Liquids Storage Terminal

Principal Products

South Portland, ME

Searsport, ME

Newington, NH: River Road

Albany, NY

Quincy, MA

Newington, NH: Avery Lane

Providence, RI(2)

Everett, MA

Oswego, NY

Quincy, MA: TRT(3)

New Bedford, MA(4)

Oceanside, NY

Mount Vernon, NY

Stamford, CT

Total

Dry Storage Terminal

Principal Products and
Materials

Newington, NH: River Road(5)

Searsport, ME

7 pads

310,000

Portland, ME(6)

4 pads

180,000

South Portland, ME

Providence, RI

Total

Operating assets and real estate are leased from Sprague Massachusetts Properties LLC, which will be a wholly-owned subsidiary of Sprague Holdings upon the closing of this offering. The New Bedford terminal is subject to a purchase and sale agreement pursuant to which a third party has agreed to acquire the terminal from Sprague Massachusetts Properties LLC. The acquisition is subject to certain conditions that are beyond the control of Sprague Massachusetts Properties LLC. Subject to those conditions, the acquisition may be consummated on or before January 5, 2013, unless extended, at the option of the buyer,

Acquire additional terminals and marketing and distribution businesses. We intend to grow our asset and customer base by acquiring additional marine and inland terminals (both refined products and materials handling) within and adjacent to the geographic markets we serve. We also intend to acquire additional refined products and natural gas marketing businesses that have demonstrated an ability to

generate free cash flow and that will enable us to leverage our existing investment in our business and customer service systems to further increase the profitability and stability of such cash flow.

Increase our business with existing customers. We intend to increase the net sales and margin we realize from customers we currently serve by expanding the range of products and services we provide and by developing additional ways to address our customers’ needs for certainty of supply, reduced commodity price risk and high-quality customer service.

Limit our exposure to commodity price volatility and credit risk. We will continue to manage commodity price risk by seeking to maintain a balanced position in our purchases and sales through the use of derivatives and forward contracts and to manage counterparty risk by maintaining conservative credit management processes. Furthermore, our materials handling segment generates ratable and stable cash flows and leverages our terminal asset base and strategic port locations.

Maintain our operational excellence. We intend to maintain our long history of safe, cost-effective operations and environmental stewardship by applying new technologies, investing in the maintenance of our assets and providing training programs for our personnel.

We own and/or operate a large portfolio of strategically located assets in the Northeast. We own and/or operate 15 terminals in the Northeast with aggregate storage capacity of approximately 7.9 million barrels, many of which have access to waterborne trade and have rail connectivity and blending capabilities. We also have access to approximately 50 third-party terminals in the Northeast. We believe that the quantity, quality and location of the assets we own or to which we have access provide us the opportunity to offer our customers both certainty of supply and a diversity of products and services to a degree that our competitors with fewer assets cannot offer. In addition, our owned and/or operated terminals and our supply relationships afford us opportunities to acquire physical volumes of refined products at prices lower than expected future prices and either hedge or enter into forward contracts with respect to those volumes.

Our experienced management team has demonstrated its ability to effectively manage and grow our business. The members of our senior management team have an average of over 20 years of experience in the energy industry and have been operating and growing the assets of our predecessor as a team for approximately eight years. During that time, our predecessor has grown in part through the strategic acquisitions of various refined products and materials handling terminals, a natural gas marketing business and a 50% equity interest in an asphalt and residual fuel oil marketing and storage company that will not be a part of our initial assets. Our management team has also expanded our product offerings, implemented our risk management systems, significantly enhanced our employee safety and environmental compliance policies and overseen the design and implementation of numerous business and customer service programs designed to reduce customer cost.

Diversity of product offerings, services and customer base. We sell a variety of products, including our four core products (distillates, gasoline, residual fuel oil and natural gas), and provide materials handling services to a large and diverse group of customers. We believe that the diversity of the products and services that we offer provides us with the opportunity to attract a broad range of new customers and to expand the products and services we can offer to our existing customers. In addition, the diversity of our products helps provide us with more stable cash flows by mitigating the impact of seasonality and commodity price sensitivity. For the three months ended March 31, 2011, our refined products, natural gas and materials handling segments accounted for 60%, 26% and 14% of our gross margin, respectively.

Reputation for reliability and superior customer service. We have been a supplier of refined products in the Northeast for more than 50 years and believe that we have developed an excellent reputation for reliability and superior customer service. We have high customer retention rates, which we believe reflect our dependability in delivering supply and our continuous innovation and implementation of new product and service options for our customers. Over the last three years, our average annual customer retention rate has been over 90% across all of our business segments.

Financial flexibility to manage our business and pursue strategic growth opportunities. Immediately following the completion of this offering, we expect to have available undrawn borrowing capacity of approximately $             million under a new credit agreement we expect to enter into in connection with this offering, as well as access to both the public and private equity and debt capital markets. We believe our borrowing capacity and our broader access to the capital markets will provide us with flexibility to pursue strategic growth opportunities while allowing us to manage the working capital requirements associated with our business.

We may not have sufficient cash from operations following the establishment of cash reserves and payment of fees and expenses, including cost reimbursements to our general partner and its affiliates, to enable us to pay the minimum quarterly distribution to our unitholders.

On a pro forma basis, we would not have had sufficient cash available for distribution to pay the full minimum quarterly distribution on our subordinated units for the year ended December 31, 2010.

The assumptions underlying the forecast of cash available for distribution that we include in “Our Cash Distribution Policy and Restrictions on Distributions” are inherently uncertain and subject to significant business, economic, financial, regulatory and competitive risks and uncertainties that could cause our actual cash available for distribution to differ materially from our forecast.

The amount of cash we have available for distribution to unitholders depends primarily on our cash flow and not solely on profitability, which may prevent us from making cash distributions during periods when we record net income.

Our business is seasonal and generally our financial results are lower in the second and third quarters of the calendar year, which may result in our need to borrow money in order to make quarterly distributions to our unitholders during these quarters.

A significant decrease in demand for refined products, natural gas or our materials handling services in the areas we serve would adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

Our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders are influenced by changes in demand for, and therefore indirectly by changes in the prices of, refined products and natural gas, which could adversely affect our profit margins, our customers’ and suppliers’ financial condition, contract performance, trade credit and the amount and cost of our borrowing under our new credit agreement.

Restrictions in our new credit agreement could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders as well as the value of our common units.

Debt we incur in the future may limit our flexibility to obtain financing and to pursue other business opportunities.

Warmer weather conditions during winter could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

The recent adoption of derivatives legislation by the United States Congress could have an adverse effect on our ability to use derivative instruments to reduce the effect of commodity prices, interest rates and other risks associated with our business.

Our risk management policies, processes and procedures cannot eliminate all commodity price risk or basis risk, which could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders. In addition, any noncompliance with our risk management policies, processes and procedures could result in significant financial losses.

We are exposed to risks of loss in the event of nonperformance by our customers, suppliers and counterparties.

We are exposed to performance risk in our supply chain.

Some of our competitors have capital resources many times greater than ours and control greater supplies of refined products and natural gas. Competitors able to supply our customers with those products and services at a lower price could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

Some of our home heating oil and residual fuel oil volumes are subject to customers switching or converting to natural gas, which could result in loss of customers and, in turn, could have an adverse effect on our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

Energy efficiency, new technology and alternative energy sources could reduce demand for our products and adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

A principal focus of our business strategy is to grow and expand our business through acquisitions. If we do not make acquisitions on economically acceptable terms, our future growth may be limited and any acquisitions we make may reduce, rather than increase, our cash generated from operations on a per unit basis.

A portion of our net sales is generated under contracts that must be renegotiated or replaced periodically. If we are unable to successfully renegotiate or replace these contracts, our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders could be adversely affected.

Due to our lack of geographic diversification, adverse developments in the terminals we use or in our operating areas would adversely affect our results of operations and cash available for distribution to our unitholders.

Our operations are subject to operational hazards and unforeseen interruptions for which we may not be able to maintain adequate insurance coverage.

Our terminalling and materials handling operations are subject to federal, state and local laws and regulations relating to environmental protection and operational safety that require us to incur substantial costs and that may become more stringent over time.

The risks of spills and releases and the associated liabilities for investigation, remediation and third-party claims, if any, are inherent in terminalling operations, and the liabilities that we incur may be substantial.

Increased regulation of greenhouse gas emissions could result in increased operating costs and reduced demand for refined products as a fuel source, which could in turn reduce demand for our products and adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

We are subject to federal, state and local laws and regulations that govern the product quality specifications of the refined products we purchase, store, transport and sell.

We depend on unionized labor for our operations in Oceanside, Mt. Vernon and Albany, New York and in Providence, Rhode Island. Work stoppages or labor disturbances at these facilities could disrupt our business.

We rely on our information technology systems to manage numerous aspects of our business, and a disruption of these systems could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

If we fail to develop or maintain an effective system of internal controls, we may not be able to report our financial results accurately or prevent fraud, which could adversely affect our business, financial condition, results of operations and ability to make quarterly distributions to our unitholders.

It is our business strategy to distribute most of our cash available for distribution, which could limit our ability to grow and make acquisitions.

Axel Johnson currently controls, and after this offering will indirectly control, our general partner, which has sole responsibility for conducting our business and managing our operations. Our general partner and its affiliates, including Axel Johnson, may have conflicts of interest with us and have limited fiduciary duties, and they may favor their own interests to the detriment of us and our common unitholders.

Our general partner intends to limit its liability regarding our obligations.

Our partnership agreement limits our general partner’s fiduciary duties to our unitholders.

Our partnership agreement restricts the remedies available to our unitholders for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty.

Cost reimbursements and fees due to our general partner and its affiliates for services provided to us or on our behalf, which may be determined in our general partner’s sole discretion, may be substantial and will reduce our cash available for distribution to our unitholders.

Unitholders have limited voting rights and, even if they are dissatisfied, cannot initially remove our general partner without its consent.

Our general partner interest or the control of our general partner may be transferred to a third party without unitholder consent.

The incentive distribution rights held by Sprague Holdings may be transferred to a third party without unitholder consent.

You will experience immediate and substantial dilution in pro forma net tangible book value of $             per common unit.

We may issue additional units without unitholder approval, which would dilute unitholder interests.

Sprague Holdings may sell units in the public or private markets, and such sales could have an adverse impact on the trading price of the common units.

An increase in interest rates may cause the market price of our common units to decline.

Our general partner’s discretion in establishing cash reserves may reduce the amount of cash available for distribution to unitholders.

Our general partner may cause us to borrow funds in order to make cash distributions, even where the purpose or effect of the borrowing benefits the general partner or its affiliates.

Our general partner has a limited call right that may require you to sell your common units at an undesirable time or price.

Your liability may not be limited if a court finds that unitholder action constitutes control of our business.

Unitholders may have liability to repay distributions that were wrongfully distributed to them.

There is no existing market for our common units, and a trading market that will provide you with adequate liquidity may not develop. The price of our common units may fluctuate significantly, and you could lose all or part of your investment.

Sprague Holdings, or any transferee holding a majority of the incentive distribution rights, may elect to cause us to issue common units to it in connection with a resetting of the target distribution levels related to the incentive distribution rights, without the approval of the conflicts committee of the board of directors of our general partner or the holders of our common units. This could result in lower distributions to our unitholders.

The NYSE does not require a publicly traded limited partnership like us to comply with certain of its corporate governance requirements.

We will incur increased costs as a result of being a publicly traded partnership.

Our tax treatment depends on our status as a partnership for U.S. federal income tax purposes. If the Internal Revenue Service, or the IRS, were to treat us as a corporation for federal income tax purposes, our cash available for distribution to our unitholders would be substantially reduced.

If we were subjected to a material amount of additional entity-level taxation by individual states, it would reduce our cash available for distribution to our unitholders.

The tax treatment of publicly traded partnerships or an investment in our units could be subject to potential legislative, judicial or administrative changes and differing interpretations, possibly on a retroactive basis.

Our unitholders will be required to pay taxes on their share of our income even if they do not receive any cash distributions from us.

The sale or exchange of 50% or more of our capital and profits interests during any twelve-month period will result in the termination of our partnership for federal income tax purposes.

Tax gain or loss on the disposition of our common units could be more or less than expected.

Tax-exempt entities and non-U.S. persons face unique tax issues from owning common units that may result in adverse tax consequences to them.

If the IRS contests the federal income tax positions we take, the market for our common units may be adversely affected and the cost of any IRS contest will reduce our cash available for distribution to our unitholders.

A portion of our operations are conducted by a corporate subsidiary that is subject to corporate-level income taxes.

We will treat each purchaser of our common units as having the same tax benefits without regard to the actual common units purchased. The IRS may challenge this treatment, which could adversely affect the value of the common units.

We will prorate our items of income, gain, loss and deduction between transferors and transferees of our units each month based upon the ownership of our units on the first day of each month, instead of on the basis of the date a particular unit is transferred. The IRS may challenge this treatment, which could change the allocation of items of income, gain, loss and deduction among our unitholders.

A unitholder whose common units are loaned to a “short seller” to cover a short sale of common units may be considered as having disposed of those common units. If so, such unitholder would no longer be treated for tax purposes as a partner with respect to those common units during the period of the loan and may be required to recognize gain or loss from the disposition.

Unitholders may be subject to state and local taxes and return filing requirements in jurisdictions where they do not live as a result of investing in our common units.

Axel Johnson will contribute to Sprague Holdings all of the ownership interests in our predecessor;

Our predecessor will be converted into a limited liability company, Sprague Operating Resources LLC;

Sprague Operating Resources LLC will distribute to Sprague Holdings certain assets and liabilities that will not be a part of us, including:

Our general partner will make a capital contribution to us and will maintain its 1.0% general partner interest in us;

Sprague Holdings will contribute to us all of the membership interests in Sprague Operating Resources LLC, our operating company, in exchange for              common units⁽¹⁾,              subordinated units and the incentive distribution rights, which entitle the holder to increasing percentages, up to a maximum of 49.0%, of the cash we distribute in excess of $             per unit per quarter as described under “Our Cash Distribution Policy and Restrictions on Distributions” beginning on page 51;

We will issue and sell, and Sprague Holdings will sell,             ⁽¹⁾ and              common units to the public, respectively, in this offering, representing an aggregate     % limited partner interest in us;

We will grant the underwriters a 30-day option to purchase up to              additional common units from us if the underwriters sell more than              common units in this offering;

We will enter into an amended and restated credit agreement, which we refer to as the new credit agreement, consisting of a working capital facility of up to $800.0 million and an acquisition facility of up to $200.0 million, as described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Agreement” beginning on page 98;

We will apply the net proceeds from our issuance and sale of              common units as described in “Use of Proceeds” on page 47; and

We and our general partner will enter into an omnibus agreement, a services agreement and a terminal operating agreement with respect to the New Bedford, Massachusetts terminal with Sprague Holdings and/or certain of its affiliates, each as described in “Certain Relationships and Related Party Transactions—Agreements Governing the Transactions” beginning on page 164.

Public Common Units

Interests of Sprague Holdings and affiliates:

Common Units

Subordinated Units

General Partner Interest

Incentive Distribution Rights

Total

Common units offered by us

Common units offered by Sprague Holdings

Units outstanding after this offering

Use of proceeds

Cash distributions

first, 99.0% to the holders of common units and 1.0% to our general partner, until each common unit has received the minimum quarterly distribution of $             plus any arrearages from prior quarters;

second, 99.0% to the holders of subordinated units and 1.0% to our general partner, until each subordinated unit has received the minimum quarterly distribution of $             ; and

third, 99.0% to all unitholders, pro rata, and 1.0% to our general partner, until each unit has received a distribution of $            .

If we assume that we completed the transactions described under “—The Formation Transactions” beginning on page 9 on January 1, 2010 and April 1, 2010, our pro forma cash available for distribution for

the year ended December 31, 2010 and the twelve months ended March 31, 2011 would have been approximately $29.5 million and $33.6 million, respectively. These amounts would have been sufficient to pay the full minimum quarterly distribution on all of the common units but would have been insufficient by approximately $             million and $             million, respectively, to pay the full minimum quarterly distribution on the subordinated units for those periods. See “Our Cash Distribution Policy and Restrictions on Distributions” beginning on page 51.

Subordinated units

Subordination period

We must make quarterly distributions from operating surplus of at least the minimum quarterly distribution on each outstanding common and subordinated unit and the corresponding distribution on our general partner’s 1.0% interest in respect of each of the prior twelve consecutive quarters;

Our aggregate operating surplus generated in respect of such twelve consecutive quarters (including operating surplus generated by increases in working capital borrowings and treating any drawdowns from cash reserves established in prior periods as cash received during such quarters but excluding the $             million basket contained in the definition of operating surplus) must equal or exceed the aggregate amount of distributions made in respect of such quarters; and

The conflicts committee of the board of directors of our general partner, or the board of directors of our general partner based on the recommendation of the conflicts committee, must determine that we will be able to maintain or increase our quarterly distribution per unit from operating surplus for the four succeeding quarterly distributions.

Right to reset the target distribution levels

Issuance of additional units

Limited voting rights

Our general partner will manage and operate us. Unlike the holders of common stock in a corporation, you will have only limited voting rights on matters affecting our business. You will have no right to

elect our general partner or the board of directors of our general partner on an annual or other continuing basis. Our general partner may not be removed except by a vote of the holders of at least 66 ²/3% of our outstanding common and subordinated units, including any common or subordinated units owned by our general partner and its affiliates (including Sprague Holdings), voting together as a single class. Upon completion of this offering, Sprague Holdings will own an aggregate of approximately     % of our common and subordinated units. This will initially give Sprague Holdings the ability to prevent the involuntary removal of our general partner. See “The Partnership Agreement—Withdrawal or Removal of Our General Partner” beginning on page 186.

Limited call right

Estimated ratio of taxable income to distributions

Material tax consequences

Exchange listing

The contribution to Sprague Holdings by Axel Johnson of all of the ownership interests in our predecessor;

The conversion of our predecessor into Sprague Operating Resources LLC, which will be our operating subsidiary;

The distribution to Sprague Holdings by Sprague Operating Resources LLC of certain of its assets and liabilities that will not be a part of us, including:

$             million of accounts receivable;

our predecessor’s 50% equity interest in Kildair; and

the terminal assets and liabilities associated with our predecessor’s terminals located in New Bedford, Massachusetts; Portsmouth, New Hampshire, and Bucksport, Maine;

The issuance by us to our general partner of a 1.0% general partner interest in us and a capital contribution to us by our general partner;

The contribution to us by Sprague Holdings of all of the membership interests in Sprague Operating Resources LLC in exchange for the issuance by us to Sprague Holdings of              common units,              subordinated units and the incentive distribution rights;

The issuance and sale by us, and the sale by Sprague Holdings, of              and              common units, respectively, to the public, representing an aggregate         % limited partner interest in us;

Our entry into a new credit agreement as described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—New Credit Agreement” beginning on page 98; and

The application of the net proceeds from the issuance and sale of              common units by us as described in “Use of Proceeds” on page 47.

Statement of Income Data:

Net sales

Cost of products sold

Gross margin

Operating expenses

Selling, general and administrative expenses

Depreciation and amortization

Total operating costs and expenses

Operating income

Other income

Interest income

Interest expense

Income before income taxes and equity in net income (loss) of foreign affiliate

Income tax provision(4)

Income before equity in net income (loss) of foreign affiliate

Equity in net income (loss) of foreign affiliate

Net income

EBITDA (unaudited)(5)

Adjusted EBITDA (unaudited)(5)

Pro forma net income per limited partner unit

Weighted average limited partner units outstanding

Cash Flow Data:

Net cash provided by (used in):

Operating activities

Investing activities

Financing activities

Other Financial and Operating Data (unaudited):

Capital expenditures(6)

Total refined products volumes (barrels)

Total natural gas volumes (MMBtus)