedness; provided that the aggregate principal amount of such Indebtedness outstanding at any time may not exceed $50 million;

•

Indebtedness of the Partnership or a Restricted Subsidiary for the purpose of the payment of certain liabilities of Petrolane; provided that the aggregate amount of such Indebtedness outstanding at any time may not exceed $30 million;

•

Indebtedness owed by the Partnership or any Restricted Subsidiary to any Wholly-Owned Restricted Subsidiary;

•

Indebtedness under Interest Rate Agreements;

•

Permitted Refinancing Indebtedness;

•

the incurrence by the Partnership or a Restricted Subsidiary of Indebtedness owing directly to its insurance carriers (without duplication) in connection with the Partnership’s, its Subsidiaries’ or its Affiliates’ self-insurance programs or other similar forms of retained insurable risks for their respective businesses, consisting of reinsurance agreements and indemnification agreements (and guarantees of the foregoing) secured by letters of credit; provided that any Consolidated Fixed Charges associated with the Indebtedness evidenced by such reinsurance agreements, indemnification agreements, guarantees and letters of credit shall be included (without duplication) in any determination of the Consolidated Fixed Charge Coverage Ratio test set forth in Section 4.8 hereof;

•

Indebtedness of the Partnership and its Restricted Subsidiaries in respect of Capital Leases; provided that the aggregate amount of such Indebtedness outstanding at any time may not exceed $10 million;

•

Indebtedness of the Partnership and its Restricted Subsidiaries represented by letters of credit supporting (i) obligations under workmen’s compensation laws, (ii) obligations to suppliers of propane; provided that the aggregate amount of such Indebtedness outstanding at any time may not exceed $15 million and (iii) the repayment of Permitted Indebtedness; or

•

surety bonds and appeal bonds required in the ordinary course of business or in connection with the enforcement of rights or claims of the Partnership or any of its Subsidiaries or in connection with judgments that do not result in a Default or Event of Default.

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First, Investments made or owned by the partnership or any Restricted Subsidiary in:

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the commercial paper or other short term unsecured debt obligations of which are as at such date rated either “A-2” or better (or comparably if the rating system is changed) by S&P or “Prime-2” or better (or comparably if the rating system is changed) by Moody’s; or

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the long-term debt obligations of which are, as at such date, rated either “A” or better (or comparably if the rating system is changed) by either S&P or Moody’s (“Permitted Banks”);

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Second, the acquisition by the partnership or any Restricted Subsidiary of capital stock or other ownership interests, whether in a single transaction or in a series of related transactions, of a person located in the United States or Canada and engaged in substantially the same business as the partnership such that, upon the completion of such transaction or series of transactions, the person becomes a Restricted Subsidiary;

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Third, subject to the eighth clause below, the making or ownership by the partnership or any Restricted Subsidiary of Investments (in addition to Investments permitted by the first, second, fourth, fifth, sixth and seventh clauses of this definition) in any person incorporated or otherwise formed pursuant to the laws of the United States or Canada or any state thereof which is engaged in the United States or Canada in substantially the same business as the partnership; provided that the aggregate amount of all such Investments made by the partnership and its Restricted Subsidiaries following April 19, 1995 and outstanding pursuant to this third clause and the eighth clause below shall not at any date of determination exceed 10% of Total Assets (the “Investment Limit”); provided that, in addition to Investments that would be permitted under the Investment Limit, during any fiscal year the partnership

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and its Restricted Subsidiaries may invest up to $25 million (the “Annual Limit”) pursuant to the provisions of this clause, but the unused amount of the Annual Limit shall not be carried over to any future years;

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Fourth, the making or ownership by the partnership or any Restricted Subsidiary of Investments:

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arising out of loans and advances to employees incurred in the ordinary course of business;

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arising out of extensions of trade credit or advances to third parties in the ordinary course of business; and

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acquired by reason of the exercise of customary creditors’ rights upon default or pursuant to the bankruptcy, insolvency or reorganization of a debtor;

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Fifth, the creation or incurrence of liability by the partnership or any Restricted Subsidiary, with respect to any guaranty constituting an obligation, warranty or indemnity, not guaranteeing indebtedness of any person, which is undertaken or made in the ordinary course of business;

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Sixth, the creation or incurrence of liability by the partnership or any Restricted Subsidiary with respect to any interest rate agreements;

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Seventh, the making by any Restricted Subsidiary of Investments in the partnership or another Restricted Subsidiary;

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Eighth, the making or ownership by the partnership or any Restricted Subsidiary of Investments in Unrestricted Subsidiaries; provided that the Net Amount of Unrestricted Investment shall not at any time exceed $5 million (and subject to the limitations specified in the third clause above); and

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Ninth, the making or ownership by the partnership or any Restricted Subsidiary of Investments in the operating partnership.

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First, liens for taxes, assessments or other governmental charges, the payment of which is not yet due and is being contested in good faith by appropriate proceedings promptly initiated and diligently conducted and as to which reserves or other appropriate provision, if any, as shall be required by GAAP, shall have been made therefor and be adequate in the good faith judgment of the obligor;

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Second, liens of lessors, landlords and carriers, vendors, warehousemen, mechanics, materialmen, repairmen and other like liens incurred in the ordinary course of business for sums not yet due or the payment of which is being contested in good faith by appropriate proceedings promptly initiated and diligently conducted and as to which reserves or other appropriate provisions, if any, as shall be required by GAAP, shall have been made therefor and be adequate in the good faith judgment of the obligor, in each case:

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not incurred or made in connection with the borrowing of money, the obtaining of advances or credit or the payment of the deferred purchase price of property; or

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incurred in the ordinary course of business securing the unpaid purchase price of property or services constituting current accounts payable;

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Third, liens, other than any lien imposed by the Employee Retirement Income Security Act of 1974, as may be amended from time to time, incurred or deposits made in the ordinary course of business:

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in connection with workers’ compensation, unemployment insurance and other types of social security; or

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to secure or to obtain letters of credit that secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, performance bonds, purchase, construction or sales contracts and other similar obligations, in each case not incurred or made in connection with the borrowing of money;

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Fourth, other deposits made to secure liability to insurance carriers under insurance or self-insurance arrangements;

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Fifth, liens securing reimbursement obligations under letters of credit, provided in each case that such liens cover only the title documents and related goods and any proceeds thereof covered by the related letter of credit;

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Sixth, any attachment or judgment lien, unless the judgment it secures shall not, within 60 days after the entry thereof, have been discharged or execution thereof stayed pending appeal or review, or shall not have been discharged within 60 days after expiration of any such stay;

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Seventh, leases or subleases granted to others, easements, rights-of-way, restrictions and other similar charges or encumbrances, which, in each case either are granted, entered into or created in the ordinary course of the business of the partnership or any Restricted Subsidiary or do not materially impair the value or intended use of the property covered thereby;

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Eighth, liens on property or assets of any Restricted Subsidiary securing indebtedness of the Restricted Subsidiary owing to the partnership or a wholly owned Restricted Subsidiary;

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Ninth, liens on assets of the partnership or any Restricted Subsidiary existing on April 19, 1995;

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Tenth, liens securing indebtedness evidenced by the first mortgage notes or any extension, renewal, refunding or refinancing of any such Indebtedness;

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Eleventh, liens securing indebtedness incurred under the acquisition facility or any extension, renewal, refunding or refinancing of any such Indebtedness;

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Twelfth, liens securing indebtedness incurred under the revolving loan facility or any extension, renewal, refunding or refinancing of any such Indebtedness;

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Thirteenth, liens, other than the liens referred to in the eleventh and twelfth clauses above, securing Indebtedness incurred in accordance with:

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The fifth clause of the definition of Permitted Indebtedness;

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the sixth and eighth clauses of the definition of Permitted Indebtedness; or

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Indebtedness otherwise permitted to be incurred under the “Limitation on Additional Indebtedness” covenant to the extent incurred:

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to finance the making of expenditures for the improvement or repair (to the extent the improvements and repairs may be capitalized on the books of the partnership and the Restricted Subsidiaries in accordance with GAAP) of, or additions including additions by way of acquisitions of businesses and related assets to, the assets and property of the partnership and its Restricted Subsidiaries; or

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by assumption in connection with additions including additions by way of acquisition or capital contributions of businesses and related assets to the property and assets of the partnership and its Restricted Subsidiaries; provided that, in the case of Indebtedness incurred in accordance with the first and second sub-points of the thirteenth clause above, the principal amount of the indebtedness does not exceed the lesser of the cost to the partnership and its Restricted Subsidiaries of the additional property or assets and the fair market value of the additional property or assets at the time of the acquisition thereof, as determined in good faith by the general partner;

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Fourteenth, liens existing on any property of any person at the time it becomes a subsidiary of the partnership, or existing at the time of acquisition upon any property acquired by the partnership or any subsidiary through purchase, merger or consolidation or otherwise, whether or not assumed by the partnership or the subsidiary, or created to secure indebtedness incurred to pay all or any part of the purchase price (a “Purchase Money Lien”) of property including, without limitation, capital stock and other securities acquired by the partnership or a Restricted Subsidiary; provided that:

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the lien shall be confined solely to the item or items of property and, if required by the terms of the instrument originally creating the lien, other property which is an improvement to or is acquired for use specifically in connection with the acquired property;

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in the case of a Purchase Money Lien, the principal amount of the Indebtedness secured by the Purchase Money Lien shall at no time exceed an amount equal to the lesser of:

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the cost to the partnership and the Restricted Subsidiaries of the property; and

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the fair market value of the property at the time of the acquisition thereof as determined in good faith by the general partner;

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the Purchase Money Lien shall be created not later than 30 days after the acquisition of the property; and

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the lien, other than a Purchase Money Lien, shall not have been created or assumed in contemplation of the person’s becoming a subsidiary of the partnership or the acquisition of property by the partnership or any subsidiary;

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Fifteenth, easements, exceptions or reservations in any property of the partnership or any Restricted Subsidiary granted or reserved for the purpose of pipelines, roads, the removal of oil, gas, coal or other minerals, and other like purposes, or for the joint or common use of real property, facilities and equipment, which are incidental to, and do not materially interfere with, the ordinary conduct of the business of the partnership or any Restricted Subsidiary;

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Sixteenth, liens arising from or constituting permitted encumbrances under the agreements and instruments securing the obligations under the first mortgage notes and the bank credit facilities; and

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Seventeenth, any lien renewing or extending any lien permitted by the ninth through the fourteenth clauses above; provided that, the principal amount of the indebtedness secured by any such lien shall not exceed the principal amount of the indebtedness outstanding immediately prior to the renewal or extension of the lien, and no assets encumbered by the lien other than the assets encumbered immediately prior to the renewal or extension shall be encumbered thereby.

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the principal amount of the Permitted Refinancing Indebtedness does not exceed the principal or accreted amount plus the amount of accrued and unpaid interest of the indebtedness so repaid, refunded, renewed, replaced, extended or refinanced except that, in the case of the 8 7/8% notes, the Permitted Refinancing Indebtedness may include the redemption premiums set forth above under “Optional Redemption,” in the case of the 10 1/8% Senior Notes, the Permitted Refinancing Indebtedness may include the redemption premiums provided in the indenture governing the 10 1/8% Senior Notes and, in the case of the first mortgage notes, the Permitted Refinancing Indebtedness may include the amount of any unamortized premium;

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with respect to the repayment, refunding, renewal, replacement, extension or refinancing of our indebtedness, the Permitted Refinancing Indebtedness ranks no more favorably in right of payment with respect to the notes than the Indebtedness so repaid, refunded, renewed, replaced, extended or refinanced; and

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with respect to the repayment, refunding, renewal, replacement, extension or refinancing our indebtedness, the Permitted Refinancing Indebtedness has a Weighted Average Life to Stated Maturity and stated maturity equal to, or greater than, and has no fixed mandatory redemption or sinking fund requirement in an amount greater than or at a time prior to the amounts set forth in, the Indebtedness so repaid, refunded, renewed, replaced, extended or refinanced;

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is guaranteed by the partnership or any Restricted Subsidiary;

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is recourse to or obligates the partnership or any Restricted Subsidiary in any way; or

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subjects any property or assets of the partnership or any Restricted Subsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof.

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make an Investment in the Unrestricted Subsidiary pursuant to the eighth clause of the definition of Permitted Investments; and

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incur the indebtedness represented by the guaranty or agreement pursuant to the first paragraph of the covenant captioned “Limitation on Additional Indebtedness.” The board of directors may designate an Unrestricted Subsidiary to be a Restricted Subsidiary; provided that immediately after giving effect to the designation there exists no Event of Default or event which after notice or lapse or time or both would become an Event of Default, and if the Unrestricted Subsidiary has, as of the date of the designation, outstanding Indebtedness other than Permitted Indebtedness, the partnership could incur at least $1.00 of Indebtedness other than Permitted Indebtedness.

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The sum of the products obtained by multiplying:

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the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by

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the number of years, calculated to the nearest one-twelfth, that will elapse between the date and the making of the payment, by

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the then outstanding principal amount of the Indebtedness;

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the DTC notifies us that it is unwilling or unable to continue as depositary or we determine that the DTC is unable to continue as depositary and we fail to appoint a successor depositary;

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we provide for the exchange pursuant to the terms of the indenture; or

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we determine that the book-entry interests will no longer be represented by global notes and we execute and deliver to the Trustee instructions to that effect.

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tax consequences to holders who may be subject to special tax treatment, such as tax-exempt entities, dealers in securities or currencies, financial institutions, insurance companies, regulated investment companies, traders in securities that elect to use a mark-to-market method of accounting for their securities holdings or corporations that accumulate earnings to avoid U.S. federal income tax;

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tax consequences to persons holding notes as part of a hedging, integrated, constructive sale or conversion transaction or a straddle or other risk reduction transaction;

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tax consequences to holders whose “functional currency” is not the U.S. dollar;

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tax consequences to persons who hold notes through a partnership or similar pass-through entity;

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tax consequences to holders who have ceased to be United States citizens or to be taxed as resident aliens;

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alternative minimum tax consequences, if any; or

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any state, local or foreign tax consequences.

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The principal offices of the Commission located at Judiciary Plaza, Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549; and

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The Commission’s website at http://www.sec.gov.

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The annual reports on Form 10-K filed by AmeriGas Partners, L.P., AP Eagle Finance Corp., AmeriGas Finance Corp. and AmeriGas Eagle Finance Corp. for the year ended September 30, 2002.

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