CHS INC (Form: 10-K, Received: 12/03/2018 06:25:23)

Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

Form 10-K

________________________________________



þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended	August 31, 2018
or
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from to .

Commission file number: 001-36079

________________________________________

CHS Inc.

(Exact name of Registrant as specified in its charter)



Minnesota (State or other jurisdiction of incorporation or organization)		41-0251095 (I.R.S. Employer Identification Number)
5500 Cenex Drive
Inver Grove Heights, Minnesota 55077 (Address of principal executive office, including zip code)		(651) 355-6000 (Registrant’s telephone number, including area code)

________________________________________

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:



8% Cumulative Redeemable Preferred Stock		The Nasdaq Stock Market LLC
Class B Cumulative Redeemable Preferred Stock, Series 1		The Nasdaq Stock Market LLC
Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 2		The Nasdaq Stock Market LLC
Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 3		The Nasdaq Stock Market LLC
Class B Cumulative Redeemable Preferred Stock, Series 4		The Nasdaq Stock Market LLC
(Title of Each Class)		(Name of Each Exchange on Which Registered)

________________________________________

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

YES o NO þ

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

YES o NO þ

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

YES þ NO o

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).

YES þ NO o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K: þ

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer o	Accelerated filer o	Non-accelerated filer þ	Smaller reporting company o	Emerging growth company o

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

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

YES o NO þ

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the Registrant’s most recently completed second fiscal quarter:

The Registrant has no voting or non-voting common equity (the Registrant is a member cooperative).

Indicate the number of shares outstanding of each of the Registrant’s classes of common stock, as of the latest practicable date:

The Registrant has no common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

INDEX



		Page No.
Explanatory Note

PART I.
Item 1.	Business	1
Item 1A.	Risk Factors	8
Item 1B.	Unresolved Staff Comments	18
Item 2.	Properties	19
Item 3.	Legal Proceedings	20
Item 4.	Mine Safety Disclosures	20

PART II.
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	21
Item 6.	Selected Financial Data	22
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	51
Item 8.	Financial Statements and Supplementary Data	53
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	53
Item 9A.	Controls and Procedures	54
Item 9B.	Other Information	56

PART III.
Item 10.	Directors, Executive Officers and Corporate Governance	57
Item 11.	Executive Compensation	63
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	87
Item 13.	Certain Relationships and Related Transactions, and Director Independence	88
Item 14.	Principal Accounting Fees and Services	89

PART IV.
Item 15.	Exhibits and Financial Statement Schedules	91
Item 16.	Form 10-K Summary	97
SIGNATURES		98

Table of Contents

EXPLANATORY NOTE

General

On October 22, 2018, the Audit Committee of the Board of Directors (the “Audit Committee”) of CHS Inc. (the “Company”, "we", "us" or "our"), after considering the recommendations of management, concluded that our audited consolidated financial statements for the fiscal years ended August 31, 2017, 2016, and 2015, included in our Annual Report on Form 10-K for the fiscal year ended August 31, 2017 (the “2017 Annual Report”), and our unaudited consolidated financial statements for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, and May 31, 2018 and 2017, included in our Quarterly Reports on Form 10-Q for the quarterly periods ended November 30, 2017, February 28, 2018, and May 31, 2018 (the "2018 Quarterly Reports”), should no longer be relied upon due to misstatements that are described in greater detail below, and that we would restate such financial statements to make the necessary accounting corrections.

The Restatement

This Annual Report on Form 10-K for the year ended August 31, 2018, includes audited consolidated financial statements for the years ended August 31, 2018, 2017, and 2016, as well as relevant unaudited interim financial information for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2018 and 2017. The consolidated financial statements for the years ended August 31, 2017 and 2016, selected financial data (Item 6. "Selected Financial Data") for the years ended August 31, 2015 and 2014, and relevant unaudited interim financial information for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017, included within this Annual Report on Form 10-K have been restated.

Restatement Background

As described in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission ("SEC") on October 26, 2018, management of the Company noted potentially excessive valuations in the net derivative asset valuations relating to certain rail freight contracts purchased in connection with our North American grain marketing operations during the preparation of our Annual Report on Form 10-K for the year ended August 31, 2018. Following our identification of these potentially excessive valuations, the Company engaged external counsel, which engaged forensic accountants to work with management of the Company under the oversight of the Audit Committee to conduct an investigation.

The investigation concluded that the misstatements in our consolidated financial statements included in the 2017 Annual Report and 2018 Quarterly Reports were due to intentional misconduct by a former employee in our rail freight trading operations, as well as due to freight contracts not meeting the technical accounting requirements to qualify as derivative financial instruments. The misconduct consisted of the former employee manipulating the mark-to-market valuation of rail cars that were the subject of rail freight purchase contracts and manipulating the quantity of rail cars included in the monthly mark-to-market valuation. In addition, the investigation revealed intentional misstatements were made by the former employee to our independent registered public accounting firm in connection with its audit of our consolidated financial statements for the fiscal year ended August 31, 2017. During the course of, and as a result of, the investigation, we terminated the former employee and have taken additional personnel actions.

Based on the findings described above, we performed additional reviews and analysis, re-performed certain accounting procedures, reviewed our accounting policies and restated certain accounting records for fiscal 2018 and prior periods. The Audit Committee, management and the Company's legal counsel reported the findings of the investigation to our Board of Directors and to our independent registered public accounting firm, and have discussed the evidence uncovered and conclusions reached in the investigation with the Staff of the Division of Enforcement of the SEC.

As a result of the work performed in relation to the freight misstatement, additional misstatements related to the elimination of intercompany balances were also identified and corrected. Although these intercompany misstatements resulted in a material misstatement of certain financial statement line items, the intercompany misstatements did not result in a material misstatement of income (loss) before income taxes or net income (loss).

Restatement of Previously Reported Consolidated Financial Information

This Annual Report on Form 10-K restates amounts included in the 2017 Annual Report described above, including the audited consolidated financial statements for the years ended August 31, 2017 and 2016. Selected financial information for fiscal years ended August 31, 2015 and 2014, and relevant unaudited interim financial information for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017, have also

Table of Contents

been restated. In addition to the misstatements related to the freight contracts and intercompany eliminations, we made adjustments related to other previously identified misstatements unrelated to the freight derivatives and related misstatements that were not material, individually or in the aggregate, to our consolidated financial statements. These other misstatements relate primarily to certain misclassifications, adjustments to revenues and cost of goods sold, and adjustments to various income tax and indirect tax accounts. The following tables present the summary impacts of the restatement adjustments on our previously reported consolidated capital reserves and total equities at August 31, 2015, and income (loss) before income taxes and net income (loss) for the years ended August 31, 2017 and 2016:



	August 31, 2015
	Capital Reserves			Total Equities
	(Dollars in thousands)
As previously reported	$	1,604,670		$	7,669,411
Cumulative restatement adjustments	(119,237		)	(117,972		)
As restated	$	1,485,433		$	7,551,439



	For the Years Ended August 31,
	2017			2016
	(Dollars in thousands)
Income (loss) before income taxes - As previously reported	$	(54,852	)	$	419,878
Restatement adjustments	(55,314		)	(17,753		)
Income (loss) before income taxes - As restated	$	(110,166	)	$	402,125

Net income (loss) - As previously reported	$	127,223		$	423,969
Restatement adjustments	(56,265		)	(40,943		)
Net income (loss) - As restated	$	70,958		$	383,026

For more information regarding the restatement and its impact on our consolidated financial statements, refer to the "Selected Financial Data" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections included within Item 6 and Item 7, respectively, of this Annual Report on Form 10-K and Note 2, Restatement of Previously Issued Consolidated Financial Statements and Note 18, Quarterly Financial Information (Unaudited) of the Notes to the Consolidated Financial Statements included within this Annual Report on Form 10-K.

Compensation Recovery

In connection with the restatement, Mr. Debertin and certain of our other named executive officers and other current senior executives, voluntarily asked our Board of Directors to reduce their award under our fiscal 2018 annual variable pay plan by an amount equal to the incentive compensation received by each such current senior executive under certain incentive compensation plans with respect to prior fiscal years that was in excess of what would have been earned by such current senior executive after taking into account the restatement of our consolidated financial statements. Our Board of Directors accepted such requests and reduced each affected executive’s earned annual variable pay for fiscal 2018 by the amount of that excess. Additionally, each of our current directors who was serving as a director in fiscal 2016 voluntarily returned an amount previously credited to such director’s retirement plan account under our deferred compensation plan in that fiscal year, equal to the excess of what would have been credited to such director’s account after taking into account the restatement of our consolidated financial statements. For more information regarding these compensation recovery actions and recovery actions regarding former executives and directors, refer to the “Annual Variable Pay”, “Compensation Recovery” and “Director Compensation” subsections included in Item 11 of this Annual Report on Form 10-K.

Control Considerations

In connection with the restatement, management has assessed the effectiveness of our disclosure controls and procedures and has included applicable disclosure in Item 9A of this Annual Report on Form 10-K, "Controls and Procedures." Management identified material weaknesses in our internal control over financial reporting as described under "Management's Report on Internal Control over Financial Reporting" in Item 9A of this Form 10-K, resulting in the conclusion by our Chief Executive Officer and Chief Financial Officer that our disclosure controls and procedures and internal control over financial

Table of Contents

reporting were not effective at a reasonable assurance level as of August 31, 2018. Management has taken and is taking additional steps, as described under "Remediation Plan and Status" in Item 9A of this Annual Report on Form 10-K, to remediate the material weaknesses in our internal control over financial reporting.

Table of Contents

PART I.

ITEM 1. BUSINESS

THE COMPANY

CHS Inc. (referred to herein as “CHS,” “we” or “us”) is the nation’s leading integrated agricultural cooperative, providing grain, foods and energy resources to businesses and consumers on a global basis. As a cooperative, we are owned by farmers and ranchers and their member cooperatives (referred to herein as “members”) across the United States. We also have preferred shareholders that own shares of our five series of preferred stock, which are each listed and traded on the Nasdaq Global Select Market. We buy commodities from and provide products and services to individual agricultural producers, local cooperatives and other companies (including our members and other non-member customers), both domestically and internationally. We provide a wide variety of products and services, ranging from initial agricultural inputs such as fuels, farm supplies, crop nutrients and crop protection products, to agricultural outputs that include grains and oilseeds, grain and oilseed processing, renewable fuels and food products. A portion of our operations are conducted through equity investments and joint ventures whose operating results are not fully consolidated with our results; rather, a proportionate share of the income or loss from those equity investments and joint ventures is included as a component of our net income using the equity method of accounting. For the year ended August 31, 2018, our total revenues were $32.7 billion and net income attributable to CHS Inc. was $775.9 million .

We have aligned our segments based on an assessment of how our businesses operate and the products and services they sell. Our Energy segment derives its revenues through refining, wholesaling and retailing of petroleum products. Our Ag segment derives its revenues through the origination and marketing of grain, including: service activities conducted at export terminals; through wholesale sales of crop nutrients; from sales of soybean meal, soybean refined oil and soyflour products; through the production and marketing of renewable fuels; and through retail sales of petroleum and agronomy products, processed sunflowers, feed and farm supplies. Our Ag segment also records equity income from our grain export joint venture and other investments. Our Nitrogen Production segment consists solely of our equity method investment in CF Industries Nitrogen, LLC (“CF Nitrogen”). Our other business operations, primarily our financing and hedging businesses, are included in Corporate and Other because of the nature of their products and services, as well as the relative amount of revenues for those businesses. Prior to its sale on May 4, 2018, our insurance business was also included in Corporate and Other. In addition, our non-consolidated wheat milling and food production and distribution joint ventures are included in Corporate and Other.

Our earnings from cooperative business are allocated to members (and to a limited extent, to non-members with which we have agreed to do business on a patronage basis) based on the volume of business they do with us. We allocate these earnings to our patrons in the form of patronage refunds (which are also called patronage dividends), which may be in cash, patrons’ equities (in the form of capital equity certificates), or both. Patrons' equities may be redeemed over time solely at the discretion of our Board of Directors. Earnings derived from non-members, which are not treated as patronage, are taxed at federal and state statutory corporate rates and are retained by us as unallocated capital reserves. We also receive patronage refunds from the cooperatives in which we are a member, if those cooperatives have earnings to distribute and if we qualify for patronage refunds from them.

Our origins date back to the early 1930s with the founding of our predecessor companies, Cenex, Inc. and Harvest States Cooperatives. CHS Inc. emerged as the result of the merger of those two entities in 1998, and is headquartered in Inver Grove Heights, Minnesota.

Our internet address is www.chsinc.com. The information contained on our website is not part of, and is not incorporated in, this Annual Report on Form 10-K or any other report we file with or furnish to the SEC.

Table of Contents

ENERGY

Overview

We are the nation’s largest cooperative energy company based on revenues and identifiable assets, with operations that include: petroleum refining and pipelines; the supply, marketing and distribution of refined fuels (gasoline, diesel fuel and other energy products); the blending, sale and distribution of lubricants; and the wholesale supply of propane and other natural gas liquids. Our Energy segment processes crude oil into refined petroleum products at our refineries in Laurel, Montana and McPherson, Kansas and sells those products under the Cenex® brand to member cooperatives and other independent retailers through a network of nearly 1,500 sites, the majority of which are convenience stores marketing Cenex® branded fuels. For fiscal 2018, our Energy revenues, after elimination of intersegment revenues, were $7.6 billion and were primarily from gasoline and diesel fuel.

Operations

Laurel Refinery. Our Laurel, Montana refinery processes medium and high sulfur crude oil into refined petroleum products that primarily include gasoline, diesel fuel, petroleum coke and asphalt. Our Laurel, Montana refinery sources approximately 93% of its crude oil supply from Canada, with the remaining balance obtained from domestic sources, and we have access to Canadian and northwest Montana crude oil through our wholly-owned Front Range Pipeline, LLC and other common carrier pipelines. Our Laurel, Montana refinery also has access to Wyoming crude oil via common carrier pipelines from the south.

Our Laurel, Montana facility processes approximately 59,000 barrels of crude oil per day to produce refined products that consist of approximately 43% gasoline, 41% diesel fuel and other distillates, 8% asphalt, 7% petroleum coke and 1% other products. Refined fuels produced at our Laurel, Montana refinery are available: via rail cars and via the Yellowstone Pipeline to western Montana terminals and to Spokane, Washington; south via common carrier pipelines to Wyoming terminals and Denver, Colorado; and east via our wholly-owned Cenex Pipeline, LLC to Glendive, Montana and Minot, Prosper, and Fargo, North Dakota.

McPherson Refinery. Our McPherson, Kansas refinery processes approximately 59% low and medium sulfur crude oil and approximately 41% heavy sulfur crude oil into gasoline, diesel fuel and other distillates, propane and other products. The refinery sources its crude oil through its own pipelines as well as common carrier pipelines. The low and medium sulfur crude oil is sourced from Kansas, Colorado, North Dakota, Oklahoma and Texas, and the heavy sulfur crude oil is sourced from Canada and Wyoming.

Our McPherson, Kansas refinery processes approximately 100,000 barrels of crude oil per day to produce refined products that consist of approximately 56% gasoline, 38% diesel fuel and other distillates, 2% propane and 4% other products. These products are either loaded into trucks at the McPherson, Kansas refinery or shipped via common carrier pipelines to other markets.

Other Energy Operations . We own six propane terminals, four asphalt terminals, seven refined product terminals and three lubricants blending and packaging facilities. We also own and lease a fleet of liquid and pressure trailers and tractors, which are used to transport refined fuels, propane, anhydrous ammonia and other products.

Products and Services

Our Energy segment produces and sells (primarily wholesale) gasoline, diesel fuel, propane, asphalt, lubricants and other related products and also provides transportation services. In addition to selling the products refined at our Laurel, Montana, and McPherson, Kansas refineries, we purchase refined petroleum products from third parties. For fiscal 2018, we obtained approximately 70% of the refined petroleum products we sold from our Laurel, Montana and McPherson, Kansas refineries, and approximately 30% from third parties.

Sales and Marketing; Customers

We market approximately 80% of our refined fuel products to members, with the balance sold to non-members. Sales are made wholesale to member cooperatives and through a network of independent retailers that operate convenience stores under the Cenex® trade name. We sold approximately 1.5 billion gallons of gasoline and approximately 1.7 billion gallons of diesel fuel in fiscal 2018. We also blend, package and wholesale auto and farm machinery lubricants to both members and non-

Table of Contents

members. We are one of the nation’s largest propane wholesalers based on revenues. Most of the propane sold in rural areas is for heating and agricultural usage. Annual sales volumes of propane vary greatly depending on weather patterns and crop conditions.

Industry; Competition

The petroleum business is highly cyclical. Demand for crude oil and energy products is driven by the condition of local and worldwide economies, local and regional weather patterns and taxation relative to other energy sources, which can significantly affect the price of refined fuel products. Our Energy segment generally experiences higher volumes and profitability in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage by our agricultural customers is highest and is subject to domestic supply and demand forces. Other energy products, such as propane, may experience higher volumes and profitability during the winter heating and crop drying seasons. More fuel-efficient equipment, reduced crop tillage, depressed prices for crops, weather conditions and government programs which encourage idle acres may all reduce demand for our energy products.

Regulation. Governmental regulations and policies, particularly in the areas of taxation, energy and the environment, have a significant impact on our Energy segment. Our Energy segment’s operations are subject to laws and related regulations and rules designed to protect the environment that are administered by the Environmental Protection Agency (the “EPA”), the Department of Transportation (the “DOT”) and similar government agencies. These laws, regulations and rules govern: the discharge of materials into the environment, air and water; reporting storage of hazardous wastes and other hazardous materials; the transportation, handling and disposal of wastes and other materials; the labeling of pesticides and similar substances; and investigation and remediation of releases of hazardous materials. Failure to comply with these laws, regulations and rules could subject us to administrative penalties, injunctive relief, civil remedies and possible recalls of products. Our hedging transactions and activities are subject to the rules and regulations of the exchanges we use, including the Chicago Mercantile Exchange (the “CME”), as well as the U.S. Commodity Futures Trading Commission (the “CFTC”).

Competition. The petroleum refining and wholesale fuels business is very competitive. Among our competitors are some of the world’s largest integrated petroleum companies, which have their own crude oil supplies, distribution and marketing systems. We also compete with smaller domestic refiners and marketers in the midwestern and northwestern United States, with foreign refiners who import products into the United States and with producers and marketers in other industries supplying other forms of energy and fuels to consumers. Given the commodity nature of the end products, profitability in the industry depends largely on margins, as well as operating efficiency, product mix and costs of product distribution and transportation. The retail gasoline market is highly competitive, with competitors that are much larger than us and that have greater brand recognition and distribution outlets throughout the country and the world than we do. We are also experiencing increased competition from regional and unbranded retailers. Our owned and non-owned retail outlets are located primarily in the northwestern, midwestern and southern United States.

We market refined fuel products in five principal geographic areas. The first area includes the Midwest and northern plains. Competition at the wholesale level in this area includes major oil companies as well as independent refiners and wholesale brokers/suppliers. This area has a robust spot market and is influenced by the large refinery center along the gulf coast.

To the east of the Midwest and northern plains is another unique marketing area. This area centers near Chicago, Illinois and includes eastern Wisconsin, Illinois and Indiana. In this area, we principally compete with the major oil companies as well as independent refineries and wholesale brokers/suppliers.

Another market area includes Arkansas, Missouri and the northern part of Texas. Competition in this area includes the major oil companies and independent refiners. This area is principally supplied from the Gulf Coast refinery center and is also driven by a strong spot market that reacts quickly to changes in the international and national supply balance.

Another geographic area includes Montana, western North Dakota, Wyoming, Utah, Idaho, Colorado and western South Dakota. Competition at the wholesale level in this area includes the major oil companies and independent refineries.

The last area includes much of Washington and Oregon. We compete with the major oil companies in this area. This area is known for volatile prices and an active spot market.

Table of Contents

Overview

Our Ag segment includes our grain marketing, country operations, crop nutrients, processing and food ingredients and renewable fuels businesses. These businesses work together to facilitate the production, purchase, sale and eventual use of grain and other agricultural products within the United States, as well as internationally. In fiscal 2018, revenues in our Ag segment were $25.1 billion after elimination of intersegment revenues, consisting principally of grain sales.

Operations

Grain Marketing. We are the nation’s largest cooperative marketer of grain and oilseed based on grain storage capacity and grain sales. Our grain marketing operations purchase grain directly from agricultural producers and elevator operators primarily in the midwestern and western United States and indirectly through our country operations business. The purchased grain is typically contracted for sale for future delivery at a specified location, and we are responsible for handling the grain and either arranging for or facilitation of its transportation to that location. We own and operate export terminals, river terminals and elevators throughout the United States to handle and transport grain and grain products. We also maintain locations in Europe, the Middle East, the Pacific Rim and South America for the marketing, merchandising and sourcing of grains and crop nutrients. We primarily conduct our grain marketing operations directly, but do conduct some of our operations through joint ventures, including TEMCO, LLC ("TEMCO"), a 50% joint venture with Cargill, Incorporated ("Cargill") focused on exports primarily to Asia.

Country Operations. Our country operations business operates 466 agri-operations locations through 44 business units dispersed throughout the midwestern and western United States. Most of these locations purchase grain from farmers and sell agronomy, energy, feed and seed products to those same producers and others, although not all locations provide every product and service. We also manufacture animal feed through eight owned plants and four limited liability companies and process sunflowers for human food and other uses.

Crop Nutrients. Our wholesale crop nutrients business delivers products directly to our customers and our country operations business from the manufacturer or through our 18 inland and river warehouse terminals and other non-owned storage facilities located throughout the United States. To supplement what is purchased domestically, our Galveston, Texas deep water port and terminal receives fertilizer by vessel from origins such as Asia and the Caribbean basin where significant volumes of urea are produced. The fertilizer is then shipped by rail to destinations within crop producing regions of the United States.

Processing and Food Ingredients. Our processing and food ingredients operations are conducted at facilities that can crush approximately 120 million bushels of oilseeds on an annual basis, producing approximately 2.7 million short tons of meal/flour and 1.5 billion pounds of edible oil annually. We purchase our oilseeds from members, other CHS businesses and third parties that have tightly integrated connections with our grain marketing operations and country operations business.

Renewable Fuels. Our renewable fuels business produces 265 million gallons of fuel grade ethanol and 685 thousand tons of dried distillers grains with solubles (“DDGS”) annually. We also market over 590 million gallons of ethanol and 4.5 million tons of DDGS annually under marketing agreements for other production plants.

Products and Services

Our Ag segment provides local cooperatives and farmers with the inputs and services they need to produce grain and raise livestock. These include seed, crop nutrients, crop protection products, animal feed, animal health products, refined fuels and propane. We also buy and merchandise grain in both domestic and international markets. With a portion of the grain we purchase we produce renewable fuels, including ethanol and DDGS. We also produce refined oils, meal and soyflour at our processing facilities.

Sales and Marketing; Customers

Our Ag segment provides products and services to a wide range of customers, primarily in the United States. These customers include member and non-member producers, local cooperatives, elevators, grain dealers, grain processors and crop nutrient retailers. We sell our edible oils and soyflour to food companies. The meal we produce is sold to integrated livestock producers and feed mills. The ethanol and DDGS we produce are sold throughout the United States and to various international locations.

Table of Contents

Industry; Competition

Many of the business activities in our Ag segment are highly seasonal and, consequently, the operating results for our Ag segment will typically vary throughout the year. For example, our country operations and crop nutrients businesses generally experience higher volumes and income during the spring planting season and in the fall, which corresponds to harvest. In addition, our Ag segment operations may be adversely affected by relative levels of supply and demand, both domestic and international, commodity price levels and transportation costs and conditions. Supply is affected by weather conditions, disease, insect damage, acreage planted and government regulations and policies. Demand may be affected by foreign governments and their programs, relationships of foreign countries with the United States, the affluence of foreign countries, acts of war, currency exchange fluctuations and substitution of commodities. Demand may also be affected by changes in eating habits, population growth, the level of per capita consumption of some products and the level of renewable fuels production.

Regulation. Our Ag operations are subject to laws and related regulations and rules designed to protect the environment that are administered by the EPA, the DOT and similar government agencies. These laws, regulations and rules govern: the discharge of materials into the environment, air and water; reporting storage of hazardous wastes and other hazardous materials; the transportation, handling and disposal of wastes and other materials; the labeling of pesticides and similar substances; and the investigation and remediation of releases of hazardous materials. In addition, environmental laws impose a liability on owners and operators for investigation and remediation of contaminated property, and a party who sends hazardous materials to those contaminated properties for treatment, storage, disposal or recycling. In some instances, that liability exists regardless of fault. Our grain marketing operations, country operations business, processing and food ingredient operations and renewable fuel operations are also subject to laws and related regulations and rules administered by the United States Department of Agriculture (the ”USDA”), the United States Food and Drug Administration (the “FDA”) and other federal, state, local and foreign governmental agencies that govern the processing, packaging, storage, distribution, advertising, labeling, quality and safety of feed and grain products. Failure to comply with these laws, regulations and rules could subject us to administrative penalties, injunctive relief, civil remedies and possible recalls of products. The hedging transactions and activities of our grain marketing, country operations, processing and food ingredient and renewable fuels businesses are subject to the rules and regulations of the exchanges we use, including the CME, as well as the CFTC.

Competition. In our Ag segment, we have significant competition in the businesses in which we operate based principally on price, services, quality, patronage and alternative products. Our businesses are dependent upon relationships with local cooperatives and private retailers, proximity to the customers and producers and competitive pricing. We compete with other large distributors of agricultural products, as well as other regional or local distributors, local cooperatives, retailers and manufacturers.

NITROGEN PRODUCTION

Overview

Our Nitrogen Production segment consists solely of our approximate 10% membership interest (based on product tons) in CF Nitrogen, our strategic venture with CF Industries Holdings, Inc. ("CF Industries"). In February 2016, in connection with our investment in CF Nitrogen, we entered into an 80-year supply agreement with CF Nitrogen that entitles us to purchase up to 1.1 million tons of granular urea and 580,000 tons of urea ammonium nitrate (“UAN”) annually for ratable delivery. We account for our CF Nitrogen investment using the hypothetical liquidation at book value method, and on August 31, 2018 , our investment was approximately $ 2.7 billion .

Our investment in CF Nitrogen positions us and our members for long-term dependable fertilizer supply, supply chain efficiency and production economics. In addition, the ability to source product from CF Nitrogen production facilities under our supply agreement benefits our members and customers through strategically positioned access to essential fertilizer products.

Operations

CF Nitrogen has four production facilities located in: Donaldsonville, Louisiana; Port Neal, Iowa; Yazoo City, Mississippi; and Woodward, Oklahoma. Natural gas is the principal raw material and primary fuel source used in the ammonia production process. CF Nitrogen has access to competitively-priced natural gas through a reliable network of pipelines that are connected to major natural gas trading hubs near its production facilities.

Table of Contents

Products and Services

CF Nitrogen produces nitrogen-based products including, methanol, UAN and urea and related products.

Sales and Marketing; Customers

CF Nitrogen has three customers including CHS and two consolidated subsidiaries of CF Industries.

Industry; Competition

Regulation . CF Nitrogen is subject to laws and related regulations and rules designed to protect the environment that are administered by the EPA and similar government agencies. These laws, regulations and rules govern: the discharge of materials into the environment, air and water; reporting storage of hazardous wastes and other hazardous materials; the handling and disposal of wastes and other materials; and the investigation and remediation of releases of hazardous materials. In addition, environmental laws impose a liability on owners and operators for investigation and remediation of contaminated property, and a party who sends hazardous materials to those contaminated properties for treatment, storage, disposal or recycling. In some instances, that liability exists regardless of fault.

Competition . CF Nitrogen competes primarily on delivered price and, to a lesser extent, on customer service and product quality. CF Nitrogen competes domestically with a variety of large companies in the fertilizer industry. There is also significant competition from products sourced from other regions of the world.

CORPORATE AND OTHER

CHS Capital . Our wholly-owned finance company subsidiary, CHS Capital, LLC (“CHS Capital”), provides cooperative associations with a variety of loans that meet commercial agriculture needs. These loans include operating, term, revolving and other short and long-term options. CHS Capital also provides loans to individual producers for crop inputs, feed, and margin calls. Specific to producer financing, during the third quarter of fiscal 2017 it was determined CHS Capital would no longer make new term loans to producers. However, producer term loans written prior to this decision may still be outstanding. Subsequently, it was also determined CHS Capital would change its offerings on producer operating loans to be marketed only in strategic geographic regions.

CHS Hedging . Our wholly-owned commodity brokerage subsidiary, CHS Hedging, LLC (“CHS Hedging”), is a registered Futures Commission Merchant and a clearing member of both the Chicago Board of Trade and the Minneapolis Grain Exchange. CHS Hedging provides limited consulting services and commodity risk management services primarily to agricultural producers and commercial agribusinesses in the areas of agriculture and energy.

CHS Insurance . Our wholly-owned subsidiary, CHS Insurance Services, LLC (“CHS Insurance”), was sold in May 2018. CHS Insurance was a full-service independent agency that offered property and casualty insurance, surety bonds, safety resources, employment services and group benefits.

Wheat Milling

Ardent Mills, LLC (“Ardent Mills”), the largest flour miller in the United States, was formed as a joint venture with Cargill and ConAgra Foods, Inc., which combined the North American flour milling operations of its three parent companies, including assets from our existing joint venture milling operations Horizon Milling, LLC and Horizon Milling, ULC and CHS-owned mills. In connection with the formation of Ardent Mills, the joint venture parties also entered into various ancillary and non-compete agreements including, among other things, an agreement for us to supply Ardent Mills with certain wheat and durum products. We hold a 12% interest in Ardent Mills and account for our investment as an equity method investment due to our ability to exercise significant influence through our ability to appoint a member of the Board of Shareholders and Board of Managers. On August 31, 2018 , our investment in Ardent Mills was $ 205.9 million .

Table of Contents

Foods

Ventura Foods, LLC ("Ventura Foods") is a joint venture between CHS and Wilsey Foods, Inc., a majority-owned subsidiary of MBK USA Holdings, Inc., with each parent company owning a 50% interest. Ventura Foods produces vegetable oil-based products such as packaged frying oils, margarine, mayonnaise, salad dressings and other food products, and currently has 16 manufacturing and distribution locations across the United States and Canada. Ventura Foods sources its raw materials, which consist primarily of soybean oil, canola oil, palm/coconut oil, peanut oil and other ingredients and supplies, from various domestic and overseas suppliers, including our oilseed processing operations. We account for our investment in Ventura Foods using the equity method of accounting, and on August 31, 2018 , our investment was $ 360.2 million .

EMPLOYEES

On August 31, 2018, we had 10,495 full, part-time, temporary and seasonal employees. Of that total, 2,534 were employed in our Energy segment, 7,317 were employed in our Ag segment and 644 were employed in Corporate and Other. In addition to those individuals directly employed by us, many individuals work for joint ventures in which we have a 50% or less ownership interest, including employees of CF Nitrogen and Ventura Foods in our Nitrogen Production segment and Corporate and Other category, respectively, and are not included in these totals.

Labor Relations

As of August 31, 2018, we had 11 collective bargaining agreements with unions covering approximately 9.0% of our employees in the United States. These collective bargaining agreements expire on various dates through July 1, 2022, except that one collective bargaining agreement covering 20 pipeline employees renews automatically every September 1, unless 60 days’ notice of termination is given.

CHS AUTHORIZED CAPITAL

We are an agricultural membership cooperative organized under Minnesota cooperative law to do business with member and non-member patrons.

Table of Contents

ITEM 1A. RISK FACTORS

CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR PROVISIONS

OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This Annual Report on Form 10-K contains and our other publicly available documents may contain, and our officers, directors and other representatives may from time to time make, “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our businesses, financial condition and results of operations, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements are discussed or identified in our public filings made with the U.S. Securities and Exchange Commission, including in this “Risk Factors” discussion. Any forward-looking statements made by us in this Annual Report on Form 10-K are based only on information currently available to us and speak only as of the date on which the statement is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise, except as required by applicable law.

Reference to this Cautionary Statement in the context of a forward-looking statement shall be deemed to be a statement that any one or more of the following factors may cause actual results to differ materially from those indicated in the forward-looking statement.

The following risk factors are in addition to any other cautionary statements, written or oral, which may be made or referred to in connection with any particular forward-looking statement. The following risk factors should not be construed as exhaustive.

We have identified material weaknesses in our internal control over financial reporting. If these material weaknesses persist or if we fail to establish and maintain effective internal control over financial reporting, our ability to accurately report our results could be adversely affected.

Maintaining effective internal control over financial reporting is necessary for us to produce reliable financial statements. We have concluded that material weaknesses in our internal control over financial reporting exist, and consequently our Board of Directors determined that management’s report on internal control over financial reporting as of August 31, 2017, included in our Annual Reports on Form 10-K for the years then ended, should no longer be relied upon. In connection with these material weaknesses, we have restated our financial statements for the years ended August 31, 2017 and 2016, each of the quarters of fiscal 2017 and for the first three quarters of fiscal 2018. These material weaknesses are discussed further within Item 9A, Controls and Procedures , of this Annual Report on Form 10-K. The existence of one or more material weaknesses precludes a conclusion by management that a corporation’s internal control over financial reporting is effective.

In response to the identified material weaknesses, our management, with the oversight of the Audit Committee of our Board of Directors, has dedicated significant resources, including the involvement of outside advisors, and efforts to improve our internal control over financial reporting and has taken immediate action to remediate the material weaknesses identified. Certain remedial actions have been completed, including the termination of the employee who engaged in the misconduct, and the termination, reassignment and discipline of other employees who were determined to have responsibility for the above-described misstatements relating to our freight trading operations in our Grain Marketing business unit. We continue to actively plan for and implement additional control procedures, including (i) instituting additional training programs for our finance, accounting, operations, IT and other necessary personnel; (ii) evaluating the quality of and sufficiency of our finance, accounting and other internal control personnel and resources; (iii) establishing the appropriate roles and responsibilities within our organization to improve our knowledge and expertise over internal control over financial reporting; (iv) implementing IT project testing oversight and management; and (v) evaluating the manual and automated IT control environment surrounding critical enterprise resource planning systems, including the new ERP system.

Table of Contents

If we fail to remediate these material weaknesses or fail to otherwise maintain effective control over financial reporting in the future, it could result in a material misstatement of our financial statements that would not be prevented or detected on a timely basis. Our management and Board of Directors continue to devote significant time and attention to remediating these material weaknesses and improving our internal control over financial reporting, and we expect to continue to incur costs associated with remediating the material weaknesses in internal controls over financial reporting and implementing appropriate processes, which could include fees for additional audit, legal and consulting services, which could negatively affect our financial condition and operating results.

The consequences of our investigation with respect to certain rail freight contracts purchased in connection with our North American grain marketing operations could have a material adverse effect on our business and could subject us to regulatory scrutiny.

As part of our preparation of this Annual Report on Form 10-K, our management noted potentially excessive valuations in the net derivative asset valuations relating to certain rail freight contracts purchased in connection with our North American grain marketing operations. Following the identification of these potentially excessive valuations, we engaged external counsel, which engaged forensic accountants to work with our management, under the oversight of the Audit Committee of our Board of Directors, to conduct an investigation. The investigation concluded that there were misstatements in the consolidated financial statements included in certain of our filings with the SEC that were due to intentional misconduct by a former employee in our rail freight trading operations, as well as due to rail freight contracts and certain non-rail freight contracts not meeting the technical accounting requirements to qualify as derivative financial instruments. The misconduct consisted of the former employee manipulating the mark-to-market valuation of rail cars that were the subject of rail freight purchase contracts and manipulating the quantity of rail cars included in the monthly mark-to-market valuation. In addition, the investigation revealed intentional misstatements that were made by the former employee to our external auditor in connection with its audit of our consolidated financial statements for the year ended August 31, 2017. During the course of, and as a result of, the investigation, we terminated the former employee. The Audit Committee of our Board of Directors and the Company's legal counsel reported the findings of the investigation to our Board of Directors and to our independent registered public accounting firm and have discussed the evidence uncovered and conclusions reached in the investigation with the Staff of the Division of Enforcement of the SEC. Although we are not aware that any formal investigation or inquiry has been commenced, we are cooperating, and will continue to fully cooperate with, the Staff of the Division of Enforcement of the SEC in any review it may conduct into these matters. We are unable at this time to predict when the SEC Division of Enforcement’s review of these matters will be completed or what regulatory or other outcomes may result. If the SEC or any other governmental authority determines that violations of certain laws or regulations occurred, then we could be exposed to a broad range of civil and criminal sanctions. Although we are currently unable to predict what actions the SEC or any other governmental authority might take, or what the likely outcome of any such actions might be, or estimate the range of reasonably possible fines or penalties, such actions, fines and/or penalties could be material, resulting in a material adverse effect on our business, prospects, reputation, financial condition, results of operations or cash flows. Even if an inquiry or investigation does not result in an adverse determination, our business, prospects, reputation, financial condition, results of operations or cash flows could still be adversely impacted. In addition, the expenses incurred in connection with any investigation by the SEC or any other governmental authority, and the diversion of the attention of our management that could occur as a result thereof, could adversely affect, our business, financial condition, results of operations or cash flows.

Our revenues, results of operations and cash flows could be materially and adversely affected by changes in commodity prices.

Our revenues, results of operations and cash flows are affected by market prices for commodities such as crude oil, natural gas, ethanol, fertilizer, grain, oilseed, flour and crude and refined vegetable oils. Commodity prices generally are affected by a wide range of factors beyond our control, including weather, disease, insect damage, drought, the availability and adequacy of supply, government regulation and policies and general political and economic conditions. We are also exposed to fluctuating commodity prices as the result of our inventories of commodities, typically grain, fertilizer and petroleum products, and purchase and sale contracts at fixed or partially fixed prices. At any time, our inventory levels and unfulfilled fixed or partially fixed price contract obligations may be substantial. We have processes in place to monitor exposures to these risks and engage in strategies to manage these risks. If these controls and strategies are not successful in mitigating our exposure to these fluctuations, we could be materially and adversely affected. Increases in market prices for commodities that we purchase without a corresponding increase in the price of our products or our sales volume or a decrease in our other operating expenses could reduce our revenues and net income.

Table of Contents

For example, in our energy operations, profitability depends largely on the margin between the cost of crude oil that we refine and the selling prices that we obtain for our refined products. The prices for both crude oil and for gasoline, diesel fuel and other refined petroleum products fluctuate widely. Factors influencing these prices, many of which are beyond our control, include:


•	levels of worldwide and domestic supplies;


•	capacities of domestic and foreign refineries;


•	the ability of the members of the Organization of Petroleum Exporting Countries (“OPEC”) to agree to and maintain oil price and production controls, and the price and level of imports;


•	disruption in supply;


•	political instability or armed conflict in oil-producing regions;


•	the level of demand from consumers, agricultural producers and other customers;


•	the price and availability of alternative fuels;


•	the availability of pipeline capacity; and


•	domestic and foreign governmental regulations and taxes.

The long-term effects of these and other conditions on the prices of crude oil and refined petroleum products are uncertain and ever-changing. Increases in crude oil prices without a corresponding increase in the prices of our refined petroleum products, and decreases in crude oil prices with larger corresponding decreases in the prices of our refined petroleum products, would reduce our net income. Accordingly, we expect our margins on, and the profitability of our energy business to fluctuate, possibly significantly, over time.

Government policies, mandates, regulations and trade agreements could adversely affect our operations and profitability.

Our business is subject to numerous government policies, mandates and regulations that could have an adverse effect on our operations or profitability. For example, government policies, mandates and regulations related to genetically modified organisms, traceability standards, product safety and labeling and renewable and low carbon fuels could have an adverse effect on our operations or profitability by, among other things, influencing the planting of certain crops, the location and size of crop production, the trade of processed and unprocessed commodity products, the volumes and types of imports and exports, the availability and competitiveness of feedstocks as raw materials and the viability and volume of certain of our products. In our Energy segment, government policies, mandates and regulations designed to stop or impede the development or production of oil, such as those limiting or banning the use of hydraulic fracturing or drilling, could also adversely affect our operations and profitability.

In addition, changes in international trade agreements and trade disputes can adversely affect commodity trade flows by limiting or disrupting trade between countries or regions. The U.S. government has imposed tariffs on certain products imported into the United States, which has resulted in reciprocal tariffs from other countries, including countries where we operate, like China. It is unclear what changes, if any, will be made to international trade agreements that are relevant to our business activities. These actions have created uncertainty between the United States and other nations, including countries where we operate. Changes in trade policy, withdrawals from or material modifications to relevant international trade agreements and continued uncertainty could depress economic activity and restrict our access to suppliers and customers. Tariffs and trade restrictions that are implemented on products that we buy and sell could increase the cost of those products or adversely affect the availability of market access. These cost increases and market changes could adversely affect the demand for our products and reduce margins, which could have a material adverse effect on our business and our earnings. In addition, the U.S. government can prevent or restrict us from doing business in or with other countries. These restrictions, and those of other governments, could limit our ability to gain access to business opportunities in various countries.

Table of Contents

We are subject to political, economic, legal and other risks of doing business globally.

We are a global business and are exposed to risks associated with having global operations. These risks include, but are not limited to, risks relating to terrorism, war, civil unrest, changes in a country’s or region’s social, economic or political conditions, changes in local labor conditions and regulations, changes in safety and environmental regulations, changes in regulatory or legal environments generally, restrictions on currency exchange activities, currency exchange fluctuations and taxes. In particular, some countries where we operate lack well-developed legal systems or have not adopted clear legal and regulatory frameworks. This lack of legal certainty exposes our operations to increased risks, including increased difficulty in enforcing our agreements in those jurisdictions and increased risks of adverse actions by local government authorities, such as unilateral or forced renegotiation, modification or nullification of existing agreements or expropriations.

Demand for our products is subject to global and regional factors that are outside of our control that could adversely impact our business.

The level of demand for our products is affected by global and regional demographics and macroeconomic conditions, including population growth rates and changes in standards of living. A significant downturn in global economic growth or recessionary conditions in major geographic regions may lead to a reduced demand for agricultural commodities, which could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. Additionally, weak global economic conditions and adverse conditions in financial and capital markets may adversely impact the financial condition and liquidity of some of our customers, suppliers and other counterparties, which could have a material adverse effect on our customers' ability to pay for our products and on our business, financial condition, liquidity, results of operations and prospects.

Our revenues, margins, results of operations and cash flows could be materially and adversely affected if our members were to do business with others rather than with us.

We do not have an exclusive relationship with our members and our members are not obligated to supply us with their products or purchase products from us. Our members often have a variety of distribution outlets and product sources available to them. If our members were to sell their products to other purchasers or purchase products from other sellers, our revenues and margins would decline and our results of operations and cash flows could be materially and adversely affected.

We are exposed to the risk of nonperformance and nonpayment by counterparties.

We are exposed to the risk of nonperformance and nonpayment by counterparties, whether pursuant to contracts or otherwise. Risk of nonperformance and nonpayment by counterparties includes the inability or refusal of a counterparty to pay us, the inability or refusal to perform because of a counterparty’s financial condition and liquidity, or for any other reason, and also the risk that the counterparty will refuse to perform a contract during a period of price fluctuations where contract prices are significantly different than the then current market prices. In the event that we experience significant nonperformance or nonpayment by counterparties, our financial condition, results of operations and cash flows could be materially and adversely affected. For example, we store inventory in third-party warehouses, and the operators of these warehouses may not adequately store or secure our inventory, or they may improperly sell that inventory to someone else, which could expose us to a loss of the value of that inventory. In the event that we experience any such nonperformance by a third-party warehouse operator, our financial condition, results of operations and cash flows could be materially and adversely affected.

We participate in highly competitive business markets and we may not be able to continue to compete successfully, which could have a material adverse effect on us.

We operate in several highly competitive business segments and our competitors may succeed in developing new or enhanced products that are better than ours, may be more successful in marketing and selling their products than we are, or may have more effective supply chain capability than we have. Competitive factors include price, service level, proximity to markets, access to transportation, product quality and marketing. In our business segments, we compete with certain companies that are larger and better known than we are and that have greater marketing, financial, personnel and other resources than we do. As a result, we may not be able to continue to compete successfully with our competitors, which could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects.

Table of Contents

Our business, profitability and liquidity may be adversely affected by the deterioration in the credit quality of, or defaults by, third parties who owe us money.

We extend credit to, make loans to and engage in other financing arrangements with individual producers, local cooperatives and other third parties around the world. When we do so, we incur credit risk and the risk of losses if our borrowers and others to which we extend credit do not repay their loans or perform their obligations to pay us the money they owe. These parties may default on their obligations to us due to bankruptcy, lack of liquidity, operational failure or for other reasons. If these counterparties do not pay us back, such that we experience significant defaults on their payment obligations to us, our financial condition, results of operations or cash flows could be materially and adversely affected.

We are also subject to the risk that our rights against borrowers and other third parties that owe us money may not be enforceable in all circumstances, for example if a borrower or third party declares bankruptcy. In addition, due to implications of the overall agricultural sector's extended period of depressed commodity prices and margins, among other factors, the credit quality of borrowers and other third parties whose obligations we hold could deteriorate, including a deterioration in the value of collateral posted by those parties to secure their obligations to us pursuant to purchase contracts, loan agreements or other contracts. If that deterioration occurs, the material adverse effects of third parties not performing their repayment obligations may be exacerbated if the collateral held by us cannot be realized or is liquidated at prices not sufficient to recover the full amount owed to us. For example, certain loans and other financing arrangements we undertake with agricultural producers are typically secured by the counterparty’s crops that are planted in the current year. There is a risk that the value of the crop will not be sufficient to satisfy the counterparty’s repayment obligations under the financing arrangement as a result of weather, crop growing conditions, other factors that influence the price, supply and demand for agricultural commodities or for other reasons.

In addition, disputes may arise as to the amount of collateral we are entitled to receive and the value of pledged assets. The termination of contracts and the foreclosure on collateral may subject us to claims for the improper exercise of our rights. Default rates, downgrades and disputes with counterparties as to the valuation of collateral increase significantly in times of market stress and illiquidity.

In respect of our lending activity, we evaluate the collectability of both commercial and producer loans on a specific identification basis, based on the amount and quality of the collateral obtained, and record specific loan loss reserves when appropriate. Consistent with accounting principles generally accepted in the United States ("U.S. GAAP"), a general reserve is also maintained based on historical loss experience and various qualitative factors. For other forms of credit, we establish reserves as appropriate and consistent with U.S. GAAP. The reserves represent our best estimate based upon current facts and circumstances. Future developments or changes in assumptions may cause us to record adjustments to the reserves which could materially and adversely affect our results of operations.

Changes in federal income tax laws or in our tax status could increase our tax liability and reduce our net income significantly.

Current federal income tax laws, regulations and interpretations regarding the taxation of cooperatives allow us to exclude income generated through business with or for a member (patronage income) from our taxable income. If any changes are made to such federal income tax laws, regulations or interpretations, or if in the future we were not eligible to be taxed as a cooperative, our tax liability would significantly increase and our net income would significantly decrease.

Table of Contents

We incur significant costs in complying with applicable laws and regulations. Any failure to comply with these laws and regulations, or make the capital or other investments necessary to comply with these laws and regulations, could expose us to unanticipated expenditures and liabilities.

We are subject to numerous federal, state and local provisions regulating our business and operations. We incur and expect to incur significant capital and operating expenses to comply with these laws and regulations. We may be unable to pass on those expenses to customers without experiencing volume and margin losses. For example, the compliance burden and impact on our operations and profitability as a result of the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) and related regulations continue to evolve, as federal agencies have implemented and continue to implement its many provisions through regulation. These efforts to change the regulation of financial markets subject users of derivatives, such as CHS, to extensive oversight and regulation by the CFTC. Such initiatives have imposed, and may continue to impose, additional costs on us, including operating and compliance costs, and could materially affect the availability, as well as the cost and terms, of certain transactions. Certain federal regulations, studies and reports addressing Dodd-Frank, including the regulation of swaps and derivatives, are still being implemented and others are being finalized. We will continue to monitor these developments. Any of these matters could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects.

We establish reserves for the future cost of known compliance obligations, such as remediation of identified environmental issues. However, these reserves may prove inadequate to meet our actual liability. Moreover, amended, new or more stringent requirements, stricter interpretations of existing requirements or the future discovery of currently unknown compliance issues may require us to make material expenditures or subject us to liabilities that we currently do not anticipate. Furthermore, our failure to comply with applicable laws and regulations could subject us to administrative penalties and injunctive relief, civil remedies, including fines and injunctions, criminal fines and penalties, and recalls of our products. For example, we regularly maintain hedges to manage the price risks associated with our commercial operations. These transactions typically take place on exchanges such as the CME. Our hedging transactions and activities are subject to the rules and regulations of the exchanges we use, including the CME, as well as the CFTC. All exchanges have broad powers to review required records, investigate and enforce compliance and to punish noncompliance by entities subject to their jurisdiction. The failure to comply with such rules and regulations could lead to restrictions on our trading activities or subject us to enforcement action by the CFTC or a disciplinary action by the exchanges, which could lead to substantial sanctions. In addition, any investigation or proceeding by an exchange or the CFTC, whether successful or unsuccessful, could result in substantial costs, the diversion of resources, including management time, and potential harm to our reputation, all of which, could have a material adverse effect on our business financial condition, liquidity, results of operations and prospects.

We are subject to the Foreign Corrupt Practices Act of 1977 and other similar anti-corruption, anti-bribery and anti-kickback laws and regulations, and any noncompliance with those laws and regulations by us or others acting on our behalf could have a material adverse effect on our business, financial condition and results of operations.

We operate on a global basis and are subject to anti-corruption, anti-bribery and anti-kickback laws and regulations, including the Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”). The FCPA and other similar anti-corruption, anti-bribery and anti-kickback laws and regulations in other jurisdictions generally prohibit companies and their intermediaries or agents from making improper payments to government officials or any other persons for the purpose of obtaining or retaining business. We operate and sell our products in many parts of the world that have experienced governmental corruption to some degree and, in certain circumstances, strict compliance with anti-corruption, anti-bribery and anti-kickback laws and regulations may conflict with local customs and practices. In addition, in certain countries, we engage third-party agents or intermediaries to act on our behalf and/or conduct all or a portion of our operations through joint venture partners, including in those countries with a high risk for corruption. If any of these third parties violate applicable anti-corruption, anti-bribery or anti-kickback laws or regulations, we may be liable for those violations. We have policies in place prohibiting employees from making or authorizing improper payments, we train our employees regarding compliance with anti-corruption, anti-bribery and anti-kickback laws and regulations and we utilize procedures to identify and mitigate risks of such misconduct by our employees, third-party agents, intermediaries and joint venture partners. However, we cannot provide assurances that our employees, third-party agents, intermediaries or joint venture partners will comply with those policies, laws and regulations. If we are found liable for violations of the FCPA, or other similar anti-corruption, anti-bribery or anti-kickback laws or regulations, either due to our own acts or out of inadvertence, or due to the acts or inadvertence of others, we could suffer criminal or civil fines or penalties or other repercussions, including reputational harm, which could have a material adverse effect on our business, financial condition and results of operations.

In the fourth quarter of fiscal 2018, we contacted the U.S. Department of Justice and SEC to voluntarily self-disclose potential violations of the FCPA in connection with a small number of reimbursements the Company made to Mexican customs agents in the 2014-2015 time period for payments the customs agents made to Mexican customs officials in connection with

Table of Contents

inspections of grain crossing the U.S.-Mexican border by railcar. We are fully cooperating with the government, including with the assistance of legal counsel, which assistance includes investigating other areas of potential interest to the government. We are unable at this time to predict when our or the government agencies' review of these matters will be completed or what regulatory or other outcomes may result.

Environmental and energy laws and regulations may result in increased operating costs and capital expenditures and may have a material and adverse effect on us.

New and current environmental and energy laws and regulations, including regulations relating to alternative energy sources and the risk of global climate change, new interpretations of existing environmental and energy laws and regulations, increased governmental enforcement of environmental and energy laws and regulations or other developments in these areas could require us to make additional unforeseen expenditures or to make unforeseen changes to our operations, either of which could adversely affect us. For example, it is possible that some form of regulation will be forthcoming at the federal or state level in the United States with respect to emissions of greenhouse gases (“GHGs”), such as carbon dioxide, methane and nitrous oxides. New federal legislation or regulatory programs that restrict emissions of GHGs, or comparable new state legislation or programs, or customer requirements, in areas where we or our customers conduct business could adversely affect our operations and the demand for our energy products, which could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. In addition, new legislation or regulatory programs could require substantial expenditures for the installation and operation of systems and equipment that we do not currently possess or for substantial modifications to existing equipment. The actual effects of climate change on our businesses are, however, unknown and indeterminable at this time.

Also, pursuant to the Energy Independence and Security Act of 2007, the EPA has promulgated the Renewable Fuel Standard (“RFS”), which requires refiners to blend renewable fuels, such as ethanol and biodiesel, with their petroleum fuels or purchase renewable energy credits, known as Renewable Identification Numbers ("RINs"), in lieu of blending. The EPA generally establishes new annual renewable fuel percentage standards for each compliance year in the preceding year. We generate RINs in our marketing operations under the RFS; however, it may not be enough to meet the needs of our refining capacity and if so, RINs must be purchased on the open market. In recent years the price of RINs has been extremely volatile. As a result, the purchase of RINs could have a negative impact on our future refined fuels margins, the impact of which we are not able to estimate at this time.

During fiscal 2018, the EPA granted our Laurel, Montana refinery an extension of the small refinery exemption under the RFS as provided for under the Clean Air Act for 2017 (the "small refinery exemption"). This action provided our Laurel, Montana refinery an exemption from its renewable fuel volume obligations under the RFS program for compliance year 2017. In granting this exemption the EPA considered a number of factors and concluded that the Laurel, Montana refinery qualified for the exemption as prescribed under the standard. As with other competitors who received the exemption in the same geographic area as our Laurel, Montana refinery, the small refinery exemption lowers our cost to operate and has a positive impact on our earnings. Since the small refinery exemption is granted on a year-to-year basis, we are unable to predict whether we will receive this exemption again in the future.

Environmental liabilities could have a material adverse effect on us.

Many of our current and former facilities have been in operation for many years and, over that time, we and other operators of those facilities have generated, used, stored and disposed of substances or wastes that are or might be considered hazardous under applicable environmental laws, including liquid fertilizers, chemicals and fuels stored in underground and above-ground tanks. Any past or future actions in violation of applicable environmental laws could subject us to administrative penalties, fines, other costs, such as capital expenditures, and injunctions. In addition, an owner or operator of contaminated property, and a party who sends hazardous materials to such site for treatment, storage, disposal or recycling, can be liable for the cost of investigation and remediation under environmental laws. In some instances, such liability exists regardless of fault. Moreover, future or unknown past releases of hazardous substances could subject us to private lawsuits claiming damages, including for bodily injury or property damage, and to adverse publicity, which could have a material adverse effect on us. Liabilities, including legal costs, related to remediation of contaminated properties are not recognized by us until the related costs are considered probable and can be reasonably estimated.

Actual or perceived quality, safety or health risks associated with our products could subject us to significant liability and damage our business and reputation.

If any of our food or animal feed products became adulterated or misbranded, we may need to recall those items and could experience product liability claims if consumers or customers’ livestock were injured, or were claimed to be injured, as a

Table of Contents

result. A widespread product recall or a significant product liability judgment could cause our products to be unavailable for a period of time or could cause a loss of consumer or customer confidence in our products. Even if a product liability claim is unsuccessful or is not fully pursued, the negative publicity surrounding any assertion that our products caused illness or injury could adversely affect our business and reputation with existing and potential consumers and customers and our corporate and brand image. Moreover, claims or liabilities of this sort might not be covered by our insurance or by any rights of indemnity or contribution that we may have against others. In addition, general public perceptions regarding the quality, safety or health risks associated with particular food or animal feed products, such as concerns regarding genetically modified crops, could reduce demand and prices for some of the products associated with our businesses. To the extent that consumer preferences evolve away from products that our members or we produce for health or other reasons, such as the growing demand for organic food products, and we are unable to develop or procure products that satisfy new consumer preferences, there will be a decreased demand for our products, which could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects.

Our financial results are susceptible to seasonality.

Many of our business activities are highly seasonal and operating results vary throughout the year. Our revenue and income are generally lowest during the second and fourth fiscal quarters and highest during the first and third fiscal quarters. For example, in our Ag segment, our crop nutrients and country operations businesses generally experience higher volumes and income during the spring planting season and during the fall harvest season. Our grain marketing operations are also subject to fluctuations in volume and income based on producer harvests, world grain prices and demand, and international trade relationships. Our Energy segment generally experiences higher volumes and income in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage by our customers and members is highest and is subject to global supply and demand forces. Other energy products, such as propane, may experience higher volumes and income during the winter heating and crop drying seasons.

Our operations are subject to business interruptions and casualty losses; we do not insure against all potential losses and could be seriously harmed by unanticipated liabilities.

Our operations are subject to business interruptions due to unanticipated events such as explosions, fires, pipeline interruptions, transportation delays, equipment failures, crude oil or refined product spills, inclement weather and labor disputes. For example:


•	our oil refineries and other facilities are potential targets for terrorist attacks that could halt or discontinue production;


•	our inability to negotiate acceptable contracts with unionized workers in our operations could result in strikes or work stoppages;


•	our corporate headquarters, the facilities we own or the significant inventories that we carry could be damaged or destroyed by catastrophic events, extreme weather conditions or contamination;


•	someone may accidentally or intentionally introduce a computer virus to our information technology systems or breach our computer systems or other cyber resources; and


•	an occurrence of a pandemic flu or other disease affecting a substantial part of our workforce or our customers could cause an interruption in our business operations.

The effects of any of these events could be significant. We maintain insurance coverage against many, but not all potential losses or liabilities arising from these operating hazards, but uninsured losses or losses above our coverage limits are possible. Uninsured losses and liabilities arising from operating hazards could have a material adverse effect on us.

Our risk management strategies may not be effective.

Our business is affected by fluctuations in commodity prices, transportation costs, energy prices, foreign currency exchange rates and interest rates. We monitor position limits, account receivables and other exposures, and engage in other strategies and controls to manage these risks. Our monitoring efforts may not be successful at detecting a significant risk exposure and our controls and strategies may not be effective in adequately managing against the occurrence of a loss relating to a risk exposure. If our controls and strategies are not successful in mitigating our financial exposure to losses due to the fluctuations mentioned above, it could significantly and adversely affect our operating results.

Table of Contents

Our business is capital-intensive in nature and we rely on cash generated from our operations and external financing to fund our strategies and ongoing capital needs.

We require significant capital, including access to credit markets from time to time, to operate our business and fund our strategies. Our working capital requirements are directly affected by the price of commodities, which may fluctuate significantly and change quickly. We also require substantial capital to maintain and upgrade our extensive network of facilities to keep pace with competitive developments, technological advances, regulations and changing safety standards. In addition, the expansion of our business and pursuit of acquisitions or other business opportunities has required, and may require, significant amounts of capital. If we are unable to generate sufficient cash flow or maintain access to adequate external financing, including as a result of significant disruptions in the global credit markets, it could restrict our current operations and our growth opportunities, which could adversely affect our operating results, and restrict our ability to repay our existing indebtedness.

Our cooperative structure limits our ability to access equity capital.

As a cooperative, we may not sell common stock in our company. In addition, existing laws and our articles of incorporation and bylaws limit dividends on any preferred stock we may issue to 8% per annum. These limitations may restrict our ability to raise equity capital and may adversely affect our ability to compete with enterprises that do not face similar restrictions.

Consolidation among the producers of products we purchase and customers for products we sell could materially and adversely affect our revenues, results of operations and cash flows.

Consolidation has occurred among the individual producers of products we sell and purchase, including crude oil, fertilizer and grain, and it is likely to continue in the future. Consolidation could allow producers to negotiate pricing, supply availability and other contract terms that are less favorable to us. Consolidation also may increase the competition among consumers of these products to enter into supply relationships with a smaller number of producers, resulting in potentially higher prices for the products we purchase.

Consolidation has occurred among cooperative associations that are wholesale customers of our products, which has resulted in a smaller wholesale and retail customer base for our products and has intensified the competition for these customers, and this consolidation is likely to continue in the future. For example, ongoing consolidation among distributors and brokers of food products and food retailers has altered the buying patterns of these businesses, as they have increasingly elected to work with product suppliers who can meet their needs nationwide rather than just regionally or locally. If these cooperatives, distributors, brokers and retailers elect not to purchase our products, our revenues, results of operations and cash flows could be materially and adversely affected.

In addition, in the seed, fertilizer and crop protection markets, consolidation at both the producer and wholesale customer level increases the potential for direct sales from the respective input manufacturer to the cooperative customers and/or the individual agricultural producer, which would remove us from the supply chain and could have a material and adverse effect on our revenues, results of operations and cash flows.

If our customers choose alternatives to our refined petroleum products, our revenues, results of operations and cash flows could be materially and adversely affected.

Numerous alternative energy sources currently under development could serve as alternatives to our gasoline, diesel fuel and other refined petroleum products. If any of these alternative products become more economically viable or preferable to our products for environmental or other reasons, demand for our energy products would decline. Declining demand for our energy products, particularly diesel fuel sold for farming applications, could materially and adversely affect our revenues, results of operations and cash flows.

The results of our agronomy business are highly dependent upon certain factors outside of our control.

Planted acreage, and consequently the volume of fertilizer and crop protection products applied, is partially dependent upon government programs, grain prices and the perception held by the producer of demand for production, all of which are outside of our control. In addition, weather conditions during the spring planting season and early summer spraying season also affect agronomy product volumes and profitability. Emerging sustainability and other environmental concerns that are outside of our control could also affect the future demand for agronomy products applied to crops and the volume of any such

Table of Contents

application. Accordingly, factors outside of our control could materially and adversely affect the revenues, results of operations and cash flows of our agronomy business.

Technological improvements could decrease the demand for our agronomy and energy products.

Technological advances in agriculture could decrease the demand for crop nutrients, energy and other crop input products and services that we provide. Genetically engineered seeds that resist disease and insects, or that meet certain nutritional requirements, could affect the demand for our crop nutrients and crop protection products. Demand for fuel that we sell could decline as technology allows for more efficient usage of equipment. Declining demand for our products could materially and adversely affect our revenues, results of operations and cash flows.

Acquisitions, strategic alliances, joint ventures, divestitures and other non-ordinary course of business events resulting from portfolio management actions and other evolving business strategies could affect future results.

We monitor our business portfolio and organizational structure and have made and may continue to make acquisitions, strategic alliances, joint ventures, divestitures and changes to our organizational structure. With respect to acquisitions, future results will be affected by our ability to identify suitable acquisition candidates, to adequately finance any acquisitions and to integrate acquired businesses quickly and obtain the anticipated financial returns, including synergies. Our ability to successfully complete a divestiture will depend on, among other things, our ability to identify buyers that are prepared to acquire such assets or businesses on acceptable terms and to adjust and optimize our retained businesses following the divestiture. Additionally, we may fail to consummate proposed acquisitions, divestitures, joint ventures or strategic alliances after incurring expenses and devoting substantial resources, including management time, to such transactions.

Several parts of our business, including in particular our nitrogen production business, our foods business and portions of our grain marketing and wheat milling operations, are operated through joint ventures with third parties where we do not have majority control of the venture. By operating a business through a joint venture, we have less control over business decisions than we have in our wholly-owned or majority-owned businesses. In particular, we generally cannot act on major business initiatives in our joint ventures without the consent of the other party or parties in those ventures. Investments in joint ventures may, under certain circumstances, involve risks not present when a third party is not involved, including the possibility that co-venturers might become bankrupt or fail to fund their share of required capital contributions, in which case the joint venture may be unable to access needed growth capital (if the co-venturer is solely responsible for capital contributions) or we and any other remaining co-venturers would generally be liable for the joint venture’s liabilities. Co-venturers may have economic, tax or other business interests or goals which are inconsistent with our business interests or goals, and may be in a position to take actions contrary to our policies or objectives. Our co-venturers may take actions that are not within our control, which may expose our investments in joint ventures to the risk of lower values or returns. Joint venture investments may also lead to impasses. Disputes between us and co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and/or directors from focusing their time and effort on our day-to-day business. In addition, we may in certain circumstances be liable for the actions of our co-venturers. Each of these matters could have a material adverse effect on us.

We made certain assumptions and projections regarding the future of the markets served by our joint venture investments which included projected market pricing and demand for their products. These assumptions were an integral part of the economics used to evaluate these joint venture investment opportunities prior to consummation. To the extent that actual market performance varies from our models, our ability to achieve the projected returns on our joint venture investments may be impacted in a material adverse manner.

We utilize information technology systems to support our business. An ongoing multi-year implementation of an enterprise-wide resource planning system, reliance upon multiple legacy business systems, security breaches or other disruptions to our information technology systems or assets could interfere with our operations, compromise security of our customers’ or suppliers’ information and expose us to liability which could adversely impact our business and reputation.

Our operations rely on certain key information technology (“IT”) systems, many of which are legacy in nature or may be dependent upon third-party services, to provide critical connections of data, information and services for internal and external users. Over the next several years, we expect to continue implementing a new enterprise resource planning system (“ERP”), which has and will continue to require significant capital and human resources to deploy. There can be no assurance that the actual costs for the ERP will not exceed our current estimates or that the ERP will not take longer to implement than we currently expect. In addition, potential flaws in implementing the ERP or in the failure of any portion/module of the ERP to meet our needs or provide appropriate controls may pose risks to our ability to operate successfully and efficiently. There may

Table of Contents

be other challenges and risks to both our aging and current IT systems over time due to any number of causes, such as catastrophic events, availability of resources, power outages, security breaches or cyber-based attacks, and as we upgrade and standardize our ERP system on a worldwide basis. These challenges and risks could result in legal claims or proceedings, liability or penalties, disruption in operations, loss of valuable data and damage to our reputation, all of which could adversely affect our business. Our ongoing IT investments include those relating to cybersecurity, including technology, hired expertise and cybersecurity risk mitigation actions. However, an incident or breach may occur and if it does, it could subject us to an adverse impact on our business and reputation.

ITEM 1B. UNRESOLVED STAFF COMMENTS

As of the date hereof, there were no unresolved comments from the SEC staff regarding our periodic or current reports.

Table of Contents

ITEM 2. PROPERTIES

We own or lease energy, agronomy, grain handling and processing facilities and other real estate throughout the United States and internationally. Below is a summary of these locations.

Energy

Facilities in our Energy segment include the following, all of which are owned except where indicated as leased:



Refineries	Laurel, Montana and McPherson, Kansas
Propane terminals	Biddeford, Maine; Glenwood, Minnesota; Rockville, Minnesota (50% owned by CHS); Hannaford, North Dakota; Ross, North Dakota; Hixton, Wisconsin
Transportation terminals/repair facilities	12 locations in Iowa, Kansas, Minnesota, Montana, North Dakota, South Dakota, Washington and Wisconsin, two of which are leased
Petroleum and asphalt terminals/storage facilities	11 locations in Montana, North Dakota and Wisconsin
Pipelines:
Cenex Pipeline, LLC	Laurel, Montana to Fargo, North Dakota
Front Range Pipeline, LLC	Canadian border to Laurel, Montana
Jayhawk Pipeline, LLC	Throughout Kansas, with branches in Nebraska, Oklahoma and Texas
Conway Pipeline	McPherson, Kansas to Conway, Kansas
Kaw Pipe Line Company	Locations throughout Kansas
Osage Pipe Line Company, LLC (50% owned by CHS McPherson)	Oklahoma to Kansas
Convenience stores/gas stations	34 locations in Minnesota, Montana, North Dakota, South Dakota, and Wyoming, 6 of which are leased
Lubricant plants/warehouses	Three locations in Minnesota, Ohio and Texas, one of which is leased

Within our Ag segment, we own or lease the following facilities:

Grain Marketing

We own 18 grain terminals, which are used in our grain marketing operations, in: Pekin and Peru, Illinois; Davenport, Iowa; Myrtle Grove, Louisiana; Savage and Winona, Minnesota; Collins, Mississippi; Friona, Texas; Superior, Wisconsin; Argentina; Brazil; Hungary; and Romania. We also own one fertilizer terminal in Argentina. In addition to office space at our corporate headquarters, we have 34 grain marketing offices in: Davenport, Iowa; Winona, Minnesota; Lincoln, Nebraska; Argentina; Brazil; Bulgaria; Canada; China; Hungary; Jordan; Paraguay; Romania; Russia; Serbia; Singapore; South Korea; Spain; Switzerland; Taiwan; Ukraine; and Uruguay. We lease all of these grain marketing offices, other than the grain marketing offices in Davenport, Iowa and Winona, Minnesota, which we own.

Country Operations

In our country operations business, we own agri-operations facilities in 466 communities (of which some of the facilities are on leased land), four sunflower plants and eight feed manufacturing facilities. These operations are located in Colorado, Idaho, Illinois, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, North Dakota, Oklahoma, Oregon, South Dakota, Texas, Washington, and Wisconsin.

Table of Contents

Crop Nutrients

We own one deep water port in Galveston, Texas and 18 terminals in: Little Rock, Arkansas; Post Falls, Idaho; Peru, Illinois; Muscatine, Iowa; Melbourne and Owensboro, Kentucky; Lake Providence, Lettsworth, Mermentau, Tallulah and Vidalia, Louisiana; St. Paul and Winona, Minnesota; Greenville, Mississippi; Watertown, South Dakota; Memphis, Tennessee; and Friona and Texarkana, Texas. The facilities located in Little Rock, Arkansas, Owensboro, Kentucky and Galveston, Texas are on leased land.

Processing and Food Ingredients

We own oilseed processing facilities in: Hallock, Fairmont and Mankato, Minnesota. In addition, we own a grain storage facility in Joliette, North Dakota.

Renewable Fuels

We own ethanol plants located in Rochelle and Annawan, Illinois.

Corporate and Other

I n addition to the leased office space at our corporate headquarters, we lease two offices in: Kansas City, Missouri; and Huron, South Dakota. We own approximately 11,000 acres of agricultural land and related improvements in central Michigan.

Corporate Headquarters

We are headquartered in Inver Grove Heights, Minnesota. We lease a 24-acre campus consisting of one building with approximately 320,000 square feet of office space and own an additional 9-acres of land adjacent to the leased property on which we have two smaller buildings with approximately 13,400 and 9,000 square feet of space. We also have offices in Eagan, Minnesota and Washington, D.C., which are leased.

ITEM 3. LEGAL PROCEEDINGS

We are involved as a defendant in various lawsuits, claims and disputes, which are in the normal course of our business. The resolution of any such matters may affect consolidated net income for any fiscal period; however, our management believes any resulting liabilities, individually or in the aggregate, will not have a material effect on our consolidated financial position, results of operations or cash flows during any fiscal year.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

Table of Contents

PART II.

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

As a cooperative, we do not have any common stock that is traded or otherwise. We have not sold any equity securities during the three years ended August 31, 2018 , that were not registered under the Securities Act of 1933.

Table of Contents

ITEM 6. SELECTED FINANCIAL DATA

The following selected income statement data for the years ended August 31, 2018, 2017, and 2016, and balance sheet data as of August 31, 2018, and 2017, are derived from our audited consolidated financial statements within this Annual Report on Form 10-K. The following selected income statement data for the years ended August 31, 2015, and 2014, and balance sheet data as of August 31, 2016, 2015, and 2014, are derived from unaudited consolidated financial information not included in this Annual Report on Form 10-K and has been restated from previously reported results.

The following table sets forth our selected historical consolidated financial data for each of the five periods indicated. Certain prior period amounts have been restated for the correction of misstatements described below. This information should be read in conjunction with the "Explanatory Note" immediately preceding Item 1 of this Annual Report on Form 10-K, Management's Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of this Annual Report on Form 10-K and with our consolidated financial statements and Notes thereto included elsewhere in this Annual Report on Form 10-K, including further details related to the misstatements discussed in Note 2, Restatement of Previously Issued Consolidated Financial Statements .



	Selected Consolidated Financial Data
	2018			(As Restated) 2017			(As Restated) 2016			(As Restated) 2015			(As Restated) 2014
	(Dollars in thousands)
Income Statement Data:
Revenues	$	32,683,347		$	32,037,426		$	30,355,260		$	34,517,452		$	42,619,712
Cost of goods sold	31,589,887			31,142,766			29,386,515			33,099,955			40,889,181
Gross profit	1,093,460			894,660			968,745			1,417,497			1,730,531
Marketing, general and administrative	674,083			612,007			601,266			642,309			598,965
Reserve and impairment charges (recoveries), net	(37,709		)	456,679			75,036			158,771			78,133
Operating earnings (loss)	457,086			(174,026		)	292,443			616,417			1,053,433
(Gain) loss on disposal of business	(131,816		)	2,190			—			—			—
Interest expense	149,202			171,239			113,704			70,659			147,240
Other (income) loss	(78,015		)	(99,951		)	(47,609		)	(46,752		)	(146,472		)
Equity (income) loss from investments	(153,515		)	(137,338		)	(175,777		)	(107,850		)	(107,446		)
Income (loss) before income taxes	671,230			(110,166		)	402,125			700,360			1,160,111
Income tax expense (benefit)	(104,076		)	(181,124		)	19,099			(4,900		)	22,226
Net income (loss)	775,306			70,958			383,026			705,260			1,137,885
Net income (loss) attributable to noncontrolling interests	(601		)	(634		)	(223		)	(816		)	1,572
Net income (loss) attributable to CHS Inc.	$	775,907		$	71,592		$	383,249		$	706,076		$	1,136,313
Balance Sheet Data (as of August 31):
Working capital	$	759,034		$	148,565		$	338,446		$	2,650,637		$	3,132,548
Net property, plant and equipment	5,141,719			5,356,434			5,488,323			5,192,927			4,180,148
Total assets	16,381,178			15,818,922			17,149,639			15,101,216			15,142,607
Long-term debt, including current maturities	1,930,255			2,179,793			2,297,205			1,478,930			1,603,028
Total equities	8,165,028			7,705,640			7,759,157			7,551,439			6,428,582

Table of Contents

Description of Restatement Adjustments

The categories of restatement adjustments and their impact on previously reported consolidated financial statements for the years ended August 31, 2017, and 2016, are detailed in Note 2, Restatement of Previously Issued Financial Statements contained in the Notes to the consolidated financial statements in this Annual Report on Form 10-K. The categories of restatement adjustments and their impact on previously reported consolidated financial statements for fiscal 2014 and fiscal 2015, and selected balance sheet data as of August 31, 2016, are described below.

(a) Freight Derivatives and Related Misstatements - Corrections for freight derivatives and related misstatements were driven by the intentional misstatement of amounts associated with both the value and quantity of rail freight contracts, as well as due to rail freight contracts and certain non-rail freight contracts not meeting the technical accounting requirements to qualify as derivative financial instruments. In addition to the elimination of the underlying freight derivative assets and liabilities and related impacts on revenues and cost of goods sold, additional adjustments were recorded to account for prepaid freight capacity balances in relevant periods and the impact of a goodwill impairment charge recorded as of May 31, 2015, for goodwill held within our Grain Marketing reporting unit. Additional details related to the impact of the freight derivatives and related misstatements and their impact on each period are discussed in restatement reference (a).

(b) Intercompany Misstatements - As a result of the work performed in relation to the freight misstatement, additional misstatements related to the elimination of intercompany balances were also identified and corrected within the consolidated financial statements. Certain of these intercompany misstatements resulted in a misstatement of various financial statement line items; however, the intercompany misstatements did not result in a material misstatement of income (loss) before income taxes or net income (loss). Additional details related to the impact of the intercompany misstatements and their impact on each period are discussed in restatement reference (b).

(c) Other Misstatements - We made adjustments for other previously identified misstatements unrelated to the freight derivatives and related misstatements that were not material, individually or in the aggregate, to our consolidated financial statements. These other misstatements related primarily to certain misclassifications, adjustments to revenues and cost of goods sold, and adjustments to various income tax and indirect tax accrual accounts. Additional details related to the impact of the other misstatements and their impact on each period are discussed in restatement reference (c).



	As of August 31, 2016
	As Previously Reported		Restatement Adjustments			As Restated		Restatement References
	(Dollars in thousands)
Balance Sheet Data:
Working capital	$	414,385	$	(75,939	)	$	338,446	a, b, c
Net property, plant and equipment	5,488,323		—			5,488,323
Total assets	17,312,135		(162,496		)	17,149,639		a, b, c
Long-term debt, including current maturities	2,297,205		—			2,297,205
Total equities	7,866,250		(107,093		)	7,759,157		a, b, c

Balance Sheet Data as of August 31, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in an $83.6 million reduction of working capital, a $178.7 million reduction of total assets, and a $115.7 million reduction of total equities. The reductions of working capital, total assets and total equities related primarily to the elimination of $169.5 million of current derivative assets that had been recorded as assets on the Consolidated Balance Sheet. The related decreases of working capital and total equities were partially offset by several related adjustments, including a $58.4 million reduction of current derivative liabilities, a $5.6 million increase of prepaid income taxes, a $20.7 million decrease of accrued income taxes and a $15.9 million increase of long-term deferred tax liabilities associated with the income tax impact of the freight misstatement. The decrease of total assets also included an approximate $16.0 million reduction of goodwill that resulted from a goodwill impairment recorded during fiscal 2015, which was partially offset by the recognition of a $1.3 million prepaid freight capacity balance.

Table of Contents

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $12.1 million increase of working capital, a $21.2 million reduction of total assets, and a $12.1 million increase of total equities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods. The decreases of working capital and total equities related primarily to $4.4 million reduction of accounts payable and a $7.7 million reduction of dividends and equities payable that resulted from timing differences. The decrease of total assets related primarily to a $6.2 million decrease of accounts receivable, a $12.1 million decrease of current derivative assets, and a $6.4 million decrease of margin deposits, which were partially offset by a $2.8 million increase of inventories with offsetting adjustments to current liabilities.

Other misstatements

(c) The correction of other misstatements resulted in a $4.4 million decrease of working capital, a $37.4 million increase of total assets, and a $3.5 million decrease of total equities. Several misclassification adjustments were made between working capital accounts; however, the decreases of working capital and total equities were driven by adjustments to certain income tax balances, including a $9.1 million decrease of prepaid income taxes and a $20.7 million increase of accrued income taxes, which were partially offset by the correction of other misstatements, including a $27.9 million reduction of dividends and equities payable that had been included from the accrual balance as the result of a timing difference. The increase of total assets relates primarily to a $39.4 million increase of inventory with a corresponding increase to accounts payable that resulted from a misclassification adjustment for an accounts payable balance that had previously been classified as a contra-inventory balance.

Table of Contents



	For the Year Ended August 31, 2015									For the Year Ended August 31, 2014
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	34,582,442		$	(64,990	)	$	34,517,452		$	42,664,033		$	(44,321	)	$	42,619,712		a, b, c
Cost of goods sold	33,091,676			8,279			33,099,955			41,011,487			(122,306		)	40,889,181			a, b, c
Gross profit	1,490,766			(73,269		)	1,417,497			1,652,546			77,985			1,730,531
Marketing, general and administrative	642,309			—			642,309			598,965			—			598,965
Reserve and impairment charges (recoveries), net	133,045			25,726			158,771			3,633			74,500			78,133			a, c
Operating earnings (loss)	715,412			(98,995		)	616,417			1,049,948			3,485			1,053,433
Interest expense	70,659			—			70,659			147,240			—			147,240
Other (income) loss	(15,565		)	(31,187		)	(46,752		)	(121,149		)	(25,323		)	(146,472		)	c
Equity (income) loss from investments	(107,850		)	—			(107,850		)	(107,446		)	—			(107,446		)
Income (loss) before income taxes	768,168			(67,808		)	700,360			1,131,303			28,808			1,160,111
Income tax expense (benefit)	(12,165		)	7,265			(4,900		)	48,296			(26,070		)	22,226			a, c
Net income (loss)	780,333			(75,073		)	705,260			1,083,007			54,878			1,137,885
Net income (loss) attributable to noncontrolling interests	(712		)	(104		)	(816		)	1,572			—			1,572
Net income (loss) attributable to CHS Inc.	$	781,045		$	(74,969	)	$	706,076		$	1,081,435		$	54,878		$	1,136,313
Balance Sheet Data (as of August 31):
Working capital	$	2,751,949		$	(101,312	)	$	2,650,637		$	3,168,512		$	(35,964	)	$	3,132,548		a, c
Net property, plant and equipment	5,192,927			—			5,192,927			4,180,148			—			4,180,148
Total assets	15,226,125			(124,909		)	15,101,216			15,293,507			(150,900		)	15,142,607			a, c
Long-term debt, including current maturities	1,428,930			50,000			1,478,930			1,603,028			—			1,603,028			c
Total equities	7,669,411			(117,972		)	7,551,439			6,466,844			(38,262		)	6,428,582			a, c

For the year ended August 31, 2015

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $67.8 million reduction of income before income taxes and a $56.0 million reduction of net income. The decreased income before income taxes and net income were primarily the result of a $42.5 million increase of cost of goods sold and an increase of reserve and impairment charges related to a goodwill impairment charge of approximately $16.0 million within our Grain Marketing reporting unit following a reassessment of the goodwill balance as of May 31, 2015. The remaining adjustment to income before income taxes relates to a $9.0 million decrease of revenues that should have been recorded during fiscal 2014 and the remaining adjustment to net income relates to an $11.8 million decrease of income tax expense resulting from the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $37.9 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Table of Contents

Other misstatements

(c) The correction of other misstatements had no impact on income (loss) before income taxes; however, a $19.1 million reduction of net income resulted from the correction of income tax misstatements. The incremental income taxes of $19.1 million were recorded to adjust for the impact of income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods. Additionally, certain misclassification adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses, including an $18.1 million decrease of revenues, a $3.7 million increase of cost of goods sold, a $9.4 million increase of reserve and impairment charges, net and a $31.2 million increase of other income.

Balance Sheet Data as of August 31, 2015

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in an $88.7 million reduction of working capital, a $141.6 million reduction of total assets, and a $104.6 million reduction of total equities. The reductions of working capital, total assets and total equities related primarily to the elimination of $132.0 million of current derivative assets that had been recorded as assets on the Consolidated Balance Sheet. The decreases of working capital and total equities were partially offset by several related adjustments, including a $32.5 million reduction of current derivative liabilities, a $5.5 million reduction of income taxes payable that resulted from the freight misstatement and the recognition of a $5.4 million prepaid freight capacity balance. In addition to the reductions of current assets, the decrease of total assets also included an approximate $16.0 million reduction of goodwill associated with a goodwill impairment recorded during fiscal 2015.

Intercompany misstatements

(b) None

Other misstatements

(c) The correction of other misstatements resulted in a $12.7 million decrease of working capital, a $16.7 million increase of total assets, a $50.0 million increase of long-term debt, including current maturities and a $13.4 million decrease of total equities. The decrease of working capital related primarily to a $13.5 million increase of dividends and equities payable that had been excluded from the accrual balance as the result of a timing difference. The $16.7 million increase of total assets related to a timing difference associated with the application of in-transit cash and receivables that had resulted in a $13.9 million understatement of cash and a $2.8 million understatement of receivables (with the offsetting entries impacting customer advance payments and accounts payable). The $50.0 million increase of long-term debt, including current maturities related to a misclassification adjustment for certain notes payable balances to their appropriate classification as long-term debt (including current portion). The $13.4 million decrease of total equities related primarily to the $13.5 million timing difference associated with the accrual of dividends and equities payable described above.

For the year ended August 31, 2014

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $28.8 million increase of income before income taxes and a $17.8 million increase of net income. The increased income before income taxes was primarily the result of a $19.8 million decrease of cost of goods sold and a $9.0 million increase of revenues that had been incorrectly recognized during fiscal 2015. The increased net income resulted primarily from the increase of income before income taxes, which was partially offset by an $11.0 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $35.6 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements had no impact on income (loss) before income taxes; however, the correction of certain tax items that resulted in an income tax benefit of $37.1 million and a corresponding increase of net income. The income tax benefit of $37.1 million was recorded to adjust for the impact of income tax items that had previously been recorded as out of period adjustments in subsequent periods. In addition to the income tax adjustment, certain

Table of Contents

misclassification adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $17.7 million decrease of revenues, a $66.9 million decrease of cost of goods sold, a $74.5 million increase of reserve and impairment charges (recoveries), net and a $25.3 million increase of other income.

Balance Sheet Data as of August 31, 2014

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $22.6 million reduction of working capital, a $150.9 million reduction of total assets, and a $49.9 million reduction of total equities. The reductions of working capital, total assets and total equities related primarily to the elimination of $224.5 million of current derivative assets that had been incorrectly recorded as assets on the Consolidated Balance Sheet. The decreases of working capital and total equities were partially offset by several related adjustments, including a $109.5 million reduction of current derivative liabilities, the recognition of a $62.8 million prepaid freight capacity balance, the recognition of a $10.8 million accounts receivable balance and a $20.1 million reduction of income taxes payable.

Intercompany misstatements

(b) None

Other misstatements

(c) The correction of other misstatements resulted in a $13.4 million decrease of working capital and an $11.7 million increase of total equities. The decrease of working capital and increase of total equities related to a $7.5 million increase of dividends and equities payable that had been excluded from the accrual balance as the result of a timing difference and an increased income tax accrual of $5.9 million that resulted from income tax items that had been previously recorded as out of period adjustments in subsequent periods.

Table of Contents

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide a reader of our financial statements with a narrative from the perspective of management on our financial condition and results of operations, liquidity and certain other factors that may affect our future results. Our MD&A is presented in the following sections:


•	Restatement


•	Overview


•	Business Strategy


•	Fiscal 2018 Highlights


•	Fiscal 2019 Priorities


•	Fiscal 2019 Outlook


•	Results of Operations


•	Liquidity and Capital Resources


•	Off Balance Sheet Financing Arrangements


•	Contractual Obligations


•	Critical Accounting Estimates


•	Effect of Inflation and Foreign Currency Transactions


•	Recent Accounting Pronouncements

Our MD&A should be read in conjunction with the accompanying audited financial statements and notes to those financial statements and the Cautionary Statement regarding forward-looking statements found in Part I, Item 1A of this Annual Report on Form 10-K.

Restatement

The accompanying MD&A gives effect to certain adjustments made to our previously reported consolidated financial statements for the years ended August 31, 2017 and 2016. Due to the restatement of these periods, the data set forth in the accompanying MD&A may not be comparable to discussions and data included in our previously filed Annual Report on Form 10-K for fiscal 2017 .

Refer to the "Explanatory Note" immediately preceding Item 1 of this Annual Report on Form 10-K, and Note 2, Restatement of Previously Issued Consolidated Financial Statements and Note 18, Quarterly Financial Information (Unaudited) of the accompanying audited financial statements for further details related to the restatement and its impact on our consolidated financial statements.

Overview

CHS Inc. is a diversified company that provides grain, foods and energy resources to businesses and consumers on a global scale. As a cooperative, we are owned by farmers, ranchers and member cooperatives across the United States. We also have preferred shareholders that own our five series of preferred stock, all of which are listed and traded on the Nasdaq Global Select Market. We operate in the following three reportable segments:


•	Energy - produces and provides primarily for the wholesale distribution and transportation of petroleum products.


•	Ag - purchases and further processes or resells grains and oilseeds originated by our country operations business, by our member cooperatives and by third parties and also serves as a wholesaler and retailer of crop inputs.


•	Nitrogen Production - consists solely of our equity method investment in CF Nitrogen and produces and distributes nitrogen fertilizer, a commodity chemical.

In addition, our financing and hedging operations along with our non-consolidated wheat milling and food production and distribution joint ventures, have been aggregated within Corporate and Other. Prior to its sale on May 4, 2018, our insurance operations were also included within Corporate and Other.

The consolidated financial statements include the accounts of CHS and all of our wholly-owned and majority-owned subsidiaries and limited liability companies. The effects of all significant intercompany transactions have been eliminated.

Table of Contents

Corporate administrative expenses and interest are allocated to each reportable segment, along with Corporate and Other, based on direct usage for services, such as information technology, legal and other factors or considerations relevant to the costs incurred.

Management's Focus . When evaluating our operating performance, management focuses on gross profit and income (loss) before income taxes ("IBIT"). As a company that operates heavily in global commodities, there is significant unpredictability and volatility in pricing, costs and global trade volumes. As such, we focus on managing the margin we can earn and the resulting income before income taxes. Management also focuses on ensuring the strength of the balance sheet through the appropriate management of financial liquidity, leverage, capital allocation and cash flow optimization.

Seasonality . Many of our business activities are highly seasonal and our operating results vary throughout the year. Our revenues and income generally trend lower during the second and fourth fiscal quarters and higher during the first and third fiscal quarters. For example, in our Ag segment, our crop nutrients and country operations businesses generally experience higher volumes and income during the fall harvest and spring planting season, which correspond to our first and third fiscal quarters, respectively. Our grain marketing operations are also subject to fluctuations in volume and earnings based on producer harvests, world grain prices, demand and global trade volumes. Our Energy segment generally experiences higher volumes and profitability in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage by our agricultural producers is highest and is subject to global supply and demand forces. Other energy products, such as propane, also generally experience higher volumes and profitability during the winter heating and fall crop drying seasons. The graphs below depict the seasonality inherent in our business.

* Note that the third quarter of fiscal 2017 was impacted by significant charges that caused IBIT for that period to deviate from historical trends.

Table of Contents

Pricing . Our revenues, assets and cash flows can be significantly affected by global market prices for commodities such as petroleum products, natural gas, grains, oilseed products and crop nutrients. Changes in market prices for commodities that we purchase without a corresponding change in the selling prices of those products can affect revenues and operating earnings. Commodity prices are affected by a wide range of factors beyond our control, including the weather, crop damage due to disease or insects, drought, availability/adequacy of supply of the related commodity, government regulations/policies, world events, global trade disputes and general political/economic conditions.

Business Strategy

Our business strategy is to help our owners grow by maximizing returns and optimizing our various operations to ensure that our core businesses are strategically positioned today and for the future. We are focusing on improving efficiency and, when necessary, disposing of assets that are not strategic and/or do not meet our internal measurement expectations. We are also focused on maintaining financial flexibility by optimizing debt levels and ensuring adequate financial liquidity so we can effectively operate throughout the agriculture and energy economic cycles.

Fiscal 2018 Highlights


•	Throughout fiscal 2018 we experienced higher crack spreads and favorable crude oil discounts that resulted in significantly improved margins and results in our Energy segment.

•

We completed the disposal of certain assets primarily within our Energy segment and Corporate and Other resulting in cash proceeds of approximately $234.9 million and a gain of approximately $131.8 million recognized during the first, second, and third quarters of fiscal 2018 . The cash proceeds were used to optimize our debt levels by reducing our need for incremental debt and minimizing existing funded debt.


•	In the second quarter of fiscal 2018, we experienced a significant tax benefit through the revaluation of our U.S. net deferred tax liability resulting from the enactment of the Tax Cuts and Jobs Act of 2017 (the "Tax Act").

Fiscal 2019 Priorities


•	Strengthening and improving our internal control environment.


•	Enhancing owner experience through deeper relationships, including seamless interactions with us through the use of more effective technology solutions.


•	A continued emphasis on sharpening our operational excellence by equipping our employees to develop needed expertise to serve CHS owners, improve processes, adapt to change and embrace diversity.


•	Drive enterprise business growth by focusing on our core businesses, continuing to improve efficiency in all that we do and earning higher market share.

Fiscal 2019 Outlook

Our Ag and Energy businesses operate in cyclical environments. The Energy industry began recovering in fiscal 2018 with higher crack spreads and favorable crude oil discounts that led to higher margins and improved earnings. We expect that these favorable market fundamentals experienced throughout fiscal 2018 will continue to support strong earnings in our Energy business during fiscal 2019. The Ag industry, however, continues to operate in a challenging environment characterized by lower margins, reduced liquidity and increased leverage that have resulted from reduced commodity prices. In addition, trade relations between the United States and foreign trade partners, particularly those that purchase large quantities of agricultural commodities, are strained resulting in unpredictable impacts to commodity prices within the Ag industry now and in the future. We are unable to predict how long the current environment will last or how severe it will ultimately be at this time. As a result, we expect our revenues, margins and cash flows to continue to be under pressure during fiscal 2019 .

Table of Contents

Results of Operations

Consolidated Statements of Operations



	For the Years Ended August 31,
				(As Restated)			(As Restated)
	2018			2017			2016
	(Dollars in thousands)
Revenues	$	32,683,347		$	32,037,426		$	30,355,260
Cost of goods sold	31,589,887			31,142,766			29,386,515
Gross profit	1,093,460			894,660			968,745
Marketing, general and administrative	674,083			612,007			601,266
Reserve and impairment charges (recoveries), net	(37,709		)	456,679			75,036
Operating earnings (loss)	457,086			(174,026		)	292,443
(Gain) loss on disposal of business	(131,816		)	2,190			—
Interest expense	149,202			171,239			113,704
Other (income) loss	(78,015		)	(99,951		)	(47,609		)
Equity (income) loss from investments	(153,515		)	(137,338		)	(175,777		)
Income (loss) before income taxes	671,230			(110,166		)	402,125
Income tax expense (benefit)	(104,076		)	(181,124		)	19,099
Net income (loss)	775,306			70,958			383,026
Net income (loss) attributable to noncontrolling interests	(601		)	(634		)	(223		)
Net income (loss) attributable to CHS Inc.	$	775,907		$	71,592		$	383,249

The charts below detail revenues, net of intersegment revenues, and IBIT by reportable segment for fiscal 2018 . Our Nitrogen Production reportable segment represents an equity method investment, and as such records earnings and allocated expenses but not revenue.

Table of Contents

Energy Segment Operating Metrics

Our Energy segment operations primarily include our Laurel, Montana and McPherson, Kansas refineries, which process crude oil to produce refined products, including gasoline, distillates and other products. The following tables provide information about our consolidated refinery operations.



	For the Years Ended August 31,
	2018	2017	2016
Refinery throughput volumes	(Barrels per day)
Heavy, high-sulfur crude oil	84,339	83,787	64,104
All other crude oil	66,785	69,980	72,115
Other feedstocks and blendstocks	17,713	14,184	16,719
Total refinery throughput volumes	168,837	167,951	152,938
Refined fuel yields
Gasolines	86,115	86,105	79,483
Distillates	65,060	65,738	57,650

We are subject to the Renewable Fuels Standard ("RFS"), which requires refiners to blend renewable fuels (e.g., ethanol, biodiesel) into their finished transportation fuels or purchase renewable energy credits, known as Renewable Identification Numbers ("RINs"), in lieu of blending. The Environmental Protection Agency generally establishes new annual renewable fuel percentage standards for each compliance year in the preceding year. We generate RINS under the RFS in our renewable fuels operations and through our blending activities at our terminals; but we cannot generate enough RINs to meet the needs of our refining capacity and RINs must be purchased on the open market. The price of RINs can be volatile and can impact profitability.

In addition to our internal operational reliability, the profitability of our Energy segment is largely driven by crack spreads (e.g., the price differential between refined products and inputs such as crude oil), which are driven by the supply and demand of refined product markets. Crack spreads continued to improve during fiscal 2018 compared to the two prior fiscal years as a result of the tightening supply and demand in the global and North American refined product markets. The table below provides information about the average market reference prices and differentials that impact our Energy segment.



	For the Years Ended August 31,
	2018	2017	2016
Market indicators
West Texas Intermediate (WTI) crude oil (dollars per barrel)	$62.23	$49.03	$41.50
WTI - Western Canadian Select (WCS) crude oil differential (dollars per barrel)	$17.92	$12.90	$14.13
Group 3 2:1:1 crack spread (dollars per barrel)*	$19.08	$14.21	$13.17
Group 3 5:3:2 crack spread (dollars per barrel)*	$18.46	$14.01	$13.10
D6 ethanol RIN (dollars per RIN)	$0.5280	$0.7214	$0.6783
D4 ethanol RIN (dollars per RIN)	$0.7221	$1.0352	$0.7621

* Group 3 refers to the oil refining and distribution system serving the Midwest markets from the Gulf Coast through the Plains States.

Income (Loss) Before Income Taxes by Segment

Energy



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change			% Change
	(Dollars in thousands)
Income (loss) before income taxes	$	452,108	$	61,118	$	273,375	$	390,990	639.7	%	$	(212,257	)	(77.6	)%

Table of Contents

The following table and commentary present the primary reasons for the changes in IBIT for the Energy segment for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	(8	)	$	15
Price	255			(99		)
Transportation, retail and other	60			(67		)
Change in reserves and impairments, net ⁺	33			(33		)
Non-gross profit related activity ⁺	51			(28		)
Total change in Energy IBIT	$	391		$	(212	)

+ See commentary related to these changes in the marketing, general and administrative expenses, reserve and impairment charges (recoveries), net, (gain) loss on disposal of business, interest expense, other income (loss) and equity (income) loss from investments sections of this Results of Operations.

Comparison of Energy segment IBIT for the years ended August 31, 2018 , and 2017

The $391.0 million increase in the Energy segment IBIT for fiscal 2018 reflects the following:

•

Improved market conditions throughout fiscal 2018 in our refined fuels business, mostly due to higher crack spreads and associated higher margins. These benefits were partially offset by planned major maintenance activities at our Laurel, Montana refinery during May 2018 and a reduction of cost of goods sold ("COGS") during fiscal 2017 resulting from the benefit of certain manufacturing changes in our propane business that did not reoccur in fiscal 2018 .


•	Gains totaling $65.9 million recorded in other income in connection with the sale of certain assets during the third quarter of fiscal 2018 , including the sale of 34 Zip Trip stores located in the Pacific Northwest, United States ("Pacific Northwest") and the sale of the Council Bluffs pipeline and refined fuels terminal in Council Bluffs, Iowa.


•	A benefit of $19.1 million recognized during the third quarter of fiscal 2018 associated with the small refinery exemption for our Laurel, Montana refinery.


•	An impairment charge of $32.7 million was recorded during the third quarter of fiscal 2017 related to the cancellation of a capital project which did not reoccur in fiscal 2018.

Comparison of Energy segment IBIT for the years ended August 31, 2017 , and 2016

The $212.3 million decrease in the Energy segment IBIT for fiscal 2017 reflects the following:

•

Significantly reduced margins within refined fuels caused by a down cycle in the energy industry throughout fiscal 2017, which drove prices lower, partially offset by increases in propane margins driven by certain manufacturing changes. The lower margins in our refined fuels business were partially offset by higher demand for energy products, which caused volumes to increase (most significantly in refined fuels).


•	A $32.7 million impairment charge associated with the cancellation of a capital project during the third quarter of fiscal 2017 .


•	On November 23, 2016, the EPA released the final renewable fuel mandate for calendar year 2017, and as a result the market price for RINs increased in the first quarter of fiscal 2017.



	For the Years Ended August 31,							2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017			(As Restated) 2016		$ Change		% Change		$ Change			% Change
	(Dollars in thousands)
Income (loss) before income taxes	$	74,258	$	(270,161	)	$	15,252	$	344,419	127.5	%	$	(285,413	)	(1,871.3	)%

Table of Contents

The following table and commentary present the primary reasons for the changes in IBIT for the Ag segment for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	3		$	3
Price	(83		)	74
Change in reserves and impairments, net ⁺	452			(441		)
Non-gross profit related activity ⁺	(28		)	79
Total change in Ag IBIT	$	344		$	(285	)

Comparison of Ag segment IBIT for the years ended August 31, 2018 , and 2017

The $344.4 million increase in Ag segment IBIT for fiscal 2018 reflects the following:


•	Significant reserve and impairment charges that were recorded during fiscal 2017, the most significant of which related to charges of $229.4 million recorded during the third quarter of fiscal 2017 in association with a trading partner in our Brazilian operations entering bankruptcy-like proceedings under Brazilian law. These reserve and impairment charges did not reoccur in fiscal 2018.

•

We had previously recorded certain reserves and impairments in fiscal 2017 as disclosed in the reserves and impairment charges (recoveries), net portion of the management discussion and analysis. During fiscal 2018 , we were able to recover $37.7 million of these reserves and impairments by receiving higher than expected sale prices on certain assets and insurance proceeds, including $3.8 million during the first quarter of fiscal 2018, $11.3 million during the second quarter of fiscal 2018, $3.8 million during the third quarter of fiscal 2018 and $18.8 million during the fourth quarter of fiscal 2018.


•	Impairments of $26.3 million related to international investments during the fourth quarter of fiscal 2018 that we have exited or are in the process of exiting.


•	Decreased margins across multiple businesses in the Ag segment throughout fiscal 2018, as a result of lower demand and uncertainties primarily associated with international trade, which were partially offset by increased margins within our processing and food ingredients business that have resulted from lower input costs; particularly in the third quarter of fiscal year 2018.

Comparison of Ag segment IBIT for the years ended August 31, 2017 , and 2016

The $285.4 million decrease in Ag segment IBIT for fiscal 2017 reflects the following:

•

Grain marketing IBIT decreased primarily due to charges of $229.4 million during the third quarter of fiscal 2017 associated with a trading partner in our Brazilian operations entering bankruptcy-like proceedings under Brazilian law. Grain marketing also experienced impairments within certain international investments of $20.2 million during the fourth quarter of fiscal 2017 due to persistent underperformance, partially offset by slightly higher grain volumes and associated margins.


•	Country operations IBIT decreased primarily due to changes in reserves related to a single producer borrower of $81.0 million along with $30.4 million of long-lived asset impairments, most of which were recorded during the second quarter of fiscal 2017. These impairments were significantly offset by higher grain margins and volumes.


•	A decrease in processing and food ingredients IBIT primarily caused by long-lived asset impairment charges of $80.1 million during the third and fourth quarters of fiscal 2017 that exceeded the prior year's non-recurring bad debt charge related to a specific customer. Higher margins partially offset this decrease.


•	Increased crop nutrients and renewable fuels IBIT, driven primarily by higher volumes and margins.

Table of Contents

All Other Segments



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change			% Change
	(Dollars in thousands)
Nitrogen Production IBIT*	$	38,838	$	29,741	$	34,070	$	9,097	30.6	%	$	(4,329	)	(12.7	)%
Corporate and Other IBIT	$	106,026	$	69,136	$	79,428	$	36,890	53.4	%	$	(10,292	)	(13.0	)%

* See Note 5, Investments, of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Comparison of All Other Segments IBIT for the years ended August 31, 2018 , and 2017

Our Nitrogen Production segment IBIT increase d as a result of significantly higher equity method income throughout fiscal 2018 attributed to increased sale prices of urea and UAN, which are produced and sold by CF Nitrogen. Fiscal 2017 also included a gain of $30.5 million associated with an embedded derivative asset inherent in the agreement relating to our investment in CF Nitrogen, of which $29.1 million was recognized during the first quarter of fiscal 2017 . The gain was solely responsible for the income in our Nitrogen Production segment in fiscal 2017 and there was no comparable gain in fiscal 2018 . Corporate and Other IBIT increased primarily as a result of the $58.2 million gain recognized on the sale of CHS Insurance during the third quarter of fiscal 2018 which was partially offset by lower earnings from our investments in Ventura Foods and Ardent Mills, and our CHS Capital and CHS Insurance businesses.

Comparison of All Other Segments IBIT for the years ended August 31, 2017 , and 2016

Our Nitrogen Production segment IBIT decrease d as a result of lower equity method income caused by downward pressures on the pricing of urea and UAN throughout fiscal 2017 . This decrease was partially offset by a gain of $30.5 million in fiscal 2017 associated with an embedded derivative asset inherent in the agreement relating to our investment in CF Nitrogen for which there was no comparable gain in the prior fiscal year, including $29.1 million that was recognized during the first quarter of fiscal 2017 . Corporate and Other IBIT decreased due to lower margins resulting from pricing pressure from customers in our investment in Ventura Foods, which was partially offset by improved equity method earnings from our investment in Ardent Mills.

Revenues by Segment

Energy



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change		% Change
	(Dollars in thousands)
Revenues	$	7,589,119	$	6,227,838	$	5,408,879	$	1,361,281	21.9	%	$	818,959	15.1	%

The following table and commentary present the primary reasons for the changes in revenue, net of intersegment revenues, for the Energy segment for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	(84	)	$	223
Price	1,449			622
Transportation, retail and other	(4		)	(26		)
Total change in Energy revenues	$	1,361		$	819

Comparison of Energy segment revenues for the years ended August 31, 2018 , and 2017

The $1.4 billion increase in Energy revenues for fiscal 2018 reflects the following:


•	Refined fuels revenues rose $1.2 billion (24%), primarily driven by an increase in the net average selling price ($1.3 billion), which was partially offset by a decrease in volumes ($51.3 million). The selling price of refined fuels products increased an average of $0.41 (25%) per gallon and sales volumes decreased 1% compared to the previous year.

Table of Contents


•	Propane revenues increased $177.6 million (30%), of which $176.3 million was attributable to a $0.21 (30%) per gallon increase in the net average selling price compared to the prior year, as well as a $1.4 million (0.2%) increase attributable to slightly higher volumes.

Comparison of Energy segment revenues for the years ended August 31, 2017 , and 2016

The $819.0 million increase in Energy revenues for fiscal 2017 reflects the following:


•	Refined fuels revenues rose $724.7 million (17%), of which $517.0 million related to an increase in the net average selling price and $207.8 million related to higher sales volumes compared to the prior year. The selling price of refined fuels products increased an average of $0.16 (11%) per gallon, and sales volumes increased 5%, compared to the previous year.


•	Propane revenues increased $112.2 million (24%), of which $105.3 million was attributable to a rise in the net average selling price and $6.9 million was attributable to higher volumes. Propane sales volume increased 1% and the average selling price of propane increased $0.12 (22%) per gallon, when compared to the previous year.



	For the Years Ended August 31,						2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Revenues	$	25,037,481	$	25,718,428	$	24,856,018	$	(680,947	)	(2.6	)%	$	862,410	3.5	%

The following table and commentary present the primary reasons for the changes in revenues, net of intersegment revenues, for the Ag segment for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	(522	)	$	858
Price	(159		)	4
Total change in Ag revenues	$	(681	)	$	862

Comparison of Ag segment revenues for the years ended August 31, 2018 , and 2017

The $680.9 million decrease in Ag segment revenues for fiscal 2018 reflects the following:


•	Grain and oilseed revenues decreased by $757.0 million as a result of a 4% decline in volumes while average sales prices remained flat on a year-over-year basis. The decrease in volumes was primarily due to uncertainty associated with international trade.


•	Renewable fuels revenues decreased $99.9 million as the result of a 9% decline in volumes, which was partially offset by an average sales price increase of 2%. The decrease in volumes was due to lower exports and the higher average sales price was driven by higher prices experienced during the first and second quarters of fiscal 2018 .

•

The decreases in grain and oilseed and renewable fuels revenues were partially offset by a $160.4 million increase in crop nutrients revenue. The increased revenues within crop nutrients resulted from an 8% increase in crop nutrient prices and slightly increased volumes. Higher crop nutrient prices were driven by improved market conditions characterized by less oversupply in the market and the increased volumes were primarily the result of supply chain management improvements and improved market conditions compared to the prior year.

•

Increased processing and food ingredients revenues of $8.5 million and increased feed and farm supplies revenue of $7.1 million also partially offset the decreased grain and oilseed and renewable fuels revenues. Processing and food ingredients and feed and farm supplies increased as a result of higher volumes; however, price declines of 13% in processing and food ingredients and 5% in feed and farm supplies offset most of the volume increases.

Table of Contents

Comparison of Ag segment revenues for the years ended August 31, 2017 , and 2016

The $862.4 million increase in Ag segment revenues for fiscal 2017 reflects the following:


•	Grain and oilseed revenues increased by $1.4 billion (8%), which was attributable to $612.1 million associated with higher average grain selling prices and an $819.7 million increase in volumes. The increase in volumes was due to the large U.S. crop production, while the rise in average sales price was primarily due to higher spring wheat and soybean prices.

•

Our processing and food ingredients revenues decreased $201.3 million, primarily due to a $181.1 million decline resulting from the prior-year sale of an international location during the third quarter of fiscal 2016 which contributed to the overall decline in volumes of $274.7 million (17%). An average sales price increase of $0.75 (6%) per unit related to processed oilseed commodities helped to partially offset the decreases associated with volume declines.

•

Wholesale crop nutrient revenues decreased $185.2 million due to lower average fertilizer selling prices of $508.4 million, partially offset by higher volumes of $323.2 million. Our wholesale crop nutrient volumes increased 15% and the average sales price of all fertilizers sold reflected a decrease of 21% per ton compared to the prior year. The increase in volumes was due to improved market demand from the prior year as well as supply chain management improvements.


•	Our renewable fuels revenues from our marketing and production operations decreased $7.3 million primarily as the result of 4% lower volumes, partially offset by an increased average sales price of $0.06 (4%) per gallon resulting from market supply and demand forces. The decrease in volumes was due to lower exports.


•	The remaining Ag segment product revenues, related primarily to feed and farm supplies, decreased $175.5 million mainly due to reduced country operations retail sales and a decline in plant food and sunflower pricing. The decreases were partially offset by increases in diesel sold as a result of higher grain movement and a rise in propane sold for home heating and crop drying.

All Other Segments



	For the Years Ended August 31,						2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Corporate and Other revenues*	$	56,747	$	91,160	$	90,363	$	(34,413	)	(37.8	)%	$	797	0.9	%

* Our Nitrogen Production reportable segment represents an equity method investment, and as such records earnings and allocated expenses, but not revenues.

Comparison of All Other Segments revenues for the years ended August 31, 2018 , and 2017

Corporate and Other revenues decreased primarily as a result of the sale of loans receivable during the majority of fiscal 2018 within the CHS Capital business, as well as the sale of CHS Insurance in May 2018.

Comparison of All Other Segments revenues for the years ended August 31, 2017 , and 2016

There were no significant changes to Corporate and Other revenues during fiscal 2017 .

Cost of Goods Sold by Segment

Energy



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change		% Change
	(Dollars in thousands)
Cost of goods sold	$	7,031,000	$	5,977,123	$	5,007,080	$	1,053,877	17.6	%	$	970,043	19.4	%

The following table and commentary present the primary reasons for the changes in COGS for the Energy segment, net of intercompany COGS, for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:

Table of Contents



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	(76	)	$	208
Price	1,194			721
Transportation, retail and other	(64		)	41
Total change in Energy cost of goods sold	$	1,054		$	970

Comparison of Energy segment COGS for the years ended August 31, 2018 , and 2017

The $1.1 billion increase in Energy segment COGS for fiscal 2018 reflects the following:


•	Refined fuels COGS increased $931.2 million (19%), which reflects a $0.32 (20%) per gallon rise in the average cost of refined fuels offset by a 1% volume decrease.


•	The $211.3 million (37%) increase in propane COGS was attributable to an increase in average cost of $0.25 (37%) per gallon and slightly increased volumes (0.2%). The increase in average cost was partially due to the benefit of certain manufacturing changes in fiscal 2017 that did not reoccur in fiscal 2018 that had reduced COGS by $33.9 million in fiscal 2017.

Comparison of Energy segment COGS for the years ended August 31, 2017 , and 2016

The $970.0 million increase in Energy segment COGS for fiscal 2017 reflects the following:


•	Refined fuels COGS increased $814.3 million (20%), which reflects a $0.20 (15%) per gallon rise in the average cost of refined fuels and a 5% volume increase.


•	The increase in propane COGS of $106.4 million was attributable to a 1% rise in volumes and an increase in average cost of $0.12 (21%) per gallon. These increases were partially offset by certain manufacturing changes that reduced COGS by $33.9 million.



	For the Years Ended August 31,						2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Cost of goods sold	$	24,560,854	$	25,161,821	$	24,376,782	$	(600,967	)	(2.4	)%	$	785,039	3.2	%

The following table and commentary present the primary reasons for the changes in COGS for the Ag segment, net of intercompany COGS, for each of the years ended August 31, 2018 , and 2017 , compared to the prior year:



	2018 vs. 2017			2017 vs. 2016
	(Dollars in millions)
Volume	$	(524	)	$	855
Price	(77		)	(70		)
Total change in Ag cost of goods sold	$	(601	)	$	785

Comparison of Ag segment COGS for the years ended August 31, 2018 , and 2017

The $601.0 million decrease in Ag segment COGS for fiscal 2018 reflects the following:


•	Grain and oilseed COGS decreased by $683.6 million as a result of a 4% decline in volumes with average costs remaining flat on a year-over-year basis. The decrease in volumes was primarily due to uncertainty associated with international trade.


•	Renewable fuels COGS decreased by $85.7 million as the result of a 9% decline in volumes, which was partially offset by increased average costs of 3%. The decrease in volumes was due to lower exports and the higher average cost was driven by higher input costs.

•

Processing and food ingredients COGS decreased by $12.5 million as the result of decreased average costs of 14%, which was partially offset by a 15% increase in volumes. The decreased costs resulted from lower input prices, primarily soybeans, and increased volumes were the result of operational improvements following the disposal of certain facilities and improved market conditions from the prior year.

Table of Contents

•

The decreases in grain and oilseed, renewable fuels, and processing and food ingredients COGS were partially offset by a $171.0 million increase in crop nutrients COGS and a $9.8 million increase of feed and farm supplies COGS. The increased COGS in crop nutrients was primarily the result of improved market conditions leading to price increases in the fertilizer market and the increased COGS for feed and farm supplies was the result of higher volumes.

Comparison of Ag segment COGS for the years ended August 31, 2017 , and 2016

The $785.0 million increase in Ag segment COGS for fiscal 2017 reflects the following:

•

The costs of grains and oilseed procured through our Ag segment increased $1.4 billion (8%). The majority of the increase was driven by a 5% increase in volumes and a 3% increase in average cost per bushel, resulting in increased COGS of $811.3 million and $570.7 million, respectively. The average per bushel month-end market price of soybeans and spring wheat increased, while corn decreased slightly compared to the prior year. The increase in volumes was due to a large U.S. crop production.


•	Processing and food ingredients COGS decreased $174.2 million (12%) and is comprised of $264.2 million in lower volumes, partially offset by a $90.0 million higher average cost of oilseeds purchased for further processing. The volume decline was driven by a $178.5 million decline due to the sale of an international location in the prior year.


•	Wholesale crop nutrients COGS decreased by $223.5 million (10%), caused primarily by a decline of 22% in average cost per ton of product. The price decline was partially offset by increased volumes of 15%. The increase in volumes and decrease in the prices paid for goods were due to better market conditions compared to the prior year, as well as efficiencies in supply chain management.


•	Renewable fuels COGS decreased $9.8 million (1%) resulting from a volume decline of 4%, which was partially offset by an increase in the average cost per gallon of $0.06 (4%).


•	The remaining Ag segment product COGS, primarily feed and farm supplies, decreased $189.5 million due to a reduction in retail sales and the purchase price of plant food and sunflower.

All Other Segments



	For the Years Ended August 31,								2018 vs. 2017				2017 vs. 2016
	2018			(As Restated) 2017			(As Restated) 2016		$ Change			% Change	$ Change			% Change
	(Dollars in thousands)
Nitrogen Production COGS	$	1,340		$	(538	)	$	2,222	$	1,878		NM*	$	(2,760	)	NM*
Corporate and Other COGS	$	(3,307	)	$	4,360		$	431	$	(7,667	)	NM*	$	3,929		NM*

*NM - Not Meaningful

Comparison of All Other Segments COGS for the years ended August 31, 2018 , and 2017

There were no significant changes to COGS for our Nitrogen Production segment or Corporate and Other during fiscal 2018 .

Comparison of All Other Segments COGS for the years ended August 31, 2017 , and 2016

There were no significant changes to COGS for our Nitrogen Production segment or Corporate and Other during fiscal 2017 .

Marketing, General and Administrative Expenses



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change		% Change
	(Dollars in thousands)
Marketing, general and administrative expenses	$	674,083	$	612,007	$	601,266	$	62,076	10.1	%	$	10,741	1.8	%

Table of Contents

Comparison of marketing, general and administrative expenses for the years ended August 31, 2018 , and 2017

The $62.1 million increase in marketing, general and administrative expenses for fiscal 2018 relates primarily to higher compensation expense associated with annual incentive-based compensation resulting from fiscal 2018 results and increased outside service expenses.

Comparison of marketing, general and administrative expenses for the years ended August 31, 2017 , and 2016

The $10.7 million increase in marketing, general and administrative expenses for fiscal 2017 reflects higher compensation expense, including incentive compensation expense and separation expenses associated with the departure of our former chief executive officer, which was partially offset by decreases in foreign currency exchange expenses and management focus on cost containment.

Reserve and Impairment Charges (Recoveries), Net



	For the Years Ended August 31,							2018 vs. 2017					2017 vs. 2016
	2018			(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Reserve and impairment charges (recoveries), net	$	(37,709	)	$	456,679	$	75,036	$	(494,388	)	(108.3	)%	$	381,643	508.6	%

Comparison of reserve and impairment charges (recoveries), net for the years ended August 31, 2018 , and 2017

The $494.4 million decrease in reserve and impairment charges (recoveries), net primarily reflects the following:


•	Reserves of approximately $229.4 million related to a Brazil trading partner in our Ag segment entering bankruptcy-like proceedings under Brazilian law that were recorded during the third quarter of fiscal 2017 which did not reoccur in fiscal 2018 .


•	An impairment charge of $32.7 million during the third quarter of fiscal 2017 associated with the cancellation of a capital project in our Energy segment and $110.6 million associated with the impairment of long-lived assets and goodwill in our Ag segment in fiscal 2017, neither of which reoccurred in fiscal 2018 .


•	Subsequent to fiscal 2017, we were able to recover $37.7 million of impairment charges that had been recorded by receiving higher than expected sale prices on certain assets and insurance proceeds.


•	The remaining decrease is mostly attributed to loan losses and accounts receivable reserve expense primarily related to a single producer borrower recorded during fiscal 2017 which did not reoccur in fiscal 2018.

Comparison of reserve and impairment charges (recoveries), net for the years ended August 31, 2017 , and 2016

The $381.6 million increase in reserve and impairment charges (recoveries), net primarily reflects the following:


•	A Brazil trading partner in our Ag segment entering into bankruptcy-like proceedings under Brazilian law during the third quarter of fiscal 2017 , which resulted in charges of $229.4 million.


•	An impairment charge in our Energy segment of $32.7 million associated with the cancellation of a capital project during the third quarter of fiscal 2017 .


•	Impairment charges of $110.6 million related to the impairment of long-lived assets and goodwill in our Ag segment during fiscal 2017 .


•	The loan loss reserve expense in our Ag segment specific to a single producer borrower increased $81.0 million when compared to fiscal 2016 .


•	These increases were partially offset by decreases in bad debt expense related to other domestic and international areas of the business when compared to fiscal 2016 .

Gain (Loss) on Disposal of Business



	For the Years Ended August 31,						2018 vs. 2017			2017 vs. 2016
	2018		(As Restated) 2017			(As Restated) 2016	$ Change		% Change	$ Change			% Change
	(Dollars in thousands)
Gain (loss) on disposal of business	$	131,816	$	(2,190	)	—	$	134,006	NM*	$	(2,190	)	NM*

*NM - Not Meaningful

Table of Contents

Comparison of (gain) loss on disposal of business for the years ended August 31, 2018 , and 2017

The increase in gain (loss) on disposal of business is primarily attributable to gains recognized on the sale of certain assets during the third quarter of fiscal 2018 , including a $65.9 million gain in our Energy segment associated with the sale of 34 Zip Trip stores located in the Pacific Northwest and the sale of the Council Bluffs pipeline and refined fuels terminal in Council Bluffs, Iowa, and a $58.2 million gain in Corporate and Other associated with the sale of CHS Insurance.

Interest Expense



	For the Years Ended August 31,						2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Interest expense	$	149,202	$	171,239	$	113,704	$	(22,037	)	(12.9	)%	$	57,535	50.6	%

Comparison of interest expense for the years ended August 31, 2018 , and 2017

The $22.0 million decrease in interest expense for fiscal 2018 was due to lower interest expense associated with lower long-term debt balances during the fourth quarter of fiscal 2018 .

Comparison of interest expense for the years ended August 31, 2017 , and 2016

The $57.5 million increase in interest expense for fiscal 2017 was due to higher interest expense of $34.1 million associated with higher debt balances, as well as lower capitalized interest of $23.4 million associated with our ongoing capital projects.

Other Income (Loss)



	For the Years Ended August 31,						2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Other income (loss)	$	78,015	$	99,951	$	47,609	$	(21,936	)	(21.9	)%	$	52,342	109.9	%

Comparison of other income (loss) for the years ended August 31, 2018 , and 2017

The $21.9 million decrease in other income (loss) for fiscal 2018 primarily reflects the following:

•

A gain of $30.5 million recorded during fiscal 2017 associated with an embedded derivative within the contract relating to our strategic investment in CF Nitrogen that did not reoccur during fiscal 2018 . See Note 13, Derivative Financial Instruments and Hedging Activities, of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.


•	The decrease associated with the embedded derivative was partially offset by increased interest income due to higher interest rates and other non-operating activity.

Comparison of other income (loss) for the years ended August 31, 2017 , and 2016

The $52.3 million increase in other income (loss) for fiscal 2017 primarily reflects the following:


•	Higher financing fees earned by us which are associated with various customer activities and receivables totaling $27.8 million.


•	A gain of $30.5 million recorded in association with an embedded derivative within the contract relating to our strategic investment in CF Nitrogen, of which $29.1 million was recognized during the first quarter of fiscal 2017 .

Table of Contents

Equity Income (Loss) from Investments



	For the Years Ended August 31,						2018 vs. 2017				2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016		$ Change		% Change		$ Change			% Change
	(Dollars in thousands)
Equity income (loss) from investments*	$	153,515	$	137,338	$	175,777	$	16,177	11.8	%	$	(38,439	)	(21.9	)%

* See Note 5, Investments, of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Comparison of equity income (loss) from investments for the years ended August 31, 2018 , and 2017

Equity income (loss) from investments for fiscal 2018 increase d primarily due to higher equity income recognized from our equity method investment in CF Nitrogen caused by higher margins, which was partially offset by lower equity income recognized from our equity method investments in Ventura Foods, Ardent Mills and other equity method investments.

Comparison of equity income (loss) from investments for the years ended August 31, 2017 , and 2016

Equity income (loss) from investments for fiscal 2017 decrease d primarily due to lower equity income recognized from our equity method investments in Ventura Foods and CF Nitrogen caused by lower margins, which was partially offset by higher equity income recognized from our equity method investments in TEMCO and Ardent Mills. We also recorded $20.2 million of impairments related to international investments as a result of continued downward pressures in the agricultural markets.

Income Tax Benefit (Expense)



	For the Years Ended August 31,							2018 vs. 2017					2017 vs. 2016
	2018		(As Restated) 2017		(As Restated) 2016			$ Change			% Change		$ Change		% Change
	(Dollars in thousands)
Income tax benefit (expense)	$	104,076	$	181,124	$	(19,099	)	$	(77,048	)	(42.5	)%	$	200,223	(1,048.3	)%

Comparison of income taxes for the years ended August 31, 2018 , and 2017

The decrease in income tax benefit was primarily due to incremental tax benefits recognized during fiscal 2017 that did not reoccur during fiscal 2018, including the recognition of deferred tax benefits related to the issuance of non-qualified equity certificates in fiscal 2013 and 2014, a tax benefit for retaining a significant portion of the Domestic Production Activities Deduction ("DPAD") and the bad debt deduction in our U.S. tax returns related to the performance of guarantees caused by the loss related to a Brazilian trading partner entering into bankruptcy-like proceedings under Brazilian law. The decrease was partially offset by income tax benefits recognized during fiscal 2018 , primarily including the revaluation of our net deferred tax liability resulting from the Tax Act enacted on December 22, 2017, the intercompany transfer of a business on December 1, 2017, and retaining a significant portion of the DPAD. The revaluation performed related to the Tax Act is considered a provisional estimate and could be subject to change. The federal and state statutory rate applied to nonpatronage business activity was 29.3% and 38.4% for the years ended August 31, 2018 , and 2017 , respectively. The income taxes and effective tax rates vary each year based upon profitability and nonpatronage business activity during each of the comparable years.

Comparison of income taxes for the years ended August 31, 2017 , and 2016

During fiscal 2017 , we had an increase in income tax benefit when compared to fiscal 2016, which was primarily due to the recognition of deferred tax benefits related to the issuance of non-qualified equity certificates in fiscal 2013 and 2014, a tax benefit in fiscal 2017 from retaining a significant portion of the DPAD and the bad debt deduction in our U.S. tax returns related to the performance of guarantees caused by an approximate $229.4 million loss related to a Brazilian trading partner entering into bankruptcy-like proceedings under Brazilian law. The fiscal 2016 income tax benefit related to an appeals settlement with the Internal Revenue Service did not reoccur in fiscal 2017. The federal and state statutory rate applied to nonpatronage business activity was 38.4% and 38.3% for the years ended August 31, 2017, and 2016, respectively. The income taxes and effective tax rate vary each year based upon profitability and nonpatronage business activity during each of the comparable years with the fiscal 2017 income tax benefit being unusually large in comparison to income before income taxes.

Table of Contents

Liquidity and Capital Resources

Summary

In assessing our financial condition, we consider factors such as working capital and internal benchmarking related to our applicable covenants and other financial criteria. We fund our operations primarily through a combination of cash flows from operations supplemented with borrowings under our revolving credit facilities. We fund our capital expenditures and growth primarily through cash, operating cash flow and long-term debt financing.

On August 31, 2018 , and 2017 , we had working capital, defined as current assets less current liabilities, of $759.0 million and $148.6 million , respectively. The increase in working capital was driven primarily by increases in our accounts receivable, inventory and cash and cash equivalents that were funded out of operating and investing cash flow. Our current ratio, defined as current assets divided by current liabilities, was 1.1 and 1.0 as of August 31, 2018 , and 2017 , respectively. Working capital and the current ratio may not be computed the same as similarly titled measures used by other companies. We believe this information is meaningful to investors as a measure of operational efficiency and short-term financial health.

As of August 31, 2018 , we had cash and cash equivalents of $450.6 million , total equities of $8.2 billion , long-term debt. including current maturities of $1.9 billion and notes payable of $2.3 billion . Our capital allocation priorities include paying our dividends, maintaining the safety and compliance of our operations, returning cash to our member-owners in the form of cash patronage and equity redemptions, paying down debt and taking advantage of strategic opportunities that benefit our owners. We will continue to consider opportunities to further diversify and enhance our sources and amounts of liquidity. These opportunities include reducing operating expenses, deploying and/or financing working capital more efficiently and identifying and disposing of nonstrategic or underperforming assets. We believe that cash generated by operating and investing activities, along with available borrowing capacity under our credit facilities, will be sufficient to support our operations for the foreseeable future and we expect to remain in compliance with our loan covenants.

Fiscal 2018 and 2017 Activity

During fiscal 2018, we completed the disposal of certain assets within our Ag and Energy segments as well as within Corporate and Other resulting in cash proceeds of $234.9 million and a corresponding gain of $131.8 million . The cash proceeds were used to optimize our debt levels by reducing our need for incremental debt, minimizing existing funded debt and funding a total of approximately $160 million in loan guarantees to our Brazilian operations as a result of losses caused by a trading partner of ours in Brazil entering into bankruptcy-like proceedings under Brazilian law.

On June 28, 2018 , we amended an existing receivables and loans securitization facility (“Securitization Facility”) with certain unaffiliated financial institutions (the "Purchasers"). Under the Securitization Facility, we and certain of our subsidiaries sell trade accounts and notes receivable (the “Receivables”) to Cofina Funding, LLC (“Cofina”), a wholly-owned bankruptcy-remote indirect subsidiary of CHS. Cofina in turn transfers the Receivables to the Purchasers, which is accounted for as a secured borrowing. During the period from July 2017 through the amendment of the Securitization Facility in June 2018 , CHS accounted for Receivables sold under the Securitization Facility as a sale of financial assets pursuant to Accounting Standards Codification 860, Transfers and Servicing, and the Receivables sold were derecognized from our Consolidated Balance Sheets. We use the proceeds from the sale of Receivables under the Securitization Facility for general corporate purposes and settlements are made on a monthly basis. The Securitization Facility terminates on June 17, 2019 , but may be extended.

The amount available under the Securitization Facility fluctuates over time based on the total amount of eligible Receivables generated during the normal course of business, with maximum availability of $700.0 million . As of August 31, 2018 , and 2017 , the total availability under the Securitization Facility was $645.0 million and $618.0 million , respectively, of which all had been utilized.

Cash Flows



	For the Years Ended August 31,									2018 vs. 2017					2017 vs. 2016
	2018			(As Restated) 2017			(As Restated) 2016			$ Change			% Change		$ Change			% Change
	(Dollars in thousands)
Net cash provided by (used in) operating activities	$	1,072,068		$	919,118		$	1,260,554		$	152,950		16.6	%	$	(341,436	)	(27.1	)%
Net cash provided by (used in) investing activities	(79,524		)	(405,041		)	(3,746,971		)	325,517			80.4	%	3,341,930			89.2	%
Net cash provided by (used in) financing activities	(732,170		)	(618,258		)	1,814,196			(113,912		)	(18.4	)%	(2,432,454		)	(134.1	)%
Effect of exchange rate changes on cash and cash equivalents	8,864			(4,713		)	(5,223		)	13,577			288.1	%	510			9.8	%
Net increase (decrease) in cash and cash equivalents	$	269,238		$	(108,894	)	$	(677,444	)	$	378,132		347.2	%	$	568,550		83.9	%

Table of Contents

Fiscal Year 2018 Compared to Fiscal Year 2017

The $153.0 million increase in cash provided by operating activities reflects cash generated through working capital efficiencies, including improvements in inventory positions and collection efforts for accounts and notes receivable. Net cash provided by operating activities was also higher for the year due to higher net income, including adjustments for non-cash items.

The $325.5 million increase in cash from investing activities for fiscal 2018 reflects the following:


•	Proceeds of $234.9 million from the sale of certain North American businesses/assets primarily during the three months ended May 31, 2018, in our Ag and Energy segments and our insurance business reported in Corporate and Other. The proceeds received were partially used to reduce long-term debt.


•	Proceeds of $91.2 million from the sale of property, plant, and equipment, including $54.7 million related to the sale of our corporate office building in Inver Grove Heights, Minnesota in the first quarter of fiscal 2018 which was subsequently leased back to us. The proceeds received were used to reduce our long-term debt.

Cash from financing activities for fiscal 2018 decrease d $113.9 million , primarily due to the following:


•	Increased payments, net of borrowings, on lines of credit and long-term borrowings as part of our focus to manage financial leverage and liquidity optimization.


•	The decrease above was partially offset by the authorization to not distribute cash patronage during the fiscal year.

Fiscal Year 2017 Compared to Fiscal Year 2016

Cash from operating activities for fiscal 2017 decreased $341.4 million , primarily due to the following:

•

Increases in inventory resulting from increased commodity prices and volumes on hand. On August 31, 2017, the per bushel market prices of two of our primary grain commodities, spring wheat and corn, increased by $1.33 (27%) and $0.41 (14%), respectively, when compared to the spot prices on August 31, 2016. The per bushel market price of our third primary commodity, soybeans, decreased by $0.24 (2%) when compared to the spot price on August 31, 2016. In general, crude oil market prices increased $2.53 (6%) per barrel on August 31, 2017, when compared to August 31, 2016. Partially offsetting grain prices, fertilizer commodity prices affecting our wholesale crop nutrients and country operations retail businesses reflected decreases of up to 14%, depending on the specific products, compared to prices on August 31, 2016.


•	Lower net income due to increased reserve and impairment charges within our Ag and Energy segments.

The $3.3 billion increase in cash from investing activities for fiscal 2017 reflects the following:


•	Our $2.8 billion investment in CF Nitrogen completed in fiscal 2016 which didn't reoccur in fiscal 2017.


•	Reduced acquisitions of property, plant and equipment and other business acquisitions. The significant decrease in acquisitions of property, plant and equipment was primarily related to our plan to reduce our capital investments to allow us to actively reduce our funded debt obligations.


•	Net cash proceeds of $7.9 million related to the sale of Receivables associated with the Securitization Facility.

Cash from financing activities for fiscal 2017 decreased $2.4 billion , primarily due to the following:


•	Proceeds from issuances of debt instruments related primarily to the financing of the CF Nitrogen investment in fiscal 2016 which didn't reoccur in fiscal 2017.


•	The decrease above was partially offset by reduced payments of cash patronage in fiscal 2017 and the final contingent payment of the noncontrolling interest in CHS McPherson Refinery Inc. ("CHS McPherson") made in fiscal 2016.

Future Uses of Cash

We expect to utilize cash and cash equivalents, along with cash generated by operating activities, to fund capital expenditures, major repairs, debt and interest payments, preferred stock dividends, patronage and equity redemptions. The following is a summary of our primary cash requirements for fiscal 2019 :


•	Capital expenditures. We expect total capital expenditures for fiscal 2019 to be approximately $515.0 million, compared to capital expenditures of $355.4 million in fiscal 2018 . Included in that amount for fiscal 2019 is approximately $151.0 million for the acquisition of property, plant and equipment at our Laurel, Montana and McPherson, Kansas refineries.

Table of Contents

•

Major repairs . Refineries have planned major maintenance to overhaul, repair, inspect and replace process materials and equipment (referred to as "turnaround") which typically occur for a five-to-six-week period every 2-4 years. Our McPherson, Kansas refinery has planned maintenance scheduled for fiscal 2019 for approximately $177.0 million. We paid $80.5 million for major repairs, primarily at our Laurel, Montana refinery in fiscal 2018.


•	Debt and interest. We expect to repay approximately $168 million of long-term debt and capital lease obligations and incur interest payments related to long-term debt of approximately $83.0 million during fiscal 2019 .


•	Preferred stock dividends. We had approximately $2.3 billion of preferred stock outstanding at August 31, 2018 . We expect to pay dividends on our preferred stock of approximately $168.7 million during fiscal 2019 .


•	Patronage . Our Board of Directors authorized approximately $75.0 million of our fiscal 2018 patronage sourced earnings to be paid to our member owners during fiscal 2019.


•	Equity redemptions . We expect total redemptions of approximately $79.0 million to be distributed in fiscal 2019 and to be in the form of redemptions of qualified and non-qualified equity owned by individual producer members and associations. This amount includes approximately $4.0 million of authorized redemptions from fiscal 2018 to be paid in fiscal 2019.

Future Sources of Cash

We fund our current operations primarily through a combination of cash flows from operations and committed and uncommitted revolving credit facilities, including our Securitization Facility. We believe these sources will provide adequate liquidity to meet our working capital needs. We fund certain of our long-term capital needs, primarily those related to acquisitions of property, plant and equipment from cash flows from operations and by issuing privately placed long-term debt and term loans. In addition, our wholly-owned subsidiary, CHS Capital, makes loans to member cooperatives, businesses and individual producers of agricultural products included in our cash flows from investing activities, and has financing sources as detailed below in CHS Capital Financing .

Working Capital Financing

We finance our working capital needs through committed and uncommitted lines of credit with domestic and international banks. We believe our current cash balances and our available capacity on our committed lines of credit will provide adequate liquidity to meet our working capital needs. The following table summarizes our primary lines of credit as of August 31, 2018 , and 2017 :



Primary Revolving Credit Facilities	Maturities	Total Capacity		Borrowings Outstanding		Interest Rates
		2018		2018	2017
		(Dollars in thousands)
Committed Five-Year Unsecured Facility	2021	$	3,000,000	$—	$480,000	LIBOR or Base Rate +0.00% to 1.45%
Uncommitted Bilateral Facilities	2019	515,000		515,000	350,000	LIBOR or Base Rate +0.00% to 1.20%

In addition to our primary revolving lines of credit, we have a three-year $315.0 million committed revolving pre-export credit facility for CHS Agronegocio Industria e Comercio Ltda ("CHS Agronegocio"), our wholly-owned subsidiary in Brazil. CHS Agronegocio uses the facility, which expires in April 2020, to finance its working capital needs related to its purchases and sales of grains, fertilizers and other agricultural products. As of August 31, 2018 , the outstanding balance under the facility was $181.1 million .

As of August 31, 2018 , in addition to our uncommitted bilateral facilities above, our wholly-owned subsidiaries, CHS Europe S.a.r.l and CHS Agronegocio, had uncommitted lines of credit with $454.1 million outstanding. In addition, our other international subsidiaries had total lines of credit outstanding of $279.4 million as of August 31, 2018 , of which $40.5 million was collateralized.

On August 31, 2018 , and 2017 , we had total short-term indebtedness outstanding on these various primary and other facilities, as well as other miscellaneous short-term notes payable, in the amount of $1.4 billion and $1.7 billion, respectively.

Table of Contents

Long-term Debt Financing

The following table presents summarized long-term debt data for the years ended August 31, 2018 , and 2017 .



	For the Years Ended August 31,
	2018			2017
	(Dollars in thousands)
Private placement debt	$	1,510,547		$	1,643,886
Bank financing	366,000			445,000
Capital lease obligations	25,280			33,075
Other notes and contract payable	32,607			62,652
Deferred financing costs	(4,179		)	(4,820		)
	$	1,930,255		$	2,179,793

Long-term debt outstanding as of August 31, 2018 , has aggregate maturities, excluding fair value adjustments and capital leases, as follows:



	(Dollars in thousands)
2019	$	162,846
2020	30,671
2021	182,472
2022	65
2023	282,065
Thereafter	1,260,570
	$	1,918,689

See Note 8, Notes Payable and Long-Term Debt, of the notes to consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

CHS Capital Financing

For a description of the Securitization Facility, see above in Fiscal 2018 and 2017 activity.

CHS Capital has available credit under master participation agreements with several counterparties. Borrowings under these agreements are accounted for as secured borrowings and bear interest at variable rates ranging from 2.22% to 3.72% as of August 31, 2018. As of August 31, 2018, the total funding commitment under these agreements was $36.0 million , of which $6.3 million was borrowed.

CHS Capital sells loan commitments it has originated to ProPartners Financial ("ProPartners") on a recourse basis. The total outstanding commitments under the program were $180.9 million as of August 31, 2018 , of which $98.3 million was borrowed under these commitments with an interest rate of 3.22% .

CHS Capital borrows funds under short-term notes issued as part of a surplus funds program. Borrowings under this program are unsecured and bear interest at variable rates ranging from 0.10% to 1.40% as of August 31, 2018 , and are due upon demand. Borrowings under these notes totaled $69.3 million as of August 31, 2018 .

Covenants

Our long-term debt is unsecured; however, restrictive covenants under various debt agreements require the maintenance of minimum consolidated net worth and other financial ratios. We were in compliance with all debt covenants and restrictions as of August 31, 2018 . Based on our current 2019 projections, we expect continued covenant compliance.

In September 2015, we amended all outstanding private placement notes to conform the financial covenants applicable thereto to those of our amended and restated five-year, unsecured, revolving credit facility. The amended notes provide that if our ratio of consolidated funded debt to consolidated cash flow is greater than 3.0 to 1.0, the interest rate on all outstanding notes will be increased by 0.25% until the ratio becomes 3.0 or less. During both fiscal 2018 and 2017, our ratio of funded debt to consolidated cash flow remained below 3.0 to 1.0.

Table of Contents

Patronage and Equity Redemptions

In accordance with our bylaws and upon approval by our Board of Directors, annual net earnings from patronage sources are distributed to consenting patrons following the close of each fiscal year. For the year ended August 31, 2018, our Board of Directors authorized distributions of $420.3 million , with qualified cash distributions of $75.0 million and non-qualified equity distributions of $345.3 million . For the year ended August 31, 2017, our Board of Directors authorized only non-qualified distributions, with no cash patronage. For the years ended August 31, 2016, and 2015, the cash portion of the qualified distributions was deemed by our Board of Directors to be 40%.

The following table presents estimated patronage data for the year ending August 31, 2019, and actual patronage data for the years ended August 31, 2018 , 2017 , and 2016 :



	2019		2018		2017		2016
	(Dollars in millions)
Patronage Distributed in Cash	$	75.0	$	—	$	103.9	$	251.7
Patronage Distributed in Equity	345.3		128.8		153.6		375.5
Total Patronage Distributed	$	420.3	$	128.8	$	257.5	$	627.2

In accordance with authorization from our Board of Directors, we expect total redemptions related to the year ended August 31, 2018 , that will be distributed in fiscal 2019 , to be approximately $75.0 million. These redemptions are classified as a current liability on the August 31, 2018 , Consolidated Balance Sheet.

Other Financing

On March 30, 2017, we issued 695,390 shares of Class B Series 1 Preferred Stock to redeem approximately $20.0 million of qualified equity certificates to eligible owners. Each share of Class B Series 1 Preferred Stock was issued in redemption of $28.74 of qualified equity certificates.

See Note 10, Equities, of the notes to consolidated financial statements that are included in this Annual Report on Form 10-K for a summary of our outstanding preferred stock as of August 31, 2018 , each series of which is listed on the Global Select Market of NASDAQ.

Off Balance Sheet Financing Arrangements

Guarantees:

We are a guarantor for lines of credit and performance obligations of related, non-consolidated companies. Our bank covenants allow maximum guarantees of $1.0 billion , of which $122.3 million were outstanding on August 31, 2018 . We have collateral for a portion of these contingent obligations. We have not recorded a liability related to the contingent obligations as we do not expect to pay out any cash related to them, and the fair values are considered immaterial. The underlying loans to the counterparties for which we provide guarantees were current as of August 31, 2018 .

Operating leases:

Future minimum lease payments required under noncancelable operating leases as of August 31, 2018 , were $352.1 million .

Debt:

There is no material off balance sheet debt.

Receivables Securitization Facility and Loan Participations:

During fiscal 2018, we engaged in off-balance sheet arrangements through our Securitization Facility and certain loan participation agreements. In the fourth fiscal quarter of 2018 , we amended the Securitization Facility so that the transfer of Receivables is accounted for as a secured borrowing. Refer to further details about these arrangements in Note 2, Receivables, of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K.

Table of Contents

Contractual Obligations

We had certain contractual obligations at August 31, 2018 , which require the following payments to be made:



	Payments Due by Period
	Total		Less than 1 Year		1 - 3 Years		3 - 5 Years		More than 5 Years
	(Dollars in thousands)
Long-term debt obligations ⁽¹⁾	$	1,918,689	$	162,846	$	213,143	$	282,130	$	1,260,570
Interest payments ⁽²⁾	641,173		83,030		151,430		134,066		272,647
Capital lease obligations ⁽³⁾	28,593		4,845		8,792		7,020		7,936
Operating lease obligations	352,062		103,800		92,081		52,381		103,800
Purchase obligations ⁽⁴⁾	8,719,832		7,331,773		541,845		262,572		583,642
Other liabilities ⁽⁵⁾	519,289		16,443		44,967		19,120		438,759
Total obligations	$	12,179,638	$	7,702,737	$	1,052,258	$	757,289	$	2,667,354

_______________________________________


⁽¹⁾	Excludes fair value adjustments to the long-term debt reported on our Consolidated Balance Sheet at August 31, 2018 , resulting from fair value interest rate swaps and the related hedge accounting.


⁽²⁾	Based on interest rates and long-term debt balances at August 31, 2018 .


⁽³⁾	Future minimum lease payments under capital leases include amounts related to bargain purchase options and residual value guarantees, which represent economic obligations as opposed to contractual payment obligations.

⁽⁴⁾

Purchase obligations are legally binding and enforceable agreements to purchase goods or services that specify all significant terms, including fixed or minimum quantities; fixed, minimum or variable price provisions; and approximate time of the transactions. In the ordinary course of business, we enter into a significant number of forward purchase commitments for agricultural and energy commodities and the related freight. The purchase obligation amounts shown above include both short- and long-term obligations and are based on: a) fixed or minimum quantities to be purchased; and b) fixed or estimated prices to be paid at the time of settlement. Current estimates are based on assumptions about future market conditions that will exist at the time of settlement. Consequently, actual amounts paid under these contracts may differ due to the variable pricing provisions. Market risk related to the variability of our forward purchase commitments is economically hedged by offsetting forward sale contracts that are not included in the amounts above.


⁽⁵⁾	Other liabilities include the long-term portion of deferred compensation, deferred tax liabilities and contractual redemptions. Of the total other liabilities and deferred tax liabilities of $519.3 million on our Consolidated Balance Sheet at August 31, 2018 , the timing of the payments of $424.5 million of such liabilities cannot be determined.

Critical Accounting Estimates

Our consolidated financial statements are prepared in conformity with U.S. GAAP. The preparation of these consolidated financial statements requires the use of estimates as well as management’s judgments and assumptions regarding matters that are subjective, uncertain or involve a high degree of complexity, all of which affect the results of operations and financial condition for the periods presented. We believe that the following significant accounting policies may involve a higher degree of estimates, judgments and complexity.

Inventory Valuation and Reserves

Grain, processed grain, oilseed and processed oilseed inventories are stated at net realizable value. All other inventories are stated at the lower of cost or net realizable value. The costs of certain energy inventories (wholesale refined products, crude oil and asphalt) are determined on the last-in, first-out ("LIFO") method; all other inventories of non-grain products purchased for resale are valued on the first-in, first-out ("FIFO") and average cost methods. Estimates are used in determining the net realizable values of grain and oilseed and processed grains and oilseeds inventories. These estimates include the measurement of grain in bins and other storage facilities, which use formulas in addition to actual measurements taken to arrive at appropriate quantities. Other determinations made by management include quality of the inventory and estimates for freight. Grain shrink reserves and other reserves that account for spoilage also affect inventory valuations. If estimates regarding the valuation of inventories, or the adequacy of reserves, are less favorable than management’s assumptions, then additional reserves or write-downs of inventories may be required.

Table of Contents

Derivative Financial Instruments

We enter into exchange-traded commodity futures and options contracts to hedge our exposure to price fluctuations on energy, grain and oilseed transactions to the extent considered practicable for minimizing risk. Futures and options contracts used for hedging are purchased and sold through regulated commodity exchanges. We also use over-the-counter ("OTC") instruments to hedge our exposure on fixed-price contracts. Fluctuations in inventory valuations, however, may not be completely hedged, due in part to the absence of satisfactory hedging facilities for certain commodities and geographical areas and, in part, to our assessment of our exposure from expected price fluctuations. We also manage our risks by entering into fixed-price purchase contracts with preapproved producers and establishing appropriate limits for individual suppliers. Fixed-price sales contracts are entered into with customers of acceptable creditworthiness, as internally evaluated. The fair values of futures and options contracts are determined primarily from quotes listed on regulated commodity exchanges. Fixed-price purchase and sales contracts are with various counterparties, and the fair values of such contracts are determined from the market price of the underlying product. We are exposed to loss in the event of nonperformance by the counterparties to the contracts and, therefore, contract values are reviewed and adjusted to reflect potential nonperformance. Risk of nonperformance by counterparties includes the inability to perform because of a counterparty’s financial condition and also the risk that the counterparty will refuse to perform on a contract during periods of price fluctuations where contract prices are significantly different than the current market prices.

Pension and Other Postretirement Benefits

Pension and other postretirement benefits costs and obligations are dependent on assumptions used in calculating such amounts. These assumptions include discount rates, health care cost trend rates, benefits earned, interest costs, expected return on plan assets, mortality rates and other factors. In accordance with U.S. GAAP, actual results that differ from the assumptions are accumulated and amortized over future periods and, therefore, generally affect recognized expenses and the recorded obligations in future periods. While our management believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect our pension and other postretirement obligations and future expenses.

Deferred Tax Assets and Uncertain Tax Positions

We assess whether a valuation allowance is necessary to reduce our deferred tax assets to the amount that we believe is more likely than not to be realized. While we have considered future taxable income, as well as other factors, in assessing the need for the valuation allowance, in the event that we were to determine that we would not be able to realize all, or part of, our net deferred tax assets in the future, an adjustment to our deferred tax assets would be charged to income in the period such determination was made. We are also significantly impacted by the utilization of tax credits, some of which were passed to us from CHS McPherson (formerly known as National Cooperative Refinery Association), related to refinery upgrades that enable us to produce ultra-low sulfur fuels. Our tax credit carryforwards are available to offset future federal and state tax liabilities with the tax credits becoming unavailable to us if not used by their expiration date. Our net operating loss carryforwards for tax purposes are available to offset future taxable income. If our loss carryforwards are not used, these loss carryforwards will expire.

Tax benefits related to uncertain tax positions are recognized in our financial statements if it is more likely than not that the position would be sustained upon examination by a tax authority that has full knowledge of all relevant information. The benefits are measured using a cumulative probability approach. Under this approach, we record in our financial statements the greatest amount of tax benefits that have a more than 50% probability of being realized upon final settlement with the tax authorities. In determining these tax benefits, we assign probabilities to a range of outcomes that we feel we could ultimately settle on with the tax authorities using all relevant facts and information available at the reporting date. Due to the complexity of these uncertainties, the ultimate resolution may result in a benefit that is materially different than our current estimate.

Long-Lived Assets

Property, plant and equipment is depreciated or amortized over the expected useful lives of individual or groups of assets based on the straight-line method. Economic circumstances, or other factors, may cause management’s estimates of expected useful lives to differ from actual.

All long-lived assets, including property, plant and equipment, goodwill, investments in unconsolidated affiliates and other identifiable intangibles, are evaluated for impairment in accordance with U.S. GAAP, at least annually for goodwill, and whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset or asset group may not be recoverable. For goodwill, our annual impairment testing occurs in our fourth quarter. An impaired asset is written down to its

Table of Contents

estimated fair value based on the best information available. Fair value is generally measured by discounting estimated future cash flows. Considerable management judgment is necessary to estimate discounted future cash flows and may differ from actual.

We have asset retirement obligations with respect to certain of our refineries and other assets due to various legal obligations to clean and/or dispose of the component parts at the time they are retired. In most cases, these assets can be used for extended and indeterminate periods of time, as long as they are properly maintained and/or upgraded. It is our practice and current intent to maintain refineries and related assets and to continue making improvements to those assets based on technological advances. As a result, we believe our refineries and related assets have indeterminate lives for purposes of estimating asset retirement obligations because dates or ranges of dates upon which we would retire a refinery and related assets cannot reasonably be estimated at this time. When a date or range of dates can reasonably be estimated for the retirement of any component part of a refinery or other asset, we will estimate the cost of performing the retirement activities and record a liability for the fair value of that future cost.

We have other assets that we may be obligated to dismantle at the end of corresponding lease terms subject to lessor discretion for which we have recorded asset retirement obligations. Based on our estimates of the timing, cost and probability of removal, these obligations are not material.

Effect of Inflation and Foreign Currency Transactions

We believe that inflation and foreign currency fluctuations have not had a significant effect on our operations during the three years ended August 31, 2018 , since we conduct a significant portion of our business in U.S. dollars.

Recent Accounting Pronouncements

See Note 1, Organization, Basis of Presentation and Significant Accounting Policies, of the notes to consolidated financial statements that are included in this Annual Report on Form 10-K for information concerning new accounting standards and the impact of the implementation of those standards on our financial statements.

Table of Contents

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

COMMODITY PRICE RISK

When we enter into a commodity purchase or sales commitment, we incur risks related to price changes and performance including delivery, quality, quantity and shipment period. In the event that market prices decrease, we are exposed to risk of loss for the market value of inventory and purchase contracts with a fixed or partially fixed price. Conversely, we are exposed to risk of loss on our fixed or partially fixed price sales contracts in the event that market prices increase.

Our use of hedging reduces the exposure to price volatility by protecting against adverse short-term price movements, but it also limits the benefits of favorable short-term price movements. To reduce the price risk associated with fixed price commitments, we generally enter into commodity derivative contracts, to the extent practical, to achieve a net commodity position within the formal position limits we have established and deemed prudent for each commodity. These contracts are primarily transacted on regulated commodity futures exchanges but may also include over-the-counter derivative instruments when deemed appropriate. For commodities where there is no liquid derivative contract, risk is managed through the use of forward sales contracts, other pricing arrangements and, to some extent, futures contracts in highly correlated commodities. These contracts are economic hedges of price risk, but are not designated as hedging instruments for accounting purposes. The contracts are recorded on our Consolidated Balance Sheets at fair values based on quotes listed on regulated commodity exchanges or the market prices of the underlying products listed on the exchanges, except that fertilizer and propane contracts are accounted for as normal purchase and normal sales transactions. Unrealized gains and losses on these contracts are recognized in cost of goods sold in our Consolidated Statements of Operations.

When a futures position is established, initial margin must be deposited with the applicable exchange or broker. The amount of margin required varies by commodity and is set by the applicable exchange at its sole discretion. If the market price relative to a short futures position increases, an additional margin deposit would be required. Similarly, a margin deposit would be required if the market price relative to a long futures position decreases. Conversely, if the market price increases relative to a long futures position or decreases relative to a short futures position, margin deposits may be returned by the applicable exchange or broker.

Our policy is to manage our commodity price risk exposure according to internal polices and in alignment with our tolerance for risk. It is our policy that our profitability should come from operations, primarily derived from margins on products sold and grain merchandised, not from hedging transactions. At any one time, inventory and purchase contracts for delivery to us may be substantial. We have risk management policies and procedures that include established net position limits. These limits are defined for each commodity and business unit, and may include both trader and management limits as appropriate. The limits policy is overseen at a high level by our corporate compliance team, with day to day monitoring procedures managed within each individual business unit to ensure any limits overage is explained and exposures reduced, or a temporary limit increase is established if needed. The position limits are reviewed, at least annually, with our senior leadership and Board of Directors. We monitor current market conditions and may expand or reduce our net position limits or procedures in response to changes in those conditions.

The use of hedging instruments does not protect against nonperformance by counterparties to cash contracts. We evaluate counterparty exposure by reviewing contracts and adjusting the values to reflect potential nonperformance. Risk of nonperformance by counterparties includes the inability to perform because of a counterparty’s financial condition and the risk that the counterparty will refuse to perform on a contract during periods of price fluctuations where contract prices are significantly different than the current market prices. We manage these risks by entering into fixed price purchase and sales contracts with preapproved producers and by establishing appropriate limits for individual suppliers. Fixed price contracts are entered into with customers of acceptable creditworthiness, as internally evaluated. Regarding our use of derivatives, we primarily transact in exchange traded instruments or enter into over-the-counter derivatives that clear through a designated clearing organization, which limits our counterparty exposure relative to hedging activities. Historically, we have not experienced significant events of nonperformance on open contracts. Accordingly, we only adjust the estimated fair values of specifically identified contracts for nonperformance. Although we have established policies and procedures, we make no assurances that historical nonperformance experience will carry forward to future periods.

A 10% adverse change in market prices would not materially affect our results of operations, since we use commodity futures and forward contracts as economic hedges of price risk, and since our operations have effective economic hedging requirements as a general business practice.

Table of Contents

INTEREST RATE RISK

Debt used to finance inventories and receivables is represented by short-term notes payable, so that our blended interest rate for all such notes approximates current market rates. We have outstanding interest rate swaps with an aggregate notional amount of $495.0 million designated as fair value hedges of portions of our fixed-rate debt. Our objective is to offset changes in the fair value of the debt associated with the risk of variability in the 3-month U.S. Dollar LIBOR interest rate, in essence converting the fixed-rate debt to variable-rate debt. Offsetting changes in the fair values of both the swap instruments and the hedged debt are recorded contemporaneously each period and only create an impact to earnings to the extent that the hedge is ineffective. During fiscal 2018, we recorded offsetting fair value adjustments of $18.7 million , with no ineffectiveness recorded in earnings.

In fiscal 2015, we entered into forward-starting interest rate swaps with an aggregate notional amount of $300.0 million designated as cash flow hedges of the expected variability of future interest payments on our anticipated issuance of fixed-rate debt. During the first quarter of fiscal 2016, we determined that certain of the anticipated debt issuances would be delayed, and we consequently recorded an immaterial amount of losses on the ineffective portion of the related swaps in earnings. Additionally, we paid $6.4 million in cash to settle two of the interest rate swaps upon their scheduled termination dates. During the second quarter of fiscal 2016, we settled two additional interest rate swaps, paying $5.3 million in cash upon their scheduled termination. In January 2016, we issued the fixed-rate debt associated with these swaps and will amortize the amounts which were previously deferred to other comprehensive income into earnings over the life of the debt. The amounts to be included in earnings are not expected to be material during any 12-month period. During the third quarter of fiscal 2016, we settled the remaining two interest rate swaps, paying $5.1 million in cash upon their scheduled termination. We did not issue additional fixed-rate debt as previously planned, and we reclassified all amounts previously recorded to other comprehensive income into earnings.

The table below provides information about our outstanding debt and derivative financial instruments that are sensitive to changes in interest rates. For debt obligations, the table presents scheduled contractual principal payments and related weighted average interest rates for the fiscal years presented. For interest rate swaps, the table presents notional amounts for payments to be exchanged by expected contractual maturity dates for the fiscal years presented and interest rates noted in the table.



Expected Maturity Date
	2019			2020			2021			2022			2023			Thereafter			Total			Fair Value Asset (Liability)
	(Dollars in thousands)
Liabilities:
Variable rate miscellaneous short-term notes payable	$	1,437,264		$	—		$	—		$	—		$	—		$	—		$	1,437,264		$	(1,437,264	)
Average interest rate	3.5		%	—			—			—			—			—			3.5		%	—
Variable rate CHS Capital short-term notes payable	$	834,932		$	—		$	—		$	—		$	—		$	—		$	834,932		$	(834,932	)
Average interest rate	2.8		%	—			—			—			—			—			2.8		%	—
Fixed rate long-term debt	$	162,846		$	30,671		$	182,472		$	65		$	282,065		$	894,570		$	1,552,689		$	(1,505,652	)
Average interest rate	4.2		%	4.4		%	4.5		%	5.1		%	4.5		%	4.6		%	4.0		%	—
Variable rate long-term debt	$	—		$	—		$	—		$	—		$	—		$	366,000		$	366,000		$	(335,927	)
Average interest rate ^(a)	—			—			—			—			—			range			range			—
Interest Rate Derivatives:
Fixed to variable long-term debt interest rate swaps	$	130,000		$	—		$	160,000		$	—		$	—		$	205,000		$	495,000		$	(9,452	)
Average pay rate ^(b)	range			—			range			—			—			range			range			—
Average receive rate ^(c)	range			—			range			—			—			range			range			—

_______________________________________


^(a)	Borrowings under the agreement bear interest at a base rate (or a LIBO rate) plus an applicable margin, or at a fixed rate of interest determined and quoted by the administrative agent under the agreement in its sole and absolute

Table of Contents

discretion from time to time. The applicable margin is based on our leverage ratio and ranges between 1.50% and 2.00% for LIBO rate loans and between 0.50% and 1.00% for base rate loans.


^(b)	Seven swaps with notional amount of $495.0 million with fixed rates from 4.08% to 4.67%.


^(c)	Average three-month U.S. Dollar LIBOR plus spreads ranging from 2.009% to 2.74%.

FOREIGN CURRENCY RISK

We were exposed to risk regarding foreign currency fluctuations during fiscal 2018 and in prior years even though a substantial amount of our international sales were denominated in U.S. dollars. In addition to specific transactional exposure, foreign currency fluctuations can impact the ability of foreign buyers to purchase U.S. agricultural products and the competitiveness of U.S. agricultural products compared to the same products offered by alternative sources of world supply. From time to time, we enter into foreign currency hedge contracts to minimize the impact of currency fluctuations on our transactional exposures. The notional amounts of our foreign exchange derivative contracts were $988.8 million and $776.7 million as of August 31, 2018 , and 2017 , respectively.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements listed in Item 15(a)(1) of this Annual Report on Form 10-K are set forth beginning on page F-1. Financial statement schedules are included in Schedule II in Item 15(a)(2) of this Annual Report on Form 10-K. Supplementary financial information required by Item 302 of Regulation S-K promulgated by the SEC for each quarter during the years ended August 31, 2018 , and 2017 , is presented below. As described in the "Explanatory Note" at the beginning of this Annual Report on Form 10-K and Note 2, Restatement of Previously Issued Consolidated Financial Statements of the Notes to the Consolidated Financial Statements included within this Annual Report on Form 10-K, unaudited interim financial information for the annual and quarterly periods ended November 30, 2016 and 2017, February 28, 2017 and 2018, May 31, 2017 and 2018, and August 31, 2017, has been restated. Refer to Note 18, Quarterly Financial Information (Unaudited) of the Notes to the Consolidated Financial Statements included within this Annual Report on Form 10-K for details related to the categories of misstatements and the impact on the unaudited interim financial information.



	For the Three Months Ended
	August 31, 2018		(As Restated) May 31, 2018		(As Restated) February 28, 2018			(As Restated) November 30, 2017
	(Unaudited) (Dollars in thousands)
Revenues	$	8,583,982	$	9,087,328	$	6,980,153		$	8,031,884
Gross profit	391,362		245,967		135,304			320,827
Income (loss) before income taxes	248,332		236,839		(21,729		)	207,788
Net income (loss)	240,545		181,620		165,959			187,182
Net income (loss) attributable to CHS Inc.	240,447		181,807		166,007			187,646



	For the Three Months Ended
	(As Restated) August 31, 2017			(As Restated) May 31, 2017			(As Restated) February 28, 2017		(As Restated) November 30, 2016
	(Unaudited) (Dollars in thousands)
Revenues	$	7,996,339		$	8,638,410		$	7,400,773	$	8,001,904
Gross profit	91,626			221,146			235,508		346,380
Income (loss) before income taxes	(109,088		)	(238,612		)	18,302		219,232
Net income (loss)	(74,327		)	(72,488		)	14,617		203,156
Net income (loss) attributable to CHS Inc.	(74,450		)	(71,533		)	14,211		203,364

Table of Contents

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Restatement of Previously Issued Financial Statements:

As described in the "Explanatory Note" at the beginning of this Annual Report on Form 10-K, on October 22, 2018, the Audit Committee of our Board of Directors, after considering the recommendations of management, concluded that our audited consolidated financial statements for the years ended August 31, 2017, 2016, and 2015, included in our 2017 Annual Report, and our unaudited consolidated financial statements for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, and May 31, 2018 and 2017, included in our 2018 Quarterly Reports, should no longer be relied upon due to misstatements, and that we would restate such financial statements to make the necessary accounting corrections. This Annual Report on Form 10-K includes consolidated financial statements for the years ended August 31, 2016, 2018, and 2017, as well as relevant unaudited interim financial information for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2018 and 2017. The consolidated financial statements for the years ended August 31, 2017 and 2016, selected financial data (Item 6. "Selected Financial Data") for the years ended August 31, 2015 and 2014, and relevant unaudited interim financial statements for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017, included within this Annual Report on Form 10-K, have been restated.

Disclosure Controls and Procedures:

Our management evaluated, with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of August 31, 2018, the end of the period covered by this Annual Report on Form 10-K. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, due to the identification of material weaknesses in our internal control over financial reporting, as further described below, our disclosure controls and procedures were not effective as of August 31, 2018.

Management’s Annual Report on Internal Control Over Financial Reporting:

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as of August 31, 2018. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013). Based on management’s assessment using this framework, management concluded that, as of August 31, 2018, we did not maintain effective internal control over financial reporting due to the fact that there are material weaknesses in our internal control over financial reporting, as further described below.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

Management identified the following material weaknesses in our internal control over financial reporting as of August 31, 2018:

We did not design and consistently maintain effective monitoring controls related to the design and operating effectiveness of our internal controls. Specifically, we did not implement and reinforce an adequate process for monitoring the proper functioning of internal control to verify that our accounting policies and procedures are consistently and adequately being performed, as relevant, by a sufficient number of resources with the appropriate knowledge and training. This material weakness contributed to the following additional material weaknesses:

Table of Contents

•

We did not design and maintain effective controls over the review of journal entries and account reconciliations in our Grain Marketing operations. Specifically, we did not design and maintain effective controls to ensure that journal entries and account reconciliations were (i) properly prepared with sufficient supporting documentation or (ii) reviewed and approved to ensure the accuracy and completeness of the resulting journal entries.


•	We did not design and maintain effective internal controls over the accounting for intercompany transactions. Specifically, we did not design and maintain effective controls to ensure intercompany transactions are completely and accurately identified, reconciled, evaluated and eliminated.

•

We did not design and maintain effective controls over the accounting for freight contracts in our Grain Marketing operations. Specifically, we did not design and maintain effective controls to verify (i) the review over the accounting for freight contracts was being performed by the appropriate individuals, with the requisite level of knowledge, training and skill, to ensure freight contracts met the criteria to be accounted for as a derivative or (ii) the accuracy, existence and valuation of freight contracts.

These material weaknesses resulted in the restatement of the Company's consolidated financial statements for the fiscal year 2016 and 2017, restatement of each of the interim periods in the fiscal years 2017 and 2018 and the misstatements in fiscal year 2018.

We also did not design and maintain effective controls over certain information technology ("IT") general controls for information systems that are relevant to the preparation of our financial statements. Specifically, we did not design and maintain sufficient (i) testing and approval controls for program development to ensure the implementation of a new ERP system was aligned with business and IT requirements, or (ii) user access controls to ensure appropriate segregation of duties, or that adequately restrict user and privileged access to certain financial applications, programs, and data to appropriate personnel. These control deficiencies resulted in misstatements to the Inventory and Cost of Goods Sold accounts and related disclosures for the third quarter of fiscal 2018. Additionally, the deficiencies, when aggregated, could impact the maintenance of effective segregation of duties, as well as the effectiveness of IT-dependent controls (such as automated controls that address the risk of material misstatement to one or more assertions, along with the IT controls and underlying data that support the effectiveness of system-generated data and reports) that could result in misstatements potentially impacting all financial statement accounts and disclosures that would not be prevented or detected. Accordingly, our management has determined that these control deficiencies constitute material weaknesses.

Additionally, each of the above material weaknesses could result in a misstatement of the aforementioned account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to the Financial Reform Bill passed in July 2010 that permits us to provide only management’s report in this Annual Report on Form 10-K.

Remediation Plan and Status:

In response to the identified material weaknesses, our management, with the oversight of the Audit Committee of our Board of Directors, has dedicated significant resources, including the involvement of outside advisors, and efforts to improve our internal control over financial reporting. We continue to actively plan for and implement additional control procedures, including (i) redesigning and/or enhancing control activities related to preparation and review of account reconciliations and journal entries related to our Grain Marketing Operations; (ii) redesigning and implementing control activities related to intercompany transactions; (iii) instituting additional training programs for our finance, accounting, operations, IT and other necessary personnel; (iv) evaluating the quality of and sufficiency of our finance, accounting and other internal control personnel and resources; (v) establishing the appropriate roles and responsibilities within our organization to improve our knowledge and expertise over internal control over financial reporting; (vi) implementing IT project testing oversight and management; and (vii) evaluating the manual and automated IT control environment surrounding critical enterprise resource planning systems, including the new ERP system.

Table of Contents

We believe the measures described above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting. We are committed to continuing to improve our internal control processes and will continue to review, optimize and enhance our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may take additional measures to address control deficiencies, or we may modify, or in appropriate circumstances not complete, certain of the remediation measures described above. These material weaknesses will not be considered remediated until the applicable remedial controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control Over Financial Reporting:

We are in the process of implementing an ERP system. The ERP system is expected to take several years to fully implement and has and will continue to require significant capital and human resources to deploy. The implementation of the ERP system will affect the processes that constitute our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) and management has taken steps to ensure that appropriate controls are designed and implemented as the ERP system is deployed.

Other than as described in the paragraph above, during our fourth fiscal quarter, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

Table of Contents

PART III.

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

BOARD OF DIRECTORS

The table below provides certain information regarding each of our directors, as of August 31, 2018 .



Name	Age	Director Region	Director Since
Donald Anthony	68	8	2006
Clinton J. Blew	41	8	2010
Dennis Carlson	57	3	2001
Scott Cordes	57	1	2017
Jon Erickson	58	3	2011
Mark Farrell	59	5	2016
Steve Fritel	63	3	2003
Alan Holm	58	1	2013
David Johnsrud	64	1	2012
Tracy Jones	55	5	2017
David Kayser	59	4	2006
Russ Kehl	43	6	2017
Randy Knecht	68	4	2001
Edward Malesich	65	2	2011
Perry Meyer	64	1	2014
Steve Riegel	66	8	2006
Daniel Schurr	53	7	2006

As a cooperative, members of our Board of Directors are nominated and elected by our members as required by our bylaws. As described below under “Director Elections and Voting,” to ensure geographic representation of our members, the Board of Directors represents eight regions in which our members are located. The members in each region nominate and elect the number of directors for that region as set forth in our bylaws. Neither management nor the incumbent directors have any control over the nominating process for directors. As described below under “Director Elections and Voting,” to be eligible for service as a director, a nominee must, among other things, (i) be an active farmer or rancher, (ii) be a Class A Individual Member of CHS or a member of a Cooperative Association Member and (iii) reside in the geographic region from which he or she is nominated. In general, our directors operate large commercial agricultural enterprises, which require expertise in all areas of management, including financial oversight. They also have experience serving on local cooperative association boards and participate in a variety of agricultural and community organizations. Our directors complete the National Association of Corporate Directors Comprehensive Director Professionalism course and earn the Certificate of Director Education.

Donald Anthony has been a member of the CHS Board of Directors since 2006. He serves on the Corporate Risk and Government Relations committees. He holds a bachelor’s degree in agricultural economics from the University of Nebraska. Mr. Anthony’s principal occupation has been farming for more than five years, and he raises corn, soybeans and alfalfa near Lexington, Nebraska.

Clinton J. Blew, first vice chairman, has been a member of the CHS Board of Directors since 2010. Since 2017, Mr. Blew has served as first vice chairman of the Executive Committee of the Board. He serves on the Audit and Corporate Risk committees. He is a member of the board of directors of Mid Kansas Coop ("MKC"), Moundridge, Kansas, and is a member of the Hutchinson Community College Ag Advisory Board, Kansas Livestock Association, Texas Cattle Feeders Association and Red Angus Association of America. He holds an applied science degree in farm and ranch management from Hutchinson Community College. Mr. Blew’s principal occupation has been farming for more than five years, and he farms and ranches in a family partnership in south-central Kansas.

Table of Contents

Dennis Carlson has been a member of the CHS Board of Directors since 2001. He serves as chairman of the Capital Committee and as a member of the Governance Committee. Mr. Carlson’s principal occupation has been farming for more than five years, and he raises wheat, sunflowers and soybeans near Mandan, North Dakota.

Scott Cordes has been a member of the CHS Board of Directors since 2017. He serves on the Government Relations and Corporate Risk committees. He serves as a director and past chairman of Security State Bank of Wanamingo (Minnesota). He also served as director of the Minneapolis Grain Exchange and National Futures Association. He holds a bachelor’s degree in agricultural economics from the University of Minnesota. Mr. Cordes’ principal occupation has been farming for more than two years. In 1995, he joined CHS and most recently served as the president of CHS Hedging, LLC, a commodities brokerage subsidiary of CHS Inc., until 2016. He operates a corn and soybean farm near Wanamingo, Minnesota.

Jon Erickson, second vice chairman, has been a member of the CHS Board of Directors since 2011. Since 2017, he has been second vice chairman of the Executive Committee of the Board. He is a member of the Audit and Capital committees. He is a member of the North Dakota Farmers Union and North Dakota Stockmen’s Association. He holds a bachelor’s degree in agricultural economics from North Dakota State University. Mr. Erickson’s principal occupation has been farming for more than five years, and he raises grains and oilseeds and operates a commercial Hereford-Angus cow-calf business near Minot, North Dakota.

Mark Farrell has been a member of the CHS Board of Directors since 2016. He serves as vice chairman of the CHS Foundation Board of Trustees and as a member of the Audit Committee. He graduated from the University of Wisconsin-Madison Agricultural & Life Sciences Farm & Industry Short Course. Mr. Farrell’s principal occupation has been farming for more than five years. He raises corn, soybeans and wheat in Dane County, Wisconsin .

Steve Fritel has been a member of the CHS Board of Directors since 2003. He serves as vice chairman of the Corporate Risk Committee and as a member of the Audit Committee. He earned an associate’s degree from North Dakota State College of Science. Mr. Fritel’s principal occupation has been farming for more than five years. He raises spring wheat, soybeans, edible beans, corn and canola near Rugby, North Dakota. He also runs a family business providing on-farm grain storage equipment.

Alan Holm has been a member of the CHS Board of Directors since 2013. He is chairman of the Corporate Risk Committee and vice chairman of the Government Relations Committee. He also serves on the board for Citizens Bank Minnesota. Mr. Holm holds an associate’s degree in machine tool technology from Mankato Technical College. Mr. Holm's principal occupation has been farming for more than five years. He raises corn, soybeans, sweet corn, peas and hay and operates a cow-calf herd near Sleepy Eye, Minnesota.

David Johnsrud, secretary-treasurer, has been a member of the CHS Board of Directors since 2012. Since 2017, he has been secretary-treasurer of the Executive Committee of the Board. He serves as a member of the Capital and Governance committees. He also serves as a member of the board for the Cooperative Network. Mr. Johnsrud’s principal occupation has been farming for more than five years, and he raises corn and soybeans near Starbuck, Minnesota.

Tracy Jones has been a member of the CHS Board of Directors since 2017. He serves on the Governance Committee and the CHS Foundation Board of Trustees. He is a board member of CHS Elburn (Illinois) and has been its board chairman since 2011. Mr. Jones’ primary occupation has been farming for more than five years. He operates a fourth-generation family farm near Kirkland, Illinois, that raises corn, soybeans and wheat and feeds cattle.

David Kayser has been a member of the CHS Board of Directors since 2006. He is chairman of the CHS Foundation Board of Trustees and vice chairman of the Audit Committee. Mr. Kayser is a member of the Mitchell Technical Institute Foundation Board. Mr. Kayser’s principal occupation has been farming for more than five years. He raises corn, soybeans and hay near Alexandria, South Dakota, and operates a cow-calf and feeder-calf business.

Russ Kehl has been a member of the CHS Board of Directors since 2017. He serves on the Governance and Capital committees. He previously served as a director of CHS SunBasin Growers and vice chairman of the Columbia Basin Seed Association. Mr. Kehl’s primary occupation has been farming for more than five years. He and his wife operate a farm near Quincy, Washington, that produces crops, primarily potatoes and dry beans, and includes a cow-calf herd. His family also owns a dry bean processing facility, runs a custom farming business, and owns and operates a trucking and logistics company.

Table of Contents

Randy Knecht has been a member of the CHS Board of Directors since 2001. He is chairman of the Government Relations Committee and vice chairman of the Capital Committee. He holds a bachelor’s degree in agriculture from South Dakota State University. Mr. Knecht’s principal occupation has been farming for more than five years, and he operates a diversified family farm operation near Houghton, South Dakota, raising corn, soybeans, alfalfa and beef cattle.

Edward Malesich has been a member of the CHS Board of Directors since 2011. He chairs the Governance Committee and serves on the Capital Committee. He is a member of Montana Stock Growers Association, Montana Grain Growers Association, Montana Farm Bureau Federation, Montana Farmers Union and Montana Council of Co-ops. He holds a bachelor’s degree in agricultural production from Montana State University. Mr. Malesich’s principal occupation has been farming for more than five years, and he raises Angus cattle, wheat, malt barley and hay near Dillon, Montana.

Perry Meyer has been a member of the CHS Board of Directors since 2014. He is chairman of the Audit Committee and serves on the Corporate Risk Committee. He serves as director of Heartland Corn Products Cooperative and is a member of United Farmers Co-op, Central Region Cooperative, Minnesota Farm Bureau, Minnesota and Nicollet County corn growers associations, and Minnesota Pork Producers Association. He serves as a director of Steamboat Pork Cooperative, chairman of NU-Telecom Board and director of Minnesota Valley Lutheran School Foundation. He holds an agricultural mechanics degree from Alexandria (Minnesota) Technical School. Mr. Meyer’s principal occupation has been farming for more than five years, and he operates a family farm, raising corn, soybean and hogs near New Ulm, Minnesota.

Steve Riegel, assistant secretary-treasurer, has been a member of the CHS Board of Directors since 2006. He serves as the assistant secretary-treasurer of the Executive Committee of the Board. He is vice chairman of the Governance Committee and serves on the CHS Foundation Board of Trustees. He serves as advisory director of Bucklin (Kansas) National Bank. He attended Fort Hays (Kansas) State University, majoring in agriculture, business and animal science. Mr. Riegel’s principal occupation has been farming for more than five years, and he raises irrigated corn, soybeans, alfalfa, dryland wheat and milo near Ford, Kansas.

Daniel Schurr, chairman , has been a member of the CHS Board of Directors since 2006. Since 2017, Mr. Schurr has served as chairman of the Executive Committee of the Board. He serves on the Blackhawk Bank and Trust board and audit and loan committees and on the Silos and Smokestacks National Heritage Area board. He holds a bachelor’s degree in agricultural business with a minor in economics from Iowa State University. Mr. Schurr’s principal occupation has been farming for more than five years. He raises corn and soybeans near LeClaire, Iowa, and operates a commercial trucking business.

Director Elections and Voting

Director elections are for three-year terms and are open to any qualified candidate. The qualifications for the office of director are as follows:


•	At the time of declaration of candidacy, the individual (except in the case of an incumbent) must have the written endorsement of a locally elected producer board that is part of the CHS system and located within the region from which the individual is to be a candidate.


•	At the time of the election, the individual must be less than 68 years old.

The remaining qualifications set forth below must be met at all times commencing six months prior to the time of election and while the individual holds office:


•	The individual must be a Class A Individual Member of CHS or a member of a Cooperative Association Member.


•	The individual must reside in the region from which he or she is to be elected.


•	The individual must be an active farmer or rancher. “Active farmer or rancher” means an individual whose primary occupation is that of a farmer or rancher, excluding anyone who is an employee of ours or of a Cooperative Association Member.

The following positions on the Board of Directors will be up for re-election at the 2018 Annual Meeting of Members:



Region	Current Incumbent
Region 1 (Minnesota)	David Johnsrud
Region 3 (North Dakota)	Steve Fritel
Region 4 (South Dakota)	David Kayser
Region 6 (Alaska, Arizona, California, Hawaii, Idaho, Nevada, Oregon, Washington, Utah)	Russ Kehl
Region 8 (Colorado, Nebraska, Kansas, New Mexico, Oklahoma, Texas)	Open Seat

_______________________________________

Table of Contents

Voting rights, including those in regard to director elections, arise by virtue of membership in CHS, not because of ownership of any equity or debt instruments; therefore, our preferred stockholders cannot recommend nominees to our Board of Directors nor vote in regard to director elections unless they are Class A or Class C Members of CHS.

EXECUTIVE OFFICERS

The table below lists our executive officers as appointed by the CHS Board of Directors as of August 31, 2018.



Name	Age	Position
Jay Debertin	58	President and Chief Executive Officer
Richard Dusek	54	Executive Vice President, Country Operations
Darin Hunhoff	48	Executive Vice President, Energy and Foods
Timothy Skidmore	57	Executive Vice President and Chief Financial Officer
James Zappa	54	Executive Vice President and General Counsel
David Black	52	Senior Vice President, Enterprise Strategy
John Griffith	49	Senior Vice President, Global Grain and Renewable Fuels
Gary Halvorson	45	Senior Vice President, Agronomy

Jay Debertin has been President and Chief Executive Officer for CHS since May 2017. He leads the CHS strategic leadership team in strengthening the company by advancing operational excellence, accelerating its focus on results and delivering products and services that help the cooperative’s owners grow. Mr. Debertin joined CHS in 1984 in the petroleum division and held a variety of positions in its energy marketing operations before being named Vice President, Crude Oil Supply, in 1998. In 2001, his responsibilities expanded to include crude oil supply, refining, pipelines and terminals, trading and risk management, and transportation. From 2005 to 2010, Mr. Debertin was Executive Vice President and Chief Operating Officer for Processing at CHS. From 2010 to 2017, he served as Executive Vice President and Chief Operating Officer of Energy and Foods where he led energy, transportation and processing and food ingredients at CHS. Mr. Debertin serves as board chairman for Ventura Foods. He earned a bachelor’s degree in economics from the University of North Dakota and a Master of Business Administration degree from the University of Wisconsin - Madison.

Richard Dusek has been Executive Vice President, Country Operations, for CHS since November 2017. He is responsible for the division delivering agricultural inputs, energy products, grain marketing, animal nutrition and other farm supplies to producers through retail businesses in 16 states. Mr. Dusek serves on the board of directors for The Fertilizer Institute. He joined CHS 30 years ago as a wheat trader. He has also been the director of merchandising, vice president of grain marketing and vice president of CHS agronomy. He earned a bachelor’s degree in agricultural economics from North Dakota State University and completed the Harvard Business School Advanced Management Program.

Darin Hunhoff has been Executive Vice President, Energy and Foods, for CHS since May 2017. He leads CHS energy operations, including refineries, pipelines and terminals, refined fuels, propane, lubricants and transportation. He also leads CHS Processing and Food Ingredients, which includes canola and soybean processing plants. In addition, he oversees the CHS Aligned Solutions group which provides strategic business advisory services to cooperatives. Mr. Hunhoff serves on the board of directors for Ardent Mills. He joined CHS more than 25 years ago as a petroleum specialist. He has also been chief strategy officer for CHS and has spent several years in energy leadership roles, including time as senior vice president of refined fuels. He earned a bachelor’s degree in marketing and business management from Southwest Minnesota State University in Marshall, Minnesota.

Timothy Skidmore has been Executive Vice President and Chief Financial Officer since joining CHS in August 2013. He is responsible for accounting, credit and finance activities across CHS. Mr. Skidmore chairs the CHS Retirement Plan Committee and serves as a trustee for the Science Museum of Minnesota, where he serves on the Audit and Finance Committee. He also serves as a founding member of World 50’s Finance Officer community, a peer forum for top finance executives. Before joining CHS, he served as Vice President of finance and strategy for Campbell North America. He joined Campbell as assistant treasurer in 2001 and held numerous leadership positions, including various business unit chief financial officer roles. Prior to that, Mr. Skidmore spent 15 years at DuPont Co., holding a variety of financial leadership positions. He holds a bachelor's degree in risk management from the University of Georgia and a Master of Business Administration in finance from Widener University, Chester, Pennsylvania.

Table of Contents

James Zappa has been Executive Vice President and General Counsel for CHS since April 2015. He provides counsel to CHS leadership and the Board of Directors on company strategy, government affairs, corporate governance, corporate compliance, federal securities reporting and compliance, and disclosure and investor communications. Mr. Zappa also serves as a director for Ventura Foods, LLC and oversees enterprise sustainability initiatives, and the CHS Foundation and Corporate Giving functions. He previously worked at 3M Company for 15 years in various legal and leadership roles including Vice President, Associate General Counsel and Chief Compliance Officer, and Vice President, Associate General Counsel, International Operations. Prior to joining 3M, he worked for UnitedHealth Group and for the law firm Dorsey & Whitney. He earned a juris doctor degree from the University of Minnesota Law School, a Master’s degree in communication arts and sciences from the University of Southern California, and a bachelor’s degree from Drake University.

David Black has been Senior Vice President, Enterprise Strategy, for CHS since April 2018. He leads enterprise strategy, CHS global information technology, marketing and communications, and facilities. He is responsible for the strategy, implementation, delivery and operation of information technology for all CHS businesses worldwide. He also serves as a director for Ventura Foods. He joined CHS four years ago. He previously worked at Monsanto Company where he served as vice president, information technology, overseeing all aspects of information technology for its global commercial businesses. During his 20 years with Monsanto, he also served as vice president, corporate strategy, and president, Monsanto Agro-Services, LLC. Mr. Black earned a bachelor’s degree in computer science from Tarkio College in Tarkio, Missouri.

John Griffith has been Senior Vice President, Global Grain and Renewable Fuels for CHS since April 2018. He leads CHS global grain marketing operations and renewable fuels trading, supply chain management and risk management, including freight, currency, execution and trade finance. Mr. Griffith serves on the Minneapolis Grain Exchange and the North American Export Grain Association boards. He also serves as the board chairman for CHS Hedging, a commodities brokerage subsidiary of CHS Inc. He worked for CHS early in his career as a grain merchandiser, and rejoined CHS at a leadership level in January 2013. Since that time, he has held various leadership roles within grain marketing including vice president grain marketing North America. He earned a bachelor’s degree from St. John’s University in Collegeville, Minnesota, and a Master of Business Administration degree from Rockhurst University in Kansas City, Missouri.

Gary Halvorson has been Senior Vice President, Agronomy for CHS since April 2018. He leads CHS agronomy, including all commodity and specialty fertilizers to seed, crop protection and precision ag technology and services. Mr. Halvorson serves on the Agricultural Retailers Association board of directors, the National FFA Sponsors board and represents CHS on the United Prairie board of directors. He joined CHS nearly 20 years ago and held various leadership roles with CHS at locations in North Dakota before becoming general manager for CHS Ag Services in Warren, Minnesota. Mr. Halvorson also served as vice president of farm supply of CHS County Operations. He earned a bachelor’s degree in business from Concordia University.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers, directors and persons who beneficially own more than 10% of any class of our preferred stock to file initial reports of ownership and reports of changes in ownership with the SEC. Such executive officers, directors and greater than 10% beneficial owners are required by the regulations of the SEC to furnish us with copies of all Section 16(a) reports they file.

Based solely upon a review of copies of reports on Forms 3 and 4 and amendments thereto furnished to us during, and reports on Form 5 and amendments thereto furnished to us with respect to, the fiscal year ended August 31, 2018 , and based further upon written representations received by us with respect to the need to file reports on Form 5, no individuals filed late reports required by Section 16(a) of the Securities Exchange Act of 1934.

CODE OF ETHICS

We have adopted a code of ethics within the meaning of Item 406(b) of Regulation S-K promulgated by the SEC. This code of ethics applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer. This code of ethics is part of our broader CHS Global Code of Conduct Policy, which is posted on our website. The Internet address for our website is http://www.chsinc.com and the CHS Global Code of Conduct Policy may be found on the "Compliance" web page, which can be accessed from the "Governance & Compliance" web page, which can be accessed from the "Our Company" web page, which can be accessed from our main web page. We intend to disclose any amendment to, or waiver from, a provision of the code of ethics that applies to our principal executive officer, principal financial officer or principal accounting officer on the "Compliance" web page of our website. The information contained on our website is not part of, and is not incorporated in, this report or any other report we file with or furnish to the SEC.

Table of Contents

AUDIT COMMITTEE MATTERS

The Board of Directors has a separately designated standing Audit Committee for the purpose of overseeing our accounting and financial reporting processes and audits of our financial statements. The Audit Committee is comprised of Mr. Blew, Mr. Erickson, Mr. Farrell, Mr. Fritel, Mr. Kayser and Mr. Meyer (chairman), each of whom is an independent director. The Audit Committee has oversight responsibility to our owners relating to our financial statements and the financial reporting process, preparation of the financial reports and other financial information provided by us to any governmental or regulatory body, the systems of internal accounting and financial controls, the internal audit function and the annual independent audit of our financial statements. The Audit Committee assures that the corporate information gathering and reporting systems developed by management represent a good faith attempt to provide senior management and the Board of Directors with information regarding material acts, events and conditions within CHS. In addition, the Audit Committee is directly responsible for the appointment, compensation and oversight of the independent registered public accounting firm.

We do not believe that any member of the Audit Committee of the Board of Directors is an "audit committee financial expert” as defined in the Sarbanes-Oxley Act of 2002 and the rules and regulations thereunder. As a cooperative, members of our Board of Directors are nominated and elected by our members. To ensure geographic representation of our members, the Board of Directors represents eight regions in which our members are located. The Voting Members in each region nominate and elect the number of directors for that region as set forth in our bylaws. To be eligible for service as a director, a nominee must among other things, (i) be an active farmer or rancher, (ii) be a Class A Individual Member of CHS or a member of a Cooperative Association Member and (iii) reside in the geographic region from which he or she is nominated. Neither management nor the incumbent directors have any control over the nominating process for directors. Because of the nomination procedure and the election process, we cannot ensure that an elected director will be an "audit committee financial expert.” However, many of our directors, including all of the Audit Committee members, are financially sophisticated and have experience or background in which they have had significant financial oversight responsibilities. The current Audit Committee includes directors who have served as presidents or chairmen of local cooperative association boards. Members of the Board of Directors, including the Audit Committee, also operate large commercial enterprises requiring expertise in all areas of management, including financial oversight.

Table of Contents

ITEM 11. EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Executive Compensation

Overview

This Compensation Discussion and Analysis describes the material elements of compensation awarded to each of the following executive officers (our "Named Executive Officers") for fiscal 2018, which ran from September 1, 2017, through August 31, 2018:



Jay Debertin	President and Chief Executive Officer
Timothy Skidmore	Executive Vice President and Chief Financial Officer
Darin Hunhoff	Executive Vice President, Energy and Foods
James Zappa	Executive Vice President and General Counsel
Richard Dusek	Executive Vice President, Country Operations
Shirley Cunningham	Former Executive Vice President, Ag Business and Enterprise Strategy

Changes to our Named Executive Officers during fiscal 2018 included the addition of Richard Dusek, our Executive Vice President, Country Operations. Shirley Cunningham, our former Executive Vice President, Ag Business and Enterprise Strategy, left CHS on May 4, 2018.

CHS is an organization that exists to, among other things, help our owners grow. CHS compensation programs are designed to attract, retain and reward the executives who carry out this promise, and align them around attainment of CHS short- and long-term success.

This section outlines the compensation and benefit programs as well as the materials and factors used to assist us in making compensation decisions. In this Compensation Discussion and Analysis, the related compensation tables and the accompanying narratives, all references to a given year refer to our fiscal year ending on August 31 of that year.

Compensation Philosophy and Objectives

The Governance Committee of our Board of Directors oversees the administration of, and the fundamental changes to, our executive compensation and benefits programs. The primary principles and objectives in compensating our executive officers include:


•	Attract and retain exceptional talent who meet our leadership expectations and are engaged and committed to the long-term success of CHS, by providing market-competitive compensation and benefit programs;


•	Align executive rewards to quantifiable annual and long-term performance goals that drive enterprise results and provide competitive returns to our member-owners;


•	Emphasize pay for performance by providing a total direct compensation mix of fixed and variable pay that is primarily weighted on annual and long-term incentives, in order to reward annual and sustained performance over the long term; and


•	Ensure compliance with government mandates and regulations.

There are no material changes anticipated to our compensation philosophy or objectives for fiscal 2019.

Components of Executive Compensation and Benefits

Our executive compensation programs are designed to attract and retain highly qualified executives and to motivate them to optimize member-owner returns by achieving specified goals. The compensation program links executive compensation directly to our annual and long-term financial performance. A significant portion of each executive’s compensation is dependent upon meeting financial goals and a smaller portion is linked to individual performance objectives.

Table of Contents

Each year, the Governance Committee of our Board of Directors reviews our executive compensation policies with respect to the correlation between executive compensation and the creation of member-owner value, as well as the competitiveness of our executive compensation programs. The Governance Committee, with input from a third-party consultant if necessary, determines what, if any, changes are appropriate to our executive compensation programs, including the incentive plan goals applicable to our Named Executive Officers under the incentive compensation plans to which they and other employees are eligible. The third-party consultant is chosen and hired directly by the Governance Committee to provide guidance regarding market competitive levels of base pay, annual variable pay and long-term incentive pay, as well as market competitive allocations between base pay, annual variable pay and long-term incentive pay for our Chief Executive Officer ("CEO"). The data is shared with our Board of Directors, which makes final decisions regarding our CEO’s base pay, annual incentive pay and long-term incentive pay, as well as the allocation of compensation between base pay, annual incentive pay and long-term incentive pay. There are no formal policies for allocation between long-term and short-term compensation, other than the intention of being competitive with the external compensation market for comparable positions and being consistent with our compensation philosophy and objectives. The Governance Committee recommends to our Board of Directors salary actions relative to our CEO and approves annual and long-term incentive awards for the CEO based on performance of the Company compared to the financial targets and, as applicable, individual performance. In turn, our Board of Directors communicates this pay information to our CEO. Our CEO is not involved with the selection of the third-party consultant and does not participate in, or observe, Governance Committee meetings that concern CEO compensation matters. Based on a review of compensation market data provided by our human resources department (survey sources and pricing methodology are explained below under “Components of Compensation”), with input from a third-party consultant if necessary, our CEO decides base compensation levels for the other Named Executive Officers, recommends for Board of Directors approval the annual and long-term incentive pay plan performance goals applicable to the other Named Executive Officers (and other employees) and communicates base and incentive compensation pay to the other Named Executive Officers. The day-to-day design and administration of compensation and benefit plans are managed by our human resources, finance and legal departments.

Components of Compensation

Our executive compensation and benefits program consists of seven components. Each component is designed to be competitive within the executive compensation market. In determining competitive compensation levels, we analyze information from independent compensation surveys, which include information regarding comparable industries, markets, revenues and companies that compete with us for executive talent. The surveys used for this analysis in fiscal 2018 included a combination of the following sources: AonHewitt Total Compensation Measurement, Mercer Benchmark Database Executive Compensation Survey and Towers Watson CDB Executive Compensation Survey Report. The data extracted from these surveys includes median market rates for base salary, annual incentive, total cash compensation and total direct compensation. Companies included in the surveys vary by industry, revenue and number of employees, and represent both public and private ownership, as well as non-profit, government and mutual organizations. Compensation paid by a comparator group of industry specific companies, which includes 16 private, public and cooperative organizations in the agronomy, energy, food and grain industries, is also considered when making compensation decisions.

The following companies comprised the 2018 comparator group:



Agrium	Cargill	Land O'Lakes
Andersons	ConAgra Foods	Monsanto
Archer Daniels Midland	Dean Foods	Mosaic
Ashland	Kinder Morgan	Valero Energy
Bunge	Koch Industries	Williams Companies
CF Industries

The emphasis of our executive compensation package is weighted more on variable pay through annual variable pay and long-term incentive awards. This is consistent with our compensation philosophy of emphasizing a strong link between pay, employee performance and business goals to foster a clear line-of-sight and strong commitment to CHS short-term and long-term success, and also aligns our programs with general market practices. The goal is to provide our executives with an overall compensation package that is competitive in comparable industries, companies and markets. We target the market median for base pay, target total cash and target total direct compensation, and 75th percentile for total direct compensation for above market performance.

Table of Contents

For fiscal 2018, base pay was below the market median, total cash compensation was above the market median, and total direct compensation was below the market median. The above market median total cash compensation occurred because actual earned annual variable pay awards exceeded Target performance, and total direct compensation levels were below the market median because no awards were earned under the CHS Long Term Incentive Plan (the "LTIP") for the 2016-2018 performance period.

The following table presents a more detailed breakout of each compensation element:



P ay Element	D efinition of Pay Element	P urpose of Pay Element
Base Pay	Competitive base level of compensation provided relative to skills, experience, knowledge and contributions	• Provides the fundamental element of compensation for carrying out duties of the job
Annual Variable Pay	Broad-based employee short-term performance based variable pay incentive for achieving predetermined annual financial and individual performance goals	• Provides a direct link between pay and annual business objectives • Pay for performance to motivate and encourage the achievement of critical business initiatives • Encourages proper expense control and containment
Profit Sharing	Broad-based employee short-term performance based variable pay incentive for achieving predetermined annual financial goals	• Provides a direct link between employee pay and CHS profitability
Long-Term Incentive Plans	Long-term performance based incentive for senior management to achieve predetermined triennial return on adjusted equity performance or return on invested capital goals	• Provides a direct link between senior management pay and long-term strategic business objectives • Aligns management and member-owner interests • Encourages retention of key management
Retirement Benefits	Retirement benefits under the qualified retirement plans are identical to the broad-based retirement plans generally available to all full-time employees	• These benefits are a part of our broad-based employee total rewards program designed to attract and retain quality employees
	The supplemental plans include non-qualified retirement benefits that restore qualified benefits contained in our broad-based plans for employees whose retirement benefits are limited by salary caps under the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"). In addition, the plans allow participants to voluntarily defer receipt of a portion of their income	• These benefits are provided to attract and retain senior managers with total rewards programs that are competitive with comparable companies
Health & Welfare Benefits	Medical, dental, vision, life insurance and short-term disability benefits generally available to all full-time employees. Certain officers, including our Named Executive Officers, also are eligible for executive long-term disability benefits	• With the exception of executive long-term disability benefits, these benefits are a part of our broad-based employee total rewards program designed to attract and retain quality employees
Additional Benefits	Additional benefits provided to certain officers, including our Named Executive Officers	• These benefits are provided as part of an overall total rewards package that strives to be competitive with comparable companies and retain individuals who are critical to CHS

Table of Contents

Explanation of Ratio of Salary and Bonus to Total Compensation

The structure of our executive compensation package is focused on a suitable mix of base pay, annual variable pay and long-term incentive awards in order to encourage executive officers and employees to strive to achieve goals that benefit our member-owners’ interests over the long term, and to better align our programs with general market practices.

Fiscal 2018 Executive Compensation Mix at Target

The charts below illustrate the mix of base salary, annual variable pay at target performance (2018 Plan), and long-term incentive compensation at target performance (2016-2018 Plan) for fiscal 2018 for our CEO and the other Named Executive Officers as a group.

Base Pay:

Base salaries of our Named Executive Officers represent a fixed form of compensation paid on a semi-monthly basis. The base salaries are generally set at the median level of market data collected through our benchmarking process against other equivalent positions of comparable companies. The individual's actual salary relative to the market median is based on a number of factors, which include, but are not limited to, scope of responsibilities and individual experience.

Base salaries for our Named Executive Officers are reviewed on an annual basis or at the time of significant changes in scope and level of responsibilities. Changes in base salaries are determined through review of competitive market data, as well as individual performance and contribution. Changes are not governed by pre-established weighting factors or merit metrics.

The CEO is responsible for this process for the other Named Executive Officers. The Governance Committee is responsible for this process for the CEO.

Mr. Debertin received a 2.5% base salary increase effective January 1, 2018. Our Board of Directors approved the increase in order to maintain a competitive pay position to market. Mr. Skidmore, Mr. Hunhoff, Mr. Zappa and Ms. Cunningham were also given base salary increases in fiscal 2018 to ensure their base salaries were commensurate with their responsibilities, skills, contributions and competitive pay range. Specifically, in fiscal 2018, their base salary increases were 2.5%, 6.0%, 6.2% and 2.5%, respectively. Mr. Dusek was promoted to the position of Executive Vice President, Country Operations in November 2017 and received a base pay increase of 38.7% at that time to reflect his new responsibilities compared to his previous position of Vice President, Agronomy. Mr. Dusek then received an additional 2.5% base salary increase effective January 1, 2018 to ensure that his base salary was commensurate with his responsibilities, skills, contributions and competitive pay range.

Annual Variable Pay:

Named Executive Officers are covered by the same broad-based CHS Annual Variable Pay Plan (the "Annual Variable Pay Plan" or "AVP") as other employees, and based on the plan provisions, when they retire they receive awards prorated to the

Table of Contents

period of time eligible. Each Named Executive Officer was eligible to participate in the AVP for fiscal 2018. Target AVP award levels were set with reference to competitive market compensation levels and were intended to motivate our executives by providing annual variable pay awards for the achievement of predetermined goals. Target AVP award levels for fiscal 2018 increased from 70% to 115% of base salary for Named Executive Officers, excluding Mr. Debertin, to improve our competitive position to market. Our AVP program for fiscal 2018 was based on enterprise-level financial performance and specific management business objectives with actual payout dependent on CHS achieving pre-determined enterprise-level financial performance targets and non-financial individual performance goals. The financial performance components included Return on Invested Capital ("ROIC") and Return on Assets ("ROA") targets for CHS at the enterprise level. The threshold, target and maximum ROIC and ROA targets for fiscal 2018 are set forth in the table below. The management business objectives include individual performance against specific goals such as business profitability, strategic initiatives and talent development. In conjunction with the annual performance appraisal process for our CEO, our Board of Directors reviews the individual non-financial goals, and in turn, determines and approves this portion of the annual variable pay award based upon completion or partial completion of the previously specified goals and principal accountabilities for our CEO. Likewise, our CEO uses the same process for determining individual goal attainment for the other Named Executive Officers.

CHS financial performance goals and award opportunities under our fiscal 2018 Annual Variable Pay Plan were as follows:



P erformance Level	CHS Company Performance Goal	CHS Company Performance Goal	Percent of Target Award
Maximum	5.7% Return on Invested Capital	6.0% Return on Assets	200%
Target	4.7% Return on Invested Capital	5.1% Return on Assets	100%
Threshold	3.7% Return on Invested Capital	4.3% Return on Assets	50%
Below Threshold	<3.7% Return on Invested Capital	<4.3% Return on Assets	0%

ROIC is a measurement of how efficiently we use capital and the level of returns on that capital, and is calculated by dividing adjusted net operating profit after tax by the sum of funded debt plus equity. We define adjusted net operating profit after tax as earnings before tax plus interest, net, and the sum is multiplied by the effective tax rate. We define funded debt as the average of the funded debt as of the end of July 2017 and 2018, respectively, and equity at the end of July 2017.

ROA is a measurement of how well we use our assets to generate earnings and maximize returns on our owner equity and assets, and is calculated by dividing adjusted operating income by net assets. We define adjusted operating income as earnings before income taxes plus interest, net, plus corporate indirect allocations. We define net assets as total assets minus working capital liabilities; where working capital liabilities means current liabilities excluding current portions of debt or financing liabilities, and is measured as of the end of July 2017.

ROIC and ROA are not defined under U.S. GAAP. Therefore, they should not be considered a substitute for other measures prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies.

Our Board of Directors approved the ROIC and ROA performance targets for the fiscal 2018 AVP and determined our CEO’s individual goals. The weighting of our CEO’s goals for fiscal 2018 was 60% CHS total company ROIC, 10% CHS total company ROA, and 30% principal accountabilities and individual goals. Our CEO determined non-financial individual goals for the other Named Executive Officers. The weighting of goals for the other Named Executive Officers for fiscal 2018 was 60% CHS total company ROIC, 10% CHS total company ROA, and 30% individual goals.

For fiscal 2018, ROIC results were 9.0% and ROA results were 7.0%.

Table of Contents

As described in "Compensation Recovery" below, in connection with the restatement of our consolidated financial statements for the fiscal years ended August 31, 2017 and 2016, and unaudited financial information for the fiscal years ended August 31, 2015 and 2014, each of Messrs. Debertin, Skidmore, Zappa, and Dusek voluntarily requested that our Board of Directors exercise its negative discretion under applicable employment agreement provisions and/or Annual Variable Pay Plan provisions to reduce the amount the Named Executive Officer will earn under the Annual Variable Pay Plan for fiscal 2018 by an amount equal to the sum of the incentive compensation paid or awarded to the Named Executive Officer under the Annual Variable Play Plan, Profit Sharing Plan and LTIP with respect to prior fiscal years that was in excess of the incentive compensation that would have been awarded to the Named Executive Officer pursuant to such plans under the restated financial statements. Our Board of Directors accepted the Named Executive Officers’ requests and exercised such negative discretion. Specifically:


•	Mr. Debertin’s earned amount was reduced by $62,411;


•	Mr. Skidmore’s earned amount was reduced by $73,213;


•	Mr. Zappa’s earned amount was reduced by $63,410; and


•	Mr. Dusek’s earned amount was reduced by $6,213.

It was not necessary for Mr. Hunhoff to make any such voluntary request, because during any year for which excess incentive compensation was paid, he was employed in a non-senior executive leadership role in our Energy segment. Ms. Cunningham voluntarily retired from the Company during fiscal 2018. Though she is no longer employed by the Company and there is no contractual obligation that would allow us to recover such incentive compensation from her, Ms. Cunningham voluntarily agreed to permit the Company to recover the $88,451 in excess compensation earned by her during the same period of years.

Accordingly, annual variable pay awards that will be paid under the Annual Variable Pay Plan for fiscal 2018 for the Named Executive Officers are as follows:



Jay Debertin	$	3,473,839
Timothy Skidmore	$	1,115,086
Darin Hunhoff	$	1,219,000
James Zappa	$	1,086,591
Richard Dusek	$	1,137,174
Shirley Cunningham	$	—

For fiscal 2019, ROIC and ROA will continue to be utilized as financial metrics under the Annual Variable Pay Plan.

Profit Sharing:

Each Named Executive Officer is eligible to participate in our Profit Sharing Plan applicable to other employees. The purpose of the Profit Sharing Plan is to provide a direct link between employee pay and our profitability. Annual profit sharing contributions are calculated as a percent of base pay and annual variable pay (total earnings) and are made to the CHS Inc. 401(k) Plan (the "401(k) Plan") account and CHS Inc. Deferred Compensation Plan (the "Deferred Compensation Plan") account of each Named Executive Officer. The levels of profit sharing awards vary in relation to the level of CHS ROIC achieved and are displayed in the following table:



Return On Invested Capital		Profit Sharing Award
5.7%		5%
5.2%		4%
4.7%		3%
4.2%		2%
3.7%		1%

In fiscal 2018 ROIC results were 9.0%. Accordingly, each Named Executive Officer earned a 5% award under the Profit Sharing Plan.

Table of Contents

For fiscal 2019, the Profit Sharing Plan goals will be based on an ROIC performance metric.

Long-Term Incentive Plans:

Each Named Executive Officer is eligible to participate in our LTIP. The purpose of the LTIP is to align long-term results with long-term performance goals, encourage our Named Executive Officers to maximize long-term value for our member-owners, and retain key executives. The LTIP consists of three-year performance periods to ensure consideration is made for our long-term sustainability with a new performance period beginning every year. Our Board of Directors approves the LTIP goals.

Awards from the LTIP are contributed to the Deferred Compensation Plan after the end of each performance period. These awards vest over an additional 28-month period following the performance period end date. The extended earning and vesting provisions of the LTIP are designed to help us retain key executives. Participants who leave CHS prior to retirement for reasons other than death or disability forfeit all unearned and unvested LTIP award balances. Participants who meet retirement criteria, die or become disabled receive prorated awards following the LTIP rules. Like the Annual Variable Pay Plan, award levels for the LTIP are set with regard to competitive considerations. Beginning with the fiscal 2018-2020 LTIP performance period, the target level LTIP award levels increased from 70% to 115% of base salary for Named Executive Officers, excluding Mr. Debertin, to improve our competitive position to market.

For the 3-year LTIP period ending in fiscal 2018, the LTIP performance measure was based upon our Return on Adjusted Equity ("ROAE") during the period. ROAE is a measurement of our profitability and is calculated by dividing adjusted net income (earnings) by adjusted equity. To determine the equity and earnings adjustments, we subtract preferred stock dividends (paid on beginning of the fiscal year preferred stock) from earnings, and reduce equity by the beginning of the fiscal year preferred stock on the balance sheet. Earnings are subject to one-time exclusions or inclusions in any given fiscal year. Award opportunities for the fiscal 2016-2018 LTIP are expressed as a percentage of a participant’s average base salary for the three-year performance period. We must meet a three-year period threshold level of ROAE performance in order for any participant to earn an award payout under the 2016-2018 LTIP. As indicated in the below table, the threshold, target, maximum and superior performance maximum ROAE goals for the fiscal 2016-2018 performance period were 8%, 10%, 14% and 20%, respectively.



P erformance Level	CHS Three Year ROAE	Percent of Target Award
Superior Performance Maximum	20%	400%
Maximum	14%	200%
Target	10%	100%
Threshold	8%	50%
Below Threshold	<8%	0%

The actual ROAE performance for the fiscal 2016-2018 performance period was 4.03%. Because this actual performance was below the 8.0% threshold, no awards relating to the fiscal 2016-2018 performance period were earned by any of the Named Executive Officers under the LTIP.

Details for fiscal 2018 awards associated with the fiscal 2018-2020 LTIP performance period are provided in the “2018 Grants of Plan-Based Awards” table.

Beginning with the fiscal 2018-2020 performance period, the LTIP ROAE performance metric was replaced with an ROIC performance metric. ROIC will continue to be used as the LTIP performance metric for the fiscal 2019-2021 performance period.

Other Compensation:

To preserve key leadership continuity and bench strength, as well as a total direct compensation opportunity amount that is competitive to market, in November 2017, our Board of Directors approved a retention award (the "Retention Award") for certain of our senior officers, including each of the Named Executive Officers who both were active participants in the 2015-2017 LTIP, and who were active employees on the date the award was approved. The potential award value is the

Table of Contents

percentage of base salary used for the 2015-2017 LTIP awards at the Threshold level, based on the participant’s job level as of the date the retention award was granted, and will be earned only if a participant continues active employment through January 1, 2020, or meets the limited pro ration criteria provided in the award.

Retirement Benefits:

We provide the following retirement and deferral programs to Named Executive Officers:


•	CHS Inc. Pension Plan


•	CHS Inc. 401(k) Plan


•	CHS Inc. Supplemental Executive Retirement Plan


•	CHS Inc. Deferred Compensation Plan

CHS Inc. Pension Plan

The CHS Inc. Pension Plan (the "Pension Plan") is a tax-qualified defined benefit pension plan. All Named Executive Officers participate in the Pension Plan. A Named Executive Officer is fully vested in the Pension Plan after three years of vesting service. The Pension Plan provides for a lump sum payment of the participant’s account balance once the Named Executive Officer reaches normal retirement age (or, alternatively, for a monthly annuity for the Named Executive Officer’s lifetime if elected by the Named Executive Officer). The normal form of benefit for a single Named Executive Officer is a life annuity, and for a married Named Executive Officer the normal form of benefit is a 50% joint and survivor annuity. Other annuity forms are also available on an actuarial equivalent basis. Compensation and benefits are limited based on limits imposed by the Internal Revenue Code.

A Named Executive Officer’s benefit under the Pension Plan depends on pay credits to their account, which are based on the Named Executive Officer’s total salary and annual variable pay for each year of employment, date of hire, age at date of hire and the length of service, and investment credits, which are computed using the interest crediting rate and the Named Executive Officer’s account balance at the beginning of the plan year.

The amount of pay credits added to a Named Executive Officer’s account each year is a percentage of the Named Executive Officer’s base salary and annual variable pay plus compensation reduction pursuant to the 401(k) Plan, and any pretax contribution to any of our welfare benefit plans, paid vacations, paid leaves of absence and pay received if away from work due to a sickness or injury. The pay credits percentage received is determined on a yearly basis, based on the years of benefit service completed as of December 31st of each year. A Named Executive Officer receives one year of benefit service for every calendar year of employment in which the Named Executive Officer completed at least 1,000 hours of service.

Pay credits are earned according to the following schedule:

Regular Pay Credits



Y ears of Benefit Service	Pay Below Social Security Taxable Wage Base	Pay Above Social Security Taxable Wage Base
1 - 3 years	3%	6%
4 - 7 years	4%	8%
8 - 11 years	5%	10%
12 - 15 years	6%	12%
16 years or more	7%	14%

Table of Contents

Mid Career Pay Credits

Employees hired after age 40 qualify for the following minimum pay credit:



	Minimum Pay Credit
A ge at Date of Hire	Pay Below Social Security Taxable Wage Base	Pay Above Social Security Taxable Wage Base
Age 40 - 44	4%	8%
Age 45 - 49	5%	10%
Age 50 or more	6%	12%

Investment Credits

We credit a Named Executive Officer’s account at the end of the calendar year with an investment credit based on the balance at the beginning of the year. The investment credit is based on the average return for one-year U.S. Treasury bills for the preceding 12-month period. The minimum interest rate under the Pension Plan is 4.65% and the maximum is 10%.

CHS Inc. 401(k) Plan

The 401(k) Plan is a tax-qualified defined contribution retirement plan. Most full-time, non-union CHS employees are eligible to participate in the 401(k) Plan, including each Named Executive Officer. Participants may contribute between 1% and 50% of their pay on a pretax basis. We match 100% of the first 1% and 50% of the next 5% of pay contributed each year (maximum 3.5%). Our Board of Directors may elect to reduce or eliminate matching contributions for any year or any portion thereof. Participants are 100% vested in their own contributions and are fully vested after two years of service in matching contributions made on the participant’s behalf by us.

Non-participants are automatically enrolled in the plan at a 3% contribution rate and, effective each January 1, the participant’s contribution will be automatically increased by 1%. This escalation will stop once the participant’s contribution reaches 10%. The participant may elect to cancel or change these automatic deductions at any time.

CHS Inc. Supplemental Executive Retirement Plan and CHS Inc. Deferred Compensation Plan

Because the Internal Revenue Code limits the benefits that may be paid from the Pension Plan and the 401(k) Plan, the CHS Inc. Supplemental Executive Retirement Plan (the "SERP") and the Deferred Compensation Plan were established to provide certain employees participating in the qualified plans with supplemental benefits such that, in the aggregate, they equal the benefits they would have been entitled to receive under the qualified plan had these limits not been in effect. The SERP also includes compensation deferred under the Deferred Compensation Plan that is excluded under the qualified retirement plan. All Named Executive Officers participate in the SERP. Participants in the plans are select management or highly compensated employees who have been designated as eligible by our CEO to participate.

Compensation includes total salary and annual variable pay without regard to limitations on compensation imposed by the Internal Revenue Code. Company contributions under the Pension Plan and 401(k) Plan are not eligible for pay credits.

Certain Named Executive Officers may have accumulated non-qualified plan balances or benefits that have been carried over from predecessor companies as a result of past mergers and acquisitions. Benefits from the SERP are primarily funded in a rabbi trust, with a balance at August 31, 2018, of $30.3 million. Benefits from the plan do not qualify for special tax treatment under the Internal Revenue Code.

The Deferred Compensation Plan allows eligible Named Executive Officers to voluntarily defer receipt of up to 75% of their base salary and up to 100% of their annual variable pay. The election must occur prior to the beginning of the calendar year in which the compensation will be earned. During the year ended August 31, 2018, all of the Named Executive Officers were eligible to participate in the Deferred Compensation Plan. Mr. Debertin, Mr. Skidmore, Mr. Zappa and Ms. Cunningham participated in the elective portion of the Deferred Compensation Plan.

Benefits from the Deferred Compensation Plan are primarily funded in a rabbi trust, with a balance as of August 31, 2018, of $122.7 million. Benefits from the plan do not qualify for special tax treatment under the Internal Revenue Code.

Table of Contents

Health & Welfare Benefits:

Like our other employees, each of the Named Executive Officers is entitled to receive benefits under our comprehensive health and welfare program. Like non-executive full-time employees, participation in the individual benefit plans is based on each Named Executive Officer’s annual benefit elections and varies by individual.

Medical Plans

Named Executive Officers and their dependents may participate in our medical plan on the same basis as other eligible full-time employees. The plan provides each Named Executive Officer an opportunity to choose a level of coverage and coverage options with varying deductibles and co-pays in order to pay for hospitalization, physician and prescription drug expenses. The cost of this coverage is shared by us and the covered Named Executive Officer.

Dental, Vision, and Hearing Plan

Named Executive Officers and their dependents may participate in our dental, vision, and hearing plan on the same basis as other eligible full-time employees. The plan provides coverage for basic dental, vision and hearing expenses. The cost of this coverage is shared by us and the covered Named Executive Officer.

Life, AD&D and Dependent Life Insurance

Named Executive Officers and their dependents may participate in our basic life, optional life, accidental death and dismemberment ("AD&D") and dependent life plans on the same basis as other eligible full-time employees. The plans allow Named Executive Officers an opportunity to purchase group life insurance on the same basis as other eligible full-time employees. Basic life insurance equal to one times eligible compensation will be provided at our expense on the same basis as other eligible full-time employees. Named Executive Officers can choose various coverage levels of optional life insurance at their own expense on the same basis as other eligible full-time employees.

Short- and Long-term Disability

Named Executive Officers participate in our Short-Term Disability Plan ("STD") on the same basis as other eligible full-time employees. The Named Executive Officers also participate in an executive Long-Term Disability Plan ("LTD"). These plans replace a portion of income in the event that a Named Executive Officer is disabled under the terms of the plan and is unable to work full-time. The cost of STD and LTD coverage is paid by us.

Flexible Spending Accounts/Health Savings Accounts/Health Reimbursement Accounts

Named Executive Officers may participate in our Flexible Spending Account ("FSA"), Health Savings Account ("HSA") or Health Reimbursement Account ("HRA") on the same basis as other eligible full-time employees. The FSA and HSA provide Named Executive Officers an opportunity to pay for certain eligible medical expenses on a pretax basis. The HRA provides Named Executive Officers an opportunity to pay for certain eligible medical expenses incurred during the year on a pretax basis. Contributions to the FSA and HSA are made by the Named Executive Officer. Contributions to the HRA are made by us and are based on the medical option selected and range between $400 and $800.

Travel Assistance Program and Identity Theft Protection

Like other non-executive full-time employees, each of the Named Executive Officers is covered by our travel assistance program and identity theft protection program. The travel assistance program provides AD&D protection should a covered injury or death occur while on a business trip. The identity theft protection program provides credit monitoring and restoration services to protect against identity theft.

Additional Benefits:

Certain benefits such as executive physical and limited financial planning assistance are available to our Named Executive Officers. These are provided as part of an overall total rewards package that strives to be competitive with comparable companies and retain individuals who are critical to us.

Table of Contents

Compensation Recovery:

As discussed in “Annual Variable Pay” above, in connection with the restatement of our consolidated financial statements for the fiscal years ended August 31, 2017 and 2016, and unaudited financial information for the fiscal years ended August 31, 2015 and 2014, certain of the currently employed Named Executive Officers, including Mr. Debertin, voluntarily asked our Board of Directors to reduce the amount of their award under the Annual Variable Pay Plan for fiscal 2018 by an amount equal to the sum of the incentive compensation awarded to the Named Executive Officer under the Annual Variable Play Plan, Profit Sharing Plan and LTIP with respect to prior fiscal years that was in excess of the incentive compensation that would have been awarded to the Named Executive Officer pursuant to such plans under the restated financial statements. Accordingly, our Board of Directors accepted the Named Executive Officers’, including Mr. Debertin’s request and exercised such negative discretion to reduce each person's earned annual variable pay for fiscal 2018 accordingly.

In addition, other current senior executives who report directly to Mr. Debertin and current executives who during one or more fiscal years covered by the restated financial statements had management responsibilities for the Grain Marketing business unit into which the freight trading operations reported or who led the finance function of our Ag segment, each made similar voluntary requests to our Board of Directors, and our Board of Directors exercised similar negative discretion to reduce each such person's earned annual variable pay for fiscal 2018 accordingly.

We will also be asking former senior and other executives who held similar positions to the current executives who requested reductions in their fiscal 2018 annual variable pay to voluntarily agree to allow us to recover incentive compensation earned by those former executives under the Annual Variable Play Plan, Profit Sharing Plan and LTIP with respect to the relevant prior fiscal years that was in excess of what would have been earned by those executives pursuant to such plans under the restated financial statements. However, except as noted below, none of these former executives has a contractual obligation to allow us to recover such incentive compensation, and there can be no assurance that we will be able to recover all or any portion of such incentive compensation.

On May 22, 2017, we entered into a Separation Agreement with our former President and Chief Executive Officer, Carl Casale. The terms of that Separation Agreement provide that certain provisions in Mr. Casale’s prior employment agreement with us survived the termination of Mr. Casale’s employment, and, continue in effect according to their terms. Mr. Casale’s employment agreement continues to provide that in the event of a restatement of our financial results due to any material non-compliance with financial reporting requirements, if our Board of Directors determines in good faith that any compensation paid to Mr. Casale was awarded or determined based on that material noncompliance, then we are entitled to recover from him all compensation based on the erroneous financial data in excess of what would have been paid or been payable to Mr. Casale under the restatement, for a three-year period preceding the date on which we are required to prepare the accounting restatement. Our Board of Directors has determined in good faith that certain incentive compensation Mr. Casale earned under the Annual Variable Play Plan, Profit Sharing Plan and LTIP with respect to prior fiscal years within that 3-year period was based on the Company’s material non-compliance with financial reporting requirements and was in excess of the amount that Mr. Casale would have earned pursuant to such plans under the restated financial statements. Our Board of Directors determined that the amount of that excess incentive compensation was $249,034 and further determined to recover that amount from Mr. Casale.

Agreements with Named Executive Officers

On May 22, 2017, Mr. Debertin was elected as our President and CEO, and in connection therewith entered into an employment agreement with us on that date (the "Employment Agreement").

Pursuant to the terms of the Employment Agreement, Mr. Debertin is entitled to, among other things:


•	An annual base salary of $1,150,000, subject to increase by our Board of Directors from time to time;


•	A target annual incentive compensation award of 150% of his base salary with a maximum potential annual incentive compensation award of 300% of his base salary, based on the achievement of performance targets set by our Board of Directors; and


•	A target long-term incentive compensation award of 150% of his average base salary during the three-year performance period applicable to that award opportunity, with a maximum superior performance potential

Table of Contents

long-term incentive compensation award of 500% of his average base salary during the three-year performance period applicable to that award.

The Employment Agreement provides that in the event of a restatement of our financial results due to material noncompliance with financial reporting requirements, if our Board of Directors determines in good faith that any compensation paid (or payable but not yet paid) to Mr. Debertin was awarded or determined based on that material noncompliance, then we are entitled to recover from him (or to reduce compensation determined but not yet paid) all compensation based on the erroneous financial data in excess of what would have been paid or been payable to him under the restatement. Given the reduction in Mr. Debertin’s annual variable pay for fiscal 2018, as described in “Compensation Recovery” above, our Board of Directors did not believe it was necessary for it to recover any additional compensation from Mr. Debertin in connection with the restated financial statements.

The severance pay and benefits to which Mr. Debertin would be entitled if we terminated his employment without cause or, if he terminated his employment for “good reason” are described below under “Post Employment”.

Mr. Zappa, our Executive Vice President and General Counsel, joined us in April 2015 and the terms of his employment provided for certain payments to him in respect of compensation earned from his former employer during past periods but forfeited in order to accept employment with us due to vesting requirements and other restrictions. Specifically, Mr. Zappa was entitled to receive three payments on the following schedule: $101,667 in April 2015; $101,667 in April 2016; and $101,667 in April 2017.

In connection with the end of Ms. Cunningham's employment on May 4, 2018, we entered into a letter agreement with Ms. Cunningham, dated March 15, 2018 (the "Letter Agreement"). The Letter Agreement, as well as the payments to which Ms. Cunningham was entitled to thereunder in connection with the end of her employment, are described below under "Post Employment".

Tax Considerations

Section 162(m) of the Internal Revenue Code ("Section 162(m)") generally limits us to a deduction for federal income tax purposes of no more than $1 million of compensation paid to certain current and former executive officers in a taxable year. However, historically, the $1 million deduction limit did not apply to compensation that satisfied Section 162(m)'s requirements for qualified performance-based compensation. Accordingly, we historically attempted to preserve the deductibility under the Internal Revenue Code, of compensation paid to our executive officers while maintaining compensation programs to attract and retain highly qualified executives in a competitive environment. However, effective for tax years beginning after December 31, 2017, the exemption for qualified performance-based compensation from the $1 million deduction limitation contained in Section 162(m) has been repealed, unless certain transition relief for certain compensation arrangements in place as of November 2, 2017, is available. As such, certain compensation paid in excess of $1 million, which has historically been deductible by us for federal tax purposes, may no longer be deductible.

We believe that Section 162(m) is only one of several relevant considerations in setting compensation. We also believe that Section 162(m) should not be permitted to compromise our ability to design and maintain executive compensation arrangements that, among other things, are intended to attract and retain highly qualified executives in a competitive environment. As a result, we retain the flexibility to provide compensation that we determine to be in our best interests and the best interests of our member-owners, even if that compensation ultimately is not deductible for tax purposes.

Shareholder Advisory Votes on Executive Compensation

We are not required to, and do not, conduct shareholder advisory votes on executive compensation under section 14A of the Securities Exchange Act of 1934.

Table of Contents

Summary Compensation Table



N ame and Principal Position	Year	Salary ($) 1,2,3	Bonus ($) 2,4,5,6	Non-Equity Incentive Plan Compensation($) 1,2,7,8		Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($) 2,9	All Other Compensation($) 2,10-16	Total ($) 2
Jay Debertin President and Chief Executive Officer	2018	1,169,167		$	3,473,839	372,721	90,579	5,106,306
	2017	815,365	—	862,500		293,497	41,611	2,012,973
	2016	667,242	—	789,871		722,208	156,018	2,335,339
Timothy Skidmore Executive Vice President and Chief Financial Officer	2018	602,883	—	1,115,086		106,115	44,133	1,868,217
	2017	523,500	100,000	207,550		95,952	30,114	957,116
	2016	487,135	235,163	576,744		193,174	106,614	1,598,830
Darin Hunhoff Executive Vice President, Energy and Foods	2018	520,000	—	1,219,000		56,050	38,457	1,833,507
	2017	443,670	100,000	175,000		75,198	18,030	811,898

James Zappa Executive Vice President and General Counsel	2018	490,267	—	1,086,591		68,928	42,646	1,688,432
	2017	467,223	201,667	164,780		69,638	23,142	926,450
	2016	423,667	101,667	508,961		140,794	96,356	1,271,445
Richard Dusek Executive Vice President, Country Operations	2018	468,012	—	1,137,174		20,449	39,089	1,664,724


Shirley Cunningham Former Executive Vice President, Ag Business and Enterprise Strategy	2018	495,113	—			97,743	283,526	876,382
	2017	612,000	—	216,300		112,784	37,576	978,660
	2016	593,983	—	683,022		235,579	117,214	1,629,798

(1)

Amounts reflect the gross salary and non-equity incentive plan compensation, as applicable, and include any applicable deferrals. Mr. Debertin deferred $157,167 in fiscal 2018, $0 in fiscal 2017 and $893,546 in fiscal 2016; Mr. Skidmore deferred $303,483 in fiscal 2018, $52,350 in fiscal 2017 and $249,224 in fiscal 2016; Mr. Zappa deferred $82,390 in fiscal 2018; and Ms. Cunningham deferred $244,550 in fiscal 2018, $100,000 in fiscal 2017 and $852,078 in fiscal 2016.


(2)	Information on Mr. Hunhoff includes compensation beginning in fiscal 2017, the first year in which he became a Named Executive Officer, and information on Mr. Dusek includes compensation beginning in fiscal 2018, the first year in which he became a Named Executive Officer.


(3)	Salary for Ms. Cunningham includes base pay and accrued paid time off that was paid upon her departure.

(4)

Includes payments to Mr. Skidmore of $100,000 in fiscal 2017, for providing additional strong leadership of and significant time commitment to the ongoing management of multiple business and financial challenges, all in addition to performing his regular Executive Vice President and Chief Financial Officer role, and $235,163 in fiscal 2016 covering earned and forfeited compensation from previous employment.

(5)

Includes payments to Mr. Zappa of $201,667 in fiscal 2017, $100,000 of which was for providing additional strong leadership of and significant time commitment to the ongoing management of multiple business and governance challenges, all in addition to performing his regular Executive Vice President and General Counsel role, and $101,667 of which covered earned and forfeited compensation from previous employment, and $101,667 in fiscal 2016, covering earned and forfeited compensation from previous employment.


(6)	Includes payment to Mr. Hunhoff of $100,000 in fiscal 2017 for taking on additional leadership roles in addition to performing his new role as Executive Vice President, Energy and Foods.


(7)	Amounts include annual variable pay awards and Long-term incentive awards.

Table of Contents

The actual annual variable pay award value was as follows in fiscal 2018, 2017 and 2016, respectively: Mr. Debertin, $3,473,839, $862,500 and $0; Mr. Skidmore, $1,115,086, $207,550 and $0; Mr. Hunhoff, $1,219,000 and $175,000 (Mr. Hunhoff was not a Named Executive Officer in fiscal 2016); Mr. Zappa, $1,086,591, $164,780 and $0; Mr. Dusek $1,137,174 (Mr. Dusek was not a Named Executive Officer in fiscal 2017 or 2016); and Ms. Cunningham, $0, $216,300, and $0.

These annual variable pay award values exclude awards in the following amounts with respect to fiscal 2018 that our Board of Directors reduced at the voluntary request of the Named Executive Officers in connection with our restated financial statements: Mr. Debertin, $62,411; Mr. Skidmore, $73,213; Mr. Zappa, $63,410; and Mr. Dusek, $6,213.

The actual long-term incentive award value was as follows in fiscal 2018, 2017 and 2016, respectively: Mr. Debertin, $0, $0, and $789,871; Mr. Skidmore, $0, $0, and $576,744; Mr. Hunhoff, $0 and $0 (Mr. Hunhoff was not a Named Executive Officer in fiscal 2016); Mr. Zappa, $0, $0 and $508,961; Mr. Dusek, $0 (Mr. Dusek was not a Named Executive Officer in fiscal 2017 or 2016); Ms. Cunningham, $0, $0, and $683,022.


(8)	Excludes award of $120,000 that was earned, but voluntarily declined, by Mr. Debertin in fiscal 2016 under his previous Supplemental Project Milestone Incentive Plan.


(9)	This column represents both changes in pension value and above-market earnings on deferred compensation. Change in pension value is the aggregate change in the actuarial present value of the Named Executive Officer’s benefit under their retirement program and nonqualified earnings, if applicable.

The aggregate change in the actuarial present value was as follows in fiscal 2018, 2017 and 2016, respectively: Mr. Debertin, $267,017, $175,298 and $617,456; Mr. Skidmore, $89,520, $79,807 and $176,801; Mr. Hunhoff, $49,824 and $68,620 (Mr. Hunhoff was not a Named Executive Officer in fiscal 2016); Mr. Zappa, $68,928, $69,638 and $140,794; Mr. Dusek, $12,951 (Mr. Dusek was not a Named Executive Officer in fiscal 2017 or 2016); and Ms. Cunningham, $77,093, $80,332 and $217,137.

Above-market earnings represent earnings exceeding 120% of the Federal Reserve long-term rate as determined by the Internal Revenue Service ("IRS") on applicable funds, and was as follows in fiscal 2018, 2017 and 2016, respectively: Mr. Debertin, $105,704, $118,199 and $104,752; Mr. Skidmore, $16,595, $16,145 and $16,373; Mr. Hunhoff, $6,226 and $6,578 (Mr. Hunhoff was not a Named Executive Officer in fiscal 2016); Mr. Zappa, $0, $0 and $0; Mr. Dusek, $7,498 (Mr. Dusek was not a Named Executive Officer in 2017 or 2016); Ms. Cunningham, $20,650, $32,452 and $18,442.


(10)	Amounts may include executive LTD paid by us, travel accident insurance, executive physical, contributions by us during each fiscal year to qualified and non-qualified defined contribution plans, spousal travel and financial planning.


(11)	Includes fiscal 2018 executive LTD of $3,221 for all Named Executive Officers except Ms. Cunningham, and fiscal 2018 executive LTD of $2,416 for Ms. Cunningham.


(12)	Includes fiscal 2018 employer contributions to the Deferred Compensation Plan: Mr. Debertin, $68,837; Mr. Skidmore, $26,133; Mr. Hunhoff, $20,961; Mr. Zappa, $19,348; Mr. Dusek, $10,558; and Ms. Cunningham, $24,797.


(13)	Includes fiscal 2018 employer contribution to the 401(k) Plan: Mr. Debertin, $12,296; Mr. Skidmore, $12,309; Mr. Hunhoff, $12,400; Mr. Zappa, $11,913; Mr. Dusek, $12,566; and Ms. Cunningham, $12,325.


(14)	Includes fiscal 2018 executive physicals for the following Named Executive Officers: Mr. Debertin, $2,762; Mr. Dusek, $10,140; and Ms. Cunningham, $4,494.


(15)	Includes fiscal 2018 executive financial planning for the following Named Executive Officers: Mr. Debertin, $860; Mr. Skidmore, $1,530; Mr. Hunhoff, $875; Mr. Zappa, $6,250; Mr. Dusek, $2,040; and Ms. Cunningham, $3,350.


(16)	Includes payment to Ms. Cunningham in fiscal 2018 of $237,000 pursuant to the terms of Ms. Cunningham's Letter Agreement.

Table of Contents

Agreements with Named Executive Officers

On May 22, 2017, we entered an Employment Agreement with Mr. Debertin our President and Chief Executive Officer. The Employment Agreement supersedes all previous agreements we had with Mr. Debertin. The Employment Agreement was entered into to clearly define the obligations of the parties thereto with respect to employment matters, as well as the compensation and benefits to be provided to Mr. Debertin upon termination of employment.

The Employment Agreement has an initial term of three years ending on August 31, 2020, provided that beginning on August 31, 2020, and on each anniversary date thereafter, the term will be automatically renewed for an additional one-year period unless either party notifies the other in writing, at least 120 days in advance of the relevant anniversary date, of its intent not to renew the agreement for the additional one-year period.

Pursuant to the terms of the Employment Agreement, Mr. Debertin is entitled to, among other things:


•	An annual base salary of $1,150,000, subject to increase by our Board of Directors from time to time;


•	A target annual incentive compensation award of 150% of his base salary with a maximum potential annual incentive compensation award of 300% of his base salary, based on the achievement of performance targets set by our Board of Directors; and


•	A target long-term incentive compensation award of 150% of his average base salary during the three-year performance period applicable to that award opportunity, with a maximum superior performance potential long-term incentive compensation award of 500% of his average base salary during the three-year performance period applicable to that award opportunity.

Mr. Skidmore, our Executive Vice President and Chief Financial Officer, joined us in August 2013. The severance payments to which Mr. Skidmore will be entitled if we terminate his employment without cause or if he terminates his employment for “good reason” are described below under the heading “Post Employment”. Other details of Mr. Skidmore’s employment arrangement with us are described in “Compensation Discussion and Analysis” above.

Mr. Zappa, our Executive Vice President and General Counsel, joined us in April 2015. The severance payments to which Mr. Zappa will be entitled if we terminate his employment without cause or if he terminates his employment for “good reason” are described below under the heading “Post Employment”. Other details of Mr. Zappa’s employment arrangement with us are described in “Compensation Discussion and Analysis” above.

In connection with the end of Ms. Cunningham's employment on May 4, 2018, we entered into the Letter Agreement with Ms. Cunningham. Details of Ms. Cunningham's Letter Agreement are described below under the heading "Post Employment".

Table of Contents

2018 Grants of Plan-Based Awards

Estimated Future Payouts Under

Non-Equity Incentive Plan Awards



N ame	Grant Date	Threshold ($)		Target ($)		Maximum ($)
Jay Debertin	9-7-17 ⁽¹⁾	$	862,500	$	1,725,000	$	3,450,000
	9-7-17 ⁽²⁾	862,500		1,725,000		6,900,000
	11-7-17 ⁽³⁾	-		862,500		-
Timothy Skidmore	9-7-17 ⁽¹⁾	340,975		681,950		1,363,900
	9-7-17 ⁽²⁾	340,975		681,950		2,727,800
	11-7-17 ⁽³⁾	-		207,550		-
Darin Hunhoff	9-7-17 ⁽¹⁾	287,500		575,000		1,150,000
	9-7-17 ⁽²⁾	287,500		575,000		2,300,000
	11-7-17 ⁽³⁾	-		175,000		-
James Zappa	9-7-17 ⁽¹⁾	270,710		541,420		1,082,840
	9-7-17 ⁽²⁾	270,710		541,420		2,165,680
	11-7-17 ⁽³⁾	-		164,780		-
Richard Dusek	9-7-17 ⁽¹⁾⁽⁶⁾	58,570		117,140		234,281
	9-7-17 ⁽²⁾⁽⁶⁾	58,570		117,140		468,562
	11-13-17 ⁽⁴⁾	278,875		557,750		1,115,000
	11-13-17 ⁽⁵⁾	278,875		557,750		2,231,000
Shirley Cunningham	9-7-17 ⁽¹⁾	355,350		710,700		1,421,400
	9-7-17 ⁽²⁾	355,350		710,700		2,842,800
	11-7-17 ⁽³⁾	-		216,300		-


⁽¹⁾	Represents range of possible awards under our fiscal 2018 Annual Variable Pay Plan.

⁽²⁾

Represents range of possible awards under our LTIP for the fiscal 2018-2020 performance period. Goals are based on achieving a three-year ROIC of 3.7% threshold, 4.7% target and 5.7% maximum plus a potential award for superior 6.7% ROIC performance. Values displayed in the maximum column reflect 6.7% superior ROIC performance award potential. The 5.7% maximum performance award values are not listed in this table. Awards are earned over a three-year period and vest over an additional 28-month period.


⁽³⁾	Represents the maximum potential award opportunity with respect to the Retention Award. The Retention Award is earned only if a participant continues active employment through January 1, 2020, or meets the limited pro ration criteria provided in the award.


⁽⁴⁾	Represents range of possible awards under our fiscal 2018 Annual Variable Pay Plan with respect to grants made to Mr. Dusek on November 13, 2017, at time of his promotion to Executive Vice President, Country Operations.


⁽⁵⁾	Represents range of possible awards under our LTIP for the fiscal 2018-2020 performance period with respect to grants made to Mr. Dusek on November 13, 2017, at time of his promotion to Executive Vice President, Country Operations.


⁽⁶⁾	These grants were canceled when Mr. Dusek was promoted to Executive Vice President, Country Operations on November 13, 2017.

The material terms of annual variable pay and long-term incentive awards that are disclosed in this table, including the vesting schedule, are described under “Compensation Discussion and Analysis” above.

Table of Contents

2018 Pension Benefits



N ame	Plan Name	Number of Years of Credited Service (#)	Present Value of Accumulated Benefits ($)		Payments During Last Fiscal Year ($)
Jay Debertin ⁽¹⁾	Pension Plan	34.2500	$	962,658	$	—
	SERP	34.2500	2,874,485		—
Timothy Skidmore	Pension Plan	5.0000	138,293		—
	SERP	5.0000	392,205		—
Darin Hunhoff	Pension Plan	26.2500	586,165		—
	SERP	26.2500	402,804		—
James Zappa	Pension Plan	2.3333	81,190		—
	SERP	2.3333	211,060		—
Richard Dusek	Pension Plan	30.0833	742,138		—
	SERP	30.0833	312,375		—
Shirley Cunningham	Pension Plan	5.3333	137,946		—
	SERP	5.3333	505,477		—


⁽¹⁾	Mr. Debertin is eligible for early retirement in both the Pension Plan and the SERP.

The above table shows the present value of accumulated retirement benefits that Named Executive Officers are entitled to under the Pension Plan and the SERP.

For a discussion of the material terms and conditions of the Pension Plan and the SERP, see “Compensation Discussion and Analysis” above.

The present value of accumulated benefits is determined in accordance with the same assumptions outlined in Note 11, Benefit Plans , of the notes to consolidated financial statements that are included in this Annual Report on Form 10-K:


•	Discount rate of 4.20% for the Pension Plan and 4.05% for the SERP;


•	RP 2014 Mortality Table with a fully generational projection reflecting scale MP 2017 from 2006;


•	Each Named Executive Officer is assumed to retire at the earliest retirement age at which unreduced benefits are available (age 65). The early retirement benefit under the cash balance plan formula is equal to the participant’s

account balance; and


•	Payments under the cash balance formula of the Pension Plan assume a lump sum payment. SERP benefits are payable as a lump sum.

The normal form of benefit for a single Named Executive Officer is a life only annuity, and for a married Named Executive Officer the normal form of benefit is a 50% joint and survivor annuity. Other annuity forms are also available on an actuarial equivalent basis. A lump sum option is also available.

All Named Executive Officers’ retirement benefits at normal retirement age will be equal to their accumulated benefits under the Pension Plan and the SERP, as described under “Compensation Discussion and Analysis” above.

Table of Contents

2018 Nonqualified Deferred Compensation



Name	Executive Contributions in Last Fiscal Year ($) 1		Registrant Contributions in Last Fiscal Year ($) 2		Aggregate Earnings in Last Fiscal Year ($) 3		Aggregate Withdrawals/ Distributions ($)		Aggregate Balance at Last Fiscal Year End ($) 2,4
Jay Debertin	$	157,167	$	68,837	$	487,943	$	4,011,287	$	10,894,443
Timothy Skidmore	303,483		26,133		243,722		733,471		3,481,964
Darin Hunhoff	—		20,961		204,860		277,002		2,498,088
James Zappa	82,390		19,348		59,834		—		825,737
Richard Dusek	—		10,558		34,008		208,947		818,397
Shirley Cunningham	244,550		24,797		97,352		2,452,344		1,595,345


⁽¹⁾	Includes amounts deferred from salary and annual incentive pay reflected in the Summary Compensation Table.

⁽²⁾

Contributions are made by us into the Deferred Compensation Plan on behalf of Named Executive Officers. Amounts include LTIP, retirement contributions on amounts exceeding IRS compensation limits, Profit Sharing, and 401(k) match. The amounts reported were made in early fiscal 2018 based on fiscal 2017 results. These results are also included in amounts reported in the Summary Compensation Table: Mr. Debertin, $12,296; Mr. Skidmore, $12,309; Mr. Hunhoff, $12,400; Mr. Zappa, $11,913; Mr. Dusek, $12,566; and Ms. Cunningham, $12,325.


⁽³⁾	The amounts in this column include the change in value of the balance, not including contributions made by the Named Executive Officer. Amounts include the following above market earnings in fiscal 2018 that are also reflected in the Summary Compensation Table: Mr. Debertin, $105,704; Mr. Skidmore, $16,595; Mr. Hunhoff, $6,226; Mr. Zappa, $0; Mr. Dusek, $7,498; and Ms. Cunningham, $20,650.

⁽⁴⁾

Amounts vary in accordance with individual pension plan provisions and voluntary employee deferrals and withdrawals. These amounts include rollovers, voluntary salary and voluntary incentive plan contributions from predecessor plans with predecessor employers that have increased in value over the course of the executive’s career. Named Executive Officers may defer up to 75% of their base salary and up to 100% of their annual variable pay to the Deferred Compensation Plan. Earnings on amounts deferred under the Deferred Compensation Plan are determined based on the investment election made by the Named Executive Officer from five market-based notional investments with a varying level of risk selected by us, and a fixed rate fund. The notional investment returns for fiscal 2018 were as follows: Vanguard Prime Money Market, 1.59%; Vanguard Life Strategy Income, 2.32%; Vanguard Life Strategy Conservative Growth, 4.97%; Vanguard Life Strategy Moderate Growth, 7.69%; Vanguard Life Strategy Growth, 10.39%; and the Fixed Rate was 4.00%.

Named Executive Officers may change their investment election daily. Payments of amounts deferred are made in accordance with elections by the Named Executive Officer and in accordance with Section 409A under the Internal Revenue Code. Payments under the Deferred Compensation Plan may be made at a specified date elected by the Named Executive Officer or deferred until retirement, disability, or death. Such payments would be made in a lump sum. In the event of retirement, the Named Executive Officer can elect to receive payments either in a lump sum or annual installments up to 10 years.

For a discussion of the material terms and conditions of the Deferred Compensation Plan, see “Compensation Discussion and Analysis” above.

Post Employment

Pursuant to the terms of his Employment Agreement, Mr. Debertin, our President and CEO, is entitled to severance in the event that his employment is terminated by us without cause or by him with “good reason.” Specifically, severance under the Employment Agreement would consist of:

•

The annual incentive compensation Mr. Debertin would have been entitled to receive for the year in which his termination occurred as if he had continued until the end of that fiscal year, determined based on our actual performance for that fiscal year relative to the performance goals applicable to Mr. Debertin (with that portion of the annual incentive compensation based on completion or partial completion of

Table of Contents

previously specified personal goals equal to 30% of the target annual incentive), prorated for the number of days in the fiscal year through Mr. Debertin’s termination date and generally payable in a cash lump sum at the time that incentive awards are payable to other participants;


•	Two times Debertin’s base salary plus two times his target annual incentive compensation, payable in three equal installments with the first installment payable 60 days following termination and the second and third installments payable on the first and second anniversary dates of termination, respectively; and


•	Welfare benefit continuation for two years following termination.

Mr. Skidmore’s employment term sheet with us provides for severance in the event his employment is terminated by us without cause, or by him with “good reason”, in the amount of one year of base pay and prorated annual variable pay, payable in a lump sum.

Mr. Zappa’s employment term sheet with us provides for severance in the event his employment is terminated by us without cause, or by him with “good reason”, in the amount of one year of base pay and prorated annual variable pay, payable as a lump sum.

Mr. Hunhoff and Mr. Dusek are covered by a broad-based employee severance program which provides a lump sum payment of two weeks of pay per year of service with a 12-month cap.

In connection with the end of Ms. Cunningham's employment on May 4, 2018, we entered into the Letter Agreement with Ms. Cunningham. Under the Letter Agreement, Ms. Cunningham is subject to customary confidentiality and cooperation covenants, as well as one-year non-competition and non-solicitation covenants. The Letter Agreement also provides for Ms. Cunningham to be paid $237,000 within 60 days after the date on which her employment with the Company ended, less applicable tax withholdings, in recognition of earned but unvested long-term incentive compensation that was forfeited due to the end of her employment prior to vesting, subject to her compliance with all of her post-employment obligations under the Letter Agreement. We made the $237,000 payment to Ms. Cunningham on August 10, 2018.

The severance pay that the Named Executive Officers (other than Ms. Cunningham, whose actual separation-related payment is described above) would have been entitled to had they been terminated by us without cause or terminated their employment for “good reason” as of the last business day of fiscal 2018 as follows:



Jay Debertin ⁽¹⁾⁽²⁾	$	7,711,603
Timothy Skidmore ⁽³⁾	1,306,824
Darin Hunhoff	530,000
James Zappa ⁽³⁾	1,075,000
Richard Dusek	497,125
Shirley Cunningham ⁽³⁾	237,000

_______________________________________


⁽¹⁾	Includes the value of health and welfare insurance based on current monthly rates.


⁽²⁾	For purposes of calculating the prorated portion of Mr. Debertin's unpaid annual variable pay award for the fiscal year in which the termination occurred, assumes an annual variable pay award at target performance for the entire fiscal year.


⁽³⁾	Assumes an annual variable pay award at target performance for the entire fiscal year.

There are no other severance benefits offered to our Named Executive Officers, except for up to $10,000 of outplacement assistance, which would be included as imputed income, and government mandated benefits such as COBRA. Except as otherwise set forth above, the method of payment would be a lump sum. Named Executive Officers not covered by employment agreements are not offered any special postretirement health and welfare benefits that are not offered to other similarly situated (i.e., age and service) salaried employees.

Table of Contents

Pay Ratio

The following pay ratio and supporting information compares the annual total compensation of our employees other than our CEO (including full-time, part-time, seasonal and temporary employees) and the annual total compensation of our CEO, as required by Section 953(b) of the Dodd-Frank Act. The pay ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K promulgated by the SEC.

For fiscal 2018, our last completed fiscal year:

• The median of the annual total compensation of all our employees (other than the CEO) was $59,846; and


•	The annual total compensation of our CEO, as reported in the Summary Compensation Table set forth above, was $5,106,306.

Based on this information, the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all other employees was 85:1.

To determine the pay ratio, we took the following steps:

•

We determined that as of June 1, 2018, the determination date, our employee population consisted of approximately 9,892 individuals, primarily located in the United States. This population consisted of our full-time, part-time, temporary and seasonal employees. Excluded from our employee population are 267 individuals who are located in the following 17 countries: Argentina (47 employees), Bulgaria (5 employees), Canada (7 employees), China (35 employees), Hungary (9 employees), Jordan (1 employee), Paraguay (15 employees), Republic of Korea (3 employees), Romania (49 employees), Russia (2 employees), Serbia (3 employees), Singapore (18 employees), Spain (8 employees), Switzerland (19 employees), Taiwan (3 employees), Ukraine (37 employees) and Uruguay (6 employees). Excluding these employees, our employee population that was used to calculate the pay ratio consisted of 9,625 individuals.


•	To identify the median employee, we compared regular, bonus and overtime wages (or their equivalents). We then applied a statistical sampling methodology to produce a sample of employees who were paid within a 5% range of the median regular, bonus and overtime wages (or their equivalents), and selected an employee from within that group as our median employee.


•	Once we identified our median employee, we calculated that employee’s annual total compensation for fiscal 2018 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K promulgated by the SEC, resulting in annual total compensation of $59,846.


•	With respect to our CEO, we used the amount reported as total compensation in the Summary Compensation Table set forth above.

In adopting the pay ratio rule, the SEC expressly sought to provide flexibility to each company to determine the methodology that best suits its own facts and circumstances. Our pay ratio should not be compared to other companies’ pay ratios, because it is based on a methodology specific to us, and certain material assumptions, adjustments and estimates have been made in the calculation of the ratio.

Director Compensation

Overview

Our Board of Directors met 11 times during the year ended August 31, 2018. Through August 31, 2018, each director was provided annual compensation of $69,000, paid in 12 monthly payments, plus actual expenses and travel allowance, with the Chairman of the Board receiving additional annual compensation of $18,000, the First Vice Chairman, and the Secretary-Treasurer each receiving additional annual compensation of $3,600 and all Board committee chairs receiving additional annual compensation of $6,000. Each director receives a per diem of $500 plus actual expenses and travel allowance for each day

Table of Contents

spent at meetings other than regular Board meetings and the CHS Annual Meeting. The number of days per diem may not exceed 55 days annually, except that the Chairman of the Board is exempt from this limit.

Further, directors are eligible to participate in the Deferred Compensation Plan. Other than direct contributions, contributions to the Deferred Compensation Plan have historically been made based on the Company's ROAE performance. However, beginning in fiscal 2020, for the 2018-2020 three-year cycle, contributions to the Deferred Compensation Plan will be made based on the Company's ROIC performance. We believe that using the ROAE and ROIC performance metrics for this purpose aligns the interests of our directors with the interest of our management and member-owners. The ROAE and ROIC performance targets are the same as the ROAE and ROIC performance targets for the applicable LTIP performance period, resulting in Deferred Compensation Plan credits that vary consistent with actual ROAE or ROIC performance levels, as applicable, as detailed on the following pages.

Director Retirement and Healthcare Benefits

Members of our Board of Directors are eligible for certain retirement and healthcare benefits. The director retirement plan is a defined benefit plan and provides for a monthly benefit for the director’s lifetime, beginning at age 60. Benefits are immediately vested and the monthly benefit is determined according to the following formula: $250 times years of service on the Board (up to a maximum of 15 years). Under no event will the benefit payment be payable for less than 120 months. Payment shall be made to the retired director’s beneficiary in the event of the director’s death before 120 payments are made. Prior to 2005, directors could elect to receive their benefit as an actuarial equivalent lump sum. In order to comply with IRS requirements, directors were required in 2005 to make a one-time irrevocable election whether to receive their accrued benefit in a lump sum or a monthly annuity upon retirement. If the lump sum was elected, the director would commence benefits upon expiration of Board term.

Effective August 31, 2011, future accruals under the director retirement plan were frozen. Directors elected after that date are not eligible for benefits under that plan.

Retirement benefits are funded by a rabbi trust, with a balance at August 31, 2018, of $8.6 million.

Directors serving as of September 1, 2005, and their eligible dependents, are eligible to participate in our medical, life, dental, vision and hearing plans. We will pay 100% of the medical premium for the director and their eligible dependents while active on the Board. Term life insurance cost is paid by the director. Retired directors and their dependents are eligible to continue medical and dental insurance with the premiums paid by us after they leave the Board, until they are eligible for Medicare. In the event a director’s coverage ends due to death or Medicare eligibility, we will pay 100% of the premium for the eligible spouse and eligible dependents until the spouse reaches Medicare age or upon death, if earlier.

New directors elected on or after December 1, 2006, and their eligible dependents, are eligible to participate in our medical, dental, vision and hearing plans. We will pay 100% of the premium for the director and eligible dependents while active on the Board. In the event a director leaves the Board prior to Medicare eligibility, premiums will be shared based on the following schedule:



Years of Service	Director	CHS
Up to 3	100%	0%
3 to 6	50%	50%
6+	0%	100%

In the event a director’s coverage ends due to death or Medicare eligibility, premiums for the eligible spouse and eligible dependents will be shared based on the same schedule until the spouse reaches Medicare age or upon death, if earlier.

Deferred Compensation Plan

Directors are eligible to participate in the Deferred Compensation Plan. Each participating director may elect to defer up to 100% of his or her monthly director fees into the Deferred Compensation Plan. This must be done prior to the beginning of the calendar year in which the fees will be earned, or in the case of newly-elected directors, upon election to the Board. During fiscal 2018, the following directors deferred Board fees pursuant to the Deferred Compensation Plan: Mr. Erickson, Mr. Johnsrud, Mr. Kehl, Mr. Knecht and Mr. Malesich.

Table of Contents

Benefits are funded in a Rabbi Trust. The Deferred Compensation Plan Rabbi Trust balance reported elsewhere in this Annual Report on Form 10-K includes amounts deferred by the directors.

Each year we will credit an amount to each director’s retirement plan account under the Deferred Compensation Plan. The fiscal 2018 credit to each director’s retirement plan account was determined based on the ROAE performance for fiscal years 2016, 2017 and 2018. Based on the determined actual ROAE performance during those years, no Company contribution was made to any director’s retirement plan account in fiscal 2018.

For fiscal years 2017-2019, the amount that could be credited was based on our cumulative ROAE performance over a three-year period as follows:



Amount Credited	ROAE Performance
$100,000 (Superior Performance)	20% Return on Adjusted Equity
$50,000 (Maximum)	9% Return on Adjusted Equity
$25,000 (Target)	7% Return on Adjusted Equity
$12,500 (Minimum)	5.5% Return on Adjusted Equity
$0	Below 5.5% Return on Adjusted Equity

Beginning in fiscal 2020, for the 2018-2020 three-year cycle, we will credit an amount to each director’s retirement plan account under the Deferred Compensation Plan based on the ROIC performance metric (as described under the heading "Long-Term Incentive Plan" above).

In connection with the restatement of our consolidated financial statements for the fiscal years ended August 31, 2014, 2015, 2016 and 2017, each of our current directors other than Messrs. Cordes, Farrell, Jones, and Kehl had previously credited to such director’s retirement plan account under the Deferred Compensation Plan an amount that was in excess of what would have been credited to such account under the restated financial statements. Messrs. Cordes, Farrell, Jones, and Kehl were not a director of the Company at the time such excess contribution was received. For each current affected director, that excess amount was $1,432. Accordingly, each affected director voluntarily declined that excess contribution and voluntarily agreed that such amount should be removed from the director’s retirement plan accounts under the Deferred Compensation Plan (and such amounts will be so removed). Our Board of Directors also determined to request that any former director who served on our Board of Directors at the time such excess amount was credited also voluntarily decline that amount of excess contribution. However, the former directors have no contractual obligation to allow us to recover such contribution and there can be no assurance that we will be able to recover all or a portion of any former director’s credited amount.

Upon leaving our Board of Directors during the fiscal year, a director’s credit for that partial fiscal year will be the target amount ($25,000) prorated through the end of the month in which the director departs. Directors who join our Board of Directors during the fiscal year will receive credit for that partial fiscal year based on the actual ROAE or ROIC, as applicable, for that fiscal year, prorated from the first of the month following the month in which the director joins our Board of Directors, to the end of the fiscal year.

Table of Contents

2018 Director Compensation



Name	Fees Earned or Paid in Cash ($) 1		Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) 2		All Other Compensation ($) 3,4		Total ($)
Donald Anthony	$	91,500	$	3,389	$	14,258	$	109,147
Clinton Blew	105,350		1,924		25,462		132,736
Dennis Carlson ⁽⁵⁾	93,500		52,682		17,574		163,756
Scott Cordes	69,750		10,169		207		80,126
Curt Eischens	28,000		3,284		14,836		46,120
Jon Erickson	87,750		2,703		17,574		108,027
Mark Farrell	87,750		—		1,702		89,452
Steven Fritel	91,250		158		14,258		105,666
Alan Holm	94,000		466		14,258		108,724
David Johnsrud	71,600		835		14,258		86,693
Tracy Jones	65,750		—		11,815		77,565
David Kayser	85,750		3,389		25,939		115,078
Russell Kehl	60,045		—		13,663		73,708
Randy Knecht	82,250		4,210		14,258		100,718
Greg Kruger	39,750		3,284		25,904		68,938
Edward Malesich	56,917		2,429		14,258		73,604
Perry Meyer	94,750		625		13,885		109,260
Steve Riegel	86,750		1,312		14,258		102,320
Daniel Schurr	106,250		1,720		20,965		128,935

_______________________________________


⁽¹⁾	Of this amount, the following directors deferred the succeeding amounts to the Deferred Compensation Plan: Mr. Erickson, $9,000; Mr. Johnsrud, $24,000; Mr. Kehl, $4,455; Mr. Knecht, $5,000; and Mr. Malesich $28,333.

⁽²⁾

This column represents both changes in pension value and above-market earnings on deferred compensation. Change in pension value is the aggregate change in the actuarial present value of the director’s benefit under his retirement program, and nonqualified earnings, if applicable. The change in pension value will vary by director based on several factors including age, service, pension benefit elected (lump sum or annuity - see above), discount rate and mortality factor used to calculate the benefit due. Future accruals under the plan were frozen as of August 31, 2011, as stated above.

Above-market earnings represent earnings exceeding 120% of the Federal Reserve long-term rate as determined by the IRS on applicable funds. The following directors had above market earnings during fiscal 2018: Mr. Anthony, $3,389; Mr. Blew, $1,924; Mr. Carlson, $3,389; Mr. Cordes, $10,169; Mr. Eischens, $3,284; Mr. Erickson, $2,703; Mr. Farrell, $0; Mr. Fritel, $158; Mr. Holm, $466; Mr. Johnsrud, $835; Mr. Jones, $0; Mr. Kayser, $3,389; Mr. Kehl, $0; Mr. Knecht, $4,210; Mr. Kruger, $3,284; Mr. Malesich, $2,429; Mr. Meyer, $625; Mr. Riegel, $1,312; and Mr. Schurr, $1,720.


⁽³⁾	All other compensation includes health insurance premiums, conference and registration fees, meals and related spousal expenses for trips made with a director on CHS business. Total amounts vary primarily due to the variations in health insurance premiums, which are due to the number of dependents covered.

Health care premiums paid for directors include: Mr. Anthony, Mr. Fritel, Mr. Holm, Mr. Johnsrud, Mr. Knecht, Mr. Malesich and Mr. Riegel, $13,948; Mr. Carlson and Mr. Erickson, $17,264; Mr. Blew and Mr. Kayser, $25,152; Mr.

Table of Contents

Eischens, $6,264; Mr. Farrell, $1,392; Mr. Jones, $11,608; Mr. Kehl, $13,456; Mr. Kruger, $17,468; Mr. Meyer, $13,568; Mr. Schurr, $20,564; Mr. Cordes, $0.


⁽⁴⁾	All other compensation includes fiscal 2018 director retirement plan Deferred Compensation Plan contributions for former directors, Mr. Eischens and Mr. Kruger, $8,333.

⁽⁵⁾

Made a one-time irrevocable retirement election in 2005 to receive a lump sum benefit under the director retirement plan. All other directors that were first elected on or prior to August 31, 2011, will receive a monthly annuity upon retirement. The director retirement plan benefit was frozen as of August 31, 2011. Accordingly, directors who are first elected after that date are not eligible for benefits under that plan.

Compensation Committee Interlocks and Insider Participation

Our Board of Directors does not have a compensation committee. The Governance Committee of our Board of Directors recommends to the entire Board of Directors salary actions relative to our CEO. The entire Board of Directors determines the compensation and the terms of the employment agreement with our CEO. Our CEO decides base compensation levels for the other Named Executive Officers with input from a third-party consultant if necessary, and recommends for our Board of Directors' approval the annual and long-term incentive plan performance goals applicable to the other Named Executive Officers.

During fiscal 2018, the members of the Governance Committee of our Board of Directors (the committee of our Board of Directors that performs the equivalent functions of a compensation committee) were Messrs. Edward Malesich (chair), Dennis Carlson, David Johnsrud, Tracy Jones, Russell Kehl and Steve Riegel. During fiscal 2018, no executive officer of CHS served on the compensation committee (or other board committee performing equivalent functions) or board of directors of any other entity that had any executive officer who also served on our Governance Committee or Board of Directors. None of the directors are, or have been, officers or employees of CHS.

See Item 13 of this Annual Report on Form 10-K for directors, including Messrs. Carlson, Eischens and Johnsrud, who were a party to related-person transactions.

Compensation Committee Report

The Governance Committee (the committee of our Board of Directors that performs the equivalent functions of a compensation committee) has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussion, the Governance Committee recommended to our Board of Directors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K.

Respectfully submitted,

Edward Malesich, Chairman

Dennis Carlson

David Johnsrud

Tracy Jones

Russell Kehl

Steven Riegel

Table of Contents

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Beneficial ownership of our equity securities by each member of our Board of Directors, each of our Named Executive Officers and all members of our Board of Directors and executive officers as a group as of October 15, 2018, is shown below. Except as indicated in the footnotes to the following table, each person has sole voting and investment power with respect to all shares attributable to such person.



	Title of Class
	8% Cumulative Redeemable Preferred Stock		Class B Cumulative Redeemable Preferred Stock
Name of Beneficial Owner	Amount of Beneficial Ownership	% of Class (1)	Amount of Beneficial Ownership	% of Class (2)
Directors:	(Shares)		(Shares)
Donald Anthony	—	*	—	*
Clinton J. Blew	—	*	—	*
Dennis Carlson	60	*	—	*
Scott Cordes ⁽³⁾	200	*	9,600	*
Jon Erickson	300	*	414	*
Mark Farrell	4,800	*	—	*
Steve Fritel	880	*	—	*
Alan Holm	—	*	—	*
David Johnsrud	—	*	1,650	*
Tracy Jones	—	*	—	*
David Kayser	—	*	630	*
Russ Kehl	—	*	—	*
Randy Knecht ⁽³⁾	1,027	*	229	*
Edward Malesich	—	*	—	*
Perry Meyer ⁽³⁾	120	*	—	*
Steve Riegel	245	*	88	*
Daniel Schurr	—	*	—	*
Named Executive Officers:
Jay Debertin ⁽³⁾	1,200	*	—	*
Richard Dusek	—	*	—	*
Darin Hunhoff	596	*	—	*
Timothy Skidmore ⁽³⁾	—	*	5,512	*
James Zappa	—	*	—	*
All other executive officers	—	*	—	*
Directors and executive officers as a group	9,428	*	18,123	*

_______________________________________


⁽¹⁾	As of October 15, 2018, there were 12,272,003 shares of 8% Cumulative Redeemable Preferred Stock outstanding.


⁽²⁾	As of October 15, 2018, there were 78,659,066 shares of Class B Cumulative Redeemable Preferred Stock outstanding with 21,459,066 , 16,800,000 , 19,700,000 and 20,700,000 attributed to Series 1, Series 2, Series 3 and Series 4, respectively.


⁽³⁾	Includes shares held by spouse, children and Individual Retirement Accounts.


*	Less than 1%.

We have no compensation plans under which our equity securities are authorized for issuance.

To our knowledge, there is no person or group who is a beneficial owner of more than 5% of any class or series of our preferred stock.

Table of Contents

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Because our directors must be active patrons of CHS, or of an affiliated association, transactions between us and our directors are customary and expected. Transactions include the sales of commodities to us and the purchases of products and services from us, as well as patronage refunds and equity redemptions received from us. During the year ended August 31, 2018 , the value of those transactions between a particular director (and any immediate family member of a director, which includes any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law and any person (other than a tenant or employee) sharing the household of such director) and us in which the total amount involved exceeded $120,000 are shown below.



Name	Transactions with CHS		Patronage Dividends
Donald Anthony	$	543,208	$	—
Dennis Carlson	391,570		—
Jon Erickson	570,081		—
David Johnsrud	2,245,057		—
Tracy Jones	2,205,480		—
David Kayser	1,185,897		—
Russ Kehl	3,541,811		—

Additionally, Kehl Farms, LLC, which is owned by our director Russ Kehl, entered into a 2018 crop inputs loan with CHS Capital for the purchase of crop inputs, seeds, supplies, and fuel in March 2018 (the "Loan"). The Loan bears interest at the rate of 7.25% per annum, which is payable upon maturity of the Loan. The largest aggregate amount of principal outstanding under the Loan during the year ended August 31, 2018, and the Loan balance on August 31, 2018, was $1,263,871. During the year ended August 31, 2018, no principal or interest was paid on the Loan. The Loan will mature in January 2019.

Review, Approval or Ratification of Related Party Transactions

Pursuant to its amended and restated charter, our Audit Committee has responsibility for the review and approval of all transactions between CHS and any related parties or affiliates of CHS, including its officers and directors, other than transactions in the ordinary course of business and on market terms as described above.

Related persons can include any of our directors or executive officers and any of their immediate family members, as defined by the SEC. In evaluating related person transactions, the committee members apply the same standards they apply to their general responsibilities as members of the Audit Committee of the Board of Directors. The committee will approve a related person transaction when, in its good faith judgment, the transaction is in the best interest of CHS. To identify related person transactions, each year we require our directors and officers to complete a questionnaire identifying any transactions with CHS in which the officer or director or their family members have an interest. We also review our business records to identify potentially qualifying transactions between a related party and us. In addition, we have a written policy addressing related persons (included in our Global Code of Conduct) that describes our expectation that all directors, officers and employees who may have a potential or apparent conflict of interest will notify our legal department of any such transactions.

Director Independence

We are a Minnesota cooperative corporation managed by a Board of Directors made up of 17 members. Nomination and election of the directors is done by eight separate regions. In addition to meeting other requirements for directorship, candidates must reside in the region from which they are elected. Directors are elected for three-year terms. The terms of directors are staggered and no more than seven director positions are elected at an annual meeting of Members. Nominations for director elections are made by the Voting Members at the region caucuses at our annual meeting of Members. Neither the Board of Directors nor management of CHS participates in the nomination process. Accordingly, we have no nominating committee.

Table of Contents

The following directors satisfy the definition of director independence set forth in the rules of the Nasdaq Stock Market LLC ("Nasdaq"):



Clinton J. Blew	Steve Fritel	Edward Malesich
Dennis Carlson	Alan Holm	Perry Meyer
Jon Erickson	David Kayser	Steve Riegel
Mark Farrell	Randy Knecht	Daniel Schurr

Further, although we do not need to rely upon an exemption for the Board of Directors as a whole, we are exempt pursuant to the Nasdaq rules from the Nasdaq director independence requirements as they relate to the makeup of the Board of Directors as a whole and the makeup of the committee performing the functions of a compensation committee. The Nasdaq exemption applies to cooperatives that are structured to comply with relevant state law and federal tax law and that do not have a publicly traded class of common stock. All of the members of our Audit Committee are independent. All of the members of our Governance Committee (the committee of our Board of Directors that performs the equivalent functions of a compensation committee) are independent other than David Johnsrud, Tracy Jones and Russ Kehl.

Independence of CEO and Board Chairman Positions

Our bylaws prohibit any employee of CHS from serving on the Board of Directors. Accordingly, our CEO may not serve as Chairman of the Board or in any CHS Board capacity. We believe that this leadership structure creates independence between the Board and management and is an important feature of appropriate checks and balances in the governance of CHS.

Board of Directors Role in Risk Oversight

It is senior management’s responsibility to identify, assess and manage our exposures to risk. Our Board of Directors plays an important and significant role in overseeing the overall risk management approach, including the review and, where appropriate, approval of guidelines and policies that govern our risk management process. Our management and Board of Directors have jointly identified multiple broad categories of risk exposure, each of which could impact operations and affect results at an enterprise level. Each such significant enterprise level risk is reviewed periodically by management with the Board of Directors and/or a committee of the Board as appropriate. The review includes an analysis by management of the continued applicability of the risk, our performance in managing or mitigating the risk, and possible additional or emerging risks to consider. As additional areas of risk are identified, our Board of Directors and/or a committee of the Board provides review and oversight of management's actions to identify, assess, and manage that risk. We continue to develop a formal Enterprise Risk Management program intended to support integration of the risk assessment and management discipline and controls into major decision making and business processes. The Corporate Risk Committee is involved in developing and approving the Enterprise Risk Management framework, and is responsible for evaluating its effectiveness on an ongoing basis. When appropriate, the Corporate Risk Committee meets jointly with the Audit Committee to discuss common financial or other risks across CHS that may have potential material impact to our financial statements.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table shows the aggregate fees billed to us by PricewaterhouseCoopers LLP for services rendered during the years ended August 31, 2018 , and 2017 :



	2018		2017
	(Dollars in thousands)
Audit Fees ⁽¹⁾	$	6,985	$	4,408
Audit-related Fees ⁽²⁾	294		546
Tax Fees ⁽³⁾	53		84
All Other Fees ⁽⁴⁾	218		1
Total	$	7,550	$	5,039

_______________________________________


⁽¹⁾	Includes fees for audit of annual financial statements and reviews of the related quarterly financial statements, certain statutory audits and work related to filings of registration statements.


⁽²⁾	Includes fees for employee benefit plan audits, due diligence on acquisitions and internal control and system audit procedures.

Table of Contents


⁽³⁾	Includes fees related to tax compliance, tax advice and tax planning.


⁽⁴⁾	Includes fees related to other professional services performed for international entities.

In accordance with the CHS Inc. Audit Committee Charter, as amended, our Audit Committee adopted the following policies and procedures for the approval of the engagement of an independent registered public accounting firm for audit, review or attest services and for pre-approval of certain permissible non-audit services, all to ensure auditor independence.

Our independent registered public accounting firm will provide audit, review and attest services only at the direction of, and pursuant to engagement fees and terms approved by our Audit Committee. Our Audit Committee approves, in advance, all non-audit services to be performed by the independent auditors and the fees and compensation to be paid to the independent auditors. Our Audit Committee approved 100% of the services listed above in advance.

Table of Contents

PART IV.

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1) FINANCIAL STATEMENTS

The following financial statements are filed as part of this Annual Report on Form 10-K.



	Page No.
Report of Independent Registered Public Accounting Firm	F-1
Consolidated Balance Sheets as of August 31, 2018, and 2017	F-2
Consolidated Statements of Operations for the years ended August 31, 2018, 2017, and 2016	F-3
Consolidated Statements of Comprehensive Income for the years ended August 31, 2018, 2017, and 2016	F-4
Consolidated Statements of Changes in Equities for the years ended August 31, 2018, 2017, and 2016	F-5
Consolidated Statements of Cash Flows for the years ended August 31, 2018, 2017, and 2016	F-6
Notes to Consolidated Financial Statements	F-7

(a)(2) FINANCIAL STATEMENT SCHEDULES

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS AND RESERVES



	Balance at Beginning of Year		Additions: Charged to Costs and Expenses *		Deductions: Write-offs, net of Recoveries			Balance at End of Year
	(Dollars in thousands)
Allowances for Doubtful Accounts
2018	$	225,726	$	2,748	$	(6,661	)	$	221,813
2017	163,644		191,581		(129,499		)	225,726
2016	106,445		65,725		(8,526		)	163,644

Valuation Allowance for Deferred Tax Assets
2018	$	289,083	$	61,854	$	(120,563	)	$	230,374
2017 (As restated)	213,583		115,893		(40,393		)	289,083
2016 (As restated)	104,334		138,794		(29,545		)	213,583

Reserve for Supplier Advance Payments
2018	$	130,705	$	—	$	(20,092	)	$	110,613
2017	—		130,705		—			130,705

*net of reserve adjustments

Table of Contents

(a)(3) EXHIBITS

EXHIBIT INDEX



2.1	Second Amended and Restated Limited Liability Company Agreement dated as of December 18, 2015 between CHS Inc. and CF Industries Sales, LLC. (Incorporated by reference to our Current Report on Form 8-K, filed December 21, 2015).()(*)
3.1	Amended and Restated Articles of Incorporation of CHS Inc. (Incorporated by reference to our Current Report on Form 8-K, filed December 5, 2016).
3.2	Amended and Restated Bylaws of CHS Inc. (Incorporated by reference to our Current Report on Form 8-K, filed December 5, 2016).
4.1	Resolution Creating a Series of Preferred Equity to be Designated 8% Cumulative Redeemable Preferred Stock. (Incorporated by reference to Amendment No. 1 to our Registration Statement on Form S-2 (File No. 333-101916), filed January 14, 2003).
4.2	Form of Certificate Representing 8% Cumulative Redeemable Preferred Stock. (Incorporated by reference to Amendment No. 2 to our Registration Statement on Form S-2 (File No. 333-101916), filed January 23, 2003).
4.3	Unanimous Written Consent Resolution of the Board of Directors Amending the Amended and Restated Resolution Creating a Series of Preferred Equity to be Designated 8% Cumulative Redeemable Preferred Stock. (Incorporated by reference to Amendment No. 2 to our Registration Statement on Form S-2 (File No. 333-101916), filed January 23, 2003).
4.4	Unanimous Written Consent Resolution of the Board of Directors Amending the Amended and Restated Resolution Creating a Series of Preferred Equity to be Designated 8% Cumulative Redeemable Preferred Stock to change the record date for dividends. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2003, filed July 2, 2003).
4.5	Resolution Amending the Terms of the 8% Cumulative Redeemable Preferred Stock to Provide for Call Protection. (Incorporated by reference to our Current Report on Form 8-K, filed July 19, 2013).
4.6	Resolution Creating Class B Cumulative Redeemable Preferred Stock. (Incorporated by reference to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-190019), filed September 13, 2013).
4.7	Unanimous Written Consent Resolution of the Board of Directors of CHS Inc. Relating to the Terms of the Class B Cumulative Redeemable Preferred Stock, Series 1. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed September 20, 2013).
4.8	Form of Certificate Representing Class B Cumulative Redeemable Preferred Stock, Series 1. (Incorporated by reference to Amendment No. 2 to our Registration Statement on Form S-1 (File No. 333-190019), filed September 13, 2013).
4.9	Unanimous Written Consent Resolution of the Board of Directors Relating to the Terms of the Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 2. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed March 5, 2014).
4.10	Form of Certificate Representing Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 2. (Incorporated by reference to Amendment No. 1 to our Registration Statement on Form S-1 (File No. 333-193891), filed February 26, 2014).
4.11	Unanimous Written Consent Resolution of the Board of Directors Relating to the Terms of the Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 3. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed September 10, 2014).
4.12	Form of Certificate Representing Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 3. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed September 10, 2014).
4.13	Unanimous Written Consent Resolution of the Board of Directors Relating to the Terms of the Class B Cumulative Redeemable Preferred Stock, Series 4. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed January 14, 2015).
4.14	Form of Certificate Representing Class B Cumulative Redeemable Preferred Stock, Series 4. (Incorporated by reference to our Registration Statement on Form 8-A (File No. 001-36079), filed January 14, 2015).
10.1	Separation Agreement between CHS Inc. and Carl M. Casale dated and effective May 22, 2017. (Incorporated by reference to our Current Report on Form 8-K, filed May 22, 2017).(+)
10.2	Letter Agreement, dated as of March 15, 2018, between Shirley Cunningham and CHS Inc. (Incorporated by reference to our Current Report on Form 8-K, filed March 15, 2018).(+)
10.3	Employment Agreement between CHS Inc. and Jay D. Debertin dated and effective May 22, 2017. (Incorporated by reference to our Current Report on Form 8-K, filed May 22, 2017).(+)
10.4	CHS Inc. Supplemental Executive Retirement Plan (2013 Restatement). (Incorporated by reference to Amendment No. 1 to our Registration Statement on Form S-1 (file No. 333-190019), filed September 3, 2013). (+)

Table of Contents



10.4A	Amendment No. 1 to the CHS Inc. Supplemental Executive Retirement Plan (2013 Restatement). (Incorporated by reference to our Form 10-K for the year ended August 31, 2016, filed November 3, 2016). (+)
10.4B	Amendment No. 2 to the CHS Inc. Supplemental Executive Retirement Plan (2013 Restatement). (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2016, filed July 7, 2016). (+)
10.5	CHS Inc. 2017 Annual Variable Pay Plan Master Plan Document (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017). (+)
10.5A	CHS Inc. 2017 Annual Variable Pay Plan Appendix A, Plan Details (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017). (+)
10.5B	CHS Inc. 2017 Annual Variable Pay Plan Appendix B, Plan Modification (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017). (+)
10.6	CHS Inc. 2018 Annual Variable Pay Plan Master Plan Document (*) (+)
10.6A	CHS Inc. 2018 Annual Variable Pay Plan Appendix, Plan Details (*) (+)
10.7	CHS Inc. Long-Term Incentive Plan XIV Master Plan Document (2015-2017). (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.7A	CHS Inc. Long-Term Incentive Plan XIV Plan Appendix (2015-2017) (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.7B	CHS Inc. Long-Term Incentive Plan XIV Master Plan Document (2016-2018). (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.7C	CHS Inc. Long-Term Incentive Plan XIV Plan Appendix (2016-2018) (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.7D	CHS Inc. Long-Term Incentive Plan XIV Plan Appendix (2017-2019)(Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.7E	CHS Inc. Long-Term Incentive Plan XIV Plan Appendix (2018-2020)(Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.8	CHS Inc. Nonemployee Director Retirement Plan. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2010, filed July 8, 2010). (+)
10.8A	Amendment No. 1 to the Nonemployee Director Retirement Plan. (Incorporated by reference to our Form 10-K for the year ended August 31, 2011, filed November 14, 2011). (+)
10.8B	Amendment No. 2 to the Nonemployee Director Retirement Plan. (Incorporated by reference to our Form 10-K for the year ended August 31, 2012, filed November 7, 2012). (+)
10.9	Trust Under the CHS Inc. Nonemployee Director Retirement Plan. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2010, filed July 8, 2010). (+)
10.10	CHS Inc. Senior Leadership Team Retention Award Document. (*) (+)
10.11	$225,000,000 Note Agreement (Private Placement Agreement) dated as of June 19, 1998 among Cenex Harvest States Cooperatives and each of the Purchasers of the Notes. (Incorporated by Reference to our Form 10-Q Transition Report for the period June 1, 1998 to August 31, 1998, filed October 14, 1998).
10.11A	First Amendment to Note Agreement ($225,000,000 Private Placement), effective September 10, 2003, among CHS Inc. and each of the Purchasers of the Notes. (Incorporated by reference to our Form 10-K for the year ended August 31, 2003, filed November 21, 2003).
10.12	Note Purchase Agreement and Series D & E Senior Notes dated October 18, 2002. (Incorporated by reference to our Form 10-K for the year ended August 31, 2002, filed November 25, 2002).
10.12A	Amendment No. 1 to Note Purchase Agreement dated as of June 9, 2011, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.12B	Amendment No. 2 to Note Purchase Agreement dated as of September 4, 2015, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.13	Note Purchase and Private Shelf Agreement between CHS Inc. and Prudential Capital Group dated as of April 13, 2004. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2004, filed July 12, 2004).
10.13A	Amendment No. 1 to Note Purchase and Private Shelf Agreement dated April 9, 2007, among CHS Inc., Prudential Investment Management, Inc. and the Prudential Affiliate parties. (Incorporated by reference to our Form 10-Q for the quarterly period ended February 28, 2007, filed April 9, 2007).
10.13B	Amendment No. 2 to Note Purchase and Private Shelf Agreement and Senior Series J Notes totaling $50 million issued February 8, 2008. (Incorporated by reference to our Current Report on Form 8-K, filed February 11, 2008).
10.13C	Amendment No. 3 to Note Purchase and Private Shelf Agreement, effective as of November 1, 2010. (Incorporated by reference to our Form 10-Q for the quarterly period ended November 30, 2010, filed January 11, 2011).

Table of Contents



10.13D	Amendment No. 4 to Note Purchase and Private Shelf Agreement dated as of June 9, 2011, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.13E	Amendment No. 5 to Note Purchase and Private Shelf Agreement dated as of December 21, 2012, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.13F	Amendment No. 6 to Note Purchase and Private Shelf Agreement dated as of September 4, 2015, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.14	Note Purchase Agreement for Series H Senior Notes ($125,000,000 Private Placement) dated September 21, 2004. (Incorporated by reference to our Current Report on Form 8-K, filed September 22, 2004).
10.15	CHS Inc. Deferred Compensation Plan Master Plan Document (2015 Restatement). (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2015, filed July 10, 2015). (+)
10.15A	Amendment No. 1 to the CHS Inc. Deferred Compensation Plan (2015 Restatement). (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2016, filed July 7, 2016). (+)
10.15B	Amendment No. 2 to the CHS Inc. Deferred Compensation Plan (2015 Restatement). (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).(+)
10.16	Beneficiary Designation Form for the CHS Inc. Deferred Compensation Plan (Incorporated by reference to our Form 10-K for the year ended August 31, 2009, filed November 10, 2009). (+)
10.17	New Plan Participants 2011 Plan Agreement and Election Form for the CHS Inc. Deferred Compensation Plan. (Incorporated by reference to our Registration Statement on Form S-8 (File No. 333-177326), filed October 14, 2011). (+)
10.18	CHS Inc. Strategic Leadership Team Retention Award. (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017). (+)
10.19	Loan Agreement (Term Loan) between CHS Inc. and European Bank for Reconstruction and Development, dated January 5, 2011. (Incorporated by reference to our Current Report on Form 8-K, filed January 18, 2011).
10.20	Revolving Loan Agreement between CHS Inc. and European Bank for Reconstruction and Development, dated November 30, 2010. (Incorporated by reference to our Current Report on Form 8-K, filed January 18, 2011).
10.21	Note Purchase Agreement ($400,000,000 Private Placement) and Series I Senior Notes dated as of October 4, 2007. (Incorporated by reference to our Current Report on Form 8-K, filed October 4, 2007).
10.21A	Amendment No. 1 to Note Purchase Agreement ($400,000,000 Private Placement) and Series I Senior Notes dated as of June 9, 2011. (*)
10.21B	Amendment No. 2 to Note Purchase Agreement dated as of September 4, 2015, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.22	Agreement Regarding Distribution of Assets, by and among CHS Inc., United Country Brands, LLC, Land O’Lakes, Inc. and Winfield Solutions, LLC, made as of September 4, 2007. (Incorporated by reference to our Form 10-K for the year ended August 31, 2007, filed November 20, 2007).
10.23	$150 Million Term Loan Credit Agreement by and between CHS Inc., CoBank, ACB and the Syndication Parties dated as of December 12, 2007. (Incorporated by reference to our Registration Statement on Form S-1 (File No. 333-148091), filed December 14, 2007).
10.23A	First Amendment to $150 Million Term Loan Credit Agreement by and between CHS Inc., CoBank, ACB and the Syndication Parties dated as of May 1, 2008. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2008, filed July 10, 2008).
10.23B	Second Amendment to $150 Million Term Loan Credit Agreement by and between CHS Inc., CoBank, ACB and the Syndication Parties dated as of June 2, 2010. (Incorporated by reference to our Current Report on Form 8-K, filed June 3, 2010).
10.23C	Third Amendment to $150 Million Term Loan Credit Agreement by and between CHS Inc., CoBank, ACB and the Syndication Parties dated as of September 27, 2011. (*)
10.23D	Fourth Amendment to $150 Million Term Loan Credit Agreement by and between CHS Inc., CoBank, ACB and the Syndication Parties dated as of June 26, 2013. (*)
10.23E	Fifth Amendment and Waiver, dated as of September 4, 2015, to that certain Credit Agreement (10-Year Term Loan), dated as of December 12, 2007, by and between CHS Inc., CoBank, ACB, as a syndication party and as the administrative agent for the benefit of all present and future syndication parties, and the other syndication parties party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.24	Amended and Restated Loan Origination and Participation Agreement dated as of September 1, 2011, by and among AgStar Financial Services, PCA, d/b/a ProPartners Financial, and CHS Capital, LLC. (Incorporated by reference to our Form 10-K for the year ended August 31, 2011, filed November 14, 2011).

Table of Contents



10.24A	Amendment No. 1 to Amended and Restated Loan Origination and Participation Agreement dated as of September 1, 2011, by and among AgStar Financial Services, PCA, d/b/a ProPartners Financial, and CHS Capital, LLC. (Incorporated by reference to our Form 10-K for the year ended August 31, 2012, filed November 7, 2012).
10.24B	Amendment No. 2 to Amended and Restated Loan Origination and Participation Agreement dated as of September 1, 2011, by and among AgStar Financial Services, PCA, d/b/a ProPartners Financial, and CHS Capital, LLC. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2017, filed July 14, 2017).
10.24C	Amendment No. 3 to Amended and Restated Loan Origination and Participation Agreement dated as of September 1, 2011, by and among AgStar Financial Services, PCA, d/b/a ProPartners Financial, and CHS Capital, LLC. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2017, filed July 14, 2017).
10.24D	Amendment No. 4 to Amended and Restated Loan Origination and Participation Agreement dated as of September 1, 2011, by and among AgStar Financial Services, PCA, d/b/a ProPartners Financial, and CHS Capital, LLC. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2017, filed July 14, 2017).
10.25	Stock Transfer Agreement, dated as of November 17, 2011, between CHS Inc. and GROWMARK, Inc. (Incorporated by reference to our Form 10-Q for the quarterly period ended November 30, 2011, filed January 11, 2012).
10.26	Stock Transfer Agreement, dated as of November 17, 2011, between CHS Inc. and MFA Oil Company. (Incorporated by reference to our Form 10-Q for the quarterly period ended November 30, 2011, filed January 11, 2012).
10.27	Amended and Restated Limited Liability Company Agreement, dated February 1, 2012, between CHS Inc. and Cargill, Incorporated. (Incorporated by reference to our Current Report on Form 8-K, filed February 1, 2012).
10.28	Note Purchase Agreement between CHS Inc. and certain accredited investors ($500,000,000) dated as of June 9, 2011. (Incorporated by reference to our Current Report on Form 8-K, filed June 13, 2011).
10.28A	Amendment No. 1 to Note Purchase Agreement dated as of September 4, 2015, between CHS Inc. and the purchasers of notes party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.29	Joint venture agreement among CHS Inc., Cargill, Incorporated, and ConAgra Foods, Inc., dated March 4, 2013. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2013, filed July 10, 2013).
10.29A	Amendment No. 1 to the joint venture agreement among CHS Inc., Cargill Incorporated, and ConAgra Foods, Inc., dated April 30, 2013. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.29B	Amendment No. 2 to the joint venture agreement among CHS Inc., Cargill Incorporated, and ConAgra Foods, Inc., dated May 31, 2013. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.29C	Amendment No. 3 to the joint venture agreement among CHS Inc., Cargill Incorporated, and ConAgra Foods, Inc., dated July 24, 2013. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.29D	Amendment No. 4 to the joint venture agreement among CHS Inc., Cargill Incorporated, and ConAgra Foods, Inc., dated March 27, 2014. (Incorporated by reference to our Form 10-Q for the quarterly period ended February 28, 2014, filed April 3, 2014).
10.29E	Amendment No. 5 to the joint venture agreement among CHS Inc., Cargill Incorporated, and ConAgra Foods, Inc., dated May 25, 2014. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2014, filed July 9, 2014).
10.30	Resolutions Amending the Long-Term Incentive Plan. (Incorporated by reference to our Current Report on Form 8-K, filed September 3, 2013). (+)
10.31	Pre-Export Credit Agreement dated as of September 24, 2013 between CHS Agronegocio Industria e Comercio Ltda., as borrower, CHS Inc., as guarantor, and Credit Agricole Corporate and Investment Bank (Credit Agricole), as administrative agent, Credit Agricole and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint lead arrangers and joint bookrunners, and the other syndication parties thereto from time to time. (Incorporated by reference to our Current Report on Form 8-K, filed October 4, 2013).
10.31A	First Amendment to Pre-Export Credit Agreement dated as of October 9, 2015, among CHS Agronegocio Industria e Comercio Ltda., as borrower, CHS Inc., as guarantor, Credit Agricole Corporate and Investment Bank, as administrative agent, and the lenders party thereto. (Incorporated by reference to our Form 10-K for the year ended August 31, 2015, filed November 23, 2015).
10.32	Amended and Restated Supply Agreement dated as of December 18, 2015 between CHS Inc. and CF Industries Nitrogen LLC. (Incorporated by reference to our Current Report on Form 8-K, filed December 21, 2015). (***)
10.33	2015 Amended and Restated Credit Agreement (5-Year Revolving Loan) dated as of September 4, 2015, by and between CHS Inc., CoBank, ACB, as a syndication party and as the administrative agent for the benefit of all present and future syndication parties, Wells Fargo Bank, National Association, as syndication agent, and the other syndication parties party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).

Table of Contents



10.34	2015 Credit Agreement (10-Year Term Loan) dated as of September 4, 2015, by and between CHS Inc., CoBank, ACB, as a syndication party and as the administrative agent for the benefit of all present and future syndication parties, and the other syndication parties party thereto. (Incorporated by reference to our Current Report on Form 8-K, filed September 11, 2015).
10.34A	Amendment No. 1 to 2015 Credit Agreement. (10-Year Term Loan), dated as of June 30, 2016, by and between CHS Inc., CoBank, ACB, as a syndication party and as the administrative agent for the benefit of all present and future syndication parties, and the other syndication parties thereto. (Incorporated by reference to our Form 10-Q for the quarterly period ended May 31, 2016, filed July 7, 2016).
10.35	Note Purchase Agreement, dated as of January 14, 2016, among CHS Inc. and each of the Purchasers signatory thereto. (Incorporated by reference to our Current Report on Form 8-K, filed January 21, 2016).
10.36	Sale and Contribution Agreement, dated as of July 22, 2016, by and among CHS Inc., CHS Capital, LLC and Cofina Funding, LLC. (Incorporated by reference to our Form 10-K for the year ended August 31, 2016, filed November 3, 2016).
10.36A	Omnibus Amendment No. 1, dated as of February 14, 2017, by and among Cofina Funding, LLC, as seller, CHS Inc., as servicer and as an originator, CHS Capital, LLC, as an originator, the conduit purchasers, committed purchasers and purchaser agents set forth on the signature pages thereto, the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as administrative agent, and U.S. Bank National Association, as custodian. (Incorporated by reference to our Current Report on 8-K, filed February 15, 2017).
10.36B	Omnibus Amendment No. 2, dated as of July 18, 2017, by and among Cofina Funding, LLC, as seller, CHS Inc., as servicer and as an originator, CHS Capital, LLC, as an originator, the conduit purchasers, committed purchasers and purchaser agents set forth on the signature pages thereto, the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as administrative agent, and U.S. Bank National Association, as custodian. (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).
10.36C	Omnibus Amendment No. 3, dated as of September 4, 2018, by and among Cofina Funding, LLC, as seller, CHS Inc., as servicer and as an originator, CHS Capital, LLC, as an originator, the conduit purchasers, committed purchasers and purchaser agents set forth on the signature pages thereto, the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as administrative agent, and U.S. Bank National Association, as custodian. (*)
10.37	Receivables Financing Agreement dated July 22, 2016, by and among CHS Inc., individually and as a Servicer, Cofina Funding, LLC, as Seller, Victory Receivables Corporation and Nieuw Amsterdam Receivables Corporation B.V., as Conduit Purchasers, Coöperatieve Rabobank U.A., as a Committed Purchaser, Coöperatieve Rabobank U.A., New York Branch, as Purchaser Agent, and the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as a Committed Purchaser, Purchaser Agent and as Administrative Agent. (Incorporated by reference to our Form 10-K for the year ended August 31, 2016, filed November 3, 2016).
10.37A	Amended and Restated Receivables Purchase Agreement dated July 18, 2017, by and among CHS Inc., individually and as a Servicer, Cofina Funding, LLC, as Seller, Victory Receivables Corporation and Nieuw Amsterdam Receivables Corporation B.V., as Conduit Purchasers, Coöperatieve Rabobank U.A., as a Committed Purchaser, Coöperatieve Rabobank U.A., New York Branch, as Purchaser Agent, and the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as a Committed Purchaser, Purchaser Agent and as Administrative Agent. (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).
10.37B	First Amendment to Amended and Restated Receivables Purchase Agreement, dated as of June 28, 2018, by and among Cofina Funding, LLC, as Seller, CHS Inc., as Servicer, the Conduit Purchasers, Committed Purchasers and Purchaser Agents set forth on the signature pages thereto and MUFG Bank Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as Administrative Agent. (Incorporated by reference to our Current Report on Form 8-K, filed July 5, 2018).
10.38	Reaffirmation of Performance Guaranty dated July 18, 2017, by and among CHS Inc., individually and as a Servicer, Cofina Funding, LLC, as Seller, Victory Receivables Corporation and Nieuw Amsterdam Receivables Corporation B.V., as Conduit Purchasers, Coöperatieve Rabobank U.A., as a Committed Purchaser, Coöperatieve Rabobank U.A., New York Branch, as Purchaser Agent, and the Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as a Committed Purchaser, Purchaser Agent and as Administrative Agent. (Incorporated by reference to our Form 10-K for the year ended August 31, 2017, filed November 9, 2017).
10.39	Master Framework Agreement, dated as of September 4, 2018 (the “Framework Agreement”), by and among, MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.) and each other financial institution from time to time party thereto, as MFA Buyers, MUFG Bank, Ltd., as agent for the MFA Buyers, CHS Inc. and CHS Capital, LLC, as sellers, and CHS Inc., as agent for the sellers. (*)
10.40	1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018, between CHS Inc. and the buyer under the Framework Agreement, including Annex I thereto (and as amended thereby). (*)
10.41	1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018, between CHS Capital, LLC and the buyer under the Framework Agreement, including Annex I thereto (and as amended thereby). (*)
10.42	Guaranty, dated as of September 4, 2018, by CHS Inc. in favor of the buyer under the Framework Agreement. (*)

Table of Contents



21.1	Subsidiaries of the Registrant.(*)
23.1	Consent of Independent Registered Public Accounting Firm.(*)
31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(*)
31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(*)
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*)
32.2	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(*)
101	The following financial information from CHS Inc.’s Annual Report on Form 10-K for the year ended August 31, 2018, formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Changes in Equity, (v) the Consolidated Statements of Cash Flows and (vi) the Notes to the Consolidated Financial Statements. (*)

_______________________________________

(*) Filed herewith.


(**)	Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. CHS hereby undertakes to furnish supplemental copies of any of the omitted schedules to the U.S. Securities and Exchange Commission upon request.


(***)	Portions of Exhibits 2.1 and 10.30 have been omitted pursuant to a confidential treatment order under the Securities Exchange Act of 1934.

(+) Indicates management contract or compensatory plan or agreement.

(b) EXHIBITS

The exhibits shown in Item 15(a)(3) of this Annual Report on Form 10-K are being filed herewith.

None.

ITEM 16. FORM 10-K SUMMARY

None.

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on December 3, 2018 .

CHS INC.



	By:	/s/ Jay D. Debertin
		Jay D. Debertin
		President and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on December 3, 2018 :



Signature		Title

/s/ Jay D. Debertin		President and Chief Executive Officer (principal executive officer)
Jay D. Debertin

/s/ Timothy Skidmore		Executive Vice President and Chief Financial Officer (principal financial officer)
Timothy Skidmore

/s/ Daniel Lehmann		Vice President Finance, Corporate Controller and Chief Accounting Officer (principal accounting officer)
Daniel Lehmann

/s/ Daniel Schurr		Chairman of the Board of Directors
Daniel Schurr		Chairman of the Board of Directors

/s/ Donald Anthony		Director
Donald Anthony		Director

/s/ Clinton J. Blew		Director
Clinton J. Blew		Director

/s/ Dennis Carlson		Director
Dennis Carlson		Director

/s/ Scott Cordes		Director
Scott Cordes		Director

/s/ Jon Erickson		Director
Jon Erickson		Director

/s/ Mark Farrell		Director
Mark Farrell		Director

/s/ Steve Fritel		Director
Steve Fritel		Director

Table of Contents



/s/ Alan Holm		Director
Alan Holm		Director

/s/ David Johnsrud		Director
David Johnsrud		Director

/s/ Tracy Jones		Director
Tracy Jones		Director

/s/ David Kayser		Director
David Kayser		Director

/s/ Russell Kehl		Director
Russell Kehl		Director

/s/ Randy Knecht		Director
Randy Knecht		Director

/s/ Edward Malesich		Director
Edward Malesich		Director

/s/ Perry Meyer		Director
Perry Meyer		Director

/s/ Steve Riegel		Director
Steve Riegel		Director

Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors, Members and Patrons of CHS Inc.:

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of CHS Inc. and its subsidiaries (the "Company") as of August 31, 2018 and 2017, and the related consolidated statements of operations, comprehensive income, changes in equities and cash flows for each of the three years in the period ended August 31, 2018, including the related notes and schedule of valuation and qualifying accounts and reserves for each of the three years in the period ended August 31, 2018, appearing under Item 15(a)(2) (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of August 31, 2018 and 2017, and the results of its operations and its cash flows for each of the three years in the period ended August 31, 2018, in conformity with accounting principles generally accepted in the United States of America.

Restatement of Previously Issued Financial Statements

As discussed in Note 2 to the consolidated financial statements, the Company has restated its 2017 and 2016 financial statements to correct misstatements.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

PricewaterhouseCoopers LLP

Minneapolis, Minnesota

December 3, 2018

We have served as the Company's auditor since 1998.

F-1

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



	August 31,
	2018			(As Restated) 2017
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	450,617		$	181,379
Receivables	2,460,401			1,892,168
Inventories	2,768,649			2,601,604
Derivative assets	329,757			218,742
Margin and related deposits	151,150			206,062
Supplier advance payments	288,423			249,234
Other current assets	244,208			281,925
Total current assets	6,693,205			5,631,114
Investments	3,711,925			3,750,993
Property, plant and equipment	5,141,719			5,356,434
Other assets	834,329			1,080,381
Total assets	$	16,381,178		$	15,818,922
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	2,272,196		$	1,985,163
Current portion of long-term debt	167,565			156,345
Customer margin deposits and credit balances	137,395			157,914
Customer advance payments	409,088			423,770
Accounts payable	1,844,489			1,991,294
Derivative liabilities	438,465			300,946
Accrued expenses	511,032			454,996
Dividends and equities payable	153,941			12,121
Total current liabilities	5,934,171			5,482,549
Long-term debt	1,762,690			2,023,448
Long-term deferred tax liabilities	182,770			329,980
Other liabilities	336,519			277,305
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			2,264,038
Equity certificates	4,609,456			4,341,649
Accumulated other comprehensive loss	(199,915		)	(180,360		)
Capital reserves	1,482,003			1,267,808
Total CHS Inc. equities	8,155,582			7,693,135
Noncontrolling interests	9,446			12,505
Total equities	8,165,028			7,705,640
Total liabilities and equities	$	16,381,178		$	15,818,922

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

F-2

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



	For the Years Ended August 31,
	2018			(As Restated) 2017			(As Restated) 2016
	(Dollars in thousands)
Revenues	$	32,683,347		$	32,037,426		$	30,355,260
Cost of goods sold	31,589,887			31,142,766			29,386,515
Gross profit	1,093,460			894,660			968,745
Marketing, general and administrative	674,083			612,007			601,266
Reserve and impairment charges (recoveries), net	(37,709		)	456,679			75,036
Operating earnings (loss)	457,086			(174,026		)	292,443
(Gain) loss on disposal of business	(131,816		)	2,190			—
Interest expense	149,202			171,239			113,704
Other (income) loss	(78,015		)	(99,951		)	(47,609		)
Equity (income) loss from investments	(153,515		)	(137,338		)	(175,777		)
Income (loss) before income taxes	671,230			(110,166		)	402,125
Income tax expense (benefit)	(104,076		)	(181,124		)	19,099
Net income (loss)	775,306			70,958			383,026
Net income (loss) attributable to noncontrolling interests	(601		)	(634		)	(223		)
Net income (loss) attributable to CHS Inc.	$	775,907		$	71,592		$	383,249

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

F-3

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME



	For the Years Ended August 31,
	2018			(As Restated) 2017			(As Restated) 2016
	(Dollars in thousands)
Net income (loss)	$	775,306		$	70,958		$	383,026
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity	20,066			32,702			6,583
Unrealized net gain (loss) on available for sale investments	(3,148		)	4,385			1,500
Cash flow hedges	2,540			2,242			(3,872		)
Foreign currency translation adjustment	(12,021		)	(8,159		)	(2,904		)
Other comprehensive income (loss), net of tax	7,437			31,170			1,307
Comprehensive income	782,743			102,128			384,333
Less comprehensive income attributable to noncontrolling interests	(601		)	(634		)	(223		)
Comprehensive income attributable to CHS Inc.	$	783,344		$	102,762		$	384,556

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

F-4

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITIES



	For the Years Ended August 31, 2018, 2017, and 2016,
	Equity Certificates												Accumulated Other Comprehensive Loss
	Capital Equity Certificates			Nonpatronage Equity Certificates			Nonqualified Equity Certificates			Preferred Stock						Capital Reserves			Noncontrolling Interests			Total Equities
	(Dollars in thousands)
Balances, August 31, 2015 (As previously reported)	$	3,793,897		$	23,057		$	282,928		$	2,167,540		$	(214,207	)	$	1,604,670		$	11,526		$	7,669,411
Cumulative restatement adjustments													1,370			(119,237		)	(105		)	(117,972		)
Balances, August 31, 2015 (As restated)	3,793,897			23,057			282,928			2,167,540			(212,837		)	1,485,433			11,421			7,551,439
Reversal of prior year patronage and redemption estimates	(268,017		)													625,444						357,427
Distribution of 2015 patronage refunds	375,506															(627,246		)				(251,740		)
Redemptions of equities	(22,948		)	(143		)	(820		)													(23,911		)
Equities issued	23,258																					23,258
Capital equity certificates exchanged for preferred stock	(76,756		)							76,756												—
Preferred stock dividends																(122,824		)				(122,824		)
Other, net	(1,248		)	(20		)	(341		)	(164		)				2,401			2,988			3,616
Net income (loss)																383,249			(223		)	383,026
Other comprehensive income (loss), net of tax													1,307									1,307
Estimated 2016 patronage refunds	153,579															(257,458		)				(103,879		)
Estimated 2016 equity redemptions	(58,560		)																			(58,560		)
Balances, August 31, 2016 (As restated)	3,918,711			22,894			281,767			2,244,132			(211,530		)	1,488,999			14,186			7,759,159
Reversal of prior year patronage and redemption estimates	(95,019		)													257,458						162,439
Distribution of 2016 patronage refunds	153,589															(257,468		)				(103,879		)
Redemptions of equities	(35,041		)	(389		)	(1,960		)													(37,390		)
Equities issued	3,194																					3,194
Capital equity certificates redeemed with preferred stock	(19,985		)							19,960						25						—
Preferred stock dividends																(167,643		)				(167,643		)
Other, net	(9,023		)	7,331			(753		)	(54		)				1,178			(1,047		)	(2,368		)
Net income (loss)																71,592			(634		)	70,958
Other comprehensive income (loss), net of tax													31,170									31,170
Estimated 2017 patronage refunds							126,333									(126,333		)				—
Estimated 2017 equity redemptions	(10,000		)																			(10,000		)
Balances, August 31, 2017 (As restated)	3,906,426			29,836			405,387			2,264,038			(180,360		)	1,267,808			12,505			7,705,640
Reversal of prior year patronage and redemption estimates	6,058						(126,333		)							126,333						6,058
Distribution of 2017 patronage refunds							128,831									(128,831		)				—
Redemptions of equities	(6,064		)	(185		)	(476		)													(6,725		)
Preferred stock dividends																(168,668		)				(168,668		)
Other, net	(3,840		)	(153		)	(361		)							2,792			(2,458		)	(4,020		)
Net income (loss)																775,907			(601		)	775,306
Other comprehensive income (loss), net of tax													7,437									7,437
Reclassification of tax effects to retained earnings													(26,992		)	26,992						—
Estimated 2018 patronage refunds							345,330									(420,330		)				(75,000		)
Estimated 2018 equity redemptions	(65,000		)				(10,000		)													(75,000		)
Balances, August 31, 2018	$	3,837,580		$	29,498		$	742,378		$	2,264,038		$	(199,915	)	$	1,482,003		$	9,446		$	8,165,028

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

F-5

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Years Ended August 31,
	2018			(As Restated) 2017			(As Restated) 2016
	(Dollars in thousands)
Cash flows from operating activities:
Net income (loss)	$	775,306		$	70,958		$	383,026
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	478,050			480,223			447,492
Amortization of deferred major repair costs	61,686			67,058			73,483
Equity (income) loss from investments	(153,515		)	(137,338		)	(175,777		)
Distributions from equity investments	190,297			213,352			178,464
Provision for doubtful accounts	2,085			177,969			57,200
(Gain) loss on disposal of business	(131,816		)	2,190			—
Unrealized (gain) loss on crack spread contingent liability	—			(15,051		)	(60,931		)
Long-lived asset impairment, net of recoveries	(10,352		)	145,042			27,247
Reserve against supplier advance payments	—			130,705			—
Deferred taxes	(146,961		)	(194,467		)	28,190
Other, net	6,653			20,173			(15,444		)
Changes in operating assets and liabilities, net of acquisitions:
Receivables	210,775			146,788			1,570
Inventories	(169,581		)	(333,479		)	353,572
Derivative assets	(102,368		)	114,023			29,822
Margin and related deposits	54,912			97,804			(30,705		)
Supplier advance payments	(39,189		)	(33,952		)	43,415
Other current assets and other assets	(13,450		)	(50,729		)	128,603
Customer margin deposits and credit balances	(20,518		)	(50,920		)	20,841
Customer advance payments	(14,682		)	(1,329		)	(7,079		)
Accounts payable and accrued expenses	(78,388		)	227,967			(129,587		)
Derivative liabilities	132,495			(132,423		)	1,443
Other liabilities	40,629			(25,446		)	(94,291		)
Net cash provided by (used in) operating activities	1,072,068			919,118			1,260,554
Cash flows from investing activities:
Acquisition of property, plant and equipment	(355,412		)	(444,397		)	(692,780		)
Proceeds from disposition of property, plant and equipment	91,153			19,541			13,417
Proceeds from sale of business	234,914			—			—
Expenditures for major repairs	(80,514		)	(2,340		)	(19,610		)
Investments in joint ventures and other	(21,679		)	(16,645		)	(2,855,218		)
Changes in CHS Capital notes receivable, net	25,335			322			(209,902		)
Financing extended to customers	(74,402		)	(67,225		)	(82,302		)
Payments from customer financing	52,453			88,154			35,188
Other investing activities, net	48,628			17,549			64,236
Net cash provided by (used in) investing activities	(79,524		)	(405,041		)	(3,746,971		)
Cash flows from financing activities:
Proceeds from lines of credit and long-term borrowings	36,040,240			37,295,236			31,586,968
Payments on lines of credit, long-term borrowings and capital lease obligations	(36,525,136		)	(37,584,011		)	(29,232,842		)
Mandatorily redeemable noncontrolling interest payments	—			—			(153,022		)
Preferred stock dividends paid	(168,668		)	(167,642		)	(163,324		)
Redemptions of equities	(8,847		)	(35,268		)	(23,911		)
Cash patronage dividends paid	—			(103,879		)	(251,740		)
Other financing activities, net	(69,759		)	(22,694		)	52,067
Net cash provided by (used in) financing activities	(732,170		)	(618,258		)	1,814,196
Effect of exchange rate changes on cash and cash equivalents	8,864			(4,713		)	(5,223		)
Net increase (decrease) in cash and cash equivalents	269,238			(108,894		)	(677,444		)
Cash and cash equivalents at beginning of period	181,379			290,273			967,717
Cash and cash equivalents at end of period	$	450,617		$	181,379		$	290,273

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

F-6

Table of Contents

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 Organization, Basis of Presentation and Significant Accounting Policies

Organization

CHS Inc. ("CHS", "the Company", "we", "us", "our") is the nation’s leading integrated agricultural cooperative. As a cooperative, CHS is owned by farmers and ranchers and their member cooperatives ("members") across the United States. We also have preferred stockholders that own shares of our various series of preferred stock, which are each listed on the Global Select Market of the Nasdaq Stock Market LLC ("Nasdaq"). See Note 10, Equities for more detailed information.

We buy commodities from and provide products and services to individual agricultural producers, local cooperatives and other companies (including member and other non-member customers), both domestic and international. Those products and services include initial agricultural inputs such as fuels, farm supplies, crop nutrients and crop protection products; as well as agricultural outputs that include grains and oilseeds, grain and oilseed processing and food products, and ethanol production and marketing. A portion of our operations are conducted through equity investments and joint ventures whose operating results are not fully consolidated with our results; rather, a proportionate share of the income or loss from those entities is included as a component in our net income under the equity method of accounting.

Basis of Presentation

The consolidated financial statements include the accounts of CHS and all wholly-owned and majority-owned subsidiaries and limited liability companies. The effects of all significant intercompany transactions have been eliminated.

As described in Note 2, Restatement of Previously Issued Consolidated Financial Statements the consolidated financial statements for the years ended August 31, 2017 and 2016, have been restated to reflect the correction of misstatements to the consolidated financial statements. We have also restated all amounts impacted within the Notes to the consolidated financial statements.

Over the course of fiscal 2017, we incurred charges related to a trading partner of ours in Brazil, which entered into bankruptcy-like proceedings under Brazilian law; intangible and fixed asset impairment charges associated with certain assets meeting the criteria to be classified as held for sale; fixed asset impairment charges due to the cancellation of a capital project at one of our refineries; and bad debt/loan loss reserve charges relating to a single large producer borrower. Charges and impairments of this nature, as well as any recoveries related to amounts previously reserved, are included in the Consolidated Statements of Operations in the line item, "reserve and impairment charges (recoveries), net" for the twelve months ended August 31, 2018 , 2017 , and 2016 . The timing and amounts of these charges and impairments, and any recoveries were determined utilizing facts and circumstances that were present in the respective years in which the charges, impairments or recoveries were recorded. See additional information related to the reserves and impairment charges in Note 3, Receivables, Note 6 , Property, Plant and Equipment , and Note 7 , Other Assets .

The notes to our consolidated financial statements refer to our Energy, Ag and Nitrogen Production reportable segments, as well as our Corporate and Other category, which represents an aggregation of individually immaterial operating segments. The Nitrogen Production reportable segment resulted from our investment in CF Industries Nitrogen, LLC ("CF Nitrogen") in February 2016. Our investment in Ventura Foods, LLC ("Ventura Foods") is no longer a significant operating segment and is now included in our Corporate and Other category. See Note 12, Segment Reporting for more information.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We base our estimates on assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates. We evaluate our estimates and assumptions on an ongoing basis.

F-7

Table of Contents

Cash and Cash Equivalents

Cash equivalents include short-term, highly liquid investments with original maturities of three months or less at the date of acquisition. The fair value of cash and cash equivalents approximates the carrying value due to the short-term nature of the instruments.

Inventories

Grain, processed grain, oilseed, processed oilseed and other minimally processed soy-based inventories are stated at net realizable value. These inventories are agricultural commodity inventories that are readily convertible to cash because of their commodity characteristics, widely available markets and international pricing mechanisms. Agricultural commodity inventories have quoted market prices in active markets, may be sold without significant further processing and have predictable and insignificant disposal costs. Changes in the net realizable value of merchandisable agricultural commodities inventories are recognized in earnings as a component of cost of goods sold.

All other inventories are stated at the lower of cost or net realizable value. Costs for inventories produced or modified by us through a manufacturing process include fixed and variable production and raw material costs, and in-bound freight costs for raw materials. Costs for inventories purchased for resale include the cost of products and freight incurred to place the products at our points of sale. The costs of certain energy inventories (wholesale refined products, crude oil and asphalt) are determined on the last-in, first-out ("LIFO") method; all other inventories of non-grain products purchased for resale are valued on the first-in, first-out ("FIFO") and average cost methods.

Derivative Financial Instruments and Hedging Activities

We enter into various derivative instruments to manage our exposure to movements primarily associated with agricultural commodity prices and to a lesser degree, foreign currency exchange rates and interest rates. Except for certain interest rate swap contracts, which are accounted for as cash flow hedges or fair value hedges, our derivative instruments represent economic hedges of price risk for which hedge accounting under Accounting Standards Codification ("ASC") Topic 815, Derivatives and Hedging , is not applied. Rather, the derivative instruments are recorded on our Consolidated Balance Sheets at fair value with changes in fair value being recorded directly to earnings, primarily within cost of goods sold in our Consolidated Statements of Operations. See Note 13, Derivative Financial Instruments and Hedging Activities and Note 14, Fair Value Measurements for additional information.

Although we have certain netting arrangements for our exchange-traded futures and options contracts and certain over-the-counter ("OTC") contracts, we have elected to report our derivative instruments on a gross basis on our Consolidated Balance Sheets under ASC Topic 210-20, Balance Sheet - Offsetting .

Margin and Related Deposits

Many of our derivative contracts with futures and options brokers require us to make margin deposits of cash or other assets. Subsequent margin deposits may also be necessary when changes in commodity prices result in a loss on the contract value, to comply with applicable regulations. Our margin and related deposit assets are held by external brokers in segregated accounts to support the associated derivative contracts and may be used to fund or partially fund the settlement of those contracts as they expire. Similar to our derivative financial instruments, margin and related deposits are also reported on a gross basis.

Supplier Advance Payments and Rebates

Supplier advance payments are typically for periods less than 12 months and primarily include amounts paid for grain purchases from suppliers and amounts paid to crop nutrient suppliers to lock in future supply and pricing.

We receive volume-based rebates from certain vendors during the year. These vendor rebates are accounted for in accordance with ASC 605, Revenue Recognition, based on the terms of the volume rebate program. For those rebates which meet the definition of a binding arrangement and are both probable and estimable, we estimate the amount of the rebate we will receive and accrue it as a reduction of the cost of inventory over the period in which the rebate is earned.

F-8

Table of Contents

Investments

The equity method of accounting is used for joint ventures and other investments in which we are able to exercise significant influence over the entity’s operations, but do not have a controlling interest in the entity. Various factors are considered when assessing significant influence, including our ownership interest, representation on the Board of Directors, voting rights, and the impact of commercial arrangements that may exist with the entity. Our equity in the income or loss of these equity method investments is recorded within equity (income) loss from investments in the Consolidated Statements of Operations. We account for our investment in CF Nitrogen, LLC using the hypothetical liquidation at book value method which is discussed further in Note 5 , Investments.

The cost method of accounting is used for other investments in which we do not exercise significant influence. Investments in other cooperatives are stated at cost, plus patronage dividends received in the form of capital stock and other equities. Patronage dividends are recorded as a reduction to cost of goods sold at the time qualified written notices of allocation are received.

Investments in other debt and equity securities are classified as available-for-sale financial instruments and are stated at fair value, with unrealized gains and losses included as a component of accumulated other comprehensive loss on our Consolidated Balance Sheets. Investments in debt and equity instruments are carried at amounts that approximate fair values.

Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are provided on the straight-line method by charges to operations at rates based on the expected useful lives of individual or groups of assets (generally 15 to 20 years for land improvements; 20 to 40 years for buildings; 5 to 20 years for machinery and equipment; and 3 to 10 years for office equipment and other). Expenditures for maintenance and minor repairs and renewals are expensed, while the costs for major maintenance activities are capitalized and amortized on a straight-line basis over the period estimated to lapse until the next major maintenance activity occurs. We also capitalize and amortize eligible costs to acquire or develop internal-use software that are incurred during the application development stage. When assets are sold or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the related accounts and resulting gains or losses are reflected in operations.

Property, plant and equipment and other long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amounts may not be recoverable. This evaluation of recoverability is based on various indicators, including the nature, future economic benefits and geographic locations of the assets, historical or future profitability measures, and other external market conditions. If these indicators suggest that the carrying amounts of an asset or asset group may not be recoverable, potential impairment is evaluated using undiscounted estimated future cash flows. Should the sum of the expected future net cash flows be less than the carrying value, an impairment loss would be recognized. An impairment loss would be measured at the amount by which the carrying value of the asset or asset group exceeds its fair value.

We have asset retirement obligations with respect to certain of our refineries and other assets due to various legal obligations to clean and/or dispose of the component parts at the time they are retired. In most cases, these assets can be used for extended and indeterminate periods of time if they are properly maintained and/or upgraded. It is our practice and current intent to maintain refineries and related assets and to continue making improvements to those assets based on technological advances. As a result, we believe our refineries and related assets have indeterminate lives for purposes of estimating asset retirement obligations because dates or ranges of dates upon which we would retire a refinery and related assets cannot reasonably be estimated at this time. When a date or range of dates can reasonably be estimated for the retirement of any component part of a refinery or other asset, we estimate the cost of performing the retirement activities and record a liability for the fair value of that future cost.

F-9

Table of Contents

Major Maintenance Activities

Within our Energy segment, major maintenance activities (“turnarounds”) are performed at our Laurel, Montana and McPherson, Kansas refineries regularly. Turnarounds are the planned and required shutdowns of refinery processing units, which include the replacement or overhaul of equipment that have experienced decreased efficiency in resource conversion. Because turnarounds are performed to extend the life, increase the capacity, and/or improve the safety or efficiency of refinery processing assets, we follow the deferral method of accounting for turnarounds. Expenditures for turnarounds are capitalized (deferred) when incurred and amortized on a straight-line basis over a period of 2 to 4 years, which is the estimated time lapse between turnarounds. Should the estimated period between turnarounds change, we may be required to amortize the remaining cost of the turnaround over a shorter period, which would result in higher depreciation and amortization costs. Capitalized turnaround costs are included in other assets (long-term) on our Consolidated Balance Sheets and amortization expense related to the capitalized turnaround costs is included in cost of goods sold in our Consolidated Statements of Operations.

The selection of the deferral method, as opposed to expensing the turnaround costs when incurred, results in deferring recognition of the turnaround expenditures. The deferral method also results in the classification of the related cash outflows as investing activities in our Consolidated Statements of Cash Flows, whereas expensing these costs as incurred would result in classifying the cash outflows as operating activities. Repair, maintenance and related labor costs are expensed as incurred and are included in operating cash flows.

Goodwill and Other Intangible Assets

Goodwill and other intangible assets are included in other assets (long-term) on our Consolidated Balance Sheets. Goodwill represents the excess of cost over the fair value of identifiable assets acquired. Goodwill is tested for impairment on an annual basis as of July 31, or more frequently if triggering events or other circumstances occur which could indicate impairment. Goodwill is tested for impairment at the reporting unit level, which has been determined to be our operating segments or one level below our operating segments in certain instances.

Other intangible assets consist primarily of customer lists, trademarks and non-compete agreements. Intangible assets subject to amortization are expensed over their respective useful lives, which generally range from 2 to 30 years. We have no material intangible assets with indefinite useful lives. See Note 7, Other Assets for more information on goodwill and other intangible assets.

Revenue Recognition

We provide a wide variety of products and services, ranging from agricultural inputs such as fuels, farm supplies and crop nutrients, to agricultural outputs that include grain and oilseed, processed grains and oilseeds and food products, and ethanol production and marketing. We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured. Sales are generally recognized upon transfer of title, which could occur either upon shipment to or receipt by the customer, depending upon the terms of the transaction. Shipping and handling amounts billed to a customer as part of a sales transaction are included in revenues, and the related costs are included in cost of goods sold.

Environmental Expenditures

We are subject to various federal, state, and local environmental laws and regulations. Environmental expenditures are expensed or capitalized depending on their future economic benefit. Liabilities, including legal costs, related to remediation of contaminated properties are recognized when the related costs are considered probable and can be reasonably estimated. Estimates of environmental costs are based on current available facts, existing technology, undiscounted site-specific costs and currently enacted laws and regulations. Recoveries, if any, are recorded in the period in which recovery is received. Liabilities are monitored and adjusted as new facts or changes in law or technology occur.

Income Taxes

CHS is a nonexempt agricultural cooperative and files a consolidated federal income tax return within our tax return period. We are subject to tax on income from nonpatronage sources, non-qualified patronage distributions and undistributed patronage-sourced income. Income tax expense is primarily the current tax payable for the period and the change during the period in certain deferred tax assets and liabilities. Deferred income taxes reflect the impact of temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for federal and

F-10

Table of Contents

state income tax purposes, based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Reserves are recorded against unrecognized tax benefits when we believe that certain fully supportable tax return positions are likely to be challenged and that we may or may not prevail. If we determine that a tax position is more likely than not to be sustained upon audit, based on the technical merits of the position, we recognize the benefit by measuring the amount that is greater than 50% likely of being realized. We reevaluate the technical merits of our tax positions and recognize an uncertain tax benefit, or derecognize a previously recorded tax benefit, when there is (i) a completion of a tax audit, (ii) effective settlement of an issue, (iii) a change in applicable tax law including a tax case or legislative guidance, or (iv) the expiration of the applicable statute of limitations. Significant judgment is required in accounting for tax reserves.

Recent Accounting Pronouncements

Adopted

In March 2018, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. This ASU provides guidance on the income tax accounting implications of the Tax Cuts and Jobs Act of 2017 (the "Tax Act") and allows for entities to report provisional amounts for specific income tax effects of the Tax Act for which the accounting under ASC Topic 740 was not yet complete, but a reasonable estimate could be determined. A measurement period of one year is available to complete the accounting effects under ASC Topic 740 and revise any previous estimates reported. Any provisional amounts or subsequent adjustments included in an entity’s financial statements during the measurement period should be included in income from continuing operations as an adjustment to tax expense in the reporting period the amounts are determined. As of August 31, 2018, we have not finalized our work associated with the income tax effects of the enactment of the Tax Act, however, a reasonable estimate was provisionally recorded as a net benefit of $155.2 million from the revaluation of our U.S. net deferred tax liability that resulted from the reduced corporate tax rate and CHS being subject to the employee compensation deduction limitations imposed by Internal Revenue Code Section 162(m).

In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220). Under existing U.S. GAAP, the effects of changes in tax rates and laws on deferred tax balances are recorded as a component of income tax expense in the period in which the law was enacted. When deferred tax balances related to items originally recorded in accumulated other comprehensive income are adjusted, certain tax effects become stranded in accumulated other comprehensive income. The amendments in ASU 2018-02 allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Act. The amendments in this ASU also require certain disclosures about stranded tax effects. This ASU is effective for us beginning September 1, 2019, for our fiscal year 2020 and for interim periods within that fiscal year. Early adoption in any period is permitted. The Company’s provisional adjustments recorded to account for the impact of the Tax Act resulted in stranded tax effects. We elected to early adopt ASU No. 2018-02 during the fourth quarter of fiscal 2018. The adoption resulted in a reclassification from accumulated other comprehensive income to retained earnings in the amount of $27.0 million for stranded tax effects resulting from the Tax Act.

In August 2017, the FASB issued ASU No. 2017-12 , Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities . This ASU is intended to improve the financial reporting of hedging relationships to better represent the economic results of an entity’s risk management activities in its financial statements and make certain improvements to simplify the application of the hedge accounting guidance. The amendments in this ASU will make more financial and nonfinancial hedging strategies eligible for hedge accounting, amend the presentation and disclosure requirements and change how entities assess effectiveness. Entities are required to apply this ASU's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This ASU is effective for us beginning September 1, 2019, for our fiscal year 2020 and for interim periods within that fiscal year. We elected to early adopt ASU No. 2017-12 during the fourth quarter of fiscal 2018. The adoption did not have a material impact on our consolidated financial statements.

In October 2016, the FASB issued ASU No. 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory (Topic 740). This ASU is intended to improve the accounting for the income tax consequences of intra-entity transfers of assets other than inventory by requiring an entity to recognize the income tax consequences when a transfer occurs, instead of when an asset is sold to an outside party. This ASU is effective for periods beginning after December 15, 2017; however, early adoption of this ASU is permitted during the first interim period if an entity issues interim financial statements. The amendments in this ASU should be applied on a modified retrospective basis through a cumulative-effect adjustment

F-11

Table of Contents

directly to retained earnings as of the beginning of the period of adoption. We elected to early adopt ASU No. 2016-16 during the first quarter of fiscal 2018. The adoption did not have a material impact on our consolidated financial statements.

Not Yet Adopted

In August 2018, the FASB issued ASU No. 2018-14, Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans , which amends ASC 715-20, Compensation - Retirement Benefits - Defined Benefit Plans - General . This ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by removing and adding certain disclosures for these plans. The eliminated disclosures include (a) the amounts in accumulated other comprehensive income expected to be recognized in net periodic benefit costs over the next fiscal year and (b) the effects of a one-percentage-point change in assumed health care cost trend rates on the net periodic benefit costs and the benefit obligation for postretirement health care benefits. The new disclosures include the interest crediting rates for cash balance plans and an explanation of significant gains and losses related to changes in benefit obligations. This ASU is effective for us beginning September 1, 2021, for our fiscal year 2022 and for interim periods within that fiscal year, with early adoption permitted. The adoption of this amended guidance in not expected to have a material impact on our consolidated financial statements.

In August 2018, the FASB issued ASU No. 2018-13, Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement , which amends ASC 820, Fair Value Measurement . This ASU modifies the disclosure requirements for fair value measurements by removing, modifying and adding certain disclosures. Specifically, the guidance removes the requirement to disclose the amount and reasons for any transfers between Level 1 and Level 2 of the fair value hierarchy and removes the requirement to disclose a description of the valuation processes used to value Level 3 fair value measurements. The guidance also requires additional disclosures surrounding Level 3 changes in unrealized gains/losses included in other comprehensive income as well the range and weighted average significant unobservable inputs calculation. This ASU is effective for us beginning September 1, 2020, for our fiscal year 2021 and for interim periods within that fiscal year. Early adoption is permitted. We elected to remove the disclosures permitted by ASU No. 2018-13 during the fourth quarter of fiscal 2018 but have not early adopted the new required additional disclosures, which is permitted by the guidance. The adoption of this amended guidance is not expected to have a material impact on our consolidated financial statements.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Costs and Net Postretirement Benefit Cost. This ASU changes the presentation of net periodic pension cost and net periodic postretirement benefit cost in the Consolidated Statements of Operations. This ASU provides that the service cost component should be included in the same income statement line item as other compensation costs arising from services rendered by the employees during the period. The other components of net periodic benefit cost should be presented in the Consolidated Statements of Operations separately outside of operating income if that subtotal is presented. Additionally, only service cost may be capitalized in assets. This ASU is effective for us beginning September 1, 2018, for our fiscal year 2019 and for interim periods within that fiscal year. Early adoption is permitted as of the beginning of an annual period for which interim financial statements have not been issued or made available for issuance. The guidance on the presentation of the components of net periodic benefit cost in the Consolidated Statement of Operations should be applied retrospectively and the guidance regarding the capitalization of the service cost component in assets should be applied prospectively. The adoption of this amended guidance is not expected to have a material impact on our consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) : Clarifying the Definition of a Business . The amendments within this ASU narrow the existing definition of a business and provide a more robust framework for evaluating whether a transaction should be accounted for as an acquisition (or disposal) of assets or a business. The definition of a business impacts various areas of accounting, including acquisitions, disposals and goodwill. Under the new guidance, fewer acquisitions are expected to be considered businesses. This ASU is effective for us beginning September 1, 2018, for our fiscal year 2019 and for interim periods within that fiscal year. Early adoption is permitted, and the guidance should be applied prospectively to transactions following the adoption date. The adoption of this amended guidance is not expected to have a material impact on our consolidated financial statements.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . This ASU is intended to reduce diversity in practice by adding or clarifying guidance on classification and presentation of changes in restricted cash on the Consolidated Statements of Cash Flows. This ASU is effective for us beginning September 1, 2018, for our fiscal year 2019 and for interim periods within that fiscal year. Early adoption is permitted, including in an interim period. The amendments in this ASU should be applied retrospectively to all periods presented. The adoption of this amended guidance is not expected to have a material impact on our Consolidated Statements of Cash Flows.

F-12

Table of Contents

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This ASU is intended to reduce existing diversity in practice in how certain cash receipts and payments are presented and classified in the Consolidated Statements of Cash Flows. This ASU is effective for us beginning September 1, 2018, for our fiscal year 2019 and for interim periods within that fiscal year. The adoption of this amended guidance is not expected to have a material impact on our Consolidated Statements of Cash Flows.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) : Measurement of Credit Losses on Financial Instruments . The amendments in this ASU introduce a new approach, based on expected losses, to estimate credit losses on certain types of financial instruments. This ASU is intended to provide financial statement users with more decision-useful information about the expected credit losses associated with most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, net investments in leases, and off-balance-sheet credit exposures. Entities are required to apply this ASU’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. This ASU is effective for us beginning September 1, 2020, for our fiscal year 2021 and for interim periods within that fiscal year. We are currently evaluating the impact the adoption will have on our consolidated financial statements.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which replaces the existing guidance in ASC 840 - Leases . The amendments within this ASU, as well as within additional clarifying ASUs issued by the FASB,

introduce a lessee model requiring entities to recognize assets and liabilities for most leases, but continue recognizing the associated expenses in a manner similar to existing accounting guidance. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases , which amends ASU No. 2016-02, Leases . This ASU is effective for us beginning September 1, 2019, for our fiscal year 2020 and for interim periods within that fiscal year. We have initiated our assessment of the new lease standard, including the utilization of surveys to gather more information about existing leases and the implementation of a new lease software to improve the collection, maintenance, and aggregation of lease data necessary for the expanded reporting and disclosure requirements under the new lease standard. It is expected that the primary impact upon adoption will be the recognition, on a discounted basis, of our minimum commitments under noncancelable operating leases as right of use assets and liabilities on our Consolidated Balance Sheets. This will result in a significant increase in assets and liabilities recorded on our Consolidated Balance Sheets. Although we expect the new lease guidance to have a material impact on our Consolidated Balance Sheets, we are continuing to evaluate the practical expedient guidance provisions available and the extent of potential impacts on our consolidated financial statements, processes, and internal controls.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers . The amendments within this ASU, as well as within additional clarifying ASUs issued by the FASB, provide a single comprehensive model to be used in the accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The new revenue recognition guidance includes a five-step model for the recognition of revenue, including (1) identifying the contract with a customer, (2) identifying the performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations, and (5) recognizing revenue when (or as) an entity satisfies a performance obligation. The adoption of the new revenue recognition guidance will require expanded disclosures in our consolidated financial statements including quantitative disclosure of revenues that fall within and outside the scope of the new revenue recognition guidance. Certain revenue streams are expected to fall within the scope of the new revenue recognition guidance; however, a substantial portion of our revenue falls outside the scope of the new revenue recognition guidance and will continue to follow existing guidance, primarily ASC 815, Derivatives and Hedging . We have completed an initial assessment of our revenue streams and do not believe that the new revenue recognition guidance will have a material impact on our consolidated financial statements. We will adopt ASU No. 2014-09 and the related ASUs using the modified retrospective method on September 1, 2018, in the first quarter of fiscal 2019.

Note 2 Restatement of Previously Issued Consolidated Financial Statements

The consolidated financial statements for the years ended August 31, 2017 and 2016, have been restated to reflect the correction of misstatements. We have also restated all amounts impacted within the Notes to the consolidated financial statements. A description of the adjustments and their impact on the previously issued financial statements are included below.

Descriptions of Restatement Adjustments

Restatement Background

During the preparation of our Annual Report on Form 10-K for the year ended August 31, 2018, we noted potentially excessive valuations in the net derivative asset valuations relating to certain rail freight contracts purchased in connection with our North American grain marketing operations. An investigation concluded that the rail freight misstatements included in our

F-13

Table of Contents

consolidated financial statements for the periods identified below were due to intentional misconduct by a former employee in our rail freight trading operations, as well as due to rail freight contracts and certain non-rail contracts not meeting the technical accounting requirements to qualify as a derivative financial instrument. The misconduct consisted of the former employee manipulating the mark-to-market valuation of rail cars that were the subject of rail freight purchase contracts and manipulating the quantity of rail cars included in the monthly mark-to-market valuation. In addition, the investigation revealed intentional misstatements were made by the former employee to our independent registered public accounting firm in connection with its audit of our consolidated financial statements for the fiscal year ended August 31, 2017. During the course of, and as a result of, the investigation, we terminated the former employee and have taken additional personnel actions.

As a result of the misstatements, we have restated our consolidated financial statements as of and for the year ended August 31, 2017, and for the year ended August 31, 2016, in accordance with ASC 250, Accounting Changes and Error Corrections (the "Restated Financial Statements"). In addition to the adjustments related to freight derivatives and related misstatements, we also made adjustments related to certain intercompany balances and other historical misstatements unrelated to the freight derivatives and related misstatements.

The restated interim financial information for the relevant unaudited interim financial statements for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017, is included in Note 18, Quarterly Financial Information (Unaudited) .

The categories of restatement adjustments and their impact on previously reported consolidated financial statements are described below.

(a) Freight Derivatives and Related Misstatements - Corrections for freight derivatives and related misstatements were driven by the misstatement of amounts associated with both the value and quantity of rail freight contracts, as well as due to rail freight contracts and certain non-rail freight contracts not meeting the technical accounting requirements to qualify as derivative financial instruments. In addition to the elimination of the underlying freight derivative assets and liabilities and related impacts on revenues and cost of goods sold, additional adjustments were recorded to account for prepaid freight capacity balances in relevant periods and the impact of a goodwill impairment charge recorded as of May 31, 2015, for goodwill held within our grain marketing reporting unit. Additional details related to the impact of the freight derivatives and related misstatements and their impact on each period are discussed in restatement reference (a).

(b) Intercompany Misstatements - As a result of the work performed in relation to the freight misstatement, additional misstatements related to the incorrect elimination of intercompany balances were also identified and corrected within the consolidated financial statements. Certain of these intercompany misstatements resulted in a misstatement of various financial statement line items; however, the intercompany misstatements did not result in a material misstatement of income (loss) before income taxes or net income (loss). Additional details related to the impact of the intercompany misstatements and their impact on each period are discussed in restatement reference (b).

F-14

Table of Contents

Summary impact of restatement adjustments to previously reported financial information

The following tables present the summary impacts of the restatement adjustments on our previously reported consolidated capital reserves and total equities at August 31, 2015, and income (loss) before income taxes and net income (loss) for the years ended August 31, 2017 and 2016:



	August 31, 2015
	Capital Reserves			Total Equities
	(Dollars in thousands)
As previously reported	$	1,604,670		$	7,669,411
Cumulative restatement adjustments	(119,237		)	(117,972		)
As restated	$	1,485,433		$	7,551,439



	For the Years Ended August 31,
	2017			2016
	(Dollars in thousands)
Income (loss) before income taxes - As previously reported	$	(54,852	)	$	419,878
Restatement adjustments	(55,314		)	(17,753		)
Income (loss) before income taxes - As restated	$	(110,166	)	$	402,125

Net income (loss) - As previously reported	$	127,223		$	423,969
Restatement adjustments	(56,265		)	(40,943		)
Net income (loss) - As restated	$	70,958		$	383,026

Reclassifications

Amounts previously included within (gain) loss on investments were reclassified into other (income) loss to conform to the current year presentation. This reclassification had no impact on our previously reported net income, cash flows or shareholders' equity and represents a reclassification of $4.6 million and $9.3 million for the periods ended August 31, 2017, and August 31, 2016, respectively.

Consolidated financial statement adjustment tables

The following tables present the restatement adjustments to previously issued consolidated financial statements, including the previously reported Consolidated Balance Sheet as of August 31, 2017, and the Consolidated Statements of Operations, Comprehensive Income and Cash Flows for the years ended August 31, 2017, and 2016. The corrections of misstatements affecting fiscal years prior to fiscal 2017 are reflected as a cumulative adjustment to the balance of capital reserves and accumulated other comprehensive income as of August 31, 2015, on the Consolidated Statements of Changes in Shareholders’ Equity.

F-15

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS



	As of August 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	181,379		$	—		$	181,379
Receivables	1,869,632			22,536			1,892,168			c
Inventories	2,576,585			25,019			2,601,604			c
Derivative assets	232,017			(13,275		)	218,742			a
Margin and related deposits	206,062			—			206,062
Supplier advance payments	249,234			—			249,234
Other current assets	299,618			(17,693		)	281,925			a, c
Total current assets	5,614,527			16,587			5,631,114
Investments	3,750,993			—			3,750,993
Property, plant and equipment	5,356,434			—			5,356,434
Other assets	1,251,802			(171,421		)	1,080,381			a
Total assets	$	15,973,756		$	(154,834	)	$	15,818,922
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	1,988,215		$	(3,052	)	$	1,985,163		c
Current portion of long-term debt	156,345			—			156,345
Customer margin deposits and credit balances	157,914			—			157,914
Customer advance payments	413,163			10,607			423,770			c
Accounts payable	1,951,292			40,002			1,991,294			c
Derivative liabilities	316,018			(15,072		)	300,946			a
Accrued expenses	437,527			17,469			454,996			a, c
Dividends and equities payable	12,121			—			12,121
Total current liabilities	5,432,595			49,954			5,482,549
Long-term debt	2,023,448			—			2,023,448
Long-term deferred tax liabilities	333,221			(3,241		)	329,980			a, c
Other liabilities	278,667			(1,362		)	277,305			a
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			—			2,264,038
Equity certificates	4,341,649			—			4,341,649
Accumulated other comprehensive loss	(183,670		)	3,310			(180,360		)	a, c
Capital reserves	1,471,217			(203,409		)	1,267,808			a, c
Total CHS Inc. equities	7,893,234			(200,099		)	7,693,135
Noncontrolling interests	12,591			(86		)	12,505			a
Total equities	7,905,825			(200,185		)	7,705,640
Total liabilities and equities	$	15,973,756		$	(154,834	)	$	15,818,922

F-16

Table of Contents

As of August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $174.1 million reduction of total assets, a $39.1 million reduction of current liabilities, a $27.5 million increase of long-term liabilities, and a $162.4 million reduction of total equities. The reduction of total assets related primarily to the elimination of $156.0 million of long-term derivative assets, an approximate $16.0 million reduction of goodwill which was triggered by the lower earnings associated with this restatement with the impairment charge recorded during fiscal 2015 and the elimination of $12.9 million of current derivative assets that had been recorded as assets on the Consolidated Balance Sheet. The decreases of total assets were partially offset by related adjustments, including an $8.9 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement and the recognition of a $1.5 million prepaid freight capacity balance. The decrease of total current liabilities related primarily to an $18.0 million reduction of current derivative liabilities and a $21.1 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement. The increase of long-term liabilities resulted from a $28.9 million increase of long-term deferred tax liabilities, which was partially offset by a $1.4 million reduction of long-term derivative liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) None

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of certain income tax adjustments on prepaid income taxes, income taxes payable and deferred income taxes. The misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the impact of income tax adjustments resulted in a $19.3 million increase of total assets, an $89.1 million increase of current liabilities, a $32.1 million decrease of long-term liabilities and a $37.7 million decrease of total equities.

The increase of total assets related primarily to a $49.2 million increase of inventory with a corresponding increase to accounts payable that resulted from a misclassification adjustment for certain items previously included within a contra-inventory account to accounts payable. The increased inventories were partially offset by a $24.1 million misclassification adjustment to decrease inventory and increase accounts receivable as a result of a timing difference related to the settlement of a single ocean vessel. The increase of total assets was partially offset by a $28.1 million decrease of prepaid income taxes associated with the correction of other misstatements identified during fiscal 2017 and other periods.

The increase of current liabilities related primarily to the $49.2 million increase of accounts payable as a result of a misclassification adjustment for certain items previously included within a contra-inventory account to accounts payable and a $38.6 million increase of accrued expenses. The increase of accrued expenses primarily resulted from the recognition of a $24.9 million accrued income tax balance associated with the correction of other misstatements identified during fiscal 2017 and other periods. Additionally, $13.7 million of accrued expenses were recorded in relation to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The decrease of long-term liabilities related to a $32.1 million decrease of long-term deferred tax liabilities that arose from the correction of other misstatements identified during fiscal 2017 and other periods.

The $37.7 million decrease of total equities was primarily related to the $20.6 million net impact on income tax accounts and the recognition of $13.7 million of additional accrued expenses due to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018.

F-17

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS



	For the Year Ended August 31, 2017									For the Year Ended August 31, 2016
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	31,934,751		$	102,675		$	32,037,426		$	30,347,203		$	8,057		$	30,355,260		a, b, c
Cost of goods sold	30,985,510			157,256			31,142,766			29,387,910			(1,395		)	29,386,515			a, b, c
Gross profit	949,241			(54,581		)	894,660			959,293			9,452			968,745
Marketing, general and administrative	604,359			7,648			612,007			601,261			5			601,266			c
Reserve and impairment charges (recoveries), net	456,679			—			456,679			47,836			27,200			75,036			c
Operating earnings (loss)	(111,797		)	(62,229		)	(174,026		)	310,196			(17,753		)	292,443
(Gain) loss on disposal of business	—			2,190			2,190			—			—			—			c
Interest expense	171,239			—			171,239			113,704			—			113,704
Other (income) loss	(90,846		)	(9,105		)	(99,951		)	(47,609		)	—			(47,609		)	c
Equity (income) loss from investments	(137,338		)	—			(137,338		)	(175,777		)	—			(175,777		)
Income (loss) before income taxes	(54,852		)	(55,314		)	(110,166		)	419,878			(17,753		)	402,125
Income tax expense (benefit)	(182,075		)	951			(181,124		)	(4,091		)	23,190			19,099			a, c
Net income (loss)	127,223			(56,265		)	70,958			423,969			(40,943		)	383,026
Net income (loss) attributable to noncontrolling interests	(634		)	—			(634		)	(223		)	—			(223		)
Net income (loss) attributable to CHS Inc.	$	127,857		$	(56,265	)	$	71,592		$	424,192		$	(40,943	)	$	383,249

For the year ended August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $38.1 million reduction of income before income taxes and a $47.3 million reduction of net income. These adjustments related primarily to a $38.1 million increase of cost of goods sold and a $9.2 million increase of income tax expense resulting from the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $35.7 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $17.2 million decrease of income before income taxes and a $9.0 million decrease of net income. The $17.2 million decrease of income before income taxes related to a $12.1 million increase of cost of goods sold due to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018, a $2.6 million combined increase in cost of goods sold and marketing, general and administrative expenses for postretirement benefit plan activity that resulted from a timing difference associated with recording certain benefit plan expenses and a $2.5 million increase of costs of goods sold related to the valuation of crack spread derivatives. An income tax benefit of $8.2 million partially offset the decrease of income before income taxes and was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

F-18

Table of Contents

businesses. These misclassification adjustments resulted in a $138.4 million increase of revenues, a $138.3 million increase of cost of goods sold, a $7.0 million increase of marketing, general and administrative expenses, a $2.2 million increase of loss on disposal of business and a $9.1 million increase of other income.

For the year ended August 31, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $15.7 million reduction of income before income taxes and a $9.9 million reduction of net income. These adjustments related to a $15.7 million increase of cost of goods sold and a $5.8 million income tax benefit resulting from the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $57.5 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

The correction of other misstatements resulted in a $2.1 million decrease of income before income taxes and a $31.0 million decrease of net income. The $2.1 million decrease of income before income taxes related to a $1.7 million increase of cost of goods sold due to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018 and a $0.4 million increase of costs of goods sold related to the valuation of crack spread derivatives. In addition to the decrease of income before income taxes, additional income tax expense of $29.0 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

Additionally, misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses between businesses. These adjustments resulted in a $65.6 million increase of revenues, a $38.4 million increase of cost of goods sold and a $27.2 million increase of reserve and impairment charges (recoveries), net.

F-19

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME



	For the Year Ended August 31, 2017									For the Year Ended August 31, 2016
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	127,223		$	(56,265	)	$	70,958		$	423,969		$	(40,943	)	$	383,026		a, b, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity	30,100			2,602			32,702			6,583			—			6,583			c
Unrealized net gain (loss) on available for sale investments	4,385			—			4,385			1,500			—			1,500
Cash flow hedges	2,242			—			2,242			(3,872		)	—			(3,872		)
Foreign currency translation adjustment	(8,671		)	512			(8,159		)	(1,730		)	(1,174		)	(2,904		)	a
Other comprehensive income (loss), net of tax	28,056			3,114			31,170			2,481			(1,174		)	1,307
Comprehensive income	155,279			(53,151		)	102,128			426,450			(42,117		)	384,333
Less comprehensive income attributable to noncontrolling interests	(634		)	—			(634		)	(223		)	—			(223		)
Comprehensive income attributable to CHS Inc.	$	155,913		$	(53,151	)	$	102,762		$	426,673		$	(42,117	)	$	384,556

For the year ended August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $47.3 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2017, above. The adjustment related to foreign currency translation relates to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None

Other misstatements

(c) The correction of other misstatements resulted in a $9.0 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2017, above. The adjustment related to postretirement benefit plan activity relates to a timing difference associated with recording certain benefit plan expenses.

For the year ended August 31, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $9.9 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2016, above. The adjustment related to foreign currency translation relates to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None

Other misstatements

(c) The correction of other misstatements resulted in a $31.0 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2016, above.

F-20

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITIES



	For the Years Ended August 31, 2017, 2016, and 2015
	Equity Certificates									Accumulated Other Comprehensive Loss
	Capital Equity Certificates			Nonpatronage Equity Certificates		Nonqualified Equity Certificates		Preferred Stock		Accumulated Other Comprehensive Loss			Capital Reserves			Noncontrolling Interests			Total Equities
	(Dollars in thousands)
Balances, August 31, 2015 (As previously reported)	$	3,793,897		$	23,057	$	282,928	$	2,167,540	$	(214,207	)	$	1,604,670		$	11,526		$	7,669,411
Cumulative restatement adjustments	—			—		—		—		1,370			(119,237		)	(105		)	(117,972		)
Balances, August 31, 2015 (As restated)	$	3,793,897		$	23,057	$	282,928	$	2,167,540	$	(212,837	)	$	1,485,433		$	11,421		$	7,551,439

Balances, August 31, 2016 (As previously reported)	$	3,932,513		$	22,894	$	281,767	$	2,244,132	$	(211,726	)	$	1,582,380		$	14,290		$	7,866,250
Cumulative restatement adjustments	(13,802		)	—		—		—		196			(93,381		)	(104		)	(107,091		)
Balances, August 31, 2016 (As restated)	$	3,918,711		$	22,894	$	281,767	$	2,244,132	$	(211,530	)	$	1,488,999		$	14,186		$	7,759,159

Balances, August 31, 2017 (As previously reported)	$	3,906,426		$	29,836	$	405,387	$	2,264,038	$	(183,670	)	$	1,471,217		$	12,591		$	7,905,825
Cumulative restatement adjustments	—			—		—		—		3,310			(203,409		)	(86		)	(200,185		)
Balances, August 31, 2017 (As restated)	$	3,906,426		$	29,836	$	405,387	$	2,264,038	$	(180,360	)	$	1,267,808		$	12,505		$	7,705,640

As of August 31, 2017, 2016, and 2015

The decrease of total equities for each restated period was driven primarily by the elimination of derivative assets and liabilities associated with the freight derivatives and related misstatements. Adjustments for the freight derivatives and related misstatements resulted in a $162.4 million reduction of total equities as of August 31, 2017, a $115.7 million reduction of total equities as of August 31, 2016, and a $104.6 million reduction of total equities as of August 31, 2015.

F-21

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Year Ended August 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Cash flows from operating activities:
Net income (loss)	$	127,223		$	(56,265	)	$	70,958		a, b, c
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	480,223			—			480,223
Amortization of deferred major repair costs	67,058			—			67,058
Equity (income) loss from investments	(137,338		)	—			(137,338		)
Distributions from equity investments	213,352			—			213,352
Provision for doubtful accounts	177,969			—			177,969
(Gain) loss on disposal of business	—			2,190			2,190			c
Unrealized (gain) loss on crack spread contingent liability	(15,051		)	—			(15,051		)
Long-lived asset impairment, net of recoveries	145,042			—			145,042
Reserve against supplier advance payments	130,705			—			130,705
Deferred taxes	(175,914		)	(18,553		)	(194,467		)	a, c
Other, net	24,044			(3,871		)	20,173
Changes in operating assets and liabilities, net of acquisitions:
Receivables	121,630			25,158			146,788			b, c
Inventories	(293,549		)	(39,930		)	(333,479		)	b, c
Derivative assets	126,824			(12,801		)	114,023			a, b, c
Margin and related deposits	104,214			(6,410		)	97,804			b, c
Supplier advance payments	(34,583		)	631			(33,952		)	b
Other current assets and other assets	(66,119		)	15,390			(50,729		)	a, c
Customer margin deposits and credit balances	(50,920		)	—			(50,920		)
Customer advance payments	(528		)	(801		)	(1,329		)	b, c
Accounts payable and accrued expenses	197,445			30,522			227,967			a, b, c
Derivative liabilities	(183,287		)	50,864			(132,423		)	a, b, c
Other liabilities	(25,446		)	—			(25,446		)
Net cash provided by (used in) operating activities	932,994			(13,876		)	919,118
Cash flows from investing activities:
Acquisition of property, plant and equipment	(444,397		)	—			(444,397		)
Proceeds from disposition of property, plant and equipment	19,541			—			19,541
Expenditures for major repairs	(2,340		)	—			(2,340		)
Investments in joint ventures and other	(16,645		)	—			(16,645		)
Changes in CHS Capital notes receivable, net	322			—			322
Financing extended to customers	(67,225		)	—			(67,225		)
Payments from customer financing	88,154			—			88,154
Other investing activities, net	17,549			—			17,549
Net cash provided by (used in) investing activities	(405,041		)	—			(405,041		)
Cash flows from financing activities:
Proceeds from lines of credit and long-term borrowings	37,295,236			—			37,295,236
Payments on lines of credit, long-term borrowings and capital lease obligations	(37,580,959		)	(3,052		)	(37,584,011		)	c
Mandatorily redeemable noncontrolling interest payments	—			—			—
Preferred stock dividends paid	(167,642		)	—			(167,642		)
Redemptions of equities	(35,268		)	—			(35,268		)
Cash patronage dividends paid	(103,879		)	—			(103,879		)
Other financing activities, net	(28,681		)	5,987			(22,694		)	c
Net cash provided by (used in) financing activities	(621,193		)	2,935			(618,258		)
Effect of exchange rate changes on cash and cash equivalents	(4,694		)	(19		)	(4,713		)
Net increase (decrease) in cash and cash equivalents	(97,934		)	(10,960		)	(108,894		)
Cash and cash equivalents at beginning of period	279,313			10,960			290,273			c
Cash and cash equivalents at end of period	$	181,379		$	—		$	181,379

F-22

Table of Contents

For the year ended August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $47.3 million reduction of net income for the year ended August 31, 2017. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2017, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2017, and 2016, resulted in certain misclassifications between line items in the Consolidated Statements of Cash Flows; however, none of the freight derivatives and related misstatements impacted the classifications between operating, investing or financing activities. Refer to descriptions of the adjustments and their impact on the Consolidated Balance Sheet in the Consolidated Balance Sheet section as of August 31, 2017, above.

Intercompany misstatements

(b) The correction of intercompany misstatements did not impact net income for the year ended August 31, 2017; however, the impact of adjustments to the Consolidated Balance Sheets as of August 31, 2017, and 2016, resulted in certain misclassification adjustments between line items in the Consolidated Statements of Cash Flows. None of the intercompany misstatements impacted the classifications between operating, investing or financing activities within the Consolidated Statements of Cash Flows.

Other misstatements

(c) The correction of other misstatements resulted in a $9.0 million decrease of net income for the year ended August 31, 2017. Refer to further details of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2017, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2017, and 2016, resulted in certain misclassification adjustments between line items in the Consolidated Statements of Cash Flows. As a result, two misclassification adjustments were made between operating and financing activities, including a $3.1 million reduction of notes payable resulted from a duplicative entry and the misclassification of a $6.0 million negative cash balance associated with a timing difference for the application of in-transit cash. Refer to descriptions of the adjustments and their impact on the Consolidated Balance Sheet in the Consolidated Balance Sheet section as of August 31, 2017, above.

Additionally, an adjustment of $11.0 million was recorded to the opening cash balance, which related to a timing difference associated with the application of in-transit cash. Refer to the Consolidated Statement of Cash Flows for the year ended August 31, 2016, below for further details.

F-23

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS



	For the Year Ended August 31, 2016
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Cash flows from operating activities:
Net income (loss)	$	423,969		$	(40,943	)	$	383,026		a, b, c
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	447,492			—			447,492
Amortization of deferred major repair costs	73,483			—			73,483
Equity (income) loss from investments	(175,777		)	—			(175,777		)
Distributions from equity investments	178,464			—			178,464
Provision for doubtful accounts	57,200			—			57,200
Unrealized (gain) loss on crack spread contingent liability	(60,931		)	—			(60,931		)
Long-lived asset impairment, net of recoveries	27,247			—			27,247
Reserve against supplier advance payments	—			—			—
Deferred taxes	(24,178		)	52,368			28,190			a, c
Other, net	(15,444		)	—			(15,444		)
Changes in operating assets and liabilities, net of acquisitions:
Receivables	46,405			(44,835		)	1,570			b, c
Inventories	338,662			14,910			353,572			b, c
Derivative assets	(20,257		)	50,079			29,822			a, b, c
Margin and related deposits	(37,115		)	6,410			(30,705		)	b, c
Supplier advance payments	44,047			(632		)	43,415			b
Other current assets and other assets	120,993			7,610			128,603			a, c
Customer margin deposits and credit balances	20,841			—			20,841
Customer advance payments	5,664			(12,743		)	(7,079		)	b, c
Accounts payable and accrued expenses	(129,259		)	(328		)	(129,587		)	a, b, c
Derivative liabilities	36,283			(34,840		)	1,443			a, b, c
Other liabilities	(94,291		)	—			(94,291		)
Net cash provided by (used in) operating activities	1,263,498			(2,944		)	1,260,554
Cash flows from investing activities:
Acquisition of property, plant and equipment	(692,780		)	—			(692,780		)
Proceeds from disposition of property, plant and equipment	13,417			—			13,417
Expenditures for major repairs	(19,610		)	—			(19,610		)
Investments in joint ventures and other	(2,855,218		)	—			(2,855,218		)
Changes in CHS Capital notes receivable, net	(209,902		)	—			(209,902		)
Financing extended to customers	(82,302		)	—			(82,302		)
Payments from customer financing	35,188			—			35,188
Other investing activities, net	64,236			—			64,236
Net cash provided by (used in) investing activities	(3,746,971		)	—			(3,746,971		)
Cash flows from financing activities:
Proceeds from lines of credit and long-term borrowings	31,586,968			—			31,586,968
Payments on lines of credit, long-term borrowings and capital lease obligations	(29,232,842		)	—			(29,232,842		)
Mandatorily redeemable noncontrolling interest payments	(153,022		)	—			(153,022		)
Preferred stock dividends paid	(163,324		)	—			(163,324		)
Redemptions of equities	(23,911		)	—			(23,911		)
Cash patronage dividends paid	(251,740		)	—			(251,740		)
Other financing activities, net	52,067			—			52,067
Net cash provided by (used in) financing activities	1,814,196			—			1,814,196
Effect of exchange rate changes on cash and cash equivalents	(5,223		)	—			(5,223		)
Net increase (decrease) in cash and cash equivalents	(674,500		)	(2,944		)	(677,444		)
Cash and cash equivalents at beginning of period	953,813			13,904			967,717			c
Cash and cash equivalents at end of period	$	279,313		$	10,960		$	290,273

F-24

Table of Contents

For the year ended August 31, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $9.9 million reduction of net income for the year ended August 31, 2016. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2016, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2016, and 2015, resulted in certain misclassification adjustments between operating activity line items in the Consolidated Statements of Cash Flows; however, none of the freight derivatives and related misstatements impacted the classifications between operating, investing or financing activities. Refer to descriptions of the adjustments and their impact on the Consolidated Balance Sheets in the Consolidated Balance Sheet section as of August 31, 2017, and 2016, above.

Intercompany misstatements

(b) The correction of intercompany misstatements did not impact net income for the year ended August 31, 2016; however, the impact of adjustments to the Consolidated Balance Sheet as of August 31, 2016, resulted in certain misclassification adjustments between operating activity line items in the Consolidated Statements of Cash Flows. None of the intercompany misstatements impacted the classifications between operating, investing or financing activities within the Consolidated Statements of Cash Flows.

Other misstatements

(c) The correction of other misstatements resulted in a $31.0 million decrease of net income for the year ended August 31, 2016. Refer to further details of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the year ended August 31, 2016, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2016, and 2015, resulted in certain misclassification adjustments between operating activity line items within Consolidated Statements of Cash Flows and a $2.9 million reduction of cash that resulted from a timing difference for the application of in-transit cash; however, none of the other misstatements impacted the classifications between operating, investing or financing activities. Refer to descriptions of the adjustments and their impact on the Consolidated Balance Sheets in the Consolidated Balance Sheet section as of August 31, 2017, and 2016, above.

Additionally, an adjustment of $13.9 million was recorded to the opening cash balance, which related to a timing difference associated with the application of in-transit cash during the prior year.

Note 3 Receivables

Receivables as of August 31, 2018 , and 2017 , are as follows:



	2018		(As Restated) 2017
	(Dollars in thousands)
Trade accounts receivable	$	1,578,764	$	1,258,644
CHS Capital short-term notes receivable	569,379		164,807
Deferred purchase price receivable	—		202,947
Other	534,071		491,496
	2,682,214		2,117,894
Less allowances and reserves	221,813		225,726
Total receivables	$	2,460,401	$	1,892,168

Trade Accounts

Trade accounts receivable are initially recorded at a selling price, which approximates fair value, upon the sale of goods or services to customers. Subsequently, trade accounts receivable are carried at net realizable value, which includes an allowance for estimated uncollectible amounts. We calculate this allowance based on our history of write-offs, level of past due accounts, and our relationships with and the economic status of our customers. Receivables from related parties are disclosed in Note 17, Related Party Transactions .

F-25

Table of Contents

During the third quarter of fiscal 2017, a trading partner of ours in Brazil entered bankruptcy-like proceedings under Brazilian law, resulting in a $98.7 million increase to our accounts receivable reserve. We also recorded a reserve of approximately $130.7 million related to supplier advance payments held by this trading partner, which is included in supplier advance payments in the Consolidated Balance Sheets. We initiated efforts to recover these losses during fiscal 2017 and we recorded a recovery of approximately $20.8 million during the fourth quarter of fiscal 2018 within reserve and impairment charges (recoveries), net in the Consolidated Statements of Operations. We continue to pursue additional recoveries in relation to these losses; however, additional recoveries are not estimable and have not been recorded as of the date of this Annual Report on Form 10-K.

CHS Capital

Notes Receivable

CHS Capital, our wholly-owned subsidiary, has short-term notes receivable from commercial and producer borrowers. The short-term notes receivable have maturity terms of 12 months or less and are reported at their outstanding unpaid principal balances, adjusted for the allowance of loan losses, as CHS Capital has the intent and ability to hold the applicable loans for the foreseeable future or until maturity or pay-off. The carrying value of CHS Capital short-term notes receivable approximates fair value given the notes' short-term duration and the use of market pricing adjusted for risk.

The notes receivable from commercial borrowers are collateralized by various combinations of mortgages, personal property, accounts and notes receivable, inventories and assignments of certain regional cooperative’s capital stock. These loans are primarily originated in the states of Minnesota, Wisconsin and North Dakota. CHS Capital also has loans receivable from producer borrowers which are collateralized by various combinations of growing crops, livestock, inventories, accounts receivable, personal property and supplemental mortgages and are originated in the same states as the commercial notes with the addition of Michigan.

In addition to the short-term balances included in the table above, CHS Capital had long-term notes receivable, with durations of generally not more than 10 years , totaling $ 203.0 million and $ 17.0 million at August 31, 2018 , and 2017 , respectively. The long-term notes receivable are included in other assets on our Consolidated Balance Sheets. As of August 31, 2018 , and 2017 , the commercial notes represented 40% and 17% , respectively, and the producer notes represented 60% and 83% , respectively, of the total CHS Capital notes receivable. The increase in short-term and long-term notes receivable is the result of the activities described within the Sale of Receivables section below.

CHS Capital has commitments to extend credit to customers if there are no violations of any contractually established conditions. As of August 31, 2018 , CHS Capital's customers have additional available credit of $ 706.3 million .

Allowance for Loan Losses and Impairments

CHS Capital maintains an allowance for loan losses which is the estimate of potential incurred losses inherent in the loans receivable portfolio. In accordance with FASB ASC 450-20, Accounting for Loss Contingencies, and ASC 310-10, Accounting by Creditors for Impairment of a Loan , the allowance for loan losses consists of general and specific components. The general component is based on historical loss experience and qualitative factors addressing operational risks and industry trends. The specific component relates to loans receivable that are classified as impaired. Additions to the allowance for loan losses are reflected within reserve and impairment charges (recoveries), net in the Consolidated Statements of Operations. The portion of loans receivable deemed uncollectible is charged off against the allowance. Recoveries of previously charged off amounts increase the allowance for loan losses. No significant amounts of CHS Capital notes were past due as of August 31, 2018 , or August 31, 2017 , and specific and general loan loss reserves related to CHS Capital notes were not material as of either date.

Interest Income

Interest income is recognized on the accrual basis using a method that computes simple interest on a daily basis. The accrual of interest on commercial loans receivable is discontinued at the time the receivable is 90 days past due unless the credit is well-collateralized and in process of collection. Past due status is based on contractual terms of the loan. Producer loans receivable are placed in non-accrual status based on estimates and analysis due to the annual debt service terms inherent to CHS Capital’s producer loans. In all cases, loans are placed in nonaccrual status or charged off at an earlier date if collection of principal or interest is considered doubtful.

F-26

Table of Contents

Troubled Debt Restructurings

A restructuring of a loan constitutes a troubled debt restructuring, or restructured loan, if the creditor for economic reasons related to the debtor’s financial difficulties grants a concession to the debtor that it would otherwise not consider. Concessions vary by program and borrower. Concessions may include interest rate reductions, term extensions, payment deferrals, or the acceptance of additional collateral in lieu of payments. In limited circumstances, principal may be forgiven. When a restructured loan constitutes a troubled debt restructuring, CHS includes these loans within its impaired loans.

During the third quarter of fiscal 2017 , CHS Capital concluded a transaction with a single producer borrower whereby CHS Capital obtained from the borrower title to approximately 14,000 acres of land and improvements that, prior to the transaction, was owned by the borrower and served as collateral for the outstanding loans to CHS Capital. The amount corresponding to the fair value of the land and improvements was credited against the notes receivable from this single producer borrower. As a result of this arrangement, all remaining outstanding notes receivable balances and corresponding reserves related to this single producer borrower were removed from the balance sheet of CHS Capital, with no incremental impact to the Consolidated Statements of Operations. During the first quarter of fiscal 2018, CHS Capital sold all rights to the outstanding notes receivable which had been previously removed from the balance sheet as they were deemed uncollectible. Through this sale, we realized a small recovery in the first quarter of fiscal year 2018. As of August 31, 2018, and 2017, CHS Capital had no other significant troubled debt restructurings and no third-party borrowers that accounted for more than 10% of the total CHS Capital notes receivable.

Sale of Receivables

Receivables Securitization Facility

On June 28, 2018 , we amended an existing receivables and loans securitization facility (“Securitization Facility”) with certain unaffiliated financial institutions (the "Purchasers"). Under the Securitization Facility, we and certain of our subsidiaries sell trade accounts and notes receivable (the “Receivables”) to Cofina Funding, LLC (“Cofina”), a wholly-owned bankruptcy-remote indirect subsidiary of CHS. Cofina in turn transfers the purchased Receivables to the Purchasers. During the period from July 2017 through the amendment of the Securitization Facility in June 2018 , CHS accounted for Receivables sold under the Facility as a sale of financial assets pursuant to ASC 860, Transfers and Servicing, and the Receivables sold were derecognized from its Consolidated Balance Sheets. Under the terms of the amended Securitization Facility, the transfer of Receivables is accounted for as a secured borrowing. We use the proceeds from the sale of Receivables under the Securitization Facility for general corporate purposes. The Securitization Facility terminates on June 17, 2019 , but may be extended.

The amount available under the Securitization Facility fluctuates over time based on the total amount of eligible Receivables generated during the normal course of business, with maximum availability of $700.0 million . Sales of Receivables by Cofina occur continuously and are settled with the Purchasers on a monthly basis. As of August 31, 2018 , and 2017 , the total availability under the Securitization Facility was $645.0 million and $618.0 million , respectively, of which all had been utilized. Prior to amending the Securitization Facility in June 2018, the proceeds from the sale of these Receivables were comprised of a combination of cash and a deferred purchase price (“DPP”) receivable. The DPP receivable was ultimately realized by CHS following the collection of the underlying Receivables sold to the Purchasers.

At the time of the amendment to the Securitization Facility in June 2018, $1.0 billion of Receivables and $634.0 million of securitized debt were recognized and a DPP receivable of $386.9 million was removed from the Consolidated Balance Sheets. At the time of a previous amendment to the Securitization Facility in July 2017, $1.1 billion of Receivables and $554.0 million of securitized debt were removed from the Consolidated Balance Sheets and a DPP receivable of $580.5 million was recognized. These amounts have been reflected as non-cash transactions in the Consolidated Statements of Cash Flows and disclosed within Note 16, Supplemental Cash Flow and Other Information .

Prior to its derecognition during June 2018, the fair value of the DPP receivable was determined by discounting the expected cash flows to be received based on unobservable inputs consisting of the face amount of the Receivables adjusted for anticipated credit losses. Refer to Note 14, Fair Value Measurements, for details related to the fair value measurement of the DPP receivable.

F-27

Table of Contents

The following table is a reconciliation of the beginning and ending balances of the DPP receivable, including the long-term portion included in other assets, for the years ended August 31, 2018 , and 2017 :



	2018			2017
	(Dollars in thousands)
Balance - beginning of year	$	548,602		$	—
Cash collections on DPP receivable	(10,961		)	—
Transfer of receivables	(386,900		)	580,509
Monthly settlements, net	(169,827		)	(31,907		)
Fair value adjustment	19,086			—
Balance - end of year	$	—		$	548,602

Loan Participations

During fiscal 2018 CHS Capital sold $64.1 million of notes receivable to numerous counterparties under a master participation agreement. The sale resulted in the removal of the notes receivable from the Consolidated Balance Sheet. CHS Capital has no retained interests in the transferred notes receivable, other than collection and administrative services. The proceeds from the sale of the notes receivable have been included in investing activities in the Consolidated Statement of Cash Flows. Fees received related to the servicing of the notes receivables are recorded in other income in the Consolidated Statements of Operations. We consider the fees received adequate compensation for services rendered, and accordingly have recorded no servicing asset or liability.

Other Receivables

Other receivables are comprised of certain other amounts recorded in the normal course of business, including receivables related to value added taxes and pre-crop financing, primarily to Brazilian farmers, to finance a portion of supplier production costs. CHS does not bear any of the costs or operational risks associated with the related growing crops. The financing is largely collateralized by future crops and physical assets of the suppliers, carries a local market interest rate and settles when the farmer’s crop is harvested and sold.

Note 4 Inventories

Inventories as of August 31, 2018 , and 2017 , are as follows:



	2018		(As Restated) 2017
	(Dollars in thousands)
Grain and oilseed	$	1,298,522	$	1,121,141
Energy	715,161		755,886
Crop nutrients	246,326		248,699
Feed and farm supplies	391,906		402,293
Processed grain and oilseed	99,426		49,723
Other	17,308		23,862
Total inventories	$	2,768,649	$	2,601,604

As of August 31, 2018 , we valued approximately 16% of inventories, primarily crude oil and refined fuels within our Energy segment, using the lower of cost, determined on the LIFO method, or net realizable value ( 19% as of August 31, 2017 ). If the FIFO method of accounting had been used, inventories would have been higher than the reported amount by $ 345.0 million and $ 186.2 million as of August 31, 2018 , and 2017 , respectively.

F-28

Table of Contents

Note 5 Investments

Investments as of August 31, 2018 , and 2017 , are as follows:



	2018		2017
	(Dollars in thousands)
Equity method investments:
CF Industries Nitrogen, LLC	$	2,735,073	$	2,756,076
Ventura Foods, LLC	360,150		347,016
Ardent Mills, LLC	205,898		206,529
Other equity method investments	288,016		309,767
Cost method and other investments	122,788		131,605
Total investments	$	3,711,925	$	3,750,993

Joint ventures and other investments in which we have significant ownership and influence but not control, are accounted for in our consolidated financial statements using the equity method of accounting. Our significant equity method investments consist of CF Nitrogen, Ventura Foods, and Ardent Mills, LLC ("Ardent Mills"), which are summarized below.

CF Nitrogen

On February 1, 2016, we invested $2.8 billion in CF Nitrogen, commencing our strategic venture with CF Industries Holdings, Inc. The investment consists of an approximate 10% membership interest (based on product tons) in CF Nitrogen. We also entered into an 80 -year supply agreement that entitles us to purchase up to 1.1 million tons of granular urea and 580,000 tons of urea ammonium nitrate ("UAN") annually from CF Nitrogen for ratable delivery. Our purchases under the supply agreement are based on prevailing market prices and we receive semi-annual cash distributions (in January and July of each year) from CF Nitrogen via our membership interest. These distributions are based on actual volumes purchased from CF Nitrogen under the strategic venture and will have the effect of reducing our investment to zero over 80 years on a straight-line basis. We account for this investment using the hypothetical liquidation at book value method, recognizing our share of the earnings and losses of CF Nitrogen based upon our contractual claims on the entity's net assets pursuant to the liquidation provisions of CF Nitrogen's Limited Liability Company Agreement, adjusted for the semi-annual cash distributions. For the years ended August 31, 2018 , and 2017 , these amounts were $106.9 million and $66.5 million , respectively, and are included as equity income from investments in our Nitrogen Production segment.

The following tables provide aggregate summarized financial information for CF Nitrogen for the balance sheets as of August 31, 2018 , and 2017 , and the statements of operations for the twelve months ended August 31, 2018 , and 2017 , and the seven months ended August 31, 2016 :



	2018		2017
	(Dollars in thousands)
Current assets	$	576,076	$	394,089
Non-current assets	7,447,594		7,314,629
Current liabilities	215,104		390,206
Non-current liabilities	71		6



	2018		2017		2016
	(Dollars in thousands)
Net sales	$	2,449,695	$	2,051,159	$	1,027,142
Gross profit	423,612		195,142		243,911
Net earnings	401,295		123,965		186,665
Earnings attributable to CHS Inc.	106,895		66,530		74,700

F-29

Table of Contents

Ventura Foods and Ardent Mills

We have a 50% interest in Venture Foods which is a joint venture that produces and distributes primarily vegetable oil-based products and we have a 12% interest in Ardent Mills, which is a joint venture with Cargill Incorporated ("Cargill") and ConAgra Foods, Inc., which combines the North American flour milling operations of the three parent companies. We account for Ventura Foods and Ardent Mills as equity method investments included in Corporate and Other.

The following tables provide aggregate summarized financial information for our equity method investments in Ventura Foods and Ardent Mills for balance sheets as of August 31, 2018 , and 2017 , and statements of operations for the twelve months ended August 31, 2018 , 2017 and 2016 :



	2018		2017
	(Dollars in thousands)
Current assets	$	1,462,590	$	1,483,384
Non-current assets	2,331,295		2,358,434
Current liabilities	671,928		685,462
Non-current liabilities	693,360		765,078



	2018		2017		2016
	(Dollars in thousands)
Net sales	$	5,882,035	$	5,762,849	$	5,694,622
Gross profit	601,927		673,329		677,920
Net earnings	226,776		265,126		265,025
Earnings attributable to CHS Inc.	46,069		60,716		88,936

Our investments in other equity method investees are not significant in relation to our consolidated financial statements, either individually or in the aggregate.

Note 6 Property, Plant and Equipment

As of August 31, 2018 , and 2017 , major classes of property, plant and equipment, which include capital lease assets, consisted of the amounts in the table below.



	2018		2017
	(Dollars in thousands)
Land and land improvements	$	341,767	$	357,829
Buildings	1,034,860		1,030,478
Machinery and equipment	7,199,509		6,950,435
Office equipment and other	316,946		235,361
Construction in progress	204,207		327,682
	9,097,289		8,901,785
Less accumulated depreciation and amortization	3,955,570		3,545,351
Total property, plant and equipment	$	5,141,719	$	5,356,434

We have various assets under capital leases totaling $50.0 million and $58.2 million as of August 31, 2018 , and 2017 , respectively. Accumulated amortization on assets under capital leases was $18.9 million and $27.4 million as of August 31, 2018 , and 2017 , respectively.

F-30

Table of Contents

The following is a schedule by fiscal year of future minimum lease payments under capital leases together with the present value of the net minimum lease payments as of August 31, 2018 :



	(Dollars in thousands)
2019	$	4,845
2020	4,595
2021	4,197
2022	3,593
2023	3,427
Thereafter	7,936
Total minimum future lease payments	28,593
Less amount representing interest	3,313
Present value of net minimum lease payments	$	25,280

During fiscal 2017, our Ag segment recorded an impairment charge of $30.4 million from the reduction in the fair value of agricultural assets held, which was determined using a market-based approach. In addition, our Energy segment recorded an impairment charge of $32.7 million associated with the cancellation of a capital project during fiscal 2017. These impairments were included in the reserve and impairment charges (recoveries), net line of the Consolidated Statements of Operations.

Depreciation expense, including amortization of capital lease assets, for the years ended August 31, 2018 , 2017 , and 2016 , was $ 475.8 million , $ 475.9 million and $ 437.6 million , respectively.

Note 7 Other Assets

Other assets as of August 31, 2018 , and 2017 , are as follows:



	2018		(As Restated) 2017
	(Dollars in thousands)
Goodwill	$	138,464	$	138,454
Customer lists, trademarks and other intangible assets	29,338		33,330
Notes receivable	211,986		51,586
Deferred purchase price receivable	—		345,655
Long-term derivative assets	23,084		40,897
Prepaid pension and other benefits	101,539		122,433
Capitalized major maintenance	130,780		105,006
Cash value life insurance	123,010		118,677
Other	76,128		124,343
	$	834,329	$	1,080,381

F-31

Table of Contents

Changes in the net carrying amount of goodwill for the years ended August 31, 2018 , and 2017, by segment, are as follows:



	Energy		Ag			Corporate and Other			Total
	(Dollars in thousands)
Balances, August 31, 2016 - As previously reported	$	552	$	148,916		$	10,946		$	160,414
Cumulative restatement adjustments	—		(16,130		)	—			(16,130		)
Balances, August 31, 2016 - As restated	552		132,786			10,946			144,284
Effect of foreign currency translation adjustments	—		352			—			352
Impairment	—		(5,542		)	—			(5,542		)
Other	—		(268		)	(372		)	(640		)
Balances, August 31, 2017 - As restated	$	552	$	127,328		$	10,574		$	138,454
Effect of foreign currency translation adjustments	—		10			—			10
Other	—		—			—			—
Balances, August 31, 2018	$	552	$	127,338		$	10,574		$	138,464

No goodwill has been allocated to our Nitrogen Production segment, which consists of a single investment accounted for under the equity method.

All long-lived assets, including property, plant and equipment, goodwill, investments in unconsolidated affiliates and other identifiable intangible assets, are evaluated for impairment in accordance with U.S. GAAP. Goodwill is evaluated for impairment annually as of July 31. All long-lived assets, including goodwill, are also evaluated for impairment whenever triggering events or other circumstances indicate that the carrying amount of an asset group or reporting unit may not be recoverable. No material impairments related to long-lived assets were recorded, and no goodwill impairments were identified as a result of CHS’s annual goodwill analyses performed as of July 31, 2018.

During the year ended August 31, 2017, certain assets and liabilities associated with a disposal group in our Ag segment were classified as held for sale, including $5.5 million of goodwill allocated to the disposal group on a relative fair value basis. As a result of impairment tests performed over the disposal group, impairment charges of $78.8 million , which includes the allocated goodwill, were recorded in the reserve and impairment charges (recoveries), net line item in the Consolidated Statements of Operations for the year ended August 31, 2017. The disposal group assets were sold during the year ended August 31, 2018, and the related recoveries were recorded in the reserve and impairment charges (recoveries), net line item in the Consolidated Statements of Operations.

Intangible assets subject to amortization primarily include customer lists, trademarks and non-compete agreements, and are amortized over their respective useful lives (ranging from 2 to 30 years). Information regarding intangible assets included in other assets on our Consolidated Balance Sheets is as follows:



	August 31, 2018							August 31, 2017
	Carrying Amount		Accumulated Amortization			Net		Carrying Amount		Accumulated Amortization			Net
	(Dollars in thousands)
Customer lists	$	40,815	$	(13,082	)	$	27,733	$	46,180	$	(14,695	)	$	31,485
Trademarks and other intangible assets	6,536		(4,931		)	1,605		23,623		(21,778		)	1,845
Total intangible assets	$	47,351	$	(18,013	)	$	29,338	$	69,803	$	(36,473	)	$	33,330

F-32

Table of Contents

Intangible asset amortization expense for the years ended August 31, 2018 , 2017 , and 2016 , was $3.4 million , $4.3 million and $6.1 million , respectively. The estimated annual amortization expense related to intangible assets subject to amortization for the next five years is as follows:



	(Dollars in thousands)
2019	$	3,355
2020	3,272
2021	3,201
2022	2,989
2023	2,910
Thereafter	13,515
Total	$	29,242

Activity related to capitalized major maintenance costs at our refineries for the years ended August 31, 2018 , 2017 , and 2016 , is summarized below:



	Balance at Beginning of Year		Cost Deferred		Amortization			Balance at End of Year
	(Dollars in thousands)
2018	$	105,006	$	87,460	$	(61,686	)	$	130,780
2017	169,054		3,010		(67,058		)	105,006
2016	241,588		949		(73,483		)	169,054

Note 8 Notes Payable and Long-Term Debt

Our notes payable and long-term debt are subject to various restrictive requirements for maintenance of minimum consolidated net worth and other financial ratios. We were in compliance with our debt covenants as of August 31, 2018 .

Notes Payable

Notes payable as of August 31, 2018 , and 2017 , consisted of the following:



	Weighted-average Interest Rate
	2018	(As Restated) 2017	2018		(As Restated) 2017
			(Dollars in thousands)
Notes payable	3.50%	2.40%	$	1,437,264	$	1,695,423
CHS Capital notes payable	2.82%	1.90%	834,932		289,740
Total notes payable			$	2,272,196	$	1,985,163

Our primary committed line of credit is a five -year, unsecured revolving credit facility with a syndication of domestic and international banks.

We maintain a series of uncommitted bilateral facilities that are renewed annually. Amounts borrowed under these short-term credit facilities are used to fund our working capital. The following table summarizes our primary lines of credit as of August 31, 2018 , and 2017 :

F-33

Table of Contents



Primary Revolving Credit Facilities	Fiscal Year of Maturity	Total Capacity		Borrowings Outstanding		Interest Rates
		2018		2018	2017
		(Dollars in thousands)
Committed Five-Year Unsecured Facility	2021	$	3,000,000	$—	$480,000	LIBOR or Base Rate +0.00% to 1.45%
Uncommitted Bilateral Facilities	2019	515,000		515,000	350,000	LIBOR or Base Rate +0.00% to 1.20%

In addition to our primary revolving lines of credit, we have a three -year $315.0 million committed revolving pre-export credit facility for CHS Agronegocio Industria e Comercio Ltda ("CHS Agronegocio"), our wholly-owned subsidiary, to provide financing for its working capital needs arising from its purchases and sales of grains, fertilizers and other agricultural products which expires in April 2020. As of August 31, 2018 , the outstanding balance under the facility was $181.1 million .

As of August 31, 2018 , our wholly-owned subsidiaries, CHS Europe S.a.r.l. and CHS Agronegocio, had uncommitted lines of credit with $454.1 million outstanding. In addition, our other international subsidiaries had lines of credit with a total of $279.4 million outstanding as of August 31, 2018 , of which $40.5 million was collateralized.

Miscellaneous short-term notes payable totaled $7.4 million as of August 31, 2018 .

CHS Capital Notes Payable

On June 28, 2018 , we amended our Securitization Facility with the Purchasers. Under the Securitization Facility, we and certain of our subsidiaries sell Receivables to Cofina, a wholly-owned bankruptcy-remote indirect subsidiary of CHS. Cofina in turn transfers the purchased Receivables to the Purchasers. During the period from July 2017 through the amendment of the Securitization Facility in June 2018 , CHS accounted for Receivables sold under the Securitization Facility as a sale of financial assets pursuant to ASC 860, Transfers and Servicing, and the Receivables sold were derecognized from its Consolidated Balance Sheets. Under the terms of the amended Securitization Facility, the transfer of Receivables is accounted for as a secured borrowing. We use the proceeds from the sale of Receivables under the Securitization Facility for general corporate purposes. The Securitization Facility terminates on June 17, 2019 , but may be extended. See Note 3, Receivables for additional information.

CHS Capital sells loan commitments it has originated to ProPartners Financial on a recourse basis. The total outstanding commitments under the program totaled $180.9 million as of August 31, 2018 , of which $98.3 million was borrowed under these commitments with an interest rate of 3.22% .

F-34

Table of Contents

Long-Term Debt

During the year ended August 31, 2018 , we repaid approximately $208 million of long-term debt consisting of scheduled debt maturities and optional prepayments. There were no new material borrowings of long-term debt during fiscal 2018. Amounts included in long-term debt on our Consolidated Balance Sheets as of August 31, 2018 , and 2017 , are presented in the table below.



	2018			2017
	(Dollars in thousands)
6.18% unsecured notes $400 million face amount, due in equal installments beginning in 2014 through 2018	$	—		$	80,000
5.60% unsecured notes $60 million face amount, due in equal installments beginning in 2012 through 2018	—			4,615
5.78% unsecured notes $50 million face amount, due in equal installments beginning in 2014 through 2018	—			10,000
4.00% unsecured notes $100 million face amount, due in equal installments beginning in 2017 through 2021	60,000			80,000
4.08% unsecured notes $130 million face amount, due in 2019 ^(a)	129,229			130,690
4.52% unsecured notes $160 million face amount, due in 2021 ^(a)	157,528			163,496
4.67% unsecured notes $130 million face amount, due in 2023 ^(a)	128,577			135,792
4.39% unsecured notes $152 million face amount, due in 2023	152,000			152,000
3.85% unsecured notes $80 million face amount, due in 2025	80,000			80,000
3.80% unsecured notes $100 million face amount, due in 2025	100,000			100,000
4.58% unsecured notes $150 million face amount, due in 2025	145,213			149,293
4.82% unsecured notes $80 million face amount, due in 2026	80,000			80,000
4.69% unsecured notes $58 million face amount, due in 2027	58,000			58,000
4.74% unsecured notes $95 million face amount, due in 2028	95,000			95,000
4.89% unsecured notes $100 million face amount, due in 2031	100,000			100,000
4.71% unsecured notes $100 million face amount, due in 2033	100,000			100,000
5.40% unsecured notes $125 million face amount, due in 2036	125,000			125,000
Private Placement debt	1,510,547			1,643,886
5.59% unsecured term loans from cooperative and other banks, due in equal installments beginning in 2013 through 2018	—			15,000
2.25% unsecured term loans from cooperative and other banks, due in 2025 ^(b)	366,000			430,000
Bank financing	366,000			445,000
Capital lease obligations	25,280			33,075
Other notes and contracts with interest rates from 1.30% to 15.25%	32,607			62,652
Deferred financing costs	(4,179		)	(4,820		)
Total long-term debt	1,930,255			2,179,793
Less current portion	167,565			156,345
Long-term portion	$	1,762,690		$	2,023,448

_______________________________________


^(a)	We have entered into interest rate swaps designated as fair value hedging relationships with these notes. Changes in the fair value of the swaps are recorded each period with a corresponding adjustment to the carrying value of the debt. See Note 13, Derivative Financial Instruments and Hedging Activities for more information.


^(b)	Borrowings are variable under the agreement and bear interest at a base rate (or a LIBO rate) plus an applicable margin.

As of August 31, 2018 , the carrying value of our long-term debt approximated its fair value, which is estimated to be $1.8 billion based on quoted market prices of similar debt (a Level 2 fair value measurement based on the classification hierarchy of ASC Topic 820, Fair Value Measurement ). We have outstanding interest rate swaps designated as fair value hedges of select portions of our fixed-rate debt. During fiscal 2018, we recorded corresponding fair value adjustments of $18.7 million ,

F-35

Table of Contents

which are included in the amounts in the table above. See Note 13, Derivative Financial Instruments and Hedging Activities for additional information.

In September 2015, we entered into a 10 -year term loan with a syndication of banks. The agreement provides for committed term loans in an amount up to $600.0 million . As of August 31, 2018 , $236.0 million was outstanding under this agreement. In June 2016, we amended the 10 -year term loan so that $300.0 million of the $600.0 million loan balance possessed a revolving feature, whereby we were able to pay down and re-advance an amount up to the referenced $300.0 million . During fiscal 2017, we re-advanced $130.0 million under the revolving provision of the loan. As of August 31, 2018 , $130.0 million was outstanding under this agreement. Principal on the outstanding balances is payable in full in September 2025.

Long-term debt outstanding as of August 31, 2018 , has aggregate maturities, excluding fair value adjustments and capital leases (see Note 6, Property, Plant and Equipment for a schedule of minimum future lease payments under capital leases), as follows:



	(Dollars in thousands)
2019	$	162,846
2020	30,671
2021	182,472
2022	65
2023	282,065
Thereafter	1,260,570
Total	$	1,918,689

Interest expense for the years ended August 31, 2018 , 2017 , and 2016 , was $149.2 million , $171.2 million and $113.7 million , respectively, net of capitalized interest of $6.7 million , $6.9 million and $30.3 million , respectively.

Note 9 Income Taxes

The provision for (benefit from) income taxes for the years ended August 31, 2018 , 2017 , and 2016 is as follows:



	2018			(As Restated) 2017			(As Restated) 2016
	(Dollars in thousands)
Current:
Federal	$	15,576		$	8,394		$	(14,536	)
State	7,041			(1,787		)	2,427
Foreign	20,268			6,736			3,018
	42,885			13,343			(9,091		)
Deferred:
Federal	(146,780		)	(173,184		)	34,753
State	(127		)	(13,244		)	(13,684		)
Foreign	(54		)	(8,039		)	7,121
	(146,961		)	(194,467		)	28,190
Total	$	(104,076	)	$	(181,124	)	$	19,099

F-36

Table of Contents

The tax expense above for fiscal 2017 and 2016 are restatements of originally filed amounts to reflect necessary tax adjustments caused by restatements to pre-tax income for the relevant periods as well as to reflect certain tax only adjustments moved to or from other years. For fiscal 2017 and 2016, the adjustments to tax expense were $1.0 million and $23.2 million , respectively. In addition, the disclosures of deferred tax assets for fiscal 2017 discussed below similarly reflect restatements from originally filed amounts for changes in book income and tax only adjustments to or from previous years. The net deferred tax liability for fiscal 2017 reflects a total adjustment from originally filed for $3.7 million . All other disclosures reflect amounts after restatement.

Domestic income before income taxes was $717.4 million , $158.5 million , and $473.0 million for the years ended August 31, 2018 , 2017 , and 2016 , respectively. Foreign income before income taxes was ($46.2) million , ($268.7) million , and ($70.9) million for the years ended August 31, 2018, 2017, and 2016, respectively.

On December 22, 2017, the Tax Act was enacted into law. The Tax Act provides for significant U.S. tax law changes that reduced our federal corporate statutory tax rate from 35% to 21% as of January 1, 2018. As a fiscal year-end taxpayer, our annual statutory federal corporate tax rate applicable to fiscal 2018 was a blended rate of 25.7% . Beginning in fiscal 2019, the annual statutory federal corporate tax rate will be 21%.

The Tax Act also requires companies to pay a one-time repatriation tax on certain unrepatriated earnings of foreign subsidiaries that were previously tax deferred ("transition tax") and creates new taxes on certain foreign sourced earnings. Foreign taxes have not historically had a material impact on our consolidated financial statements. The foreign impacts of the Tax Act are discussed below.

The Tax Act initially repealed the Domestic Production Activities Deduction ("DPAD") and enacted the Deduction for Qualified Business Income of Pass-Thru Entities ("QBI Deduction"); however, the Consolidated Appropriations Act, 2018 (the "Appropriations Act") enacted into law on March 23, 2018, impacted these deductions. The Appropriations Act modifies the QBI Deduction under Sec. 199A of the Tax Act to reenact DPAD for agricultural and horticultural cooperatives as it existed prior to the enactment of the Tax Act, and also modifies the QBI Deduction available to cooperative patrons as enacted by the Tax Act. All references to the Tax Act below include the modifications introduced by the Appropriations Act.

As discussed in Note 1, Organization, Basis of Presentation and Significant Accounting Policies , the FASB issued ASU 2018-05 during March 2018, which allows for entities to report provisional amounts for specific income tax effects associated with the Tax Act for which the accounting is not complete, but a reasonable estimate can be determined.

As of August 31, 2018, we have not finalized our work associated with the income tax effects of the enactment of the Tax Act; however, a reasonable estimate was provisionally recorded as a net benefit of $155.2 million from the revaluation of our U.S. net deferred tax liability that resulted from the reduced federal corporate tax rate and CHS being subject to the employee compensation deduction limitations imposed by Internal Revenue Code Section 162(m).

We have provisionally estimated that we will not have a transition tax liability; however, we continue to gather additional information and will refine that estimate, if necessary. Additionally, we continue to review the anticipated impacts of global intangible low-taxed income ("GILTI"), including whether its tax effects should be accounted for as an in-period or deferred tax expense. Due to the complexity of the GILTI tax rules and the dependency upon future results of our global operations and our global structure, we are currently unable to make a reasonable estimate of this provision and have not recorded any impact associated with GILTI in the tax rate for the year ended August 31, 2018.

Deferred taxes are comprised of basis differences related to investments, accrued liabilities and certain federal and state tax credits. Deferred tax assets and liabilities as of August 31, 2018 , and 2017 , are as follows:

F-37

Table of Contents



	2018			(As Restated) 2017
	(Dollars in thousands)
Deferred tax assets:
Accrued expenses	$	138,417		$	227,877
Postretirement health care and deferred compensation	41,797			82,682
Tax credit carryforwards	154,240			169,549
Loss carryforwards	104,519			156,615
Nonqualified equity	178,046			140,009
Major maintenance	5,484			13,011
Other	83,580			83,138
Deferred tax assets valuation reserve	(230,373		)	(289,082		)
Total deferred tax assets	475,710			583,799
Deferred tax liabilities:
Pension	19,397			32,150
Investments	98,608			130,816
Property, plant and equipment	513,238			709,313
Other	26,828			40,323
Total deferred tax liabilities	658,071			912,602
Net deferred tax liabilities	$	182,361		$	328,803

We have total gross loss carry forwards of $531.1 million , of which $342.8 million will expire over periods ranging from fiscal 2019 to fiscal 2040. The remainder will carry forward indefinitely. Based on estimates of future taxable profits and losses in certain foreign tax jurisdictions, as well as consideration of other factors, we assessed whether a valuation allowance was necessary to reduce specific foreign loss carry forwards to amounts that we believe are more likely than not to be realized as of August 31, 2018 . If our estimates prove inaccurate, adjustments to the valuation allowances may be required in the future with gains or losses being charged to income in the period such determination is made. During fiscal 2018 , valuation allowances related to foreign operations decreased by $33.8 million due to net operating loss carry forwards and other timing differences. CHS McPherson Refinery Inc. ("CHS McPherson") (formerly known as National Cooperative Refinery Association) gross state tax credit carry forwards for income tax were approximately $121.6 million and $172.9 million as of August 31, 2018 , and 2017 , respectively. During the year ended August 31, 2018 , the valuation allowance for CHS McPherson decreased by $17.0 million , net of federal tax, due to a change in the amount of state tax credits that will be available for use and estimated to be utilized. The significant decrease in state tax credit carry forwards resulted from the CHS McPherson expansion project qualifying for an alternative Kansas state credit than the credit under which the project previously qualified. CHS McPherson's valuation allowance on Kansas state credits is necessary due to the limited amount of taxable income generated in Kansas by the combined group on an annual basis.

Our foreign tax credit of $11.2 million was generated in fiscal 2018 and will expire in ten years. Our alternative minimum tax credit of $6.1 million will not expire. Our general business credits of $61.2 million , comprised primarily of low sulfur diesel credits, will begin to expire on August 31, 2027 and our state tax credits of $121.6 million will begin to expire on August 31, 2019.

As of August 31, 2018 , and 2017 , net deferred tax assets of $0.4 million and $1.2 million were included in other assets, respectively.

F-38

Table of Contents

The reconciliation of the statutory federal income tax rates to the effective tax rates for the years ended August 31, 2018 , 2017 , and 2016 is as follows:



	2018		(As Restated) 2017		(As Restated) 2016
Statutory federal income tax rate	25.7	%	35.0	%	35.0	%
State and local income taxes, net of federal income tax benefit	0.7		12.1		0.3
Patronage earnings	(13.6	)	91.7		(21.2	)
Domestic production activities deduction	(8.4	)	30.5		(12.1	)
Export activities at rates other than the U.S. statutory rate	6.1		51.6		(3.0	)
U.S. tax reform	(23.2	)	—		—
Intercompany transfer of business assets	(6.1	)	—		—
Increase in unrecognized tax benefits	6.8		—		—
Valuation allowance	(3.4	)	(77.1	)	25.4
Tax credits	0.7		22.8		(14.1	)
Crack spread contingency	—		4.8		(5.3	)
Other	(0.8	)	(7.0	)	(0.3	)
Effective tax rate	(15.5	)%	164.4	%	4.7	%

The primary drivers of the fiscal 2018 income tax benefit are the recognition of deferred benefits from the revaluation of our net deferred tax liability resulting from the Tax Act, the intercompany transfer of a business on December 1, 2017 and a current tax benefit from retaining a significant portion of the DPAD, which were partially offset by deferred tax expense from an increase in our unrecognized tax benefit as descried below.

The components of the income tax benefit disclosed as a percentage of income (loss) before income taxes in the reconciliation of the statutory federal income tax rate for the year ended August 31, 2017 , were magnified because our fiscal 2017 income tax benefit was unusually large in relation to our income (loss) before income taxes. The primary drivers of the fiscal 2017 income tax benefit were the recognition of deferred tax benefits related to the issuance of non-qualified equity certificates for fiscal 2013 and 2014, which is disclosed within ‘Patronage earnings’ and U.S. and Brazil deductions related to the Brazilian trading partner loss, which are disclosed within ‘Statutory federal income tax rate’ and ‘Export activities at rates other than the U.S. statutory rate’, respectively, as well as a current tax benefit from retaining a significant portion of the DPAD. A significant income tax expense within the fiscal 2017 income tax benefit is an increase in the valuation allowance against deferred tax assets generated in the Brazilian trading partner loss and Kansas state tax credits.

We file income tax returns in the U.S. federal jurisdiction, as well as various state and foreign jurisdictions. Our uncertain tax positions are affected by the tax years that are under audit or remain subject to examination by the relevant taxing authorities. In addition to the current year, fiscal 2007 through 2017 remain subject to examination, at least for certain issues.

We account for our income tax provisions in accordance with ASC Topic 740, Income Taxes , which prescribes a minimum threshold that a tax provision is required to meet before being recognized in our consolidated financial statements. This interpretation requires us to recognize in our consolidated financial statements tax positions determined more likely than not to be sustained upon examination, based on the technical merits of the position. A reconciliation of the gross beginning and ending amounts of unrecognized tax benefits for the periods presented follows:



	2018		2017		2016
	(Dollars in thousands)
Balance at beginning of period	$	37,830	$	37,105	$	72,181
Additions attributable to current year tax positions	3,640		725		1,387
Additions attributable to prior year tax positions	49,665		—		—
Reductions attributable to prior year tax positions	—		—		(36,463		)
Balance at end of period	$	91,135	$	37,830	$	37,105

F-39

Table of Contents

During fiscal 2018 , adverse judicial opinions received by other taxpayers with similar filing positions resulted in an increase to our unrecognized tax benefits primarily for excise tax credits related to the blending and sale of renewable fuels deducted from income taxes. During fiscal 2017 , we increased our unrecognized tax benefits for excise tax credits related to the blending and sale of renewable fuels deducted for income taxes. During fiscal 2016 , we decreased our unrecognized tax benefits due to a settlement with the Internal Revenue Service and increased our unrecognized tax benefits for excise tax credits related to the blending and sale of renewable fuels deducted for income taxes.

If we were to prevail on all positions taken in relation to uncertain tax positions, $83.3 million of the unrecognized tax benefits would ultimately benefit our effective tax rate. However, we do not believe it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within the next 12 months.

We recognize interest and penalties related to unrecognized tax benefits in our provision for income taxes. We recognized $1.2 million for interest related to unrecognized tax benefits in our Consolidated Statement of Operations for the year ended August 31, 2018 , and a related $1.2 million interest payable on our Consolidated Balance Sheet as of August 31, 2018 . No interest or penalties were recognized in our Consolidated Statements of Operations for the years ended August 31, 2017 , and 2016 and no interest payable was recorded on our Consolidated Balance Sheet as of August 31, 2017 .

Note 10 Equities

In accordance with our bylaws and by action of the Board of Directors, annual net earnings from patronage sources are distributed to consenting patrons following the close of each fiscal year, and are based on amounts using financial statement earnings. The cash portion of the qualified patronage distribution, if any, is determined annually by the Board of Directors, with the balance issued in the form of qualified and/or non-qualified capital equity certificates. Total patronage distributions for fiscal 2018 are estimated to be $420.3 million , with the qualified cash portion estimated to be $75.0 million and non-qualified equity distributions of $345.3 million . No portion of annual net earnings for fiscal 2018 will be issued in the form of qualified capital equity certificates. Patronage distributions in fiscal 2017 were $128.8 million , with no cash portion. The actual patronage distributions and cash portion for fiscal 2016 , and 2015 were $ 257.5 million ( $103.9 million in cash), and $627.2 million ( $251.7 million in cash), respectively.

Annual net earnings from patronage or other sources may be added to the unallocated capital reserve or, upon action by the Board of Directors, may be allocated to members in the form of nonpatronage equity certificates. The Board of Directors authorized, in accordance with our bylaws, that 10% of the earnings from patronage business for fiscal 2018 , 2017 , and 2016 be added to our capital reserves.

Redemptions of outstanding equity are at the discretion of the Board of Directors. Redemptions of capital equity certificates approved by the Board of Directors are divided into two pools, one for non-individuals (primarily member cooperatives) who may participate in an annual redemption program for qualified equities held by them and another for individual members who are eligible for equity redemptions at age 70 or upon death. Beginning with fiscal 2017 patronage (for which distributions were made in fiscal 2018), CHS's redemption policy includes a redemption program for individuals similar to the one that was previously only available to non-individual members, subject to the CHS Board of Directors' overall discretion whether to redeem outstanding equity. In accordance with authorization from the Board of Directors, we expect total redemptions related to the year ended August 31, 2018 , that will be distributed in fiscal 2019 , to be approximately $75.0 million . This amount is classified as a current liability on our August 31, 2018 , Consolidated Balance Sheet. During the years ended August 31, 2018 , 2017 , and 2016 , we redeemed in cash, outstanding owners' equities in accordance with authorization from the Board of Directors, in the amounts of $ 8.8 million , $35.3 million and $ 23.9 million , respectively.

In March 2017, we redeemed approximately $20.0 million of patrons' equities by issuing 695,390 shares of Class B Cumulative Redeemable Preferred Stock, Series 1 ("Class B Series 1 Preferred Stock"), with a total redemption value of $17.4 million , excluding accumulated dividends. Each share of Class B Series 1 Preferred Stock was issued in redemption of $28.74 of patrons' equities in the form of capital equity certificates. Additionally, in fiscal 2016, we redeemed approximately $76.8 million of patrons' equities by issuing 2,693,195 shares of Class B Series 1 Preferred Stock with a total redemption value of $67.3 million , excluding accumulated dividends. Each share of Class B Series 1 Preferred Stock was issued in redemption of $28.50 of patrons' equities in the form of capital equity certificates.

F-40

Table of Contents

Preferred Stock

The following is a summary of our outstanding preferred stock as of August 31, 2018 , all shares of which are listed on the Global Select Market of Nasdaq:



	Nasdaq symbol	Issuance date	Shares outstanding	Redemption value		Net proceeds (a)		Dividend rate (b) (c)		Dividend payment frequency	Redeemable beginning (d)
				(Dollars in millions)
8% Cumulative Redeemable	CHSCP	(e)	12,272,003	$	306.8	$	311.2	8.00	%	Quarterly	7/18/2023
Class B Cumulative Redeemable, Series 1	CHSCO	(f)	21,459,066	$	536.5	$	569.3	7.875	%	Quarterly	9/26/2023
Class B Reset Rate Cumulative Redeemable, Series 2	CHSCN	3/11/2014	16,800,000	$	420.0	$	406.2	7.10	%	Quarterly	3/31/2024
Class B Reset Rate Cumulative Redeemable, Series 3	CHSCM	9/15/2014	19,700,000	$	492.5	$	476.7	6.75	%	Quarterly	9/30/2024
Class B Cumulative Redeemable, Series 4	CHSCL	1/21/2015	20,700,000	$	517.5	$	501.0	7.50	%	Quarterly	1/21/2025


^(a)	Includes patrons' equities redeemed with preferred stock.


^(b)	The Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 2 accumulates dividends at a rate of 7.10% per year until March 31, 2024, and then at a rate equal to the three-month LIBOR plus 4.298% , not to exceed 8.00% per annum, subsequent to March 31, 2024.


^(c)	The Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 3 accumulates dividends at a rate of 6.75% per year until September 30, 2024, and then at a rate equal to the three-month LIBOR plus 4.155% , not to exceed 8.00% per annum, subsequent to September 30, 2024.


^(d)	Preferred stock is redeemable for cash at our option, in whole or in part, at a per share price equal to the per share liquidation preference of $25.00 per share, plus all dividends accumulated and unpaid on that share to and including the date of redemption, beginning on the dates set forth in this column.


^(e)	The 8% Cumulative Redeemable Preferred Stock was issued at various times from 2003 through 2010.


^(f)	Shares of Class B Cumulative Redeemable Preferred Stock, Series 1 were issued on September 26, 2013, August 25, 2014, March 31, 2016 and March 30, 2017.

We made dividend payments on our preferred stock of $168.7 million , $167.6 million , and $163.3 million , during the years ended August 31, 2018 , 2017 and 2016 , respectively. As of August 31, 2018 , we have no authorized but unissued shares of preferred stock.

F-41

Table of Contents

Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive income (loss) by component, for the years ended August 31, 2018 , 2017 , and 2016 are as follows:



	Pension and Other Postretirement Benefits			Unrealized Net Gain (Loss) on Available for Sale Investments			Cash Flow Hedges			Foreign Currency Translation Adjustment			Total
	(Dollars in thousands)
Balance as of August 31, 2015, net of tax (As previously reported)	$	(171,729	)	$	4,156		$	(5,324	)	$	(41,310	)	$	(214,207	)
Cumulative restatement adjustments	—			—			—			1,370			1,370
Balance as of August 31, 2015, net of tax (As restated)	(171,729		)	4,156			(5,324		)	(39,940		)	(212,837		)
Other comprehensive income (loss), before tax:
Amounts before reclassifications	(10,512		)	2,447			(11,353		)	(2,210		)	(21,628		)
Amounts reclassified out	20,998			—			5,071			469			26,538
Total other comprehensive income (loss), before tax	10,486			2,447			(6,282		)	(1,741		)	4,910
Tax effect	(3,903		)	(947		)	2,410			(1,163		)	(3,603		)
Other comprehensive income (loss), net of tax	6,583			1,500			(3,872		)	(2,904		)	1,307
Balance as of August 31, 2016, net of tax (As restated)	(165,146		)	5,656			(9,196		)	(42,844		)	(211,530		)
Other comprehensive income (loss), before tax:
Amounts before reclassifications	25,216			7,117			1,892			(7,960		)	26,265
Amounts reclassified out	26,174			—			1,742			15			27,931
Total other comprehensive income (loss), before tax	51,390			7,117			3,634			(7,945		)	54,196
Tax effect	(18,688		)	(2,732		)	(1,392		)	(214		)	(23,026		)
Other comprehensive income (loss), net of tax	32,702			4,385			2,242			(8,159		)	31,170
Balance as of August 31, 2017, net of tax (As restated)	(132,444		)	10,041			(6,954		)	(51,003		)	(180,360		)
Other comprehensive income (loss), before tax:
Amounts before reclassifications	7,633			21,078			1,031			(10,062		)	19,680
Amounts reclassified out	21,804			(25,534		)	1,704			(2,042		)	(4,068		)
Total other comprehensive income (loss), before tax	29,437			(4,456		)	2,735			(12,104		)	15,612
Tax effect	(9,371		)	1,308			(195		)	83			(8,175		)
Other comprehensive income (loss), net of tax	20,066			(3,148		)	2,540			(12,021		)	7,437
Reclassification of tax effects to retained earnings	(27,957		)	1,968			(1,468		)	465			(26,992		)
Balance as of August 31, 2018, net of tax	$	(140,335	)	$	8,861		$	(5,882	)	$	(62,559	)	$	(199,915	)

During fiscal 2018, we adopted ASU No. 2018-02, Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income . Under U.S. GAAP, the effects of tax law changes on deferred tax balances, including adjustments to deferred taxes originally recorded to accumulated other comprehensive income (loss), are recorded as a component of income tax expense. Adjusting deferred tax balances related to items originally recorded in accumulated other comprehensive income (loss) through tax expense resulted in a remaining accumulated other comprehensive income (loss) balance that was disproportionate to the amounts that would have been recorded through net income in future periods. The new guidance allowed us to reclassify $27.0 million of disproportionate (or stranded) amounts related to the Tax Act to capital reserves.

Amounts reclassified from accumulated other comprehensive income (loss) were related to pension and other postretirement benefits, cash flow hedges, available for sale investments and foreign currency translation adjustments. Pension and other postretirement reclassifications include amortization of net actuarial loss, prior service credit and transition amounts and are recorded as cost of goods sold and marketing, general and administrative expenses (see Note 11, Benefit Plans for further information). Amortization related to gains or losses on cash flow hedges is recorded to interest expense. Gains or losses on the sale of available for sale investments are recorded to other income. Foreign currency translation reclassifications related to sales of businesses are recorded to gain on sale of business or reserve and impairment charges (recoveries), net.

F-42

Table of Contents

During fiscal 2016, interest rate swaps accounted for as cash flow hedges were terminated as the issuance of the underlying debt was no longer probable. As a result, a $3.7 million loss was reclassified from accumulated other comprehensive loss into net income. This pre-tax loss is included as a component of interest expense in our Consolidated Statement of Operations for the year ended August 31, 2016.

Note 11 Benefit Plans

We have various pension and other defined benefit as well as defined contribution plans in which substantially all employees may participate. We also have non-qualified supplemental executive and Board retirement plans.

Financial information on changes in benefit obligation, plan assets funded and balance sheet status as of August 31, 2018 , and 2017 , is as follows:



	Qualified Pension Benefits						Non-Qualified Pension Benefits						Other Benefits
	2018			2017			2018			2017			2018			2017
	(Dollars in thousands)
Change in benefit obligation:
Benefit obligation at beginning of period	$	806,174		$	812,749		$	25,599		$	32,696		$	31,836		$	36,779
Service cost	39,677			42,149			548			1,206			943			1,160
Interest cost	24,007			22,999			711			843			908			930
Actuarial (gain) loss	3,146			(10,054		)	205			(5,692		)	(623		)	(4,650		)
Assumption change	(36,515		)	(17,750		)	(783		)	(655		)	(1,612		)	(775		)
Plan amendments	244			—			—			—			—			—
Settlements	—			—			(4,824		)	(2,131		)	—			—
Benefits paid	(69,549		)	(43,919		)	(701		)	(668		)	(1,662		)	(1,608		)
Benefit obligation at end of period	$	767,184		$	806,174		$	20,755		$	25,599		$	29,790		$	31,836
Change in plan assets:
Fair value of plan assets at beginning of period	$	875,820		$	883,265		$	—		$	—		$	—		$	—
Actual gain (loss) on plan assets	23,345			36,474			—			—			—			—
Company contributions	—			—			5,525			2,799			1,662			1,608
Settlements	—			—			(4,824		)	(2,131		)	—			—
Benefits paid	(69,549		)	(43,919		)	(701		)	(668		)	(1,662		)	(1,608		)
Fair value of plan assets at end of period	$	829,616		$	875,820		$	—		$	—		$	—		$	—
Funded status at end of period	$	62,432		$	69,646		$	(20,755	)	$	(25,599	)	$	(29,790	)	$	(31,836	)
Amounts recognized on balance sheet:
Non-current assets	$	62,432		$	70,019		$	—		$	—		$	—		$	—
Accrued benefit cost:
Current liabilities	—			—			(1,780		)	(2,270		)	(2,040		)	(2,140		)
Non-current liabilities	—			(373		)	(18,975		)	(23,329		)	(27,750		)	(29,696		)
Ending balance	$	62,432		$	69,646		$	(20,755	)	$	(25,599	)	$	(29,790	)	$	(31,836	)
Amounts recognized in accumulated other comprehensive loss (pretax):
Prior service cost (credit)	$	1,288		$	2,481		$	(691	)	$	(660	)	$	(3,716	)	$	(4,281	)
Net (gain) loss	209,606			236,232			427			953			(17,875		)	(16,864		)
Ending balance	$	210,894		$	238,713		$	(264	)	$	293		$	(21,591	)	$	(21,145	)

F-43

Table of Contents

The accumulated benefit obligation of the qualified pension plans was $ 736.2 million and $ 743.5 million at August 31, 2018 , and 2017 , respectively. The accumulated benefit obligation of the non-qualified pension plans was $ 18.6 million and $ 20.6 million at August 31, 2018 , and 2017 , respectively.

Information for the pension plans with an accumulated benefit obligation in excess of plan assets is set forth below:



	For the Years Ended August 31,
	2018		2017
	(Dollars in thousands)
Projected benefit obligation	$	20,755	$	28,177
Accumulated benefit obligation	18,586		23,221
Fair value of plan assets	—		2,203

A significant assumption for pension plan accounting is the discount rate. Historically, we have selected a discount rate each year (as of our fiscal year-end measurement date) for our plans based upon a high-quality corporate bond yield curve for which the cash flows from coupons and maturities match the year-by-year projected benefit cash flows for our pension plans. The corporate bond yield curve is comprised of high-quality fixed income debt instruments available at the measurement date. At August 31, 2016, we made the determination to use an individual spot-rate approach, discussed below. This alternative approach focuses on measuring the service cost and interest cost components of net periodic benefit cost by using individual spot rates derived from a high-quality corporate bond yield curve and matched with separate cash flows for each future year instead of a single weighted-average discount rate approach.

As of August 31, 2016, we changed the method used to estimate the service and interest cost components of net periodic benefit cost for pension and other post-retirement benefits. This change in methodology has and is expected to continue to result in a decrease in the service and interest cost components for the pension and other post-retirement benefit costs. We historically estimated these service and interest cost components utilizing a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. Beginning in fiscal 2017, we elected to utilize a full-yield curve approach in the determination of these components by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. We elected to make this change to provide a more precise measurement of service and interest costs by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates. This change does not affect the measurement of our total benefit obligations at August 31, 2016, the net periodic cost recognized in fiscal 2016 or the ultimate benefit payment that must be made in the future. We have accounted for this change as a change in accounting estimate and, accordingly, have accounted for it on a prospective basis.

F-44

Table of Contents

Components of net periodic benefit costs for the years ended August 31, 2018 , 2017 , and 2016 are as follows:



	Qualified Pension Benefits									Non-Qualified Pension Benefits									Other Benefits
	2018			2017			2016			2018			2017			2016			2018			2017			2016
	(Dollars in thousands)
Components of net periodic benefit costs:
Service cost	$	39,677		$	42,149		$	37,533		$	548		$	1,206		$	1,035		$	943		$	1,160		$	1,412
Interest cost	24,007			22,999			30,773			711			843			1,406			908			930			1,709
Expected return on assets	(48,159		)	(48,235		)	(48,055		)	—			—			—			—			—			—
Settlement of retiree obligations	—			—			—			(112		)	(30		)	—			—			—			—
Prior service cost (credit) amortization	1,437			1,540			1,606			30			19			228			(565		)	(565		)	(120		)
Actuarial loss (gain) amortization	18,073			22,869			19,016			61			546			692			(1,224		)	(798		)	(464		)
Net periodic benefit cost	$	35,035		$	41,322		$	40,873		$	1,238		$	2,584		$	3,361		$	62		$	727		$	2,537
Weighted-average assumptions to determine the net periodic benefit cost:
Discount rate	3.80		%	3.60		%	4.20		%	3.53		%	3.28		%	4.20		%	3.56		%	3.30		%	4.20		%
Expected return on plan assets	5.75		%	5.75		%	6.00		%	N/A			N/A			N/A			N/A			N/A			N/A
Rate of compensation increase	5.08		%	5.60		%	4.90		%	5.08		%	5.60		%	4.90		%	N/A			N/A			N/A
Weighted-average assumptions to determine the benefit obligations:
Discount rate	4.23		%	3.80		%	3.60		%	4.09		%	3.53		%	3.28		%	4.13		%	3.56		%	3.30		%
Rate of compensation increase	5.14		%	5.08		%	5.60		%	5.14		%	5.08		%	5.60		%	N/A			N/A			N/A

Components of net periodic benefit costs and amounts recognized in other comprehensive income (loss) for the years ended August 31, 2018, 2017, and 2016 are as follows:



	Qualified Pension Benefits									Non-Qualified Pension Benefits									Other Benefits
	2018			2017			2016			2018			2017			2016			2018			2017			2016
	(Dollars in thousands)
Other comprehensive income (loss)
Prior service cost (credit)	$	244		$	—		$	411		$	—		$	—		$	(1,044	)	$	—		$	—		$	(4,495	)
Net actuarial loss (gain)	(8,553		)	(16,044		)	17,712			(578		)	(6,345		)	(655		)	(2,234		)	(5,427		)	(2,290		)
Amortization of actuarial loss (gain)	(18,073		)	(22,869		)	(19,016		)	(61		)	(546		)	(692		)	1,224			798			464
Amortization of prior service costs (credit)	(1,437		)	(1,540		)	(1,606		)	(30		)	(19		)	(228		)	565			565			120
Settlement of retiree obligations (a)	—			—			—			112			30			—			—			—			—
Total recognized in other comprehensive income	$	(27,819	)	$	(40,453	)	$	(2,499	)	$	(557	)	$	(6,880	)	$	(2,619	)	$	(445	)	$	(4,064	)	$	(6,201	)

(a) Reflects amounts reclassified from accumulated other comprehensive income (loss) to net earnings

The estimated amortization in fiscal 2019 from accumulated other comprehensive loss into net periodic benefit cost is as follows:



	Qualified Pension Benefits		Non-Qualified Pension Benefits			Other Benefits
	(Dollars in thousands)
Amortization of prior service cost (credit)	$	190	$	(75	)	$	(556	)
Amortization of net actuarial (gain) loss	12,266		2			(1,629		)

For measurement purposes, a 7.5% annual rate of increase in the per capita cost of covered health care benefits was assumed for the year ended August 31, 2018 . The rate was assumed to decrease gradually to 4.5% by 2027 and remain at that level thereafter.

F-45

Table of Contents

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage point change in the assumed health care cost trend rates would have the following effects:



	1% Increase		1% Decrease
	(Dollars in thousands)
Effect on total of service and interest cost components	$	230	$	(200	)
Effect on postretirement benefit obligation	2,400		(2,100		)

We provide defined life insurance and health care benefits for certain retired employees and Board of Directors participants. The plan is contributory based on years of service and family status, with retiree contributions adjusted annually.

We did not contribute to the qualified pension plans in fiscal 2018 . Based on the funded status of the qualified pension plans as of August 31, 2018 , we do not believe we will be required to contribute to these plans in fiscal 2019 , although we may voluntarily elect to do so. We expect to pay $ 3.8 million to participants of the non-qualified pension and postretirement benefit plans during fiscal 2019 .

Our retiree benefit payments, which reflect expected future service, are anticipated to be paid as follows:



	Qualified Pension Benefits		Non-Qualified Pension Benefits		Other Benefits Gross
	(Dollars in thousands)
2019	$	66,528	$	1,780	$	2,040
2020	62,320		1,670		2,260
2021	61,279		1,750		2,400
2022	62,877		2,230		2,590
2023	64,573		1,840		2,720
2024-2028	328,313		9,270		12,690

We have trusts that hold the assets for the defined benefit plans. CHS has a qualified plan committee that sets investment guidelines with the assistance of external consultants. Investment objectives for the plans' assets are as follows:


•	optimization of the long-term returns on plan assets at an acceptable level of risk;


•	maintenance of a broad diversification across asset classes and among investment managers; and


•	focus on long-term return objectives.

Asset allocation targets promote optimal expected return and volatility characteristics given the long-term time horizon for fulfilling the obligations of the pension plans. Our pension plans' investment policy strategy is such that liabilities match assets. This is being accomplished through the asset portfolio mix by reducing volatility and de-risking the plans. The plans’ target allocation percentages range between 45% and 65% for fixed income securities, and range between 35% and 55% for equity securities. An annual analysis of the risk versus the return of the investment portfolio is conducted to justify the expected long-term rate of return assumption. We generally use long-term historical return information for the targeted asset mix identified in asset and liability studies. Adjustments are made to the expected long-term rate of return assumption, when deemed necessary, based upon revised expectations of future investment performance of the overall investment markets.

The discount rate reflects the rate at which the associated benefits could be effectively settled as of the measurement date. In estimating this rate, we look at rates of return on fixed-income investments of similar duration to the liabilities in the plans that receive high, investment-grade ratings by recognized ratings agencies.

The investment portfolio contains a diversified portfolio of investment categories, including domestic and international equities, fixed-income securities and real estate. Securities are also diversified in terms of domestic and international securities, short and long-term securities, growth and value equities, large and small cap stocks, as well as active and passive management styles.

The committee believes that with prudent risk tolerance and asset diversification, the plans should be able to meet pension obligations in the future.

F-46

Table of Contents

Our pension plans’ recurring fair value measurements by asset category at August 31, 2018 , and 2017 , are presented in the tables below:



	2018
	Level 1		Level 2		Level 3		Total
	(Dollars in thousands)
Cash and cash equivalents	$	7,424	$	—	$	—	$	7,424
Equities:
Mutual funds	692		—		—		692
Common/collective trust at net asset value ⁽¹⁾	—		—		—		216,962
Fixed income securities:
Common/collective trust at net asset value ⁽¹⁾	—		—		—		500,637
Partnership and joint venture interests measured at net asset value ⁽¹⁾	—		—		—		101,954
Other assets measured at net asset value ⁽¹⁾	—		—		—		1,947
Total	$	8,116	$	—	$	—	$	829,616



	2017
	Level 1		Level 2		Level 3		Total
	(Dollars in thousands)
Cash and cash equivalents	$	9,988	$	—	$	—	$	9,988
Equities:
Mutual funds	459		—		—		459
Common/collective trust at net asset value ⁽¹⁾	—		—		—		231,228
Fixed income securities:
Common/collective trust at net asset value ⁽¹⁾	—		—		—		535,185
Partnership and joint venture interests measured at net asset value ⁽¹⁾	—		—		—		96,994
Other assets measured at net asset value ⁽¹⁾	—		—		—		1,966
Total	$	10,447	$	—	$	—	$	875,820

(1) In accordance with ASC Topic 820-10, Fair Value Measurements, certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in the tables above are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of net assets.

Definitions for valuation levels are found in Note 14, Fair Value Measurements . We use the following valuation methodologies for assets measured at fair value.

Mutual funds: Valued at quoted market prices, which are based on the net asset value of shares held by the plan at year end. Mutual funds traded in active markets are classified within Level 1 of the fair value hierarchy. Mutual funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy in accordance with ASC Topic 820-10, Fair Value Measurement .

Common/Collective Trusts: Common/collective trusts primarily consist of equity and fixed income funds and are valued using other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risks, referenced indices, quoted prices in inactive markets, adjusted quoted prices in active markets, adjusted quoted prices on foreign equity securities that were adjusted in accordance with pricing procedures approved by the trust, etc.). Common/collective trust investments can be redeemed daily and without restriction. Redemption of the entire investment balance generally requires a 45- to 60-day notice period. The equity funds provide exposure to large, mid and small cap U.S. equities, international large and small cap equities and emerging market equities. The fixed income funds provide exposure to U.S., international and emerging market debt securities. Common/collective trusts measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy in accordance with ASC Topic 820-10, Fair Value Measurement .

F-47

Table of Contents

Partnership and joint venture interests: Valued at the net asset value of shares held by the plan at year end as a practical expedient for fair value. The net asset value is based on the fair value of the underlying assets owned by the trust, minus its liabilities then divided by the number of units outstanding. Redemptions of these interests generally require a 45- to 60-day notice period. Partnerships and joint venture interests measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy in accordance with ASC Topic 820-10, Fair Value Measurement.

Other assets : Other assets primarily includes real estate funds and hedge funds held in the asset portfolio of our U.S. defined benefit pension plans. Other funds measured at fair value using the net asset value per share practical expedient have not been categorized in the fair value hierarchy in accordance with ASC Topic 820-10, Fair Value Measurement.

We are one of approximately 400 employers that contribute to the Co-op Retirement Plan ("Co-op Plan"), which is a defined benefit plan constituting a “multiple employer plan” under the Internal Revenue Code of 1986, as amended, and a “multiemployer plan” under the accounting standards. The risks of participating in these multiemployer plans are different from single-employer plans in the following aspects:


•	Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers;


•	If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; and


•	If we choose to stop participating in the multiemployer plan, we may be required to pay the plan an amount based on the underfunded status of the plan, referred to as a withdrawal liability.

Our participation in the Co-op Plan for the years ended August 31, 2018 , 2017 , and 2016 is outlined in the table below:



		Contributions of CHS
		(Dollars in thousands)
Plan Name	EIN/Plan Number	2018		2017		2016		Surcharge Imposed	Expiration Date of Collective Bargaining Agreement
Co-op Retirement Plan	01-0689331 / 001	$	1,662	$	1,653	$	1,862	N/A	N/A

Our contributions for the years stated above did not represent more than 5% of total contributions to the Co-op Plan as indicated in the Co-op Plan's most recently available annual report (Form 5500).

Provisions of the Pension Protection Act of 2006 ("PPA") do not apply to the Co-op Plan because there is a special exemption for cooperative plans if the plan is maintained by more than one employer and at least 85% of the employers are rural cooperatives or cooperative organizations owned by agricultural producers. In the Co-op Plan, a “zone status” determination is not required, and therefore not determined. In addition, the accumulated benefit obligations and plan assets are not determined or allocated separately by individual employers. The most recent financial statements available in 2018 and 2017 are for the Co-op Plan's year-end at March 31, 2018 , and 2017 , respectively. In total, the Co-op Plan was at least 80% funded on those dates based on the total plan assets and accumulated benefit obligations.

Because the provisions of the PPA do not apply to the Co-op Plan, funding improvement plans, and surcharges are not applicable. Future contribution requirements are determined each year as part of the actuarial valuation of the plan and may change as a result of plan experience.

In addition to the contributions to the Co-op Plan listed above, total contributions to individually insignificant multi-employer pension plans were immaterial in fiscal 2018 , 2017 , and 2016 .

We have other contributory defined contribution plans covering substantially all employees. Total contributions by us to these plans were $ 24.7 million , $ 19.9 million and $ 29.5 million , for the years ended August 31, 2018 , 2017 , and 2016 , respectively.

F-48

Table of Contents

Note 12 Segment Reporting

We are an integrated agricultural enterprise, providing grain, foods and energy resources to businesses and consumers on a global basis. We provide a wide variety of products and services, from initial agricultural inputs such as fuels, farm supplies, crop nutrients and crop protection products, to agricultural outputs that include grains and oilseeds, grain and oilseed processing and food products, and the production and marketing of ethanol. We define our operating segments in accordance with ASC Topic 280, Segment Reporting , to reflect the manner in which our chief operating decision maker, our Chief Executive Officer, evaluates performance and allocates resources in managing the business. We have aggregated those operating segments into three reportable segments: Energy, Ag and Nitrogen Production.

Our Energy segment produces and provides primarily for the wholesale distribution of petroleum products and transportation of those products. Our Ag segment purchases and further processes or resells grains and oilseeds originated by our country operations business, by our member cooperatives and by third parties; serves as a wholesaler and retailer of crop inputs; and produces and markets ethanol. Our Nitrogen Production segment consists solely of our equity method investment in CF Nitrogen, which was completed in February 2016 and which entitles us, pursuant to a supply agreement that we entered with CF Nitrogen, to purchase up to a specified annual quantity of granular urea and UAN annually from CF Nitrogen. The addition of the Nitrogen Production segment had no impact on historically reported segment results and balances as this segment came into existence in fiscal 2016. There were no changes to the composition of our Energy or Ag segments as a result of the addition of the Nitrogen Production segment. Corporate and Other primarily represents our non-consolidated wheat milling operations and packaged food joint ventures, as well as our business solutions operations, which primarily consists of commodities hedging, financial services related to crop production, and insurance which was disposed of in May 2018. Our investment in Ventura Foods is included in our Corporate and Other category.

Corporate administrative expenses and interest are allocated to each business segment, and Corporate and Other, based on direct usage for services that can be tracked, such as information technology and legal, and other factors or considerations relevant to the costs incurred.

Many of our business activities are highly seasonal and operating results vary throughout the year. For example, in our Ag segment, our crop nutrients and country operations businesses generally experience higher volumes and income during the spring planting season and in the fall, which corresponds to harvest. Our grain marketing operations are also subject to fluctuations in volume and earnings based on producer harvests, world grain prices and demand. Our Energy segment generally experiences higher volumes and profitability in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage is highest and is subject to global supply and demand forces. Other energy products, such as propane, may experience higher volumes and profitability during the winter heating and crop drying seasons.

Our revenues, assets and cash flows can be significantly affected by global market prices for commodities such as petroleum products, natural gas, grains, oilseeds, crop nutrients and flour. Changes in market prices for commodities that we purchase without a corresponding change in the selling prices of those products can affect revenues and operating earnings. Commodity prices are affected by a wide range of factors beyond our control, including the weather, crop damage due to disease or insects, drought, the availability and adequacy of supply, government regulations and policies, world events, and general political and economic conditions.

While our revenues and operating results are derived from businesses and operations which are wholly-owned and majority-owned, a portion of our business operations are conducted through companies in which we hold ownership interests of 50% or less and do not control the operations. We account for these investments primarily using the equity method of accounting, wherein we record our proportionate share of income or loss reported by the entity as equity income from investments, without consolidating the revenues and expenses of the entity in our Consolidated Statements of Operations. In our Ag segment, this principally includes our 50% ownership in TEMCO. In our Nitrogen Production segment, this consists of our approximate 10% membership interest (based on product tons) in CF Nitrogen. In Corporate and Other, this principally includes our 50% ownership in Ventura Foods and our 12% ownership in Ardent Mills. See Note 5, Investments for more information related to CF Nitrogen, Ventura Foods and Ardent Mills.

Reconciling amounts represent the elimination of revenues between segments. Such transactions are executed at market prices to more accurately evaluate the profitability of the individual business segments.

F-49

Table of Contents

Segment information for the years ended August 31, 2018 , 2017 , and 2016 is presented in the tables below.



	Energy			Ag			Nitrogen Production			Corporate and Other			Reconciling Amounts			Total
	(Dollars in thousands)
For the year ended August 31, 2018:
Revenues, including intersegment revenues	$	8,068,717		$	25,052,395		$	—		$	64,516		$	(502,281	)	$	32,683,347
Operating earnings (loss)	390,092			95,883			(20,619		)	(8,270		)	—			457,086
(Gain) loss on disposal of business	(65,862		)	(7,707		)	—			(58,247		)	—			(131,816		)
Interest expense	14,627			94,256			50,499			(7,712		)	(2,468		)	149,202
Other (income) loss	(7,718		)	(66,316		)	(3,061		)	(3,388		)	2,468			(78,015		)
Equity (income) loss from investments	(3,063		)	1,392			(106,895		)	(44,949		)	—			(153,515		)
Income (loss) before income taxes	$	452,108		$	74,258		$	38,838		$	106,026		$	—		$	671,230
Intersegment revenues	$	(479,598	)	$	(14,914	)	$	—		$	(7,769	)	$	502,281		$	—
Capital expenditures	$	248,207		$	77,962		$	—		$	29,243		$	—		$	355,412
Depreciation and amortization	$	230,230		$	218,716		$	—		$	29,104		$	—		$	478,050
Total assets as of August 31, 2018	$	4,168,239		$	6,534,777		$	2,758,668		$	2,919,494		$	—		$	16,381,178



	Energy			Ag			Nitrogen Production			Corporate and Other			Reconciling Amounts			Total
	(Dollars in thousands)
For the year ended August 31, 2017: (As restated)
Revenues, including intersegment revenues	$	6,620,680		$	25,738,740		$	—		$	95,414		$	(417,408	)	$	32,037,426
Operating earnings (loss)	75,138			(268,946		)	(18,430		)	38,212			—			(174,026		)
(Gain) loss on disposal of business	—			2,190			—			—			—			2,190
Interest expense	18,365			71,986			48,893			33,250			(1,255		)	171,239
Other (income) loss	(1,164		)	(65,684		)	(30,534		)	(3,824		)	1,255			(99,951		)
Equity (income) loss from investments	(3,181		)	(7,277		)	(66,530		)	(60,350		)	—			(137,338		)
Income (loss) before income taxes	$	61,118		$	(270,161	)	$	29,741		$	69,136		$	—		$	(110,166	)
Intersegment revenues	$	(392,842	)	$	(20,312	)	$	—		$	(4,254	)	$	417,408		$	—
Capital expenditures	$	260,543		$	146,139		$	—		$	37,715		$	—		$	444,397
Depreciation and amortization	$	223,229		$	232,443		$	—		$	24,551		$	—		$	480,223
Total assets as of August 31, 2017	$	4,290,618		$	6,359,058		$	2,781,610		$	2,387,636		$	—		$	15,818,922



	Energy			Ag			Nitrogen Production			Corporate and Other			Reconciling Amounts			Total
	(Dollars in thousands)
For the year ended August 31, 2016: (As restated)
Revenues, including intersegment revenues	$	5,743,882		$	24,896,354		$	—		$	92,725		$	(377,701	)	$	30,355,260
Operating earnings (loss)	246,105			36,649			(6,193		)	15,882			—			292,443
Interest expense	(22,244		)	82,085			34,437			30,647			(11,221		)	113,704
Other (income) loss	(287		)	(53,044		)	—			(5,499		)	11,221			(47,609		)
Equity (income) loss from investments	(4,739		)	(7,644		)	(74,700		)	(88,694		)	—			(175,777		)
Income (loss) before income taxes	$	273,375		$	15,252		$	34,070		$	79,428		$	—		$	402,125
Intersegment revenues	$	(335,003	)	$	(40,336	)	$	—		$	(2,362	)	$	377,701		$	—
Capital expenditures	$	376,841		$	260,865		$	—		$	55,074		$	—		$	692,780
Depreciation and amortization	$	193,525		$	230,172		$	—		$	23,795		$	—		$	447,492

F-50

Table of Contents

We have international sales, which are predominantly in our Ag segment. The following table presents our sales, based on the geographic locations in which the sales originated, for the years ended August 31, 2018 , 2017 , and 2016 :



	2018		(As Restated) 2017		(As Restated) 2016
	(Dollars in thousands)
North America	$	29,475,724	$	29,068,842	$	26,571,367
South America	1,569,330		1,441,316		1,847,284
Europe, the Middle East and Africa (EMEA)	536,501		652,308		878,407
Asia Pacific (APAC)	1,101,792		874,960		1,058,202
Total	$	32,683,347	$	32,037,426	$	30,355,260

Included in North American revenues are revenues from the United States of $29.5 billion , $29.0 billion and $26.5 billion for the years ended August 31, 2018 , 2017 , and 2016 , respectively.

Long-lived assets include our property, plant and equipment, capital lease assets and capitalized major maintenance costs. The following table presents long-lived assets by geographical region:



	2018		2017
	(Dollars in thousands)
United States	$	5,185,572	$	5,359,270
International	86,927		102,170
Total	$	5,272,499	$	5,461,440

Note 13 Derivative Financial Instruments and Hedging Activities

Our derivative instruments primarily consist of commodity and forward contracts and, to a minor degree, may include foreign currency and interest rate swap contracts. These contracts are economic hedges of price risk, but we do not apply hedge accounting under ASC Topic 815, Derivatives and Hedging , except with respect to certain interest rate swap contracts which are accounted for as cash flow hedges or fair value hedges as described below. Derivative instruments are recorded on our Consolidated Balance Sheets at fair value as described in Note 14, Fair Value Measurements .

The following tables present the gross fair values of derivative assets, derivative liabilities, and margin deposits (cash collateral) recorded on our Consolidated Balance Sheets along with the related amounts permitted to be offset in accordance with U.S. GAAP. We have elected not to offset derivative assets and liabilities when we have the right of offset under ASC Topic 210-20, Balance Sheet - Offsetting; or when the instruments are subject to master netting arrangements under ASC Topic 815-10-45, Derivatives and Hedging - Overall .



	August 31, 2018
			Amounts Not Offset on the Consolidated Balance Sheet but Eligible for Offsetting
	Gross Amounts Recognized		Cash Collateral		Derivative Instruments		Net Amounts
	(Dollars in thousands)
Derivative Assets:
Commodity derivatives	$	313,033	$	—	$	26,781	$	286,252
Foreign exchange derivatives	15,401		—		8,703		6,698
Embedded derivative asset	23,595		—		—		23,595
Total	$	352,029	$	—	$	35,484	$	316,545
Derivative Liabilities:
Commodity derivatives	$	421,054	$	12,983	$	26,781	$	381,290
Foreign exchange derivatives	24,701		—		8,703		15,998
Total	$	445,755	$	12,983	$	35,484	$	397,288

F-51

Table of Contents



	August 31, 2017 (As Restated)
			Amounts Not Offset on the Consolidated Balance Sheet but Eligible for Offsetting
	Gross Amounts Recognized		Cash Collateral		Derivative Instruments		Net Amounts
	(Dollars in thousands)
Derivative Assets:
Commodity derivatives	$	215,349	$	—	$	34,912	$	180,437
Foreign exchange derivatives	8,779		—		3,636		5,143
Embedded derivative asset	25,533		—		—		25,533
Total	$	249,661	$	—	$	38,548	$	211,113
Derivative Liabilities:
Commodity derivatives	$	293,330	$	3,898	$	34,912	$	254,520
Foreign exchange derivatives	19,931		—		3,636		16,295
Total	$	313,261	$	3,898	$	38,548	$	270,815

Derivative assets and liabilities with maturities of less than 12 months are recorded in derivative assets and derivative liabilities, respectively, on the Consolidated Balance Sheets. Derivative assets and liabilities with maturities greater than 12 months are recorded in other assets and other liabilities, respectively, on the Consolidated Balance Sheets. The amount of long-term derivative assets, excluding derivatives accounted for as fair value hedges, recorded on the Consolidated Balance Sheet at August 31, 2018, and 2017, was $23.1 million and $ 30.9 million , respectively. The amount of long-term derivative liabilities, excluding derivatives accounted for as fair value hedges, recorded on the Consolidated Balance Sheet at August 31, 2018, and 2017, was $7.9 million and $12.3 million , respectively.

Derivatives Not Designated as Hedging Instruments

The majority of our derivative instruments have not been designated as hedging instruments. The following table sets forth the pretax gains (losses) on derivatives not accounted for as hedging instruments that have been included in our Consolidated Statements of Operations for the years ended August 31, 2018 , 2017 , and 2016 .



	Location of Gain (Loss)	2018			(As Restated) 2017			(As Restated) 2016
		(Dollars in thousands)
Commodity derivatives	Cost of goods sold	$	162,321		$	168,569		$	(67,014	)
Foreign exchange derivatives	Cost of goods sold	(26,010		)	(13,140		)	(10,904		)
Foreign exchange derivatives	Marketing, general and administrative	596			(1,604		)	(97		)
Interest rate derivatives	Interest expense	(1		)	8			(6,292		)
Embedded derivative	Other income (loss)	3,061			30,533			—
Total		$	139,967		$	184,366		$	(84,307	)

Commodity Contracts:

When we enter a commodity purchase or sales commitment, we are exposed to risks related to price changes and performance including delivery, quality, quantity and shipment period. If market prices decrease, we are exposed to risk of loss in the market value of inventory and purchase contracts with a fixed or partially fixed price. Conversely, we are exposed to risk of loss on our fixed or partially fixed price sales contracts if market prices increase.

F-52

Table of Contents

contracts, other pricing arrangements and, to some extent, futures contracts in highly correlated commodities. These contracts are economic hedges of price risk, but are not designated as hedging instruments for accounting purposes. The contracts are recorded on our Consolidated Balance Sheets at fair values based on quotes listed on regulated commodity exchanges or the market prices of the underlying products listed on the exchanges, except that fertilizer and certain propane contracts are accounted for as normal purchase and normal sales transactions. Unrealized gains and losses on these contracts are recognized in cost of goods sold in our Consolidated Statements of Operations.

Our policy is to manage our commodity price risk exposure according to internal polices and in alignment with our tolerance for risk. Our profitability from operations is primarily derived from margins on products sold and grain merchandised, not from hedging transactions. At any one time, inventory and purchase contracts for delivery to us may be substantial. We have risk management policies that include established net position limits. These limits are defined for each commodity and business unit, and may include both trader and management limits as appropriate. The limits policy is managed within each individual business unit to ensure any limits overage is explained and exposures reduced, or a temporary limit increase is established if needed. The position limits are reviewed, at least annually, with senior leadership and the Board of Directors. We monitor current market conditions and may expand or reduce our net position limits in response to changes in those conditions. In addition, all purchase and sales contracts are subject to credit approvals and appropriate terms and conditions.

As of August 31, 2018 , and 2017 , we had outstanding commodity futures and options contracts that were used as economic hedges, as well as fixed-price forward contracts related to physical purchases and sales of commodities. The table below presents the notional volumes for all outstanding commodity contracts accounted for as derivative instruments.



	2018		(As Restated) 2017
	Long	Short	Long	Short
	(Units in thousands)
Grain and oilseed - bushels	715,866	929,873	569,243	767,110
Energy products - barrels	17,011	8,329	15,072	18,252
Processed grain and oilseed - tons	1,064	2,875	299	2,347
Crop nutrients - tons	11	76	9	15
Ocean freight - metric tons	227	45	160	198
Natural gas - MMBtu	610	—	500	—

F-53

Table of Contents

Foreign Exchange Contracts

We conduct a substantial portion of our business in U.S. dollars, but we are exposed to risks relating to foreign currency fluctuations primarily due to grain marketing transactions in South America, the Asia Pacific region, and Europe, and purchases of products from Canada. We use foreign currency derivative instruments to mitigate the impact of exchange rate fluctuations. Although CHS has some risk exposure relating to foreign currency transactions, a larger impact with exchange rate fluctuations is the ability of foreign buyers to purchase U.S. agricultural products and the competitiveness of U.S. agricultural products compared to the same products offered by alternative sources of world supply. The notional amounts of our foreign exchange derivative contracts were $988.8 million and $776.7 million as of August 31, 2018 , and August 31, 2017 , respectively.

Embedded Derivative Asset

Under the terms of our strategic investment in CF Nitrogen, if CF Industries' credit rating is reduced below certain levels by two of three specified credit ratings agencies, we are entitled to receive a non-refundable annual payment of $5.0 million from CF Industries. These payments will continue on an annual basis until the date that CF Industries' credit rating is upgraded to or above certain levels by two of the three specified credit ratings agencies or February 1, 2026, whichever is earlier.

During the first quarter of fiscal 2017, CF Industries' credit rating was reduced below the specified levels and we recorded a gain of $29.1 million in other income (loss) in our Consolidated Statement of Operations and received a $5.0 million payment from CF Industries. A total gain of $30.5 million was recognized in relation to the embedded credit derivative during fiscal 2017. During fiscal 2018, we received a second $5.0 million payment from CF Industries. The fair value of the embedded derivative asset recorded on our Consolidated Balance Sheet as of August 31, 2018 , was equal to $23.6 million . The current and long-term portions of the embedded derivative asset are included in derivative assets and other assets on our Consolidated Balance Sheet, respectively. See Note 14, Fair Value Measurements for additional information regarding the valuation of the embedded derivative asset.

Derivatives Designated as Cash Flow or Fair Value Hedging Strategies

Fair Value Hedges

As of August 31, 2018 , and 2017 , we had outstanding interest rate swaps with an aggregate notional amount of $495.0 million designated as fair value hedges of portions of our fixed-rate debt that is due between fiscal 2019 and fiscal 2025. Our objective in entering into these transactions is to offset changes in the fair value of the debt associated with the risk of variability in the three-month U.S. dollar LIBOR interest rate ("LIBOR"), in essence converting the fixed-rate debt to variable-rate debt. Under these interest rate swaps, we receive fixed-rate interest payments and make interest payments based on the three-month LIBOR. Offsetting changes in the fair values of both the swap instruments and the hedged debt are recorded contemporaneously each period and only create an impact to earnings to the extent that the hedge is ineffective.

The following table presents the fair value of our derivative interest rate swap instruments designated as fair value hedges and the line items on our Consolidated Balance Sheets in which they are recorded as of August 31, 2018 , and 2017 .



	2018		2017			2018		2017
Balance Sheet Location	Derivative Assets				Balance Sheet Location	Derivative Liabilities
	(Dollars in thousands)					(Dollars in thousands)
Derivative assets	$	—	$	—	Derivative liabilities	$	771	$	—
Other assets	—		9,978		Other liabilities	8,681		707
Total	$	—	$	9,978	Total	$	9,452	$	707

F-54

Table of Contents

The following table sets forth the pretax gains (losses) on derivatives accounted for as hedging instruments that have been included in our Consolidated Statements of Operations for the years ended August 31, 2018 , 2017 , and 2016 .



Gain (Loss) on Fair Value Hedging Relationships:	Location of Gain (Loss)	2018			2017			2016
		(Dollars in thousands)
Interest rate swaps	Interest expense	$	18,723		$	12,806		$	(9,842	)
Hedged item	Interest expense	(18,723		)	(12,806		)	9,842
Total		$	—		$	—		$	—

The following table provides the location and carrying amount of hedged liabilities in our Consolidated Balance Sheets as of August 31, 2018 , and 2017 .



	August 31, 2018				August 31, 2017
Balance Sheet Location	Carrying Amount of Hedged Liabilities		Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of Hedged Liabilities		Carrying Amount of Hedged Liabilities		Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of Hedged Liabilities
	(Dollars in thousands)
Long-term debt	$	485,548	$	9,452	$	504,271	$	(9,271	)

Cash Flow Hedges

In the fourth quarter of fiscal 2018, our Energy segment entered into pay-fixed, receive-variable, cash-settled swaps designated as cash flow hedges of future crude oil purchases. We also entered into pay-variable, receive-fixed, cash-settled swaps designated as cash flow hedges of future refined product sales. These hedging instruments and the related hedged items are exposed to significant market price risk and potential volatility. As part of our risk management strategy, we look to hedge a portion of our expected future crude oil needs and the resulting refined product output based on prevailing futures prices, management's expectations about future commodity price changes and our risk appetite. As of August 31, 2018, the notional amount, the fair value and the amounts recorded in other comprehensive income relating to these cash flow hedges were immaterial. There were no outstanding cash flow hedges as of August 31, 2017.

In fiscal 2015, we entered into forward-starting interest rate swaps with an aggregate notional amount of $300.0 million designated as cash flow hedges of the expected variability of future interest payments on our anticipated issuance of fixed-rate debt. During the first quarter of fiscal 2016, we determined that certain of the anticipated debt issuances would be delayed; and we consequently recorded an immaterial amount of losses on the ineffective portion of the related swaps in earnings. Additionally, we paid $6.4 million in cash to settle two of the interest rate swaps upon their scheduled termination dates. During the second quarter of fiscal 2016, we settled an additional two interest rate swaps, paying $5.3 million in cash upon their scheduled termination. In January 2016, we issued the fixed-rate debt associated with these swaps and will amortize the amounts which were previously deferred to other comprehensive income into earnings over the life of the debt. The amounts to be included in earnings are not expected to be material during any 12-month period. During the third quarter of fiscal 2016, we settled the remaining two interest rate swaps, paying $5.1 million in cash upon their scheduled termination. We did not issue additional fixed-rate debt as previously planned, and we reclassified all amounts previously recorded to other comprehensive income into earnings.

The following table presents the pretax gains (losses) recorded in other comprehensive income relating to cash flow hedges for the years ended August 31, 2018 , 2017 , and 2016 :



	2018		2017		2016
	(Dollars in thousands)
Interest rate derivatives	$	178	$	—	$	(10,070	)

F-55

Table of Contents

The following table presents the pretax gains (losses) relating to cash flow hedges that were reclassified from accumulated other comprehensive loss into income for the years ended August 31, 2018 , 2017 , and 2016 :



	Location of Gain (Loss)	2018			2017			2016
		(Dollars in thousands)
Interest rate derivatives	Interest expense	$	(1,704	)	$	(1,742	)	$	(5,071	)

Note 14 Fair Value Measurements

ASC Topic 820, Fair Value Measurement defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

We determine fair values of derivative instruments and certain other assets, based on the fair value hierarchy established in ASC Topic 820, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. ASC Topic 820 describes three levels within its hierarchy that may be used to measure fair value, and our assessment of relevant instruments within those levels is as follows:

Level 1: Values are based on unadjusted quoted prices in active markets for identical assets or liabilities. These assets and liabilities include exchange-traded derivative instruments, Rabbi Trust investments, deferred compensation investments and available-for-sale investments.

Level 2: Values are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. These assets and liabilities include interest rate, foreign exchange, and commodity swaps; forward commodity contracts with a fixed price component; and other OTC derivatives whose value is determined with inputs that are based on exchange traded prices, adjusted for location specific inputs that are primarily observable in the market or can be derived principally from, or corroborated by, observable market data.

Level 3: Values are generated from unobservable inputs that are supported by little or no market activity and that are a significant component of the fair value of the assets or liabilities. These unobservable inputs would reflect our own estimates of assumptions that market participants would use in pricing related assets or liabilities. Valuation techniques might include the use of pricing models, discounted cash flow models or similar techniques.

The following tables present assets and liabilities, included on our Consolidated Balance Sheets, that are recognized at fair value on a recurring basis, and indicate the fair value hierarchy utilized to determine these fair values. Assets and liabilities are classified, in their entirety, based on the lowest level of input that is a significant component of the fair value measurement. The lowest level of input is considered Level 3. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy levels.

F-56

Table of Contents

Recurring fair value measurements at August 31, 2018 , and 2017 , are as follows:



	2018
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(Dollars in thousands)
Assets:
Commodity derivatives	$	54,487	$	259,359	$	—	$	313,846
Foreign currency derivatives	—		15,401		—		15,401
Deferred compensation assets	39,073		—		—		39,073
Embedded derivative asset	—		23,595		—		23,595
Other assets	5,334		—		—		5,334
Total	$	98,894	$	298,355	$	—	$	397,249
Liabilities:
Commodity derivatives	$	31,778	$	389,911	$	—	$	421,689
Foreign currency derivatives	—		24,701		—		24,701
Interest rate swap derivatives	—		9,452		—		9,452
Total	$	31,778	$	424,064	$	—	$	455,842



	2017 (As Restated)
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(Dollars in thousands)
Assets:
Commodity derivatives	$	48,483	$	166,866	$	—	$	215,349
Foreign currency derivatives	—		8,779		—		8,779
Interest rate swap derivatives	—		9,978		—		9,978
Deferred compensation assets	52,414		—		—		52,414
Deferred purchase price receivable	—		—		548,602		548,602
Embedded derivative	—		25,533		—		25,533
Other assets	14,846		—		—		14,846
Total	$	115,743	$	211,156	$	548,602	$	875,501
Liabilities:
Commodity derivatives	$	31,190	$	262,140	$	—	$	293,330
Foreign currency derivatives	—		19,931		—		19,931
Interest rate swap derivatives	—		707		—		707
Total	$	31,190	$	282,778	$	—	$	313,968

Commodity and foreign currency derivatives — Exchange-traded futures and options contracts are valued based on unadjusted quoted prices in active markets and are classified within Level 1. Our forward commodity purchase and sales contracts with fixed-price components, select ocean freight contracts and other OTC derivatives are determined using inputs that are generally based on exchange traded prices and/or recent market bids and offers, adjusted for location specific inputs, and are classified within Level 2. The location specific inputs are driven by local market supply and demand, and are generally based on broker or dealer quotations, or market transactions in either the listed or OTC markets. Changes in the fair values of these contracts are recognized in our Consolidated Statements of Operations as a component of cost of goods sold.

Interest rate swap derivatives — Fair values of our interest rate swap derivatives are determined utilizing valuation models that are widely accepted in the market to value these OTC derivative contracts. The specific terms of the contracts, as

F-57

Table of Contents

well as market observable inputs, such as interest rates and credit risk assumptions, are factored into the models. As all significant inputs are market observable, all interest rate swaps are classified within Level 2. Changes in the fair values of contracts not designated as hedging instruments for accounting purposes are recognized in our Consolidated Statements of Operations as a component of interest expense. See Note 13, Derivative Financial Instruments and Hedging Activities for additional information about interest rates swaps designated as fair value and cash flow hedges.

Deferred compensation and other assets — Our deferred compensation investments, Rabbi Trust assets and available-for-sale investments in common stock of other companies are valued based on unadjusted quoted prices on active exchanges and are classified within Level 1. Changes in the fair values of these other assets are primarily recognized in our Consolidated Statements of Operations as a component of marketing, general and administrative expenses.

Embedded derivative asset — The embedded derivative asset relates to contingent payments inherent to our investment in CF Nitrogen. The inputs used in the fair value measurement include the probability of future upgrades and downgrades of CF Industries' credit rating based on historical credit rating movements of other public companies and the discount rates applied to potential annual payments based on applicable historical and current yield coupon rates. Based on these observable inputs, our fair value measurement is classified within Level 2. See Note 13, Derivative Financial Instruments and Hedging Activities for additional information.

Deferred purchase price receivable — As described in Note 3, Receivables our Securitization Facility was amended during fiscal 2018 such that no DPP receivable remained as of August 31, 2018 . The fair value of the DPP receivable as of August 31, 2017 , was included in receivables, net and other assets, and was determined by discounting the expected cash flows to be received. The expected cash flows were primarily based on unobservable inputs consisting of the face amount of the Receivables adjusted for anticipated credit losses. Due to the use of significant unobservable inputs in the pricing model, including management's assumptions related to anticipated credit losses, the DPP receivable was classified as a Level 3 fair value measurement. A reconciliation of the DPP receivable for the years ended August 31, 2018 , and 2017 , is included in Note 3, Receivables .

Note 15 Commitments and Contingencies

Environmental

We are required to comply with various environmental laws and regulations incidental to our normal business operations. To meet our compliance requirements, we establish reserves for the probable future costs of remediation of identified issues, which are included in cost of goods sold and marketing, general and administrative in our Consolidated Statements of Operations. The resolution of any such matters may affect consolidated net income for any fiscal period; however, we believe any resulting liabilities, individually or in the aggregate, will not have a material effect on our consolidated financial position, results of operations or cash flows during any fiscal year.

Other Litigation and Claims

We are involved as a defendant in various lawsuits, claims and disputes, which are in the normal course of our business. The resolution of any such matters may affect consolidated net income for any fiscal period; however, we believe any resulting liabilities, individually or in the aggregate, will not have a material effect on our consolidated financial position, results of operations or cash flows during any fiscal year.

Guarantees

Credit Commitments

CHS Capital has commitments to extend credit to customers if there is no violation of any condition established in the contracts. As of August 31, 2018 , CHS Capital’s customers have additional available credit of $706.3 million .

F-58

Table of Contents

Lease Commitments

We lease certain property, plant and equipment used in our operations under both capital and operating lease agreements. Many leases contain renewal options and escalation clauses. Our operating leases, which are primarily for rail cars, equipment, vehicles and office space have remaining terms of one to 19 years. Total rental expense for operating leases was $88.5 million , $81.3 million and $74.7 million for the years ended August 31, 2018 , 2017 , and 2016 , respectively.

On November 30, 2017, we completed a sale-leaseback transaction for our primary corporate office building located in Inver Grove Heights, Minnesota. Simultaneous with the closing of the sale of the building we entered into a 20 -year operating lease arrangement with respect to the building, with base annual rent of approximately $3.4 million during the first year, followed by annual increases of 2% through the remainder of the lease period.

We lease certain rail cars, equipment, vehicles and other assets under capital lease arrangements. These assets are included in property, plant and equipment on our Consolidated Balance Sheets while the corresponding capital lease obligations are included in long-term debt. See Note 6, Property, Plant and Equipment and Note 8, Notes Payable and Long-Term Debt for more information about capital leases.

Minimum future lease payments required under noncancelable operating leases as of August 31, 2018 , are as follows:



	(Dollars in thousands)
2019	$	103,800
2020	50,653
2021	41,428
2022	29,733
2023	22,648
Thereafter	103,800
Total minimum future lease payments	$	352,062

Unconditional Purchase Obligations

Unconditional purchase obligations are commitments to transfer funds in the future for fixed or minimum amounts or quantities of goods or services at fixed or minimum prices. Our long-term unconditional purchase obligations primarily relate to pipeline and grain handling take-or-pay and through-put agreements and are not recorded on our Consolidated Balance Sheets. As of August 31, 2018 , minimum future payments required under long-term commitments that are noncancelable, and that third parties have used to secure financing for the facilities that will provide the contracted goods, are as follows:



	Payments Due by Period
	Total		2019		2020		2021		2022		2023		Thereafter
	(Dollars in thousands)
Long-term unconditional purchase obligations	$	639,010	$	54,631	$	57,152	$	57,523	$	57,947	$	58,372	$	353,385

Total payments under these arrangements were $61.4 million , $70.5 million and $88.0 million for the years ended August 31, 2018 , 2017 , and 2016 , respectively.

Gain Contingency

As of August 31, 2018, a gain contingency resulted from applying ASC Topic 450-30, Gain Contingencies , to the facts and circumstances surrounding the potential for certain excise tax credits associated with manufacturing changes within our Energy business. The resulting gain, if recognized, will likely have a material impact on our consolidated financial statements.

F-59

Table of Contents

Note 16 Supplemental Cash Flow and Other Information

Additional information concerning supplemental disclosures of cash flow activities for the years ended August 31, 2018 , 2017 , and 2016 , is included in the table below.



	2018		2017		(As Restated) 2016
	(Dollars in thousands)
Net cash paid during the period for:
Interest	$	148,874	$	160,040	$	147,089
Income taxes	13,410		14,571		5,184
Other significant noncash investing and financing transactions:
Notes receivable reacquired under Securitization Facility	615,089		—		—
Trade receivables reacquired under Securitization Facility	402,421		—		—
Securitized debt reacquired under Securitization Facility	634,000		—		—
Deferred purchase price receivable extinguished under Securitization Facility	386,900		—		—
Notes receivable sold under Securitization Facility	—		747,345		—
Securitized debt extinguished under Securitization Facility	—		554,000		—
Deferred purchase price receivable recognized under Securitization Facility	—		547,553		—
Land and improvements received for notes receivable	—		138,699		—
Capital expenditures and major repairs incurred but not yet paid	53,453		22,490		44,307
Capital lease obligations incurred	396		6,832		23,921
Capital equity certificates redeemed with preferred stock	—		19,985		76,756
Capital equity certificates issued in exchange for Ag acquisitions	—		2,928		19,089
Accrual of dividends and equities payable	153,941		12,121		162,439

Note 17 Related Party Transactions

Related party transactions with equity investees, primarily CF Nitrogen, TEMCO, Ardent Mills and Ventura Foods for the years ended August 31, 2018 , 2017 , and 2016 , respectively, and balances as of August 31, 2018 , and 2017 , respectively, are as follows:



	2018		2017		2016
	(Dollars in thousands)
Sales	$	2,928,984	$	3,183,944	$	2,728,793
Purchases	2,505,185		2,610,887		1,707,990



	2018		2017
	(Dollars in thousands)
Due from related parties	$	31,063	$	33,119
Due to related parties	52,284		39,232

As a cooperative, we are owned by farmers and ranchers and their member cooperatives, which are referred to as members. We buy commodities from and provide products and services to our members. Individually, our members do not have a significant ownership in CHS.

Note 18 Quarterly Financial Information (Unaudited)

As further described in Note 2, Restatement of Previously Issued Consolidated Financial Statements , the previously reported financial information for the quarters ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017, have been restated. Relevant restated financial information for the first, second and third quarters of fiscal 2018 is included in this Annual Report on Form 10-K in the tables that follow. The unaudited interim financial

F-60

Table of Contents

statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. Although misstatements impacted individual line items within operating cash flows, the quarterly cash flow information classification between operating, investing and financing activities for these periods was not materially impacted by the misstatements and has not been presented. Restated amounts are computed independently each quarter; therefore, the sum of the quarterly amounts may not equal the total amount for the respective year due to rounding.

F-61

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)



	(As Restated)
	As of November 30, 2017			As of February 28, 2018			As of May 31, 2018
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	249,767		$	219,273		$	533,887
Receivables	2,058,222			1,836,490			2,248,213
Inventories	3,111,963			3,676,325			2,913,507
Derivative assets	166,557			251,048			250,005
Margin and related deposits	206,955			188,167			253,141
Supplier advance payments	542,770			658,815			426,607
Other current assets	270,674			296,982			190,680
Total current assets	6,606,908			7,127,100			6,816,040
Investments	3,777,000			3,752,876			3,787,163
Property, plant and equipment	5,266,408			5,179,868			5,140,106
Other assets	997,402			943,552			960,240
Total assets	$	16,647,718		$	17,003,396		$	16,703,549
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	2,480,264		$	3,071,639		$	2,868,506
Current portion of long-term debt	71,022			46,290			53,056
Customer margin deposits and credit balances	139,868			106,323			137,999
Customer advance payments	413,519			756,642			372,590
Accounts payable	2,444,650			1,853,974			1,898,172
Derivative liabilities	207,426			361,909			316,831
Accrued expenses	425,912			465,032			538,249
Dividends and equities payable	121,209			128,700			209,718
Total current liabilities	6,303,870			6,790,509			6,395,121
Long-term debt	1,936,744			1,915,843			1,905,515
Long-term deferred tax liabilities	348,902			165,659			203,208
Other liabilities	315,254			265,028			278,869
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			2,264,038			2,264,038
Equity certificates	4,319,840			4,307,292			4,253,414
Accumulated other comprehensive loss	(177,341		)	(167,230		)	(167,302		)
Capital reserves	1,324,372			1,450,326			1,559,040
Total CHS Inc. equities	7,730,909			7,854,426			7,909,190
Noncontrolling interests	12,039			11,931			11,646
Total equities	7,742,948			7,866,357			7,920,836
Total liabilities and equities	$	16,647,718		$	17,003,396		$	16,703,549

F-62

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)



	(As Restated)
	As of November 30, 2016			As of February 28, 2017			As of May 31, 2017
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	516,646		$	276,137		$	266,748
Receivables	3,034,083			2,767,150			2,767,967
Inventories	3,143,551			3,730,682			2,688,949
Derivative assets	277,498			233,429			206,187
Margin and related deposits	312,899			290,291			251,695
Supplier advance payments	476,907			701,705			431,433
Other current assets	187,524			196,237			265,469
Total current assets	7,949,108			8,195,631			6,878,448
Investments	3,828,899			3,802,379			3,841,749
Property, plant and equipment	5,443,079			5,404,347			5,405,651
Other assets	1,054,454			1,056,873			955,532
Total assets	$	18,275,540		$	18,459,230		$	17,081,380
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	3,227,564		$	3,867,438		$	3,321,808
Current portion of long-term debt	206,894			205,136			193,096
Customer margin deposits and credit balances	180,850			149,625			132,479
Customer advance payments	543,411			897,464			391,122
Accounts payable	2,574,006			1,919,421			1,865,803
Derivative liabilities	282,658			232,507			233,955
Accrued expenses	397,446			392,058			436,111
Dividends and equities payable	239,857			131,380			134,718
Total current liabilities	7,652,686			7,795,029			6,709,092
Long-term debt	1,958,907			2,051,567			2,046,264
Long-term deferred tax liabilities	511,821			531,522			369,170
Other liabilities	332,610			272,532			276,483
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,244,132			2,244,114			2,264,063
Equity certificates	4,194,534			4,201,803			4,214,657
Accumulated other comprehensive loss	(224,935		)	(211,091		)	(208,568		)
Capital reserves	1,592,434			1,560,498			1,397,834
Total CHS Inc. equities	7,806,165			7,795,324			7,667,986
Noncontrolling interests	13,351			13,256			12,385
Total equities	7,819,516			7,808,580			7,680,371
Total liabilities and equities	$	18,275,540		$	18,459,230		$	17,081,380

F-63

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	(As Restated)
	Three Months Ended			Three Months Ended			Six Months Ended			Three Months Ended			Nine Months Ended			Three Months Ended
	November 30, 2017			February 28, 2018			February 28, 2018			May 31, 2018			May 31, 2018			August 31, 2018
	(Dollars in thousands)
Revenues	$	8,031,884		$	6,980,153		$	15,012,037		$	9,087,328		$	24,099,365		$	8,583,982
Cost of goods sold	7,711,057			6,844,849			14,555,906			8,841,361			23,397,267			8,192,620
Gross profit	320,827			135,304			456,131			245,967			702,098			391,362
Marketing, general and administrative	139,500			186,713			326,213			161,579			487,792			186,291
Reserve and impairment charges (recoveries), net	(3,787		)	(11,346		)	(15,133		)	(3,811		)	(18,944		)	(18,765		)
Operating earnings (loss)	185,114			(40,063		)	145,051			88,199			233,250			223,836
(Gain) loss on disposal of business	—			(7,705		)	(7,705		)	(124,050		)	(131,755		)	(61		)
Interest expense	40,702			40,176			80,878			49,340			130,218			18,984
Other (income) loss	(25,014		)	(11,364		)	(36,378		)	(14,622		)	(51,000		)	(27,015		)
Equity (income) loss from investments	(38,362		)	(39,441		)	(77,803		)	(59,308		)	(137,111		)	(16,404		)
Income (loss) before income taxes	207,788			(21,729		)	186,059			236,839			422,898			248,332
Income tax expense (benefit)	20,606			(187,688		)	(167,082		)	55,219			(111,863		)	7,787
Net income (loss)	187,182			165,959			353,141			181,620			534,761			240,545
Net income (loss) attributable to noncontrolling interests	(464		)	(48		)	(512		)	(187		)	(699		)	98
Net income (loss) attributable to CHS Inc.	$	187,646		$	166,007		$	353,653		$	181,807		$	535,460		$	240,447

F-64

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	(As Restated)
	Three Months Ended			Three Months Ended			Six Months Ended			Three Months Ended			Nine Months Ended			Three Months Ended
	November 30, 2016			February 28, 2017			February 28, 2017			May 31, 2017			May 31, 2017			August 31, 2017
	(Dollars in thousands)
Revenues	$	8,001,904		$	7,400,773		$	15,402,677		$	8,638,410		$	24,041,087		$	7,996,339
Cost of goods sold	7,655,524			7,165,265			14,820,789			8,417,264			23,238,053			7,904,713
Gross profit	346,380			235,508			581,888			221,146			803,034			91,626
Marketing, general and administrative	151,258			160,166			311,424			155,347			466,771			145,236
Reserve and impairment charges (recoveries), net	18,357			72,373			90,730			326,779			417,509			39,170
Operating earnings (loss)	176,765			2,969			179,734			(260,980		)	(81,246		)	(92,780		)
(Gain) loss on disposal of business	4,105			(1,395		)	2,710			(1,224		)	1,486			704
Interest expense	38,265			39,945			78,210			39,201			117,411			53,828
Other (income) loss	(44,509		)	(18,083		)	(62,592		)	(11,952		)	(74,544		)	(25,407		)
Equity (income) loss from investments	(40,328		)	(35,800		)	(76,128		)	(48,393		)	(124,521		)	(12,817		)
Income (loss) before income taxes	219,232			18,302			237,534			(238,612		)	(1,078		)	(109,088		)
Income tax expense (benefit)	16,076			3,685			19,761			(166,124		)	(146,363		)	(34,761		)
Net income (loss)	203,156			14,617			217,773			(72,488		)	145,285			(74,327		)
Net income (loss) attributable to noncontrolling interests	(208		)	406			198			(955		)	(757		)	123
Net income (loss) attributable to CHS Inc.	$	203,364		$	14,211		$	217,575		$	(71,533	)	$	146,042		$	(74,450	)

F-65

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	(As Restated)
	Three Months Ended			Three Months Ended			Six Months Ended			Three Months Ended			Nine Months Ended			Three Months Ended
	November 30, 2017			February 28, 2018			February 28, 2018			May 31, 2018			May 31, 2018			August 31, 2018
	(Dollars in thousands)
Net income (loss)	$	187,182		$	165,959		$	353,141		$	181,620		$	534,761		$	240,545
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity	1,594			3,142			4,736			3,417			8,153			11,913
Unrealized net gain (loss) on available for sale investments	3,640			3,554			7,194			6,286			13,480			(16,628		)
Cash flow hedges	(4		)	1,063			1,059			413			1,472			1,068
Foreign currency translation adjustment	(2,211		)	2,352			141			(10,188		)	(10,047		)	(1,974		)
Other comprehensive income (loss), net of tax	3,019			10,111			13,130			(72		)	13,058			(5,621		)
Comprehensive income	190,201			176,070			366,271			181,548			547,819			234,924
Less comprehensive income attributable to noncontrolling interests	(464		)	(48		)	(512		)	(187		)	(699		)	98
Comprehensive income attributable to CHS Inc.	$	190,665		$	176,118		$	366,783		$	181,735		$	548,518		$	234,826



	(As Restated)
	Three Months Ended			Three Months Ended		Six Months Ended			Three Months Ended			Nine Months Ended			Three Months Ended
	November 30, 2016			February 28, 2017		February 28, 2017			May 31, 2017			May 31, 2017			August 31, 2017
	(Dollars in thousands)
Net income (loss)	$	203,156		$	14,617	$	217,773		$	(72,488	)	$	145,285		$	(74,327	)
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity	3,239			3,724		6,963			3,636			10,599			22,103
Unrealized net gain (loss) on available for sale investments	777			968		1,745			(118		)	1,627			2,758
Cash flow hedges	654			964		1,618			375			1,993			249
Foreign currency translation adjustment	(18,075		)	8,187		(9,888		)	(1,369		)	(11,257		)	3,098
Other comprehensive income (loss), net of tax	(13,405		)	13,843		438			2,524			2,962			28,208
Comprehensive income	189,751			28,460		218,211			(69,964		)	148,247			(46,119		)
Less comprehensive income attributable to noncontrolling interests	(208		)	406		198			(955		)	(757		)	123
Comprehensive income attributable to CHS Inc.	$	189,959		$	28,054	$	218,013		$	(69,009	)	$	149,004		$	(46,242	)

F-66

Table of Contents

Reclassifications

Amounts previously included within (gain) loss on investments were reclassified into other (income) loss to conform to the current period presentation. This reclassification had no impact on our previously reported net income, cash flows or shareholders' equity and represents reclassifications for the periods ended November 30, 2017 and 2016, and February 28, 2018 and 2017. The reclassifications included a $2.8 million gain reclassification during the three months ended November 30, 2017, a $4.1 million gain reclassification during the three months ended February 28, 2018, a $7.4 million loss during the three months ended November 30, 2016, and a $2.9 million gain during the three months ended February 28, 2017.

Consolidated financial statement adjustment tables

The following tables present the impacts of the restatement adjustments to the previously reported financial information for the quarterly periods ended November 30, 2017 and 2016, February 28, 2018 and 2017, May 31, 2018 and 2017, and August 31, 2017. Refer to discussion in Note 2, Restatement of Previously Issued Consolidated Financial Statements . The restatement references identified in the following tables directly correlate to the restatement adjustments detailed below.

The categories of restatement adjustments and their impact on previously reported consolidated financial statements are described below.

(a) Freight Derivatives and Related Misstatements - Corrections for freight derivatives and related misstatements were driven by the misstatement of amounts associated with both the value and quantity of rail freight contracts, as well as due to freight contracts not meeting the technical accounting requirements to qualify as derivative financial instruments. In addition to the elimination of the underlying freight derivative assets and liabilities and related impacts on revenues and cost of goods sold, additional adjustments were recorded to account for prepaid freight capacity balances in relevant periods and the impact of a goodwill impairment charge recorded during fiscal 2015 for goodwill held within our Grain Marketing reporting unit which was triggered by the lowering of earnings due to the restatement. Additional details related to the impact of the freight derivatives and related misstatements and their impact on each period are discussed in restatement reference (a).

F-67

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)



	As of November 30, 2017									As of November 30, 2016
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	252,129		$	(2,362	)	$	249,767		$	515,484		$	1,162		$	516,646		b, c
Receivables	2,059,623			(1,401		)	2,058,222			3,052,989			(18,906		)	3,034,083			a, b, c
Inventories	3,046,101			65,862			3,111,963			3,117,935			25,616			3,143,551			c
Derivative assets	283,256			(116,699		)	166,557			419,103			(141,605		)	277,498			a, c
Margin and related deposits	206,955			—			206,955			312,899			—			312,899
Supplier advance payments	542,139			631			542,770			480,709			(3,802		)	476,907			b
Other current assets	289,250			(18,576		)	270,674			189,896			(2,372		)	187,524			a, c
Total current assets	6,679,453			(72,545		)	6,606,908			8,089,015			(139,907		)	7,949,108
Investments	3,777,000			—			3,777,000			3,828,899			—			3,828,899
Property, plant and equipment	5,266,408			—			5,266,408			5,443,079			—			5,443,079
Other assets	1,061,562			(64,160		)	997,402			1,069,468			(15,014		)	1,054,454			a
Total assets	$	16,784,423		$	(136,705	)	$	16,647,718		$	18,430,461		$	(154,921	)	$	18,275,540
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	2,480,264		$	—		$	2,480,264		$	3,227,564		$	—		$	3,227,564
Current portion of long-term debt	71,022			—			71,022			206,894			—			206,894
Customer margin deposits and credit balances	139,868			—			139,868			180,850			—			180,850
Customer advance payments	414,441			(922		)	413,519			544,266			(855		)	543,411			b, c
Accounts payable	2,380,998			63,652			2,444,650			2,568,533			5,473			2,574,006			a, b, c
Derivative liabilities	226,279			(18,853		)	207,426			317,505			(34,847		)	282,658			a, c
Accrued expenses	409,522			16,390			425,912			389,321			8,125			397,446			a, c
Dividends and equities payable	121,209			—			121,209			275,448			(35,591		)	239,857			b, c
Total current liabilities	6,243,603			60,267			6,303,870			7,710,381			(57,695		)	7,652,686
Long-term debt	1,936,744			—			1,936,744			1,958,907			—			1,958,907
Long-term deferred tax liabilities	350,841			(1,939		)	348,902			497,283			14,538			511,821			a, c
Other liabilities	315,460			(206		)	315,254			332,610			—			332,610
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			—			2,264,038			2,244,132			—			2,244,132
Equity certificates	4,319,840			—			4,319,840			4,208,336			(13,802		)	4,194,534			b
Accumulated other comprehensive loss	(178,445		)	1,104			(177,341		)	(226,220		)	1,285			(224,935		)	a
Capital reserves	1,520,218			(195,846		)	1,324,372			1,691,603			(99,169		)	1,592,434			a, b, c
Total CHS Inc. equities	7,925,651			(194,742		)	7,730,909			7,917,851			(111,686		)	7,806,165
Noncontrolling interests	12,124			(85		)	12,039			13,429			(78		)	13,351			a
Total equities	7,937,775			(194,827		)	7,742,948			7,931,280			(111,764		)	7,819,516
Total liabilities and equities	$	16,784,423		$	(136,705	)	$	16,647,718		$	18,430,461		$	(154,921	)	$	18,275,540

F-68

Table of Contents

As of November 30, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $171.7 million reduction of total assets, a $38.6 million reduction of current liabilities, a $30.2 million increase of long-term liabilities and a $163.2 million reduction of total equities. The reduction of total assets related primarily to the elimination of $116.8 million of current derivative assets and a $49.2 million reduction of long-term derivative assets that had been recorded as assets on the Consolidated Balance Sheet as well as an approximate $16.0 million reduction of goodwill associated with a goodwill impairment charge recorded during fiscal 2015 The decreases of total assets were partially offset by related adjustments, including an $8.5 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement and the recognition of a $1.1 million prepaid freight capacity balance. The decrease of total current liabilities related primarily to a $16.5 million reduction of current derivative liabilities and a $22.2 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement. The increase of long-term liabilities resulted from a $30.2 million increase of long-term deferred tax liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $3.4 million reduction of total assets and a $3.4 million reduction of current liabilities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods.

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. The misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $38.4 million increase of total assets, a $102.3 million increase of current liabilities, a $32.3 million decrease of long-term liabilities and a $31.6 million decrease of total equities.

The increase of total assets related primarily to a $67.5 million increase of inventories that resulted from a misclassification adjustment related to $67.5 million previously included as a contra-inventory balance moving to accounts payable. The increase related to inventories was partially offset by a $28.1 million decrease of other current assets that resulted from the reduction of prepaid income taxes associated with the correction of other misstatements identified during fiscal 2018 and other periods.

The increase of current liabilities related primarily to a $67.5 million increase of accounts payable that resulted from a misclassification adjustment for amounts previously included as a contra-inventory balance to accounts payable and a $38.6 million increase of accrued expenses. The increase of accrued expenses related to the recognition of a $24.9 million accrued income tax balance associated with the correction of other misstatements identified during fiscal 2018 and other periods, as well as the recognition of $13.7 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. Long-term liabilities decreased primarily as a result of a $32.1 million decrease of long-term deferred tax liabilities related to the correction of other misstatements identified during fiscal 2018 and other periods.

The $31.6 million decrease of total equities related primarily to the impacts associated with the $20.6 million net impact on income tax accounts and the recognition of an additional $13.7 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018.

F-69

Table of Contents

As of November 30, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $145.5 million reduction of total assets, a $47.0 million reduction of current liabilities, a $15.5 million increase of long-term liabilities and a $114.0 million reduction of total equities. The reduction of total assets related primarily to the elimination of $141.0 million of current derivative assets that had been incorrectly recorded as assets on the Consolidated Balance Sheet and an approximate $16.0 million reduction of goodwill associated with a goodwill impairment charge recorded during fiscal 2015. The decreases of total assets were partially offset by related adjustments, including a $4.0 million increase of receivables, a $5.7 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement and the recognition of a $0.9 million prepaid freight capacity balance. The decrease of total current liabilities related primarily to a $35.0 million reduction of current derivative liabilities and a $20.7 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement. These decreases of current liabilities were partially offset by an $8.7 million increase of accounts payable. The increase of long-term liabilities resulted from a $15.5 million increase of long-term deferred tax liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $73.3 million reduction of total assets, an $85.4 million reduction of current liabilities and a $12.1 million increase of total equities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods.

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. The misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $63.9 million increase of total assets, a $74.6 million increase of current liabilities, a $0.9 million decrease of long-term liabilities and a $9.9 million decrease of total equities.

The increase of total assets related primarily to a misclassification adjustment for $73.8 million previously included as a contra-inventory balance moving to accounts payable. The increased inventories were partially offset by a $48.2 million reduction of inventory related to a misclassification adjustment for certain collateral moving from inventory to receivables.

The increase of total liabilities relates primarily to a misclassification adjustment for $73.8 million previously included as a contra-inventory balance moving to accounts payable.

The $9.9 million decrease of total equities relates primarily to the $28.8 million net impact on income tax accounts and the recognition of $8.1 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The overall decrease in total equities was partially offset by an increase that arose from a $27.9 million timing difference for the accrual of dividends and equities payable.

F-70

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)



	As of February 28, 2018									As of February 28, 2017
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	190,426		$	28,847		$	219,273		$	249,801		$	26,336		$	276,137		b, c
Receivables	1,765,640			70,850			1,836,490			2,697,699			69,451			2,767,150			a, b, c
Inventories	3,650,158			26,167			3,676,325			3,752,218			(21,536		)	3,730,682			c
Derivative assets	429,625			(178,577		)	251,048			386,613			(153,184		)	233,429			a, c
Margin and related deposits	188,167			—			188,167			290,291			—			290,291
Supplier advance payments	658,815			—			658,815			701,705			—			701,705			b
Other current assets	310,674			(13,692		)	296,982			200,288			(4,051		)	196,237			a, c
Total current assets	7,193,505			(66,405		)	7,127,100			8,278,615			(82,984		)	8,195,631
Investments	3,752,876			—			3,752,876			3,802,379			—			3,802,379
Property, plant and equipment	5,179,868			—			5,179,868			5,404,347			—			5,404,347
Other assets	958,613			(15,061		)	943,552			1,072,824			(15,951		)	1,056,873			a
Total assets	$	17,084,862		$	(81,466	)	$	17,003,396		$	18,558,165		$	(98,935	)	$	18,459,230
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	2,993,456		$	78,183		$	3,071,639		$	3,867,438		$	—		$	3,867,438		c
Current portion of long-term debt	46,290			—			46,290			205,136			—			205,136
Customer margin deposits and credit balances	106,323			—			106,323			149,625			—			149,625
Customer advance payments	727,535			29,107			756,642			871,370			26,094			897,464			b, c
Accounts payable	1,835,289			18,685			1,853,974			1,877,040			42,381			1,919,421			a, b, c
Derivative liabilities	372,406			(10,497		)	361,909			275,484			(42,977		)	232,507			a, c
Accrued expenses	459,867			5,165			465,032			378,318			13,740			392,058			a, c
Dividends and equities payable	128,700			—			128,700			131,380			—			131,380
Total current liabilities	6,669,866			120,643			6,790,509			7,755,791			39,238			7,795,029
Long-term debt	1,915,843			—			1,915,843			2,051,567			—			2,051,567
Long-term deferred tax liabilities	171,844			(6,185		)	165,659			516,681			14,841			531,522			c
Other liabilities	265,349			(321		)	265,028			272,532			—			272,532			c
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			—			2,264,038			2,244,114			—			2,244,114			b
Equity certificates	4,307,292			—			4,307,292			4,201,803			—			4,201,803			a
Accumulated other comprehensive loss	(168,225		)	995			(167,230		)	(211,442		)	351			(211,091		)	a
Capital reserves	1,646,837			(196,511		)	1,450,326			1,713,784			(153,286		)	1,560,498			a, c
Total CHS Inc. equities	8,049,942			(195,516		)	7,854,426			7,948,259			(152,935		)	7,795,324			a
Noncontrolling interests	12,018			(87		)	11,931			13,335			(79		)	13,256
Total equities	8,061,960			(195,603		)	7,866,357			7,961,594			(153,014		)	7,808,580
Total liabilities and equities	$	17,084,862		$	(81,466	)	$	17,003,396		$	18,558,165		$	(98,935	)	$	18,459,230

F-71

Table of Contents

As of February 28, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $183.8 million reduction of total assets, a $26.8 million reduction of current liabilities, a $28.9 million increase of long-term liabilities and a $185.9 million reduction of total equities. The reduction of total assets related primarily to the elimination of $179.3 million of current derivative assets which had been incorrectly recorded as assets on the Consolidated Balance Sheet and an approximate $16.0 million impairment of goodwill which was triggered when earnings were lowered due to the restatement. The decrease of total assets was partially offset by a related adjustment to increase prepaid income taxes by $9.7 million as a result of the income tax impact of the freight misstatement. The decrease of total current liabilities related primarily to a $7.1 million reduction of current derivative liabilities and a $19.7 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement. The increase of long-term liabilities was primarily attributable to the $28.9 million increase of long-term deferred tax liabilities. The decrease of total equities was related primarily to the elimination of derivative assets and liabilities from the Consolidated Balance Sheet as described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $5.6 million reduction of total assets and a $5.6 million reduction of current liabilities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods.

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. These misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $108.0 million increase of total assets, a $153.1 million increase of current liabilities, a $35.4 million decrease of long-term liabilities and a $9.7 million decrease of total equities.

The increase of total assets related primarily to a $28.8 million increase of cash that resulted from a timing difference for the application of in-transit cash and a $78.2 million increase of receivables and notes payable related to a participation arrangement that did not meet certain criteria for off-balance sheet treatment. As a result, both receivables and notes payable were increased by $78.2 million .

The increase of current liabilities related primarily to the $78.2 million increase of receivables and notes payable in a participation arrangement that did not meet certain criteria for off-balance sheet treatment, a $29.1 million increase of customer advance payments that resulted from a timing difference related to the application of in-transit cash and a $27.9 million increase of accounts payable that had previously been included as a contra-inventory balance. Long-term liabilities decreased primarily due to the recognition of long-term deferred tax liabilities of $35.1 million related to the correction of other misstatements identified during fiscal 2018 and other periods.

The $9.7 million decrease of total equities relates primarily to the $14.1 million net impact on income tax accounts, which was partially offset by a $4.5 million increase related to the valuation of crack spread derivatives.

F-72

Table of Contents

As of February 28, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $160.3 million reduction of total assets, a $61.3 million reduction of current liabilities, a $15.8 million increase of long-term liabilities and a $114.7 million reduction of total equities. The reduction of total assets related primarily to the elimination of $153.0 million of current derivative assets that were incorrectly recorded as assets on the Consolidate Balance Sheet and an approximate $16.0 million impairment of goodwill recorded in fiscal 2015 associated with lower earnings as a result of the restatement. The overall decrease of total assets was partially offset by related adjustments, including a $6.4 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement and the recognition of a $0.6 million prepaid freight capacity balance. The decrease of total current liabilities related primarily to a $43.0 million reduction of current derivative liabilities and a $20.7 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement, which were partially offset by the recognition of a $2.3 million accounts payable balance. The increase of long-term liabilities resulted from the $15.8 million increase of long-term deferred tax liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $4.9 million reduction of total assets and a $4.9 million reduction of current liabilities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods.

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. These misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $66.3 million increase of total assets, a $105.5 million increase of current liabilities, a $0.9 million decrease of long-term liabilities and a $38.3 million decrease of total equities.

The increase of total assets related primarily to a $24.8 million increase of cash that resulted from a timing difference for the application of in-transit cash and a $47.7 million increase of inventory with a corresponding increase to accounts payable as a result of a misclassification adjustment for certain items previously included as a contra-inventory balance moving to accounts payable. The increase of inventory was offset by a $48.2 million reduction of inventory that resulted from a misclassification adjustment for certain collateral being classified as receivables rather than inventory.

The increase of current liabilities related primarily to the $47.7 million increase of accounts payable as a result of a misclassification adjustment for certain items previously included as a contra-inventory balance moving to accounts payable, a $26.1 million increase of customer advance payments that resulted from a timing difference for the application in-transit cash and $34.4 million increase of accrued expenses. The increase of accrued expenses related to the recognition of a $20.7 million accrued income tax balance associated with the correction of other misstatements identified during fiscal 2017 and other periods and the recognition of $13.7 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018.

The $38.3 million decrease of total equities related primarily to the impacts associated with the $24.4 million net impact on income tax accounts and the recognition of $13.7 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018.

F-73

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)



	As of May 31, 2018									As of May 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	533,887		$	—		$	533,887		$	267,229		$	(481	)	$	266,748		b, c
Receivables	2,198,211			50,002			2,248,213			2,722,325			45,642			2,767,967			a, b, c
Inventories	2,940,907			(27,400		)	2,913,507			2,684,087			4,862			2,688,949			c
Derivative assets	483,794			(233,789		)	250,005			388,188			(182,001		)	206,187			a, c
Margin and related deposits	253,141			—			253,141			251,695			—			251,695
Supplier advance payments	426,607			—			426,607			431,433			—			431,433			b
Other current assets	198,078			(7,398		)	190,680			255,236			10,233			265,469			a, c
Total current assets	7,034,625			(218,585		)	6,816,040			7,000,193			(121,745		)	6,878,448
Investments	3,787,163			—			3,787,163			3,841,749			—			3,841,749
Property, plant and equipment	5,140,106			—			5,140,106			5,409,151			(3,500		)	5,405,651
Other assets	973,885			(13,645		)	960,240			970,704			(15,172		)	955,532			a
Total assets	$	16,935,779		$	(232,230	)	$	16,703,549		$	17,221,797		$	(140,417	)	$	17,081,380
LIABILITIES AND EQUITIES
Current liabilities:
Notes payable	$	2,819,086		$	49,420		$	2,868,506		$	3,321,808		$	—		$	3,321,808
Current portion of long-term debt	53,056			—			53,056			193,096			—			193,096
Customer margin deposits and credit balances	137,999			—			137,999			132,479			—			132,479
Customer advance payments	372,616			(26		)	372,590			390,576			546			391,122			b, c
Accounts payable	1,904,819			(6,647		)	1,898,172			1,809,868			55,935			1,865,803			a, b, c
Derivative liabilities	344,973			(28,142		)	316,831			284,212			(50,257		)	233,955			a, c
Accrued expenses	538,249			—			538,249			422,371			13,740			436,111			a, c
Dividends and equities payable	209,718			—			209,718			134,718			—			134,718
Total current liabilities	6,380,516			14,605			6,395,121			6,689,128			19,964			6,709,092
Long-term debt	1,905,515			—			1,905,515			2,046,264			—			2,046,264
Long-term deferred tax liabilities	207,912			(4,704		)	203,208			350,966			18,204			369,170
Other liabilities	279,303			(434		)	278,869			276,483			—			276,483
Commitments and contingencies (Note 15)
Equities:
Preferred stock	2,264,038			—			2,264,038			2,264,063			—			2,264,063			b
Equity certificates	4,253,414			—			4,253,414			4,214,657			—			4,214,657			a
Accumulated other comprehensive loss	(169,726		)	2,424			(167,302		)	(209,700		)	1,132			(208,568		)	a, b, c
Capital reserves	1,803,078			(244,038		)	1,559,040			1,577,469			(179,635		)	1,397,834
Total CHS Inc. equities	8,150,804			(241,614		)	7,909,190			7,846,489			(178,503		)	7,667,986			a
Noncontrolling interests	11,729			(83		)	11,646			12,467			(82		)	12,385
Total equities	8,162,533			(241,697		)	7,920,836			7,858,956			(178,585		)	7,680,371
Total liabilities and equities	$	16,935,779		$	(232,230	)	$	16,703,549		$	17,221,797		$	(140,417	)	$	17,081,380

F-74

Table of Contents

As of May 31, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $229.3 million reduction of total assets, a $50.5 million reduction of current liabilities, a $30.4 million increase of long-term liabilities and a $209.2 million reduction of total equities. The reduction of total assets related primarily to the elimination of $233.9 million of current derivative assets that had been recorded as assets on the Consolidated Balance Sheet and an approximate $16.0 million reduction of goodwill associated with a goodwill impairment charge recorded during fiscal 2015. The decreases of total assets were partially offset by related adjustments, including an $11.1 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement and the recognition of a $7.5 million prepaid freight capacity balance. The decrease of total current liabilities related primarily to a $25.6 million reduction of current derivative liabilities and a $24.9 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement. The increase of long-term liabilities resulted from a $30.4 million increase of long-term deferred tax liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) The correction of intercompany misstatements resulted in a $6.9 million reduction of total assets and a $6.9 million reduction of current liabilities due to different practices of eliminating intercompany balances between CHS's businesses which existed in previous periods.

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. These misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $3.9 million increase of total assets, a $72.0 million increase of current liabilities, a $35.5 million decrease of long-term liabilities and a $32.5 million decrease of total equities.

The increase of total assets related primarily to a $49.4 million increase of receivables and notes payable for a participation arrangement that did not meet certain criteria for off-balance sheet treatment. The increase of receivables was mostly offset by an $18.8 million decrease of inventories that resulted from the overstatement of inventories following the implementation of a new enterprise resource planning software during the third quarter of fiscal 2018 and a $24.5 million reduction of prepaid income taxes as a result of the income tax effects associated with the correction of other misstatements identified during fiscal 2018 and other periods.

The increase of current liabilities resulted primarily from the $49.4 million increase of notes payable associated with the participation agreement described above, as well as the recognition of a $24.9 million accrued income tax balance due to the income tax effects of the other misstatements. The decrease of long-term liabilities related primarily to a $35.1 million decrease of long-term deferred tax liabilities related to the correction of other misstatements identified during fiscal 2018 and other periods.

The decrease of total equities related primarily to the $14.1 million net impact on income tax accounts and the $18.8 million timing difference adjustment associated with the implementation of a new enterprise resource planning software during the third quarter of fiscal 2018.

As of May 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $181.6 million reduction of total assets, a $64.0 million reduction of current liabilities, a $19.1 million increase of long-term liabilities and a $136.8 million reduction of total equities. The reduction of total assets related primarily to the elimination of $181.8 million of current derivative assets that had been recorded as assets on the Consolidated Balance Sheet and an approximate $16.0 million reduction of goodwill associated with a goodwill impairment charge recorded during fiscal 2015. The decreases of total assets were partially offset by related adjustments, including a $12.9 million increase of prepaid income taxes resulting from the income tax impact of the freight misstatement, the recognition of a $2.0 million prepaid freight capacity balance and the recognition of a $0.5 million receivable. The decrease of total current

F-75

Table of Contents

liabilities related primarily to a $50.3 million reduction of current derivative liabilities and a $20.7 million reduction of income taxes payable resulting from the income tax effect of the freight misstatement, which were partially offset by the recognition of a $7.0 million accounts payable balance. The increase of long-term liabilities resulted from a $19.1 million increase of long-term deferred tax liabilities. The decrease of total equities related primarily to the elimination of the derivative assets and liabilities described above and the related income tax impacts, as well as the reduction of goodwill associated with the goodwill impairment charge recorded during fiscal 2015.

Intercompany misstatements

(b) None

Other misstatements

(c) Adjustments for other misstatements related primarily to misclassifications between line items included within the Consolidated Balance Sheets, as well as the impact of income tax adjustments on income tax accounts, including prepaid income taxes, income taxes payable and deferred income taxes. These misclassification adjustments arose primarily due to the application of differing accounting policies between businesses and collectively with the income tax adjustments resulted in a $41.2 million increase of total assets, an $83.9 million increase of current liabilities, a $0.9 million decrease of long-term liabilities and a $41.8 million decrease of total equities.

The most significant driver of the $41.2 million increase of total assets related to a $53.1 million misclassification adjustment for certain items previously included as a contra-inventory balance moving to accounts payable. The overall increase of inventories was mostly offset by a $48.2 million reduction of inventory that resulted from a misclassification adjustment for certain collateral being classified as receivables rather than inventory; however, this misstatement did not impact total assets.

The increase of current liabilities related primarily to the $53.1 million increase of accounts payable associated with a misclassification adjustment for a contra-inventory balance moving to accounts payable, as well as the impact of the income tax adjustments on accrued income taxes, which increased by $20.7 million .

The $41.8 million decrease of total equities related primarily to the $24.4 million net impact on income tax accounts, the recognition of $13.7 million of accrued expense related to the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018 and a $3.5 million increase of reserve and impairment charges related to a fixed asset impairment charge that should have been recorded during the third quarter of fiscal 2017 rather than the fourth quarter of fiscal 2017.

F-76

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended November 30, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	8,048,889		$	(17,005	)	$	8,031,884		a, b, c
Cost of goods sold	7,735,627			(24,570		)	7,711,057			a, b, c
Gross profit	313,262			7,565			320,827
Marketing, general and administrative	140,168			(668		)	139,500			c
Reserve and impairment charges (recoveries), net	(3,787		)	—			(3,787		)
Operating earnings (loss)	176,881			8,233			185,114
Interest expense	40,702			—			40,702
Other (income) loss	(25,014		)	—			(25,014		)
Equity (income) loss from investments	(38,362		)	—			(38,362		)
Income (loss) before income taxes	199,555			8,233			207,788
Income tax expense (benefit)	19,936			670			20,606			a
Net income (loss)	179,619			7,563			187,182
Net income (loss) attributable to noncontrolling interests	(464		)	—			(464		)
Net income (loss) attributable to CHS Inc.	$	180,083		$	7,563		$	187,646

For the three months ended November 30, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.5 million reduction of income before income taxes and a $1.2 million reduction of net income. These adjustments related to a $0.5 million increase of cost of goods sold and a $0.7 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in an $11.4 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in an $8.8 million increase of income before income taxes and net income. The $8.8 million increase of income before income taxes relates primarily to a $6.2 million decrease of cost of goods sold related to the valuation of crack spread derivatives and a $2.6 million decrease in costs related to postretirement benefit plan activity that resulted from a timing difference associated with recording certain benefit plan expenses (included in cost of goods sold and marketing, general and administrative expenses).

F-77

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended February 28, 2018									For the Six Months Ended February 28, 2018
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	6,851,093		$	129,060		$	6,980,153		$	14,899,982		$	112,055		$	15,012,037		a, b, c
Cost of goods sold	6,708,610			136,239			6,844,849			14,444,237			111,669			14,555,906			a, b, c
Gross profit	142,483			(7,179		)	135,304			455,745			386			456,131
Marketing, general and administrative	186,716			(3		)	186,713			326,881			(668		)	326,213			c
Reserve and impairment charges (recoveries), net	(11,349		)	3			(11,346		)	(15,133		)	—			(15,133		)	c
Operating earnings (loss)	(32,884		)	(7,179		)	(40,063		)	143,997			1,054			145,051
(Gain) loss on disposal of business	(7,705		)	—			(7,705		)	(7,705		)	—			(7,705		)
Interest expense	40,176			—			40,176			80,878			—			80,878
Other (income) loss	(11,364		)	—			(11,364		)	(36,378		)	—			(36,378		)
Equity (income) loss from investments	(39,441		)	—			(39,441		)	(77,803		)	—			(77,803		)
Income (loss) before income taxes	(14,550		)	(7,179		)	(21,729		)	185,005			1,054			186,059
Income tax expense (benefit)	(181,176		)	(6,512		)	(187,688		)	(161,240		)	(5,842		)	(167,082		)	a, c
Net income (loss)	166,626			(667		)	165,959			346,245			6,896			353,141
Net income (loss) attributable to noncontrolling interests	(48		)	—			(48		)	(512		)	—			(512		)
Net income (loss) attributable to CHS Inc.	$	166,674		$	(667	)	$	166,007		$	346,757		$	6,896		$	353,653

For the three months ended February 28, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $22.5 million reduction of income before income taxes and a $22.6 million reduction of net income. These adjustments related to a $22.5 million increase of cost of goods sold and a $0.1 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $161.5 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $15.3 million increase of income before income taxes and a $21.9 million increase of net income. The $15.3 million increase of income before income taxes relates primarily to a $13.7 million decrease of cost of goods sold arising from the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The remaining increase relates to a $1.6 million decrease of cost of goods sold as a result of the valuation of crack spread derivatives. In addition to the increase of income before income taxes, an income tax benefit of $6.6 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

F-78

Table of Contents

For the six months ended February 28, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $23.0 million reduction of income before income taxes and a $23.8 million reduction of net income. These adjustments related to a $23.0 million increase of cost of goods sold and a $0.8 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $150.2 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in an $24.1 million increase of income before income taxes and a $30.7 million increase of net income. The $24.1 million increase of income before income taxes relates primarily to a $13.7 million decrease of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The remaining increase relates to a $7.9 million decrease of cost of goods sold related to the valuation of crack spread derivatives and a $2.6 million increase to expense related to postretirement benefit plan activity that resulted from a timing difference associated with the recording of certain benefit plan expenses (included in cost of goods sold and marketing, general and administrative expenses). In addition to the increase of income before income taxes, an income tax benefit of $6.6 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

F-79

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended May 31, 2018									For the Nine Months Ended May 31, 2018
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	9,027,525		$	59,803		$	9,087,328		$	23,927,508		$	171,857		$	24,099,365		a, b, c
Cost of goods sold	8,728,914			112,447			8,841,361			23,173,151			224,116			23,397,267			a, b, c
Gross profit	298,611			(52,644		)	245,967			754,357			(52,259		)	702,098
Marketing, general and administrative	161,578			1			161,579			488,459			(667		)	487,792			c
Reserve and impairment charges (recoveries), net	(3,811		)	—			(3,811		)	(18,944		)	—			(18,944		)
Operating earnings (loss)	140,844			(52,645		)	88,199			284,842			(51,592		)	233,250
(Gain) loss on disposal of business	(124,050		)	—			(124,050		)	(131,755		)	—			(131,755		)
Interest expense	49,340			—			49,340			130,218			—			130,218
Other (income) loss	(14,622		)	—			(14,622		)	(51,000		)	—			(51,000		)
Equity (income) loss from investments	(59,308		)	—			(59,308		)	(137,111		)	—			(137,111		)
Income (loss) before income taxes	289,484			(52,645		)	236,839			474,490			(51,592		)	422,898
Income tax expense (benefit)	60,338			(5,119		)	55,219			(100,901		)	(10,962		)	(111,863		)	a, c
Net income (loss)	229,146			(47,526		)	181,620			575,391			(40,630		)	534,761
Net income (loss) attributable to noncontrolling interests	(187		)	—			(187		)	(699		)	—			(699		)
Net income (loss) attributable to CHS Inc.	$	229,333		$	(47,526	)	$	181,807		$	576,090		$	(40,630	)	$	535,460

For the three months ended May 31, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $29.8 million reduction of income before income taxes and a $24.7 million reduction of net income. These adjustments related to a $29.8 million increase of cost of goods sold and a $5.1 million decrease of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $38.8 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $22.8 million decrease of income before income taxes and net income. The $22.8 million decrease of income before income taxes related primarily to an $18.8 million increase of cost of goods sold due to adjustments associated with the implementation of a new enterprise resource planning software during the third quarter of fiscal 2018. The remaining decrease relates to an $11.8 million increase of revenues and a $14.5 million increase of cost of goods sold related to the timing of revenue recognition as well as a $1.3 million increase of cost of goods sold related to the valuation of crack spread derivatives.

F-80

Table of Contents

For the nine months ended May 31, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $52.9 million reduction of income before income taxes and a $48.5 million reduction of net income. These adjustments related to a $52.9 million increase of cost of goods sold and a $4.4 million increase of income tax benefit related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $189.0 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $1.3 million increase of income before income taxes and a $7.9 million increase of net income. The $1.3 million increase of income before income taxes relates to a combination of offsetting misstatements, including a $13.7 million decrease of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018, a $6.6 million decrease of cost of goods sold related to the valuation of crack spread derivatives, and a $2.6 million decrease in expense related to postretirement benefit plan activity that resulted from a timing difference associated with recording certain benefit plan expenses (included in cost of goods sold and marketing, general and administrative expenses). The overall increase was mostly offset by an $18.8 million increase of cost of goods sold due to a timing difference associated with the implementation of a new enterprise resource planning software during the third quarter of fiscal 2018. The increase in income before income taxes and net income was also impacted by a $7.0 million increase of revenue and a $9.9 million increase of cost of goods sold related to the timing of revenue recognition. In addition to the increase of income before income taxes, an income tax benefit of $6.6 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

F-81

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended November 30, 2016
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	8,048,250		$	(46,346	)	$	8,001,904		a, b, c
Cost of goods sold	7,695,553			(40,029		)	7,655,524			a, b, c
Gross profit	352,697			(6,317		)	346,380
Marketing, general and administrative	147,849			3,409			151,258			c
Reserve and impairment charges (recoveries), net	18,357			—			18,357
Operating earnings (loss)	186,491			(9,726		)	176,765
(Gain) loss on disposal of business	—			4,105			4,105			c
Interest expense	38,265			—			38,265
Other (income) loss	(37,000		)	(7,509		)	(44,509		)	c
Equity (income) loss from investments	(40,328		)	—			(40,328		)
Income (loss) before income taxes	225,554			(6,322		)	219,232
Income tax expense (benefit)	16,612			(536		)	16,076			a
Net income (loss)	208,942			(5,786		)	203,156
Net income (loss) attributable to noncontrolling interests	(208		)	—			(208		)
Net income (loss) attributable to CHS Inc.	$	209,150		$	(5,786	)	$	203,364

For the three months ended November 30, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.1 million increase of income before income taxes and a $0.6 million increase of net income. These adjustments were primarily related to a $1.9 million increase of cost of goods sold, a $1.9 million increase of revenues related to the timing of revenue recognition, and a $0.6 million decrease of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $77.3 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $6.4 million decrease of income before income taxes and net income. The $6.4 million decrease of income before income taxes and net income relates primarily to an increase of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018.

Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $29.1 million increase of revenues, a $29.1 million increase of cost of goods sold, a $3.4 million increase of marketing, general and administrative expenses, a $4.1 million increase of loss on disposal of business and a $7.5 million increase of other income.

F-82

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended February 28, 2017									For the Six Months Ended February 28, 2017
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	7,320,406		$	80,367		$	7,400,773		$	15,368,656		$	34,021		$	15,402,677		a, b, c
Cost of goods sold	7,079,664			85,601			7,165,265			14,775,217			45,572			14,820,789			a, b, c
Gross profit	240,742			(5,234		)	235,508			593,439			(11,551		)	581,888
Marketing, general and administrative	157,862			2,304			160,166			305,711			5,713			311,424			c
Reserve and impairment charges (recoveries), net	72,373			—			72,373			90,730			—			90,730
Operating earnings (loss)	10,507			(7,538		)	2,969			196,998			(17,264		)	179,734
(Gain) loss on disposal of business	—			(1,395		)	(1,395		)	—			2,710			2,710			c
Interest expense	39,945			—			39,945			78,210			—			78,210
Other (income) loss	(17,235		)	(848		)	(18,083		)	(54,235		)	(8,357		)	(62,592		)	c
Equity (income) loss from investments	(35,800		)	—			(35,800		)	(76,128		)	—			(76,128		)
Income (loss) before income taxes	23,597			(5,295		)	18,302			249,151			(11,617		)	237,534
Income tax expense (benefit)	8,624			(4,939		)	3,685			25,236			(5,475		)	19,761			a, c
Net income (loss)	14,973			(356		)	14,617			223,915			(6,142		)	217,773
Net income (loss) attributable to noncontrolling interests	406			—			406			198			—			198
Net income (loss) attributable to CHS Inc.	$	14,567		$	(356	)	$	14,211		$	223,717		$	(6,142	)	$	217,575

For the three months ended February 28, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.3 million reduction of income before income taxes and a $0.2 million increase of net income. These adjustments related to a $1.1 million reduction of revenues and a $0.9 million decrease of cost of goods sold, and a $0.5 million decrease of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $58.9 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $5.0 million decrease of income before income taxes and a $0.6 million decrease of net income. The $5.0 million decrease of income before income taxes relates primarily to a $5.6 million increase of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The overall decrease of income before income taxes was partially offset by a $0.6 million decrease of cost of goods sold related to the valuation of crack spread derivatives. The decrease of income before income taxes was mostly offset by an income tax benefit of $4.5 million that was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

F-83

Table of Contents

increase of cost of goods sold, a $2.3 million increase of marketing, general and administrative expenses, a $1.4 million increase of gain on disposal of business, and a $0.8 million increase of other income.

For the six months ended February 28, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.2 million reduction of income before income taxes and a $0.8 million increase of net income. These adjustments related to a $0.7 million increase of revenues and a $1.0 million increase of cost of goods and a $1.0 million decrease of income tax expense related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $18.4 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in an $11.4 million decrease of income before income taxes and a $6.9 million decrease of net income. The $11.4 million decrease of income before income taxes relates primarily to a $12.1 million increase of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The overall decrease of income before income taxes was partially offset by a $0.7 million decrease of cost of goods sold related to the valuation of crack spread derivatives. The decrease of income before income taxes was partially offset by an income tax benefit of $4.5 million that was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $51.7 million increase of revenues, a $51.6 million increase of cost of goods sold, a $5.7 million increase of marketing, general and administrative expenses, a $2.7 million increase of loss on disposal of business, and an $8.4 million increase of other income.

F-84

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended May 31, 2017									For the Nine Months Ended May 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	8,614,090		$	24,320		$	8,638,410		$	23,982,746		$	58,341		$	24,041,087		a, b, c
Cost of goods sold	8,366,988			50,276			8,417,264			23,142,205			95,848			23,238,053			a, b, c
Gross profit	247,102			(25,956		)	221,146			840,541			(37,507		)	803,034
Marketing, general and administrative	153,498			1,849			155,347			459,831			6,940			466,771			c
Reserve and impairment charges (recoveries), net	323,901			2,878			326,779			414,009			3,500			417,509			c
Operating earnings (loss)	(230,297		)	(30,683		)	(260,980		)	(33,299		)	(47,947		)	(81,246		)
(Gain) loss on disposal of business	—			(1,224		)	(1,224		)	—			1,486			1,486			c
Interest expense	39,201			—			39,201			117,411			—			117,411
Other (income) loss	(11,947		)	(5		)	(11,952		)	(66,183		)	(8,361		)	(74,544		)	c
Equity (income) loss from investments	(48,393		)	—			(48,393		)	(124,521		)	—			(124,521		)
Income (loss) before income taxes	(209,158		)	(29,454		)	(238,612		)	39,994			(41,072		)	(1,078		)
Income tax expense (benefit)	(163,018		)	(3,106		)	(166,124		)	(137,781		)	(8,582		)	(146,363		)	a, c
Net income (loss)	(46,140		)	(26,348		)	(72,488		)	177,775			(32,490		)	145,285
Net income (loss) attributable to noncontrolling interests	(955		)	—			(955		)	(757		)	—			(757		)
Net income (loss) attributable to CHS Inc.	$	(45,185	)	$	(26,348	)	$	(71,533	)	$	178,532		$	(32,490	)	$	146,042

For the three months ended May 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $25.9 million reduction of income before income taxes and a $22.8 million reduction of net income. These adjustments related to a $3.7 million decrease of revenues and a $22.2 million increase of cost of goods sold and a $3.1 million increase of income tax benefit related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $9.6 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $3.6 million decrease of income before income taxes and net income. The $3.6 million decrease of income before income taxes and net income relates primarily to a $3.5 million increase of reserve and impairment charges related to a timing difference for a fixed asset impairment charge that should have been recorded during the third quarter of fiscal 2017 rather than the fourth quarter of fiscal 2017.

Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $37.6 million increase of revenues, a $37.6 million increase of cost of goods sold, a $1.8 million increase of marketing, general and administrative expenses, a $0.6 million decrease of reserve and impairment charges and a $1.2 million increase of gain on disposal of business.

F-85

Table of Contents

For the nine months ended May 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $26.2 million reduction of income before income taxes and a $22.1 million reduction of net income. These adjustments related to a $2.9 million reduction of revenues and a $23.2 million increase of cost of goods sold, as well as a $4.1 million increase of income tax benefit related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $28.0 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $14.9 million decrease of income before income taxes and a $10.4 million decrease of net income. The $14.9 million decrease of income before income taxes relates primarily to a $12.1 million increase of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018 and a $3.5 million increase of reserve and impairment charges related to a fixed asset impairment charge that should have been recorded during the third quarter of fiscal 2017 rather than the fourth quarter of fiscal 2017. The overall decrease of income before income taxes was partially offset by a $0.7 million decrease of cost of goods sold related to the valuation of crack spread derivatives. The decrease of income before income taxes was partially offset by an income tax benefit of $4.5 million that was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in an $89.2 million increase of revenues, a $89.2 million increase of cost of goods sold, a $6.9 million increase of marketing, general and administrative expenses, a $1.5 million increase of loss on sale of business and an $8.4 million increase of other income.

F-86

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)



	For the Three Months Ended August 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Revenues	$	7,952,005		$	44,334		$	7,996,339		a, b, c
Cost of goods sold	7,843,305			61,408			7,904,713			a, b, c
Gross profit	108,700			(17,074		)	91,626
Marketing, general and administrative	144,528			708			145,236			c
Reserve and impairment charges (recoveries), net	42,670			(3,500		)	39,170			c
Operating earnings (loss)	(78,498		)	(14,282		)	(92,780		)
(Gain) loss on disposal of business	—			704			704			c
Interest expense	53,828			—			53,828
Other (income) loss	(24,664		)	(743		)	(25,407		)	c
Equity (income) loss from investments	(12,817		)	—			(12,817		)
Income (loss) before income taxes	(94,845		)	(14,243		)	(109,088		)
Income tax expense (benefit)	(44,293		)	9,532			(34,761		)	a, c
Net income (loss)	(50,552		)	(23,775		)	(74,327		)
Net income (loss) attributable to noncontrolling interests	123			—			123
Net income (loss) attributable to CHS Inc.	$	(50,675	)	$	(23,775	)	$	(74,450	)

For the three months ended August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $12.0 million reduction of income before income taxes and a $25.2 million reduction of net income. These adjustments related to a $2.9 million increase of revenues, and a $14.9 million increase of cost of goods sold and a $13.3 million decrease of income tax benefit related to the tax effect of the freight derivatives and related misstatements.

Intercompany misstatements

(b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $7.7 million decrease of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS's businesses which existed in previous periods.

Other misstatements

(c) The correction of other misstatements resulted in a $2.3 million decrease of income before income taxes and a $1.4 million increase of net income. The $2.3 million decrease of income before income taxes related primarily to a $3.2 million increase of cost of goods sold related to the valuation of crack spread derivatives and a $2.6 million increase of cost of goods sold and marketing, general and administrative expenses related to a timing difference associated with the recording of certain benefit plan expenses. These decreases of income before income taxes were partially offset by a $3.5 million decrease of reserve and impairment charges related to a timing difference for recording a fixed asset impairment charge. The decrease of net income was partially offset by an income tax benefit of $3.7 million that was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods.

Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $49.1 million increase of revenues, a $49.1 million increase of cost of goods sold, a $0.7 million increase of loss on disposal of business and a $0.7 million increase of other income.

F-87

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended November 30, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	179,619		$	7,563		$	187,182		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity, net of tax expense (benefit) of $2,620	4,196			(2,602		)	1,594			c
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $404	3,640			—			3,640
Cash flow hedges net of tax expense (benefit) of $(2)	(4		)	—			(4		)
Foreign currency translation adjustment net of tax expense (benefit) of $(443)	(2,607		)	396			(2,211		)	a
Other comprehensive income (loss), net of tax	5,225			(2,206		)	3,019
Comprehensive income	184,844			5,357			190,201
Less comprehensive income attributable to noncontrolling interests	(464		)	—			(464		)
Comprehensive income attributable to CHS Inc.	$	185,308		$	5,357		$	190,665

For the three months ended November 30, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $1.2 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended November 30, 2017, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in an $8.8 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended November 30, 2017, above. The adjustment related to postretirement benefit plan activity is attributable to a timing difference associated with recording certain benefit plan expenses.

F-88

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended February 28, 2018									For the Six Months Ended February 28, 2018
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	166,626		$	(667	)	$	165,959		$	346,245		$	6,896		$	353,141		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $1,309 and $3,929	3,141			1			3,142			7,338			(2,602		)	4,736			c
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $1,481 and $1,885	3,554			—			3,554			7,194			—			7,194
Cash flow hedges net of tax expense (benefit) of $443 and $441	1,063			—			1,063			1,059			—			1,059
Foreign currency translation adjustment net of tax expense (benefit) of $422 and $(21)	2,461			(109		)	2,352			(146		)	287			141			a
Other comprehensive income (loss), net of tax	10,219			(108		)	10,111			15,445			(2,315		)	13,130
Comprehensive income	176,845			(775		)	176,070			361,690			4,581			366,271
Less comprehensive income attributable to noncontrolling interests	(48		)	—			(48		)	(512		)	—			(512		)
Comprehensive income attributable to CHS Inc.	$	176,893		$	(775	)	$	176,118		$	362,202		$	4,581		$	366,783

For the three months ended February 28, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $22.6 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended February 28, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $21.9 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended February 28, 2018, above.

For the six months ended February 28, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $23.8 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the six months ended February 28, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

F-89

Table of Contents

Other misstatements

(c) The correction of other misstatements resulted in a $30.7 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the six months ended February 28, 2018, above. The adjustment related to postretirement benefit plan activity is attributable to a timing difference associated with recording certain benefit plan expenses.

F-90

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended May 31, 2018									For the Nine Months Ended May 31, 2018
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	229,146		$	(47,526	)	$	181,620		$	575,391		$	(40,630	)	$	534,761		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $1,424 and $5,353	3,417			—			3,417			10,755			(2,602		)	8,153			c
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $2,620 and $4,505	6,286			—			6,286			13,480			—			13,480
Cash flow hedges net of tax expense (benefit) of $172 and $613	413			—			413			1,472			—			1,472
Foreign currency translation adjustment net of tax expense (benefit) of $(254) and $(275)	(11,617		)	1,429			(10,188		)	(11,763		)	1,716			(10,047		)	a
Other comprehensive income (loss), net of tax	(1,501		)	1,429			(72		)	13,944			(886		)	13,058
Comprehensive income	227,645			(46,097		)	181,548			589,335			(41,516		)	547,819
Less comprehensive income attributable to noncontrolling interests	(187		)	—			(187		)	(699		)	—			(699		)
Comprehensive income attributable to CHS Inc.	$	227,832		$	(46,097	)	$	181,735		$	590,034		$	(41,516	)	$	548,518

For the three months ended May 31, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $24.7 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended May 31, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $22.8 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended May 31, 2018, above.

For the nine months ended May 31, 2018

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $48.5 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the nine months ended May 31, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

F-91

Table of Contents

Other misstatements

(c) The correction of other misstatements resulted in a $7.9 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the nine months ended May 31, 2018, above. The adjustment related to postretirement benefit plan activity relates to a timing difference associated with recording certain benefit plan expenses.

F-92

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended November 30, 2016
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	208,942		$	(5,786	)	$	203,156		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $2,011	3,239			—			3,239
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $482	777			—			777
Cash flow hedges net of tax expense (benefit) of $406	654			—			654
Foreign currency translation adjustment net of tax expense (benefit) of $(209)	(19,164		)	1,089			(18,075		)	a
Other comprehensive income (loss), net of tax	(14,494		)	1,089			(13,405		)
Comprehensive income	194,448			(4,697		)	189,751
Less comprehensive income attributable to noncontrolling interests	(208		)	—			(208		)
Comprehensive income attributable to CHS Inc.	$	194,656		$	(4,697	)	$	189,959

For the three months ended November 30, 2016

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.6 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended November 30, 2016, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $6.4 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended November 30, 2016, above.

F-93

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended February 28, 2017							For the Six Months Ended February 28, 2017
	As Previously Reported		Restatement Adjustments			As Restated		As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	14,973	$	(356	)	$	14,617	$	223,915		$	(6,142	)	$	217,773		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $2,312 and $4,323	3,724		—			3,724		6,963			—			6,963
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $600 and $1,083	968		—			968		1,744			1			1,745			c
Cash flow hedges net of tax expense (benefit) of $598 and $1,005	963		1			964		1,618			—			1,618			c
Foreign currency translation adjustment net of tax expense (benefit) of $(204) and $5	9,123		(936		)	8,187		(10,041		)	153			(9,888		)	a
Other comprehensive income (loss), net of tax	14,778		(935		)	13,843		284			154			438
Comprehensive income	29,751		(1,291		)	28,460		224,199			(5,988		)	218,211
Less comprehensive income attributable to noncontrolling interests	406		—			406		198			—			198
Comprehensive income attributable to CHS Inc.	$	29,345	$	(1,291	)	$	28,054	$	224,001		$	(5,988	)	$	218,013

For the three months ended February 28, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.2 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended February 28, 2017, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $0.6 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended February 28, 2017, above.

For the six months ended February 28, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $0.8 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the six months ended February 28, 2017, above. The adjustment related to foreign currency translation relates to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

F-94

Table of Contents

Other misstatements

(c) The correction of other misstatements resulted in a $6.9 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the six months ended February 28, 2017, above.

F-95

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended May 31, 2017									For the Nine Months Ended May 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	(46,140	)	$	(26,348	)	$	(72,488	)	$	177,775		$	(32,490	)	$	145,285		a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $2,257 and $6,580	3,635			1			3,636			10,599			—			10,599			c
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $(72) and $1,010	(117		)	(1		)	(118		)	1,627			—			1,627			c
Cash flow hedges net of tax expense (benefit) of $233 and $1,238	375			—			375			1,993			—			1,993
Foreign currency translation adjustment net of tax expense (benefit) of $(334) and $(329)	(2,151		)	782			(1,369		)	(12,193		)	936			(11,257		)	a
Other comprehensive income (loss), net of tax	1,742			782			2,524			2,026			936			2,962
Comprehensive income	(44,398		)	(25,566		)	(69,964		)	179,801			(31,554		)	148,247
Less comprehensive income attributable to noncontrolling interests	(955		)	—			(955		)	(757		)	—			(757		)
Comprehensive income attributable to CHS Inc.	$	(43,443	)	$	(25,566	)	$	(69,009	)	$	180,558		$	(31,554	)	$	149,004

For the three months ended May 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $22.8 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended May 31, 2017, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $3.6 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended May 31, 2017, above.

For the nine months ended May 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $22.1 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the nine months ended May 31, 2017, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

F-96

Table of Contents

Other misstatements

(c) The correction of other misstatements resulted in a $10.4 million decrease of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the nine months ended May 31, 2017, above.

F-97

Table of Contents

CHS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended August 31, 2017
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
	(Dollars in thousands)
Net income (loss)	$	(50,552	)	$	(23,775	)	$	(74,327	)	a, c
Other comprehensive income (loss), net of tax:
Postretirement benefit plan activity net of tax expense (benefit) of $12,108	19,501			2,602			22,103			c
Unrealized net gain (loss) on available for sale investments net of tax expense (benefit) of $1,722	2,758			—			2,758
Cash flow hedges net of tax expense (benefit) of $155	249			—			249
Foreign currency translation adjustment net of tax expense (benefit) of $542	3,522			(424		)	3,098			a
Other comprehensive income (loss), net of tax	26,030			2,178			28,208
Comprehensive income	(24,522		)	(21,597		)	(46,119		)
Less comprehensive income attributable to noncontrolling interests	123			—			123
Comprehensive income attributable to CHS Inc.	$	(24,645	)	$	(21,597	)	$	(46,242	)

For the three months ended August 31, 2017

Freight derivatives and related misstatements

(a) The correction of freight derivatives and related misstatements resulted in a $25.2 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended August 31, 2017, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015.

Intercompany misstatements

(b) None.

Other misstatements

(c) The correction of other misstatements resulted in a $1.4 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three months ended August 31, 2017, above. The adjustment related to postretirement benefit plan activity relates to a timing difference associated with recording certain benefit plan expenses.

F-98

Exhibit 10.6

CHS ANNUAL VARIABLE PAY PLAN

MASTER PLAN DOCUMENT

PLAN PURPOSE URPOSE

The purpose of the CHS Annual Variable Pay Plan (the “Plan”) is to provide a direct financial incentive for eligible employees (each a “Participant”) who contribute to the achievement of company and business unit financial goals, as well as individual employee performance goals that are aligned with organizational priorities and CHS Leadership Expectations.

The objectives of this Plan are to:


•	Drive strong business performance and reward Participants for achieving goals relevant to the business


•	Emphasize shared ownership of enterprise and business unit initiatives, and reward for the achievement of collective results through collaborative work efforts


•	Create a line of sight for Participants to see how their actions contribute to the achievement of company goals


•	Reward goal achievement that is competitive with compensation in the external market and aligns with organizational and market best practices

PERFORMANCE PERIOD ERFORMANCE PERIOD

Each performance period for the Plan (“Performance Period”) will be a CHS fiscal year, currently September 1 through August 31. A new Performance Period begins each fiscal year.

PLAN TRIGGER

Except as may be expressly determined for any Performance Period, the Threshold Return on Invested Capital (ROIC) Performance, as identified in the Plan Appendix, must be met in order for all or a portion of award compensation to be earned under the Plan.


•	If the company Threshold ROIC Performance is attained, then compensation earned under all Plan components, including enterprise, business unit and individual goals, are calculated independently.


•	If company Threshold ROIC Performance is not achieved, the following will occur:


◦	Corporate participants’ opportunity for an earned award is zero for all plan components.

◦

Business unit participants’ opportunity for an earned award is zero for all plan components unless the business unit ROA goal is achieved at the target level or higher. If the business unit target ROA performance is achieved, the company ROIC and individual components earned award is zero, and award compensation is earned only for the performance achieved at the business unit ROA target level or higher for the ROA component.

Company ROIC and business unit ROA goals are defined in the following Plan Goals section and the Plan Appendix.

PLAN GOALS LAN GOALS

Corporate functions and business units have predetermined goals and weightings which include CHS ROIC, CHS or business unit Return on Assets (ROA), and individual goals.

The President and Chief Executive Officer (CEO) and the Chief Financial Officer (CFO) establish, and the CHS Board of Directors approves, the Threshold, Target and Maximum ROIC and ROA Performance Targets at the corporate level for each Performance Period established pursuant to the Plan. Business unit ROA goals are determined by the CEO and CFO in collaboration with senior finance and business unit leaders. The ROIC and ROA performance targets for each such Performance Period are measured only over the entire Performance Period.

Compensation for any Performance Period is earned as a percent of the Target award, and is mathematically interpolated when performance results occur between the three financial Performance Targets.



Financial Performance Targets	Description	Award as % of Target
Maximum	Maximum Performance Goal	200%
Target	Targeted Performance Goal	100%
Threshold	Minimum Performance Goal	50%

The company ROIC and business unit ROA Performance Targets are published in the Plan Appendix after the beginning of each new Performance Period.

Goals are weighted based on whether Participants are in a corporate function or a business unit. The table below illustrates goal weightings by employee groups.



Employee Group	ROIC	ROA	Individual
Corporate Participants	60%	10%	30%
Business Unit Participants	10%	60%	30%

ROIC is measured at the enterprise level for corporate and business unit Participants, ROA is measured at the enterprise level for corporate Participants, and at the business unit level, as determined by the CEO and CFO in collaboration with senior finance and business unit leaders, for business unit Participants. ROIC and ROA goals are communicated to business unit leaders and Participants by Finance. Individual goals are determined by the Participant’s manager and the Participant.

AWARD METHODOLOGY WARD METHODOLOGY

Each Participant’s variable pay award opportunity pursuant to the Plan for any Plan Period (“Potential Award”) varies by grade level and/or position, and is expressed as a percent of base pay. The Company can vary a Participant’s potential award by grade level and/or position at the sole discretion of the Plan Administrators. For salaried employees, the base pay used to establish the potential award is the employee’s base salary at the end of the Performance Period (August 31). For hourly employees, the base pay used to establish the potential award is actual earnings during the Performance Period, to include base pay and overtime earnings.

Award opportunity and calculation examples are included in the Plan Appendix.

AWARD PAYMENT AWARD PAYMENT

Actual compensation earned under the Plan for any Performance Period is determined, approved and issued as soon as administratively feasible following the close of the Performance Period. No compensation shall be deemed earned under the Plan until after approval by the CHS Board of Directors. Awards can be modified or terminated without Participant consent for any reason up until the CHS Board of Directors approves the amounts earned under the awards. Once such amounts are approved, the awards cannot be modified or terminated, except as is expressly provided in the Plan. In all cases, any compensation earned under the Plan shall be paid no later than November 30 following the Performance Period for which it was earned. Compensation paid under the Plan is paid through the same process as the Participant’s paycheck. All payments are subject to appropriate withholdings.

ADMINISTRATION ADMINISTRATION

The CFO and Head of Human Resources administer the Plan (each a Plan Administrator). The Plan Administrators, along with the CEO, are authorized to make all decisions as required in the administration of the Plan and to exercise their discretion to define, interpret, construe and apply Plan provisions, approve, administer, withdraw, and make any exceptions to the terms of the Plan. Any adjustments to the Plan based on extraordinary business conditions requires CHS Board of Directors and CFO approval at the company level, and CEO and CFO approval at the business unit level.

ELIGIBILITY ITY

•

Participants must be employed by the company in an eligible non-union position, categorized as a full-time or part-time regularly scheduled employee at the end of the Performance Period or have a status change during the Performance Period, as defined in the table below. Employees who cease being employed after the end of the Performance Period and before the actual payment date will be paid any compensation earned under the Plan for that Performance Period.


•	Participants must have a hire or transfer date to an eligible position on or before June 1 of the Performance Period.

•

Salaried Participants who become eligible during the Performance Period will earn and be paid prorated compensation, based on the number of days worked in an eligible position during the Performance Period, divided by 365. Hourly Participants who become eligible during the Performance Period will earn and be paid compensation, based on actual earnings in an eligible position during the Performance Period, to include base pay and overtime earnings.


•	Participant awards may be prorated based on changes in compensation or role during the Performance Period, at the sole discretion of the Participant’s manager and the business unit Human Resources Director.


•	Participants must actively work a minimum of 30 days during the Performance Period to be eligible to earn compensation under the Plan for that Performance Period.


•	Employees who are eligible to earn variable compensation through any other bonus, commission or incentive plan are not eligible to participate in the Plan and will not be a Participant for purposes of this Plan, unless approved by the Plan Administrators.

•

Participants may forfeit their eligibility to earn compensation under the Plan for any Performance Period if it is determined that they have failed to meet job performance criteria and standards, which includes but is not limited to documented performance issues, or that they have committed acts of misconduct, dishonesty or violation of CHS policies and procedures. Forfeiture of eligibility must be approved by the business unit Human Resources Director and Compensation Director.


•	The following status table outlines eligibility status criteria and how compensation earned under the Plan is prorated when a change in status occurs during the Performance Period:



Status Category	Period of Time Included	Period of Time Excluded
Deceased	Days actually worked	Days beyond last day worked
Full Time	Days actually worked	Days of ineligible status
Leave of Absence	First 90 days	Days beyond 90 days
Long-Term Disability	Days actually worked	Days on LTD
Military Leave	First 90 days	Days beyond 90 days
Part Time	Days actually worked	Days of ineligible status
Position Elimination	Days actually worked if employee has worked 90 days	Days beyond last day worked
Retirement as defined by the CHS Retirement Plan rules	Days actually worked	Days beyond last day worked
Separation from employment and return to employment during Performance Period	Days actually worked before and after separation if employee returns before 90 days	Days actually worked prior to and during separation if employee returns after 90 days
Short-Term Disability (including FMLA)	First 90 days	Days beyond 90 days
Temp/Seasonal	Not eligible	Days as Temp/Seasonal
Worker’s Compensation	First 90 days	Days beyond 90 days

^* This plan document applies to eligible U.S. employees and expatriates. Plan documents are customized by region for eligible international Participants.

^* Primary eligibility for the Plan is defined by business unit and position. Groups of employees that are not eligible for the Plan after consideration of the eligibility rules above include: Energy Certified Energy Specialists; Energy Transportation and Distribution Drivers; Energy Zip Trip store employees; Business Solutions commissioned sales employees; Production Incentive eligible employees; Ag Associates; Country Operations employees below the Vice President level with location codes outside of Inver Grove Heights. This list can be changed at any time by the Plan Administrators.

GENERAL PROVISIONS GENERAL PROVISIONS

CHS reserves the right to change or cancel this plan at any time. This document does not intend to create an employment contract or provide a guarantee of continued employment. Contact your manager or HR Business Partner for more information on the CHS Annual Variable Pay Plan. There is no vested right to any payment prior to the award determination and the CHS Annual Variable Pay Plan does not give rise to any vested right to future payments.

Non-Recurring Events

Non-recurring business events, which have a substantial impact on CHS financial results during the Plan Period, may be excluded from the calculations for determining awards. Such events could include major gains or losses from acquisitions (including planned short-term losses), divestitures, lawsuits, significant business write-offs, casualty losses or sale of assets.

Clawback or Recoupment

All awards under this Plan shall be subject to recovery or the penalties pursuant to any applicable law, rule or regulation or applicable stock exchange rule, including, without limitation, Section 304 of the Sarbanes-Oxley Act of 2002, Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and any applicable stock exchange listing rule adopted Pursuant thereto.

Exhibit 10.6A

CHS ANNUAL VARIABLE PAY PLAN

APPENDIX, PLAN DETAILS - FISCAL 2018

COMPANY RETURN ON INVESTED CAPITAL (ROIC) and RETURN ON ASSET (ROA) GOALS



Performance Targets	CHS ROIC	CHS ROA	Description	Award as % of Target
Maximum	5.7%	6.0%	Maximum Performance Goal	200%
Target	4.7%	5.1%	Targeted Performance Goal	100%
Threshold	3.7%	4.3%	Minimum Performance Goal	50%

RETURN ON INVESTED CAPITAL (ROIC) EXPLANATION

ROIC is a measurement of how efficiently the company uses its capital and the level of returns on that capital, and is calculated by dividing net operating profit after tax by funded debt plus equity. Details on the ROIC calculation, goal determination and 2018 goals can be answered by the finance contact for your group.



ROIC=	Net Operating Profit After Tax
	*Funded Debt + Equity

*Funded Debt is the average of the funded debt at each of the beginning of and the end of the fiscal year, and Equity is the equity at the beginning of the fiscal year.

RETURN ON ASSETS (ROA) EXPLANATION RETURN ON ASSETS (ROA) EXPLANATION

ROA is a measurement of how well a company uses its assets to generate earnings and maximizes returns on owner equity and company assets, and is calculated by dividing operating income by total assets minus working capital liabilities. Details on the ROA calculation, goal determination and 2018 goals can be answered by the finance contact for your group.



ROA=	Operating Income
	*Net Assets

* Net Assets are total assets minus working capital liabilities (current liabilities related to the Business Unit business activities excluding financing (payables, accruals, derivatives, liabilities, advances, etc.)) and is measured as of the beginning of the fiscal year.

AWARD OPPORTUNITY EXAMPLES AWARD OPPORTUNITY EXAMPLES

The example below illustrates threshold, target, and maximum award opportunities for an employee with a pay basis of $70,000 and a target award potential of 5%.



Performance Targets	Award Opportunity as % of Base Pay	Award Opportunity Calculation	Award Opportunity Amount
Maximum	10.0%	$70,000 x 10.0%	$7,000
Target	5.0%	$70,000 x 5.0%	$3,500
Threshold	2.5%	$70,000 x 2.5%	$1,750

Compensation earned will be mathematically interpolated when performance results occur between the three Performance Levels.

AWARD CALCULATION EXAMPLES ARD CALCULATION EXAMPLES

The following is an example of an annual variable pay compensation calculation for an employee who is a Business Unit participant with a $70,000 pay basis and a target award potential of 5.0% ($3,500).



Performance Measures	Goal Weighting	Target Award	X	Performance to Target	=	Goal/ Award Result
CHS ROIC	10%	$350	X	90%	=	$315
Business Unit ROA	60%	$2,100	X	100%	=	$2,100
Individual Performance	30%	$1,050	X	170%	=	$1,785
Totals	100%	$3,500				$4,200

The following is an example of an annual variable pay compensation calculation for an employee who is a Corporate participant with a $70,000 pay basis and a target award potential of 5.0% ($3,500).



Performance Measures	Goal Weighting	Target Award	X	Performance to Target	=	Goal/ Award Result
CHS ROIC	60%	$2,100	X	90%	=	$1,890
Enterprise ROA	10%	$350	X	100%	=	$350
Individual Performance	30%	$1,050	X	170%	=	$1,785
Totals	100%	$3,500				$4,025

In the following example, the CHS ROIC threshold goal required to trigger all components of the Plan is not met. The business unit achieves 110% of its ROA target and only the earned business unit award is paid. No compensation is earned for the CHS ROIC and individual performance components of the award.

The earned award calculation is for an employee who is a Business Unit participant with a $70,000 pay basis and a target award potential of 5.0% ($3,500).



Performance Measures	Goal Weighting	Target Award	X	Performance to Target	=	Goal/ Award Result
CHS ROIC	10%	$350	X	0%	=	$0
Business Unit ROA	60%	$2,100	X	110%	=	$2,310
Individual Performance	30%	$1,050	X	0%	=	$0
Totals	100%	$3,500				$2,310

Exhibit 10.10

CHS STRATEGIC LEADERSHIP TEAM

RETENTION AWARD DOCUMENT

PURPOSE

The purpose of the Strategic Leadership Team (SLT) Retention Award (the Award) is to preserve key leadership continuity and bench strength and a competitive compensation position to the external market to ensure leadership retention and engagement of senior most executives.

ELIGIBILITY

The President and CEO and Executive Vice Presidents who were eligible participants in the 2015-2017 Long Term Incentive Plan (LTIP) with active employment status on November 1, 2017, are eligible for an award.

AWARD METHODOLOGY

Award value is the percentage of base salary used for incentive compensation awards at the Threshold-level based on the participant’s job level as of November 1, 2017.

EARNING THE AWARD


•	The Award will be earned only if the executive


◦	Continues active employment through January 1, 2020


◦	During the Award Earning Period, is consistently meeting performance expectations, and


◦	During the Award Earning Period is not determined to have committed any act of misconduct or any violation of the CHS Code of Conduct or a CHS policy


•	If employment ends prior to the end of the Award Earning Period due to death, disability, retirement or termination of employment by CHS for a reason not related to performance or behavior, the award will be earned based on the number of full months worked from the time the award is granted to the date one of the events listed above occurs as the numerator, and the number twenty-six

(26) as the denominator.

PAYMENT OF THE EARNED THE AWARD


•	Payment will be in cash within 30 days of the date on which the Award is earned, through the same process as the participant’s paycheck. All payments are subject to appropriate withholdings


•	Awards cannot be contributed to the CHS Deferred Compensation Plan


•	Earned award is not eligible to be included as part of pension income

Nothing in this Plan is intended to be nor is a contract for employment, continued employment or continued participation in the Plan, or in any other CHS compensation or benefit program.

Exhibit 10.21A

Execution Version

CHS INC.

AMENDMENT NO. 1 TO NOTE PURCHASE AGREEMENT

As of June 9, 2011

To the Noteholders (as defined below)

Ladies and Gentlemen:

CHS Inc. (hereinafter, together with its successors and assigns, the "Company"), agrees with you as follows:


1.	PRELIMINARY STATEMENTS.

1.1 Note Issuances, etc.

Pursuant to that certain Note Purchase Agreement dated as of October 4, 2007 (as in effect immediately prior to giving effect to the Amendments (as defined below) provided for hereby, the "Existing Note Purchase Agreement" , and as amended by this Amendment Agreement (as defined below) and as may be further amended, restated or otherwise modified from time to time, the "Note Purchase Agreement" ), the Company issued and sold Four Hundred Million Dollars ($400,000,000) in aggregate principal amount of its 6.18% Series I Senior Notes due October 4, 2017 (as amended, restated or otherwise modified from time to time as of the date hereof, the "Notes" ). The register for the registration and transfer of the Notes indicates that the parties named in Annex 1 (the "Noteholders" ) to this Amendment No. 1 to Note Purchase Agreement (the " Amendment Agreement" ) are currently the holders of the entire outstanding principal amount of the Notes.


2.	DEFINED TERMS.

Capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in the Existing Note Purchase Agreement.


3.	AMENDMENTS TO THE EXISTING NOTE PURCHASE AGREEMENT.

Subject to Section 5 of this Amendment Agreement, the Required Holders and the Company hereby agree to each of the amendments to the Existing Note Purchase Agreement as provided for by this Amendment Agreement and specified in Exhibit A. Such amendments are referred to herein, collectively, as the "Amendments" .


4.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

To induce you to enter into this Amendment Agreement and to consent to the Amendments, the Company represents and warrants as follows:

4.1 Organization, Power and Authority, etc.

The Company has all requisite corporate power and authority to enter into and perform its obligations under this Amendment Agreement.

4.2 Legal Validity.

The execution and delivery of this Amendment Agreement by the Company and compliance by the Company with its obligations hereunder and under the Note Purchase Agreement: (a) are within the corporate powers of the Company; and (b) do not violate or result in any breach of, constitute a default under, or result in the creation of any Lien upon any property of the Company under the provisions of: (i) its charter documents; (ii) any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority applicable to either the Company or its property; or (iii) any agreement or instrument to which the Company is a party or by which the Company or any of its property may be bound or any statute or other rule or regulation of any Governmental Authority applicable to the Company or its property.

This Amendment Agreement has been duly authorized by all necessary action on the part of the Company, has been executed and delivered by a duly authorized officer of the Company, and constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, reorganization, arrangement, insolvency, moratorium, or other similar laws affecting the enforceability of creditors' rights generally and subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

4.3 No Defaults.

No event has occurred and no condition exists that: (a) would constitute a Default or an Event of Default or (b) could reasonably be expected to have a Material Adverse Effect.

4.4 Disclosure.

This Amendment Agreement and the documents, certificates or other writings delivered to the Noteholders by or on behalf of the Company in connection therewith, taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect that has not been set forth herein or in the other documents, certificates and other writings delivered to the Noteholders by or on behalf of the Company specifically for use in connection with the transactions contemplated by this Amendment Agreement.


5.	EFFECTIVENESS OF AMENDMENTS.

The Amendments shall become effective only upon the date of the satisfaction in full of the following conditions precedent (the "Effective Date"):

5.1 Execution and Delivery of this Amendment Agreement.

The Company and the Required Holders shall have executed and delivered this Amendment Agreement.

5.2 Representations and Warranties True.

The representations and warranties set forth in Section 4 shall be true and correct on such date in all respects.

5.3 Authorization.

The Company shall have authorized, by all necessary action, the execution, delivery and performance of all documents, agreements and certificates in connection with this Amendment Agreement.

5.4 Amendment to 1998 Note Agreement.

The Company shall have delivered to the Noteholders a fully executed copy of that certain Second Amendment to Note Agreement, dated as of the date hereof, by and among the Company and each of the Persons signatory thereto with respect to that certain Note Agreement, dated as of June 19, 1998, together with each of the other instruments and agreements executed and/or delivered in connection therewith, each certified as true and correct by a Responsible Officer, such amendment to be in form and substance satisfactory to the Required Holders, and the conditions to the effectiveness thereof shall have been satisfied or waived.

5.5 Amendment to 2002 Note Purchase Agreement.

The Company shall have delivered to the Noteholders a fully executed copy of that certain Amendment No. 1 to Note Purchase Agreement, dated as of the date hereof, by and among the Company and each of the Persons signatory thereto with respect to that certain Note Purchase Agreement, dated as of October 18, 2002, together with each of the other instruments and agreements executed and/or delivered in connection therewith, each certified as true and correct by a Responsible Officer, such amendment to be in form and substance satisfactory to the Required Holders, and the conditions to the effectiveness thereof shall have been satisfied or waived.

5.6 Amendment to 2004 Note Purchase Agreement.

The Company shall have delivered to the Noteholders a fully executed copy of that certain Amendment No. 1 to Note Purchase Agreement, dated as of the date hereof, by and among the Company and each of the Persons signatory thereto with respect to that certain Note Purchase Agreement, dated as of September 21, 2004, together with each of the other instruments and agreements executed and/or delivered in connection therewith, each certified as true and correct by a Responsible Officer, such amendment to be in form and substance

satisfactory to the Required Holders, and the conditions to the effectiveness thereof shall have been satisfied or waived.

5.7 Amendment to 2004 Note Purchase and Private Shelf Agreement.

The Company shall have delivered to the Noteholders a fully executed copy of that certain Amendment No. 4 to Note Purchase and Private Shelf Agreement, dated as of the date hereof, by and among the Company and each of the Persons signatory thereto with respect to that certain Note Purchase and Private Shelf Agreement, dated as of April 13, 2004, together with each of the other instruments and agreements executed and/or delivered in connection therewith, each certified as true and correct by a Responsible Officer, such amendment to be in form and substance satisfactory to the Required Holders, and the conditions to the effectiveness thereof shall have been satisfied or waived.

5.8 Special Counsel Fees.

The Company shall have paid the reasonable fees and disbursements of Noteholders' special counsel in accordance with Section 6 below.

5.9 Proceedings Satisfactory.

All proceedings taken in connection with this Amendment Agreement and all documents and papers relating thereto shall be satisfactory to the Noteholders signatory hereto and their special counsel, and such Noteholders and their special counsel shall have received copies of such documents and papers as they or their special counsel may reasonably request in connection herewith.


6.	EXPENSES.

Whether or not the Amendments become effective, the Company will promptly (and in any event within thirty (30) days of receiving any statement or invoice therefor) pay all fees, expenses and costs of your special counsel, Bingham McCutchen LLP, incurred in connection with the preparation, negotiation and delivery of this Amendment Agreement and any other documents related thereto. Nothing in this Section shall limit the Company's obligations pursuant to Section 15.1 of the Existing Note Purchase Agreement.


7.	MISCELLANEOUS.

7.1 Part of Existing Note Purchase Agreement; Future References, etc.

This Amendment Agreement shall be construed in connection with and as a part of the Note Purchase Agreement and, except as expressly amended by this Amendment Agreement, all terms, conditions and covenants contained in the Existing Note Purchase Agreement are hereby ratified and shall be and remain in full force and effect. Any and all notices, requests, certificates and other instruments executed and delivered after the execution and delivery of this Amendment Agreement may refer to the Note Purchase Agreement without making specific reference to this Amendment Agreement, but nevertheless all such references shall include this Amendment Agreement unless the context otherwise requires.

7.2 Counterparts, Facsimiles.

This Amendment Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each

counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. Delivery of an executed signature page by facsimile or e-mail transmission shall be effective as delivery of a manually signed counterpart of this Amendment Agreement.

7.3 Governing Law.

THIS AMENDMENT AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD PERMIT THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.

[Remainder of page intentionally left blank. Next page is signature page.]

If you are in agreement with the foregoing, please so indicate by signing the acceptance below on the accompanying counterpart of this Amendment Agreement and returning it to the Company, whereupon it will become a binding agreement among you and the Company.

CHS INC.

By:______________________________

Name: David A. Kastelic

Title: Executive Vice President and

Chief Financial Officer

The foregoing Amendment Agreement is hereby accepted as of the date first above written. By its execution below, each of the undersigned represents that it is the owner of one or more of the Notes and is authorized to enter into this Amendment Agreement in respect thereof.

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By:________________________________

Name: Anthony Coletta

Title: Vice President

UNIVERSAL PRUDENTIAL ARIZONA REINSURANCE COMPANY

By: Prudential Investment Management, Inc., as investment manager

By:________________________________

Name: Anthony Coletta

Title: Vice President

PRUDENTIAL RETIREMENT INSURANCE AND ANNUITY COMPANY

By: Prudential Investment Management, Inc., as investment manager

By:________________________________

Name: Anthony Coletta

Title: Vice President

PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY

By:________________________________

Name: Anthony Coletta

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

THE NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY

By:________________________________

Name: Jerome R. Baier

Title: Its Authorized Representative

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

PRINCIPAL LIFE INSURANCE COMPANY

By: Principal Global Investors, LLC a Delaware limited liability company, its authorized signatory

By:________________________________

Name: Joellen J. Watts

Title: Counsel

By:________________________________

Name: Alan P. Kress

Title: Counsel

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

STATE OF WISCONSIN INVESTMENT BOARD

By:________________________________

Name: Christopher P. Prestigiacomo

Title: Portfolio Manager

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

AMERICAN UNITED LIFE INSURANCE COMPANY

By:________________________________

Name: John C. Mason

Title: Vice President, Fixed Income Securities

THE STATE LIFE INSURANCE COMPANY


By:	American United Life Insurance Company, its Agent

By:________________________________

Name: John C. Mason

Title: Vice President, Fixed Income Securities

FARM BUREAU LIFE INSURANCE COMPANY OF MICHIGAN

By: American United Life Insurance Company, its Agent

By:________________________________

Name: John C. Mason

Title: Vice President, Fixed Income Securities

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

AMERICAN FAMILY LIFE INSURANCE COMPANY

By:________________________________

Name: Phillip Hannifan

Title: Investment Manager

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

PHOENIX LIFE INSURANCE COMPANY

By:________________________________

Name: Christopher M Wilkos

Title: Executive Vice President

PHL VARIABLE INSURANCE COMPANY

By:________________________________

Name: Christopher M Wilkos

Title: Executive Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

HARTFORD LIFE INSURANCE COMPANY

By: Hartford Investment Management Company its Agent and Attorney-in-Fact

By:________________________________

Name: Robert M. Mills

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

U.S. AGBANK, CB

By:________________________________

Name: Travis W. Ball

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

AGFIRST FARM CREDIT BANK

By:________________________________

Name: Steven J. O'Shea

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

AMERICAN FIDELITY ASSURANCE COMPANY

By: Advantus Capital Management, Inc.

By:________________________________

Name: Thomas S. Houghton

Title: Vice President

GUIDEONE MUTUAL INSURANCE COMPANY


By:	Advantus Capital Management, Inc.

By:________________________________

Name: Thomas S. Houghton

Title: Vice President

GUIDEONE PROPERTY & CASUALTY INSURANCE COMPANY

By: Advantus Capital Management, Inc.

By:________________________________

Name: Thomas S. Houghton

Title: Vice President

BLUE CROSS AND BLUE SHIELD OF FLORIDA, INC.

By: Advantus Capital Management, Inc.

By:________________________________

Name: Thomas S. Houghton

Title: Vice President

GREAT WESTERN INSURANCE COMPANY

By: Advantus Capital Management, Inc.

By:________________________________

Name: Thomas S. Houghton

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

MODERN WOODMEN OF AMERICA

By:________________________________

Name: Douglas A. Pannier

Title: Portfolio Manager - Private Placements

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

UNITED OF OMAHA LIFE INSURANCE COMPANY

By:________________________________

Name: Justin P. Kavan

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

CUNA MUTUAL INSURANCE SOCIETY CUMIS INSURANCE SOCIETY, INC.

By: MEMBERS Capital Advisors, Inc., acting as Investment Advisor

By:________________________________

Name: Allen R. Cantrell

Title: Managing Director, Investments

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

FARM CREDIT SERVICES OF MID-AMERICA, PCA

By:________________________________

Name: Ralph M. Bowman

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

1 ST FARM CREDIT SERVICES, PCA

By:________________________________

Name: Dale A. Richardson

Title: Vice President, Capital Markets

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

AGCOUNTRY FARM CREDIT SERVICES, PCA, D/B/A FCS COMMERCIAL FINANCE GROUP

By:________________________________

Name: Jeremy Voigts

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

FARM CREDIT SERVICES OF AMERICA, PCA

By:________________________________

Name: Steven L. Moore

Title: Vice President

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

NATIONAL GUARDIAN LIFE INSURANCE COMPANY

By:________________________________

Name: R.A. Mucci

Title: Senior Vice President & Treasurer

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

ASSURITY LIFE INSURANCE COMPANY

By:________________________________

Name: Victor Weber

Title: Senior Director - Investments

[Signature page to Amendment No. I to Note Purchase Agreement dated as of October 4, 2007 - CHS]

Annex 1

Noteholders

The Prudential Insurance Company of America

Universal Prudential Arizona Reinsurance Company

Pruco Life Insurance Company of New Jersey

Prudential Retirement Insurance and Annuity Company

The Northwestern Mutual Life Insurance Company

State Farm Life Insurance Company

John Hancock Life Insurance Company of New York

John Hancock Life Insurance Company (U.S.A.)

The Guardian Life Insurance Company of America

Berkshire Life Insurance Company of America

The Guardian Insurance & Annuity Company, Inc.

Principal Life Insurance Company

State of Wisconsin Investment Board

Genworth Mortgage Insurance Corporation

American United Life Insurance Company

The State Life Insurance Company

Farm Bureau Life Insurance Company of Michigan

American Family Life Insurance Company

Knights of Columbus

Phoenix Life Insurance Company

PHL Variable Insurance Company

Hartford Life Insurance Company

U.S. AgBank, FCB

AgFirst Farm Credit Bank

Blue Cross and Blue Shield of Florida, Inc.

Great Western Insurance Company

American Fidelity Assurance Company

GuideOne Mutual Insurance Company

GuideOne Property & Casualty Insurance Company

Modem Woodmen of America

United of Omaha Life Insurance Company

CUNA Mutual Insurance Society

CUMIS Insurance Society Inc.

Farm Credit Services of Mid-America, PCA

1st Farm Credit Services, PCA

AgCountry Farm Credit Services, PCA, d/b/a FCS Commercial Finance Group

Farm Credit Services of America, PCA

The Ohio National Life Insurance Company

Ohio National Life Assurance Corporation

National Guardian Life Insurance Company

Assurity Life Insurance Company

EXHIBIT A

AMENDMENTS

(a) Section 10.2 - Merger, Consolidation, etc. Section 10.2 of the Existing Note Purchase Agreement is hereby amended by (i) deleting "and" at the end of clause (a), (ii) deleting the period at the end of clause (b)(iii) and inserting "; and" in lieu thereof and (iii) by adding a new clause (c) to such Section to read as follows:

"(c) CoFina may transfer CoFina Loan Assets to a Wholly-Owned Subsidiary in the ordinary course of business."

(b) Section 10.5 - Priority Debt. Section 10.5 of the Existing Note Purchase Agreement is hereby amended and restated to read as follows:

"10.5 Priority Debt.

(a) The Company covenants that it will not, and will not permit any of its Subsidiaries to, directly or indirectly, create, issue, incur or assume any Priority Debt if after giving effect thereto the aggregate outstanding principal amount of all Priority Debt would exceed 20% of Consolidated Net Worth at the time of such creation, issuance, incurrence or assumption.

(b) The Company will not at any time permit any Subsidiary to guaranty, become a co-borrower or otherwise become obligated in respect of any Debt owing under any Primary Bank Facility unless contemporaneously such Subsidiary guaranties, or becomes similarly obligated in respect of, the Notes, in each case pursuant to documentation in form and substance reasonably satisfactory to the Required Holders."

(c) Section 10.6 - Liens. Section 10.6 of the Existing Note Purchase Agreement is hereby amended by (i) deleting "and" from the end of clause (i), (ii) deleting clause G) and the last paragraph of such Section and (iii) inserting new clauses G) and (k) and a new last paragraph of such Section all to read as follows:

"(j) Liens consisting of the cash collateralization of reimbursement obligations in an aggregate amount not to exceed $200,000,000 in respect of letters of credit required to be pledged because the expiry date of such letters of credit occurs later than the maturity date of the lending facility under which such letters of credit were issued, but only to the extent and for so long as no Default or Event of Default has occurred and is continuing and no "potential default" or "event of default" has occurred and is continuing under and as defined in such lending facility; and

(k) Liens not otherwise permitted under clause (a) through G) of this Section

10.6 securing Debt, provided that the existence, creation, issuance, incurrence or assumption of such Debt is permitted under Sections 10.3, 10.4 and 10.5 hereof.

If, notwithstanding the prohibition contained herein, the Company shall, or shall permit any of its Subsidiaries to, directly or indirectly create, incur, assume or permit to

exist any Lien, other than those Liens permitted by the provisions of paragraphs (a) through (k) of this Section 10.6 (but including any Liens in respect of the Primary Bank Facility whether or not permitted by paragraphs (a) - (k) of this Section 10.6 (but excluding clause G)), it will make or cause to be made effective provision whereby the Notes will be secured equally and ratably with any and all other obligations thereby secured, such security to be pursuant to agreements reasonably satisfactory to the Required Holders (including intercreditor arrangements providing for the pari passu treatment of the Notes and all such secured Debt) and, in any such case, the Notes shall have the benefit, to the fullest extent that, and with such priority as, the holders of the Notes may be entitled under applicable law, of an equitable Lien on such property. For the avoidance of doubt, the Company acknowledges that it will not, and will not permit any Subsidiary to, secure or grant any Liens in respect of the Primary Bank Facility (other than Liens permitted by paragraph G) of this Section 10.6), unless an equal and ratable Lien is granted in respect of the Notes."

(d) Section 22.3 - Accounting Terms. Section 22.3 of the Existing Note Purchase Agreement is hereby amended and restated to read as follows:

"22.3 Accounting Terms.

All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (a) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (b) all financial statements shall be prepared in accordance with GAAP. For purposes of determining compliance with the financial covenants contained in this Agreement, any election by the Company to measure an item of Debt using fair value (as permitted by FASB ASC 825-10-25 - Fair Value Option (formerly known as FASB 159) or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.

Notwithstanding the foregoing, if the Company notifies the holders of Notes that, in Company's reasonable opinion, or if the Required Holders notify the Company that, in the Required Holders' reasonable opinion, as a result of a change in GAAP after the First Amendment Effective Date, any covenant contained in Sections 10.2, 10.3, 10.4, 10.5, 10.6 or 10.7, or any of the defined terms used therein no longer apply as intended such that such covenants are materially more or less restrictive to the Company than as at the date of this Agreement, the Company shall negotiate in good faith with the holders of Notes to make any necessary adjustments to such covenant or defined term to provide the holders of the Notes with substantially the same protection as such covenant provided prior to the relevant change in GAAP. Until the Company and the Required Holders so agree to reset, amend or establish alternative covenants or defined terms, (a) the covenants contained in Sections 10.2, 10.3, 10.4, 10.5, 10.6 and 10.7, together with the relevant defined terms, shall continue to apply and compliance therewith shall be determined on the basis of GAAP in effect at the date of this Agreement and (b) each set of financial statements delivered to holders of Notes pursuant to Section 7.l (a) or (b)

during such time shall include detailed reconciliations reasonably satisfactory to the Required Holders as to the effect of such change in GAAP."

(e) Schedule B - Definitions. The definitions of "Debt" and "Priority Debt" appearing in Schedule B of the Existing Note Purchase Agreement are each hereby amended and restated to read as follows:

""Debt" means with respect to any Person

(a) all obligations of such Person for borrowed money (including all obligations for borrowed money secured by any Lien with respect to any property owned by such Person whether or not such Person has assumed or otherwise become liable for such obligations),

(b) all obligations of such Person for the deferred purchase price of property acquired by such Person (excluding accounts payable arising in the ordinary course of business but including all liabilities created or arising under any conditional sale or other title retention agreement with respect to such property),


(c)	all Capitalized Lease Obligations of such Person,

(d) the aggregate amount of CoFina Loan Assets subject to a sale or financing arrangement, and

(e) all Guaranties of such Person with respect to liabilities of the type described in clause (a), (b), (c) or (d) of any other Person,

provided that (i) Debt of a Subsidiary of the Company shall exclude such obligations and Guaranties of such Subsidiary if owed or guaranteed by such Subsidiary to the Company or a Wholly-Owned Subsidiary of the Company, (ii) Debt of the Company shall exclude such obligations and Guaranties if owed or guaranteed by the Company to a Wholly-Owned Subsidiary of the Company and (iii) Debt of the Company shall exclude any unfunded obligations which may exist now and in the future in the Company's pension plans."

""Priority Debt" means, at any time, without duplication, the sum of

(a) all then outstanding Debt of the Company or any Subsidiary secured by any Lien on any property of the Company or any Subsidiary (other than Debt secured only by Liens permitted under paragraphs (a) through G) of Section 10.6); provided that any CoFina Debt in an aggregate amount not to exceed $500,000,000 secured by any Lien on any CoFina Loan Asset, will not be deemed to constitute Priority Debt, plus


(b)	all Funded Debt of Subsidiaries of the Company."

(f) Schedule B - Definitions of CoFina Debt, CoFina Loan Assets and First Amendment Effective Date. The following definitions are hereby added to Schedule B of the Existing Note Purchase Agreement in their proper alphabetical order to read as follows:

""CoFina" means collectively, Cofina Financial, LLC, and each of its Subsidiaries."

""CoFina Debt" means, on any date of determination, Debt owing by CoFina in connection with the sale or financing of CoFina Loan Assets, and in respect of which neither the Company nor any of its other Subsidiaries has any obligation (including, without limitation, any indemnification obligation) or liability."

""CoFina Loan Assets" means loan assets owned and loan commitments made by CoFina or a Wholly-Owned Subsidiary in the ordinary course of business."

""First Amendment Effective Date" means, the "Effective Date" as defined in Amendment No. 1 to Note Purchase Agreement between the Company and the holders of the Notes dated June 9, 2011."

Exhibit 10.23C

[EXECUTION COPY]

THIRD AMENDMENT TO CREDIT AGREEMENT

Parties:

“CoBank”: CoBank, ACB

5500 South Quebec Street Greenwood Village, Colorado 80111

“Borrower”: CHS Inc.

5500 Cenex Drive

Inver Grove Heights, Minnesota 55077

“Syndication Parties”: The entities name below on the signature pages

Execution Date: September 27, 2011

Recitals:

A. CoBank, in its capacity as Administrative Agent (“ Administrative Agent ”) and as a Syndication Party, the Syndication Parties signatory thereto (collectively with any Persons who have become or who become Syndication Parties, “ Syndication Parties ”), and Borrower have entered into that certain Credit Agreement (10 Year Term Loan) dated as of December 12, 2007 (as amended pursuant to that certain First Amendment to Credit Agreement dated as of May 1, 2008, as further amended pursuant to the certain Second Amendment to Credit Agreement dated as of June 2, 2010, and as further amended, modified, or supplemented from time to time, the “ Credit Agreement ”), pursuant to which the Syndication Parties have extended certain credit facilities to Borrower under the terms and conditions set forth in the Credit Agreement.

B. Borrower has requested that the Agent and the Syndication Parties amend certain terms of the Credit Agreement, which the Agent and the Syndication Parties are willing to do under the terms and conditions as set forth in this Second Amendment to Credit Agreement (“ Second Amendment ”).

Agreement:

Now, therefore, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows:

1. Amendments to Credit Agreement . The Credit Agreement is amended as of the Effective Date as follows:

1.1 Section 1.2 is amended in its entirety to read as follows:

Adjusted Consolidated Funded Debt : means Consolidated Funded Debt, plus the net present value of all rentals payable under Operating Leases of Borrower and its Consolidated Subsidiaries as discounted by a rate of 8.0% per annum.


1.2	Section 1.15 is amended in its entirety to read as follows:

Bank Debt: all amounts owing under the Note, fees, Borrower's obligations to purchase Bank Equity Interests, Funding Losses and all principal, interest, expenses, charges and other amounts payable by Borrower pursuant to the Loan Documents (including interest, expenses, charges and other amounts accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding).


1.3	Section 1.23 is amended in its entirety to read as follows:

Capital Leases: means, at any time, a lease with respect to which the lessee is required concurrently to recognize the acquisition of any asset and the incurrence of a liability in accordance with GAAP; provided that, notwithstanding any change in GAAP after September 27, 2011 relating to leases, any lease that was accounted for by the lessee as an operating lease as of the date hereof and any similar lease entered into after the date hereof by Borrower and the Consolidated Subsidiaries shall be treated as an Operating Lease for the purposes of this definition.


1.4	Section 1.29 is amended in its entirety to read as follows:

Consolidated Cash Flow : for any period, the sum of (a) earnings before income taxes of Borrower and its Consolidated Subsidiaries for such period determined on a consolidated basis in accordance with GAAP (excluding, in the case of any non-Wholly Owned Consolidated Subsidiary, the portion of earnings attributable to holders of equity interests of such Consolidated Subsidiary, other than Borrower or a Consolidated Subsidiary), plus (b) amounts that have been deducted in the determination of such earnings before income taxes for such

period for (i) Consolidated Interest Expense for such period, (ii) Depreciation for such period, (iii) Amortization for such period, and (iv) extraordinary non-cash losses for such period, minus (c) the amounts that have been included in the determination of such earnings before income taxes for such period for (i) one-time gains, (ii) extraordinary income, (iii) non-cash patronage income, and (iv) non-cash equity earnings in joint ventures.


1.5	Section 1.32 is amended in its entirety to read as follows:

Consolidated Funded Debt : means as of any date of determination, the total of all Funded Debt of Borrower and its Consolidated Subsidiaries outstanding on such date, after eliminating all offsetting debits and credits between Borrower and its Consolidated Subsidiaries and all other items required to be eliminated in the course of preparation of consolidated financial statements of Borrower and its Consolidated Subsidiaries in accordance with GAAP.


1.6	Section 1.34 is amended in its entirety to read as follows:

Adjusted Consolidated Equity : means, with respect to Borrower and its Consolidated Subsidiaries, the amount of equity accounts, plus (or minus in the case of a deficit) the amount of surplus and retained earnings accounts of Borrower and its Consolidated Subsidiaries and non-controlling interests; provided that the total amount of intangible assets of Borrower and its Consolidated Subsidiaries (including, without limitation, unamortized debt discount and expense, deferred charges and goodwill) included therein shall not exceed

$30,000,000 (and to the extent such intangible assets exceed $30,000,000, they will not be included in the

calculation of Adjusted Consolidated Equity); all as determined on a consolidated basis in accordance with GAAP consistently applied .


1.7	Section 1.37 is amended in its entirety to read as follows:

Debt : means as to any Person: (a) indebtedness or liability of such Person for borrowed money, or for the deferred purchase price of property or services (including trade obligations); (b) all Capitalized Lease Obligations of such Person; (c) obligations of such Person arising under bankers’, or trade acceptance facilities, or reimbursement obligations for drawings made under letters of credit; (d) the aggregate amount of CHS Capital Loan Assets subject to a sale or refinancing, (e) all Guarantees, endorsements (other than for collection or deposit in the ordinary course of business), and other contingent obligations of such Person (i) to purchase any of the items included in this definition, (ii) to provide funds for payment, (iii) to supply funds to invest in any other Person, (iv) otherwise to assure a creditor of another Person against loss or (v) with respect to letters of credit (in each case, without duplication); (f) all obligations secured by a lien on property owned by such Person, whether or not the obligations have been assumed; and

(g) all obligations of such Person under any agreement providing for an interest rate swap, cap, cap and floor, contingent participation or other hedging mechanisms with respect to interest payable on any of the items described in this definition; provided that (i) Debt of a Consolidated Subsidiary of Borrower shall exclude such obligations and Guarantees, endorsements and other contingent obligations and Guarantees of such Consolidated Subsidiary if owed or guaranteed by such Consolidated Subsidiary to Borrower or a Wholly Owned Consolidated Subsidiary of Borrower, (ii) Debt of Borrower shall exclude such obligations and Guarantees, endorsements and other contingent obligations if owed or guaranteed by Borrower to a Wholly Owned Consolidated Subsidiary of Borrower and (iii) Debt of Borrower shall exclude any unfunded obligations which may exist now and in the future in Borrower’s pension plans.


1.8	Section 1.53 is amended in its entirety to read as follows:

Funded Debt : means with respect to any Person, all Debt which would, in accordance with GAAP, be required to be classified as a long term liability on the books of such Person, and shall include, without limitation (a) any Debt which by its terms or by the terms of any instrument or agreement relating thereto matures, or which is otherwise payable or unpaid, more than one year from the date of creation thereof, (b) any Debt outstanding under a revolving credit or similar agreement providing for borrowings (and renewals and extensions thereof) which would, in accordance with GAAP, be required to be classified as a long term liability of such Person, (c) any Capitalized Lease Obligation of such Person and all obligations to reimburse the Letter of Credit Bank or any Syndication Party or any letter of credit issuer or other credit provider with respect to all Letters of Credit or other letters of credit which support long-term debt, with expiration dates in excess of one-year from the date of issuance thereof, and

(d) any Guarantee of such Person with respect to Funded Debt of another Person.


1.9	Section 1.70 is amended in its entirety to read as follows:

Lien : means with respect to any asset any mortgage, deed of trust, pledge, security interest, hypothecation, assignment for security purposes, encumbrance, lien (statutory or other), or other security agreement or charge, or encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale, Capital Lease or other title retention agreement related to such asset, and including, in the case of capital stock, any stockholder agreements, voting trust agreements and all similar arrangements).


1.10	Section 1.73 is amended in its entirety to read as follows:

Material Adverse Effect : means a material adverse effect on (a) the financial condition, results of operation, business or property of Borrower, or of Borrower and its Subsidiaries taken as a whole; or (b) the ability of Borrower to perform its obligations under this Credit Agreement and the other Loan Documents; or (c) the ability of the Administrative Agent or the Syndication Parties to enforce their rights and remedies against Borrower under the Loan Documents.


1.11	Section 1.102 is amended in its entirety to read as follows:

Revolving Loan Credit Agreement : means one or both of (i) the 2011 Credit Agreement (3-Year Revolving Loan), dated as of September 27, 2011, by and between Borrower and CoBank, as administrative agent for all syndication parties thereunder, and as a syndication party thereunder, and the other syndication parties party thereto, and (ii) the 2011 Credit Agreement (5-Year Revolving Loan), dated as of September 27, 2011, by and between Borrower and CoBank, as administrative agent for all syndication parties thereunder, and as a syndication party thereunder, and the other syndication parties party thereto, in each case, as amended, supplemented or otherwise modified from time to time.


1.12	Article 1 is amended by adding a new Section 1.118 to read as follows:

Capitalized Lease Obligation: means with respect to any Person and a Capital Lease, the amount of the obligation of such Person as the lessee under such Capital Lease (net of interest expenses) which would, in accordance with GAAP, appear as a liability on a balance sheet of such Person.


1.13	Article 1 is amended by adding a new Section 1.119 to read as follows:

CHS Capital : means CHS Capital, LLC (formerly known as Cofina Financial, LLC), and each of its Subsidiaries.


1.14	Article 1 is amended by adding a new Section 1.120 to read as follows:

CHS Capital Debt : means, on any date of determination, Debt owing by CHS Capital in connection with the sale or financing of CHS Capital Loan Assets, and in respect of which neither Borrower nor any of its other Subsidiaries has any obligation (including, without limitation, any indemnification obligation) or liability.


1.15	Article 1 is amended by adding a new Section 1.121 to read as follows:

CHS Capital Loan Assets : means loan assets owned and loan commitments made by CHS Capital or a Wholly Owned Subsidiary in the ordinary course of business.


1.16	Article 1 is amended by adding a new Section 1.122 to read as follows:

Consolidated Net Worth : shall mean, for any period, the amount of equity accounts plus (or minus in the case of a deficit) the amount of surplus and retained earnings accounts of Borrower and its Consolidated Subsidiaries, excluding (i) accumulated other comprehensive income (or loss) and (ii) non-controlling interests, all as determined in accordance with GAAP.


1.17	Article 1 is amended by adding a new Section 1.123 to read as follows:

Guarantee : means, with respect to any Person, any obligation (except the endorsement in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any Debt, dividend or other obligation of any other Person in any manner, whether directly or indirectly, including (without

limitation) obligations incurred through an agreement, contingent or otherwise, by such Person:

(a) to purchase such Debt or obligation or any property constituting security therefor; (b) to advance or supply funds (i) for the purchase or payment of such Debt or obligation, or (ii) to maintain any working capital or other balance sheet condition or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such Debt or obligation; (c) to lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such Debt or obligation of the ability of any other Person to make payment of the Debt or obligation; or (d) otherwise to assure the owner of such Debt or obligation against loss in respect thereof. In any computation of the Debt or other liabilities of the obligor under any Guarantee, the Debt or other obligations that are the subject of such Guarantee shall be assumed to be direct obligations of such obligor.


1.18	Article 1 is amended by adding a new Section 1.124 to read as follows:

Priority Debt : means, at any time, without duplication, the sum of (a) all then outstanding Debt of Borrower or any Consolidated Subsidiary secured by any Lien on any property of Borrower or any Consolidated Subsidiary (other than Debt secured only by Liens permitted under Section 12.3(a) through (k)), plus (b) all Funded Debt of the Consolidated Subsidiaries of Borrower; provided that any CHS Capital Debt in an aggregate amount not to exceed $500,000,000 secured by any Lien on any CHS Capital Loan Asset will not be deemed to constitute Priority Debt.


1.19	Article 1 is amended by adding a new Section 1.125 to read as follows:

Wholly Owned Subsidiary : means, at any time, any Subsidiary one hundred percent (100%) of all of the equity interests (except directors’ qualifying shares) and voting interests of which are owned by any one or more of Borrower and Borrower’s other Wholly Owned Subsidiaries at such time.


1.20	Subsection 10.1 is amended by deleting the last two sentences thereof.

1.21 Subsection 10.3 is amended as follows: (i) by renumbering clause (k) as clause (l) and (ii) inserting a new clause (k) to read as follows:

credit; and”

“Liens consisting of the cash collateralization of obligations in respect of letters of

1.22 The first paragraph of Subsection 10.5 (the text before clause (a) thereof) is amended to read as follows:

“Borrower shall not (nor shall it permit any of its Consolidated Subsidiaries to) merge or consolidate with any entity, or acquire all or substantially all of the assets of any person or entity, or convey, transfer or lease all or substantially of its assets to any Person, in a single transaction or in a series of transactions, or form or create any new Subsidiary (other than a Consolidated Subsidiary formed by Borrower), acquire the controlling interest in any Person, change its business form from a cooperative corporation, or commence operations under any other name, organization, or entity, including any joint venture; provided , however ,”


1.23	Article 14 is amended by inserting a new Subsection 14.23 to read as follows: “ Accounting Terms . All accounting terms used herein which are not expressly

defined in this Credit Agreement have the meanings respectively given to them in accordance

with GAAP. Except as otherwise specifically provided herein, (a) all computations made pursuant to this Credit Agreement shall be made in accordance with GAAP (except as provided otherwise in the definition of Capital Leases), and (b) all financial statements shall be prepared in accordance with GAAP. For purposes of determining compliance with the financial covenants contained in this Credit Agreement, any election by Borrower to measure an item of Debt using fair value (as permitted by FASB ASC 825-10-25 - Fair Value Option (formerly known as FASB

159) or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.Notwithstanding the foregoing, if Borrower notifies the Administrative Agent that, in Borrower’s reasonable opinion, or if the Administrative Agent notifies Borrower that, in the Administrative Agent’s reasonable opinion (or at the reasonable request of the Required Lenders), as a result of a change in GAAP after the date hereof, any covenant contained in Sections 9.14, 10.1, 10.3 and 10.4, or any of the defined terms used therein no longer apply as intended such that such covenants are materially more or less restrictive to Borrower than as at the date of this Credit Agreement, Borrower shall negotiate in good faith with the Administrative Agent and the Syndication Parties to make any necessary adjustments to such covenant or defined term to provide the Syndication Parties with substantially the same protection as such covenant provided prior to the relevant change in GAAP. Until Borrower and the Administrative Agent (with the approval of the Required Lenders) so agree to reset, amend or establish alternative covenants or defined terms, (a) the covenants contained in Sections 9.14, 10.1, 10.3 and 10.4, together with the relevant defined terms, shall continue to apply and compliance therewith shall be determined on the basis of GAAP in effect at the date of this Credit Agreement and (b) each set of financial statements delivered to the Administrative Agent pursuant to Section 9.2 after such time shall include detailed reconciliations reasonably satisfactory to the Required Lenders and the Administrative Agent as to the effect of such change in GAAP.”

2. Conditions to Effectiveness of this Third Amendment . The effectiveness of this Third Amendment is subject to satisfaction, in the Administrative Agent’s sole discretion, of each of the following conditions precedent (the date on which all such conditions precedent are so satisfied (except those that may be satisfied at a later date) shall be the “ Effective Date ”):

2.1 Delivery of Executed Loan Documents . Borrower and the Required Lenders shall have delivered to the Administrative Agent, for the benefit of, and for delivery to, the Administrative Agent and the Syndication Parties, this Third Amendment (or their approval thereof, in the case of Voting Participants), duly executed.

2.2 Representations and Warranties . The representations and warranties of Borrower in the Credit Agreement shall be true and correct in all material respects on and as of tile Effective Date as though

made on and as of such date.

2.3 No Event of Default . No Event of Default shall have occurred and be continuing under the Credit Agreement as of the Effective Date of this Second Amendment.

2.4 Payment of Fees and Expenses . Borrower shall have paid the Administrative Agent, by wire transfer of immediately available federal funds all fees and expenses presently due under the Credit Agreement (as amended by this Third Amendment).


3.	General Provisions .

3.1 No Other Modifications . The Credit Agreement, as expressly modified herein, shall continue in full force and effect and be binding upon the parties thereto.

3.2 Successors and Assigns . This Third Amendment shall be binding upon and inure to the benefit of Borrower, Agent, and the Syndication Parties, and their respective successors and assigns, except that Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of all the Syndication Parties.

3.3 Definitions . Capitalized terms used, but not defined, in this Third Amendment shall have the meaning set forth in the Credit Agreement.

3.4 Severability . Should any provision of this Third Amendment be deemed unlawful or unenforceable, said provision shall be deemed several and apart from all other provisions of this Third Amendment and all remaining provision of this Third Amendment shall be fully enforceable.

3.5 Governing Law . To the extent not governed by federal law, this Third Amendment and the rights and obligations of the parties hereto shall be governed by, interpreted and enforced in accordance with the laws of the State of Colorado.

3.6 Headings . The captions or headings in this Third Amendment are for convenience only and in no way define, limit or describe the scope or intent of any provision of this Third Amendment.

3.7 Counterparts . This Third Amendment may be executed by the parties hereto in separate counterparts, each of which, when so executed and delivered, shall be an original, but all such counterparts shall together constitute one and the same instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all of the parties hereto. Copies of documents or signature pages bearing original signatures, and executed documents or signature pages delivered by a party by telefax, facsimile, or e-mail transmission of an Adobe ® file format document (also known as a PDF file) shall, in each such instance, be deemed to be, and shall constitute and be treated as, an original signed document or counterpart, as applicable. Any party delivering an executed counterpart of this Third Amendment by telefax, facsimile, or e-mail transmission of an Adobe ® file format document also shall deliver an original executed counterpart of this Second Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Second Amendment.

IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be executed as of the Effective Date.

[Signature Pages Follow]

BORROWER:

CHS INC., a cooperative corporation

formed under the laws of the State of

Minnesota

By:__________________________

Name: Dav i d A. Kaste li c

T itl e: Exec u t i ve V i ce Preside n t a n d

Chief Financial Officer

ADMINISTRATIVE AGENT:

COBANK, ACB

By:___________________________

Name: Michael Tous i gnant

T i t l e: V i ce P r eside n t

SYNDICATION PARTIES:

By:___________________________

Name: Michael Tous i gnant

T i t l e: V i ce P r eside n t

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

BORROWER:

CH S INC., a cooperative corporation form d und er t he l a ws of th e S tat e of Minnesota

B y :________________________________________

N ame : David A. Kas teli c

Title : E x e c u tive Vic e Pr e s ident and C hief Finan cial O ffic e r

A DMINI STRATIV E AG ENT:

COBANK. ACB

By:_________________________________________

Name: Michael Tous i gnant

T i t l e: V i ce P r eside n t

SYNDICATION PARTIES:

COBANK ACB

By: ________________________________________

Name: Michael Tous i gnant

T i t l e: V i ce P r eside n t

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

Farm Credit Services of America, PCA

By:____________________________________

Name: Steven L. Moore

Title: Vice President

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

U.S. AgBank, FCB, as Voting Participant

By:______________________________

Name: Travis W. Ball

Title: Vice President

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

FCS FINANCIAL, FLCA

By: ______________________________

Name: Laura Roessler

Title: Senior Lending Officer

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

Northwest Farm Credit Services, FLCA

By: ________________________________

Name: Casey Kinzer

Title: Account Manager

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

Farm Credit Services of Mid-America

By: ___________________________________

Name: Timothy R. Stringfellow

Title: Credit Officer

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

SYNDICATION PARTY:

Farm Credit Bank of Texas

By:___________________________________

Name: Luis M. H. Requejo

Title: Director Capital markets

[S i g n ature Page to T h ird Amendme n t to Credit Agreement (10 Year) ]

Exhibit 10.23D

Execution Copy

FOURTH AMENDMENT TO CREDIT AGREEMENT

Parties:


“CoBank”:	CoBank, ACB

5500 South Quebec Street

Greenwood Village, Colorado 80111

“Borrower”: CHS Inc.

5500 Cenex Drive

Inver Grove Heights, Minnesota 55077

“Syndication Parties”: The entities named below on the signature pages

Execution Date: June 26, 2013

Recitals:

A. CoBank, in its capacity as Administrative Agent (“ Administrative Agent ”) and as a Syndication Party, the Syndication Parties signatory thereto (collectively with any Persons who have become or who become Syndication Parties, “ Syndication Parties ”), and Borrower have entered into that certain Credit Agreement (10 Year Term Loan) dated as of December 12, 2007 (as amended pursuant to that certain First Amendment to Credit Agreement dated as of May 1, 2008, as further amended pursuant to that certain Second Amendment to Credit Agreement dated as of June 2, 2010, as further amended pursuant to that certain Third Amendment to Credit Agreement dated as of September 27, 2011, and as further amended, modified, or supplemented from time to time, the “ Credit Agreement ”), pursuant to which the Syndication Parties have extended certain credit facilities to Borrower under the terms and conditions set forth in the Credit Agreement.

B. Borrower has requested that the Agent and the Syndication Parties amend certain terms of the Credit Agreement, which the Agent and the Syndication Parties are willing to do under the terms and conditions as set forth in this Fourth Amendment to Credit Agreement (“ Fourth Amendment ”).

Agreement:

1. Amendments to Credit Agreement . The Credit Agreement is amended as of the Effective Date as follows:


1.1	Section 1.102 is amended in its entirety to read as follows:

Revolving Loan Credit Agreeme nt: means the 2013 Credit Agreement (5-Year Revolving Loan), dated as of June 26, 2013, by and between Borrower and CoBank, as administrative agent for all syndication parties thereunder, and as a syndication party thereunder, and the other syndication parties party thereto, as amended, supplemented or otherwise modified from time to time.


1.2	Section 1.119 is amended in its entirety to read as follows:

CHS C apital: means CHS Capital, LLC (formerly known as Cofina Financial, LLC) or any other Subsidiary of Borrower that makes seasonal and term loans to member cooperatives, businesses and individual producers of agricultural products included in Borrower’s cash flows from investing activities, and each of any such entity’s Subsidiaries.


1.3	Section 1.121 is amended in its entirety to read as follows:

CHS Capital Loan A ssets: means loan assets owned and loan commitments made by CHS Capital in the ordinary course of business.

2. Conditions to Effectiveness of this Fourth Amendment . The effectiveness of this Fourth Amendment is subject to satisfaction, in the Administrative Agent’s sole discretion, of each of the following conditions precedent (the date on which all such conditions precedent are so satisfied (except those that may be satisfied at a later date) shall be the “ Effective Date ”):

2.1 Delivery of Executed Loan Documents . Borrower and the Required Lenders shall have delivered to the Administrative Agent, for the benefit of, and for delivery to, the Administrative Agent and the Syndication Parties, this Fourth Amendment (or their approval thereof, in the case of Voting Participants), duly executed.

2.2 Representations and Warranties . The representations and warranties of Borrower in the Credit Agreement shall be true and correct in all material respects on and as of the Effective Date as though made on and as of such date.

2.3 No Event of Default . No Event of Default shall have occurred and be continuing under the Credit Agreement as of the Effective Date of this Fourth Amendment.

2.4 Payment of Fees and Expenses . Borrower shall have paid the Administrative Agent, by wire transfer of immediately available funds all fees and expenses presently due under the Credit Agreement (as amended by this Fourth Amendment).


3.	General Provisions .

3.1 No Other Modifications . The Credit Agreement, as expressly modified herein, shall continue in full force and effect and be binding upon the parties thereto.

3.2 Successors and Assigns . This Fourth Amendment shall be binding upon and inure to the benefit of Borrower, Agent, and the Syndication Parties, and their respective successors and assigns, except that Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of all the Syndication Parties.

3.3 Definitions . Capitalized terms used, but not defined, in this Fourth Amendment shall

have the meaning set forth in the Credit Agreement.

3.4 Severability . Should any provision of this Fourth Amendment be deemed unlawful or unenforceable, said provision shall be deemed several and apart from all other provisions of this Fourth Amendment and all remaining provision of this Fourth Amendment shall be fully enforceable.

3.5 Governing Law . To the extent not governed by federal law, this Fourth Amendment and the rights and obligations of the parties hereto shall be governed by, interpreted and enforced in accordance with the laws of the State of Colorado.

3.6 Headings . The captions or headings in this Fourth Amendment are for convenience only and in no way define, limit or describe the scope or intent of any provision of this Fourth Amendment.

3.7 Counterparts . This Fourth Amendment may be executed by the parties hereto in separate counterparts, each of which, when so executed and delivered, shall be an original, but all such counterparts shall together constitute one and the same instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all of the parties hereto. Copies of documents or signature pages bearing original signatures, and executed documents or signature pages delivered by a party by telefax, facsimile, or e-mail transmission of an Adobe ® file format document (also known as a PDF file) shall, in each such instance, be deemed to be, and shall constitute and be treated as, an original signed document or counterpart, as applicable. Any party delivering an executed counterpart of this Fourth Amendment by telefax, facsimile, or e-mail transmission of an Adobe ® file format document also shall deliver an original executed counterpart of this Fourth Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Fourth Amendment.

IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment to be executed as of the Effective Date.

[Signature Pages Follow]

BORROWER:

C HS INC . , a cooperative corporation formed under the law s of th e State of Minnesota

By_______________________________

Name: David A. Kastelic

Title: Executive Vice President and Chief Financial Officer

ADMINISTRATIVE AGENT:

COBANK, ACB

By:______________________________

Name: Michael Tousignant

Title: Vice President

SYNDICATION PARTIES:

CO BANK , ACB

By:_____________________________

Name: Michael Tousignant

Title: Vice President

[Signatur e Page to Fourth Amendment to Credit Agreement (10 Year)]

Exhibit 10.36C

EXECUTION COPY

OMNIBUS AMENDMENT NO. 3

This OMNIBUS AMENDMENT NO. 3, dated as of September 4, 2018 (this “ Amendment ”), is entered into by and among COFINA FUNDING, LLC, a Delaware limited liability company, as seller (the “ Seller ”), CHS INC. (“ CHS ”), a Minnesota corporation, as Servicer (in such capacity, the “ Servicer ”) and as an Originator, CHS CAPITAL, LLC, as an Originator (together with CHS, the “ Originators ”), the CONDUIT PURCHASERS, COMMITTED PURCHASERS and PURCHASER AGENTS set forth on the signature pages hereto, and MUFG BANK, LTD. F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH, as administrative agent (in such capacity, the “ Administrative Agent ”) and is (i) the third amendment to the RPA (as defined below) and (ii) the third amendment to the Sale Agreement (as defined below).

RECITALS

A. WHEREAS, the Seller, the Servicer, CHS, the Purchasers, the Purchaser Agents and the Administrative Agent have entered into that certain Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 (as amended by that certain First Amendment to Amended and Restated Receivables Purchase Agreement dated as of June 28, 2018, as amended by that certain Second Amendment to Amended and Restated Receivables Purchase Agreement dated as of August 20, 2018, and as further amended, restated, supplemented or otherwise modified through the date hereof, the “ RPA ”); and

B. WHEREAS, pursuant to and in accordance with Section 13.1 of the RPA, the Seller, the Servicer, the Purchasers, the Purchaser Agents and the Administrative Agent desire to amend the RPA as provided herein;

C. WHEREAS, the Originators and the Seller have entered into that certain Sale and Contribution Agreement, dated as of July 22, 2016 (as amended by that certain Omnibus Amendment No. 1, dated as of February 14, 2017, as amended by that certain Omnibus Amendment No. 2, dated as of July 18, 2017, and as further amended, restated, supplemented or otherwise modified through the date hereof, the “ Sale Agreement ” and, together with the RPA, the “ Agreements ”); and

D. WHEREAS, pursuant to and in accordance with Section 8.1 of the Sale Agreement, the Originators, the Seller, the Administrative Agent and the Purchasers desire to amend the Sale Agreement as provided herein.

NOW, THEREFORE, based upon the above Recitals, the mutual premises and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned, intending to be legally bound, hereby agree as follows:

SECTION 1. Definitions and Interpretation . Each capitalized term used but not defined herein has the meaning ascribed thereto in Appendix A to the RPA. The rules of interpretation set forth in Appendix A to the RPA are hereby incorporated as if fully set forth herein.

SECTION 2. Amendments to the RPA . The Seller, the Servicer, the Purchasers, the Purchaser Agents and the Administrative Agent hereby agree that the RPA is amended in its entirety in the form of Exhibit A attached hereto.

SECTION 3. Amendments to the Sale Agreement . The Originators, the Seller, the Administrative Agent and the Purchasers hereby agree that the Sale Agreement is amended in its entirety in the form of Exhibit B attached hereto.

SECTION 4. Agreements in Full Force and Effect as Amended . Except as specifically amended hereby, all provisions of the Agreements shall remain in full force and effect. This Amendment shall not be deemed to expressly or impliedly waive, amend or supplement any provision of the Agreements other than as expressly set forth herein and shall not constitute a novation of the Agreements.

SECTION 5. Representations and Warranties . Each of the Seller, the Servicer and the Originators hereby represent and warrant to the Administrative Agent and the Purchasers, as of the date of this Amendment, as follows:

(a) this Amendment has been duly executed and delivered by it;

(b) this Amendment constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent conveyance or other laws relating to the enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is sought at equity or law);

(c) no authorization or approval or other action by, and no notice to, license from or filing with, any Governmental Authority is required for the due execution, delivery and performance of this Amendment;

(d) the execution, delivery and performance by it of this Amendment (i) is within its limited liability company or corporate powers, (ii) has been duly authorized by all necessary limited liability company or corporation action, and (iii) does not contravene, violate or breach (1) its organizational documents or (2) any Applicable Law; and

(e) immediately after giving effect to this Amendment, (i) each of the representations and warranties of the Seller, the Servicer or the Originators, as applicable, set forth in the RPA (in the case of the Seller and the Servicer) or in the Sale Agreement (in the case of the Seller and the Originators) that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects (except to the extent such representations and warranties explicitly refer solely to an earlier date or period, in which case they shall be true and correct as of such earlier date or period), and (ii) no Event of Termination, Unmatured Event of Termination, Servicer Termination Event or Unmatured Servicer Termination Event has occurred and is continuing.

SECTION 6. Conditions to Effectiveness . This Amendment shall become effective (the “ Effective Date ”) upon receipt by the Administrative Agent of:

(a) executed counterparts of this Amendment; this Amendment, duly executed and delivered by each party hereto;

(b) the No-Petition Letter Agreement, dated as of the date hereof, duly executed and delivered by the parties thereto;

(c) the Amended and Restated Subordinated Notes (“ Amended and Restated Subordinated Notes ”), dated as of the date hereof, duly executed and delivered by the Seller in favor of each Originator; and



	2

(d) a favorable bring-down opinion, dated as of the date hereof, relating to the true sale and non-consolidation opinion of Dorsey & Whitney LLP, in form and substance reasonably satisfactory to the Administrative Agent.

SECTION 7. Consent . The Administrative Agent and each Purchaser hereby consents to the delivery and execution of the Amended and Restated Subordinated Notes issued by Cofina to CHS Inc. and CHS Capital, LLC, as applicable.

SECTION 8. Miscellaneous.

(a) This Amendment may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. Delivery of an executed counterpart hereof by facsimile or by electronic mail attachment in portable document format (.pdf) shall be effective as delivery of an originally executed counterpart.

(b) Any provisions of this Amendment which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

(c) THIS AMENDMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF, EXCEPT TO THE EXTENT THAT THE PERFECTION, THE EFFECT OF PERFECTION OR PRIORITY OF THE INTERESTS OF THE ADMINISTRATIVE AGENT OR ANY PURCHASER IN THE POOL ASSETS OR RELATED ASSETS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK).

(d) Headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.

(e) Section 13.7 of the RPA is hereby incorporated as if fully set forth herein.

(f) This Amendment is a Transaction Document and all references to a “Transaction Document” in the Agreements and the other Transaction Documents (including, without limitation, all such references in the representations and warranties in the Agreements and the other Transaction Documents) shall be deemed to include this Amendment.

(g) Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Amendment or the transactions contemplated hereby.



	3

IN WITNESS WHEREOF , the undersigned have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first written above.

COFINA FUNDING, LLC , as Seller

By:________________________________

Name:

Title:

CHS INC. , as Servicer and an Originator

By:________________________________

Name:

Title:

CHS CAPITAL, LLC , as Servicer and an Originator

By:________________________________

Name:

Title:

MUFG BANK, LTD. F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., NEW YORK BRANCH , as Administrative Agent, a Committed Purchaser and Purchaser Agent for the MUFG Purchaser Group

By:________________________________

Name:

Title:

VICTORY RECEIVABLES CORPORATION , as a Conduit Purchaser

By:________________________________

Name:

Title:

NIEUW AMSTERDAM RECEIVABLES CORPORATION B.V. , as a Conduit Purchaser

By:

Name:

Title:

By:

Name:

Title:

COÖPERATIEVE RABOBANK U.A. , as a Committed Purchaser

By:

Name:

Title:

By:

Name:

Title:

Coöperatieve Rabobank U.A., NEW YORK BRANCH , as Purchaser Agent for the Rabobank Purchaser Group

By:

Name:

Title:

By:

Name:

Title:

EXHIBIT A

Attached.

EXHIBIT B

Attached.

AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT

Dated as of July 18, 2017

and

as amended by the First Amendment to Amended and Restated Receivables Purchase Agreement dated as of June 28, 2018, the Second Amendment to Amended and Restated Receivables Purchase Agreement dated as of August 20, 2018, and the Omnibus Amendment No. 3, dated as of September 4, 2018

among

CHS INC.,

individually and as Servicer,

COFINA FUNDING, LLC,

as Seller,

THE VARIOUS CONDUIT PURCHASERS, COMMITTED PURCHASERS, AND PURCHASER AGENTS FROM TIME TO TIME PARTY HERETO,

and

MUFG BANK, LTD. (F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.),

as Administrative Agent

TABLE OF CONTENTS



		Page
ARTICLE I	PURCHASES AND REINVESTMENTS	2
SECTION 1.1	Purchases; Limits on Purchasers' Obligations	2
SECTION 1.2	Purchase Procedures; Assignment of Seller's Interests	3
WHERE:		4
SECTION 1.3	Reinvestments of Certain Collections; Payment of Remaining Collections; Asset Interest	5
ARTICLE II	COMPUTATIONAL RULES	7
SECTION 2.1	Selection of Rate Tranches	7
SECTION 2.2	Computation of each Purchaser Group Investment and each Purchaser's Tranche Investment	8
SECTION 2.3	Computation of Account Debtor Concentration Limit, Account Debtor Concentration Overage Amount, Concentration Overage Amount (Loans) and Unpaid Balance	8
SECTION 2.4	Computation of Yield	8
SECTION 2.5	Estimates of Yield Rate, Fees, Etc.	8
ARTICLE III	SETTLEMENTS	9
SECTION 3.1	Settlement Procedures	9
SECTION 3.2	Deemed Collections; Event of Repurchase; Reduction of Total Investment, Etc.	12
SECTION 3.3	Payments and Computations, Etc.	14
SECTION 3.4	Treatment of Collections and Deemed Collections	17
ARTICLE IV	FEE AND YIELD PROTECTION	17
SECTION 4.1	Fees	17
SECTION 4.2	Yield Protection	17
SECTION 4.3	Funding Losses	19
ARTICLE V	CONDITIONS PRECEDENT	20
SECTION 5.1	Closing Date	20
SECTION 5.2	Effective Date	20
SECTION 5.3	Conditions Precedent to All Purchases and Reinvestments	21
ARTICLE VI	REPRESENTATIONS AND WARRANTIES	21
SECTION 6.1	Representations and Warranties of Seller	21



	i

Table of Contents

(continued)



		Page
SECTION 6.2	Representations and Warranties of CHS	26
ARTICLE VII	GENERAL COVENANTS OF SELLER AND SERVICER	29
SECTION 7.1	Covenants of Seller	29
SECTION 7.2	Covenants of CHS	36
SECTION 7.3	Full Recourse	40
SECTION 7.4	Corporate Separateness; Related Matters and Covenants	41
ARTICLE VIII	ADMINISTRATION AND COLLECTION	44
SECTION 8.1	Designation of Servicer	44
SECTION 8.2	Duties of Servicer	44
SECTION 8.3	Rights of Administrative Agent	46
SECTION 8.4	Responsibilities of Servicer	47
SECTION 8.5	Further Action Evidencing Purchases and Reinvestments	47
SECTION 8.6	Application of Collections	48
SECTION 8.7	Funds and Documents to be held in Trust	48
ARTICLE IX	SECURITY INTEREST	48
SECTION 9.1	Grant of Security Interest	48
SECTION 9.2	Further Assurances	49
SECTION 9.3	Remedies; Waiver	49
ARTICLE X	EVENTS OF DEFAULT	49
SECTION 10.1	Events of Default	49
SECTION 10.2	Remedies	52
ARTICLE XI	PURCHASER AGENTS; ADMINISTRATIVE AGENT; CERTAIN RELATED MATTERS	55
SECTION 11.1	Authorization and Action of Program Administrator	55
SECTION 11.2	Limited Liability of Purchasers, Purchaser Agents and Administrative Agent	55
SECTION 11.3	Authorization and Action of each Purchaser Agent	56
SECTION 11.4	Authorization and Action of Administrative Agent	56
SECTION 11.5	Delegation of Duties of each Purchaser Agent	56
SECTION 11.6	Delegation of Duties of Administrative Agent	56
SECTION 11.7	Successor Agent	56
SECTION 11.8	Indemnification	56



	ii

Table of Contents

(continued)



		Page
SECTION 11.9	Reliance, etc.	57
SECTION 11.10	Purchasers and Affiliates	57
SECTION 11.11	Sharing of Recoveries	57
SECTION 11.12	Non-Reliance on Administrative Agent, Purchaser Agents and Other Purchasers	57
ARTICLE XII	INDEMNIFICATION	58
SECTION 12.1	Indemnities by Seller	58
SECTION 12.2	Indemnity by Servicer	61
ARTICLE XIII	MISCELLANEOUS	61
SECTION 13.1	Amendments, Etc.	61
SECTION 13.2	Notices, Etc.	62
SECTION 13.3	Successors and Assigns; Participants; Assignments	62
SECTION 13.4	No Waiver; Remedies	64
SECTION 13.5	Binding Effect; Survival	64
SECTION 13.6	Costs, Expenses and Taxes	65
SECTION 13.7	No Proceedings	65
SECTION 13.8	Confidentiality	66
SECTION 13.9	Captions and Cross References	67
SECTION 13.10	Integration	67
SECTION 13.11	Governing Law	68
SECTION 13.12	Waiver of Jury Trial	68
SECTION 13.13	Consent to Jurisdiction; Waiver of Immunities	68
SECTION 13.14	Execution in Counterparts	68
SECTION 13.15	No Recourse Against Other Parties	68
SECTION 13.16	Pledge to a Federal Reserve Bank	69
SECTION 13.17	Pledge to a Collateral Trustee	69
SECTION 13.18	Severability	69
SECTION 13.19	No Party Deemed Drafter	69
SECTION 13.20	PATRIOT Act	69
SECTION 13.21	Acknowledgement and Consent to Bail-In if EEA Financial Institutions	69



	iii

Table of Contents

(continued)



		Page
SECTION 13.22	Amendment and Restatement	70



	iv

APPENDIX A Definitions

SCHEDULE I Payment Instructions

SCHEDULE 13.2 Addresses for Notices

EXHIBIT A Credit and Collection Policy

EXHIBIT B Collection Accounts; Lockboxes; Originator Specified Accounts;

Concentration Account

EXHIBIT C Purchaser Groups

EXHIBIT D Form of Loan Documents

EXHIBIT E Form of Notice of Purchase

EXHIBIT F Form of Notice of Payment

EXHIBIT 3.1(a) Form of Information Package



	v

AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT

This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT, dated as of July 18, 2017, as amended by the First Amendment to Amended and Restated Receivables Purchase Agreement dated as of June 28, 2018, the Second Amendment to Amended and Restated Receivables Purchase Agreement dated as of August 20, 2018, and the Omnibus Amendment No. 3, dated as of September 4, 2018 (this “ Agreement ”), is among CHS INC., a Minnesota corporation (“ CHS ”), individually and as initial Servicer, COFINA FUNDING, LLC, a Delaware limited liability company (“ Seller ”), the various CONDUIT PURCHASERS, COMMITTED PURCHASERS and PURCHASER AGENTS from time to time party hereto, and MUFG BANK, LTD. (F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.) (“ MUFG ”), as administrative agent on behalf of the Affected Parties (in such capacity, together with its successors and assigns in such capacity, the “ Administrative Agent ”).

B A C K G R O U N D :

1. Originators have, and expect to have, Receivables and Loans which Originators intend to absolutely and irrevocably sell or contribute, as applicable, to Seller pursuant to the Sale Agreement.

2. Seller is a special purpose, bankruptcy-remote, limited liability company and indirect wholly-owned subsidiary of CHS.

3. Seller, in turn, intends to sell to Administrative Agent, on behalf of Purchasers, all of its right, title and interest in, to and under the Pool Assets and certain other related assets and proceeds of the foregoing which Seller is acquiring from Originators.

4. Seller has requested that Administrative Agent on behalf of Purchasers, and Administrative Agent on behalf of Purchasers has agreed, subject to the terms and conditions contained in this Agreement, to purchase such Pool Assets and certain other related assets, referred to herein as the Asset Interest, from Seller from time to time during the term of this Agreement.

5. Seller, Purchasers, Purchaser Agents and Administrative Agent also desire that, subject to the terms and conditions of this Agreement, certain of the daily Collections in respect of the Asset Interest be reinvested in Pool Assets, which Reinvestment shall constitute part of the Asset Interest.

6. Seller, Purchasers, Purchaser Agents and Administrative Agent also desire that, pursuant to the terms hereof, CHS be appointed, and act, as the initial Servicer of the Pool Assets.

7. Seller, Purchasers, Purchaser Agents and Administrative Agent also desire that Performance Guarantor guarantee the obligations of the Originators and Servicer under the Transaction Documents in accordance with the terms of the Performance Guaranty.

8. MUFG has been requested, and is willing, to act as Administrative Agent.

9. Each of the Purchaser Agents has been requested by the Purchasers in its Purchaser Group, and is willing, to act as Purchaser Agent for such Purchasers.

10. The parties hereto are party to that certain Receivables Financing Agreement, dated as of July 22, 2016, as amended (the “ Original Agreement ”) and, subject to Section 13.22 , wish to amend and restate the Original Agreement in its entirety in the form set out herein.

NOW, THEREFORE , in consideration of the premises and the mutual agreements herein contained, the parties hereto agree as follows:

Capitalized terms used and not otherwise defined in this Agreement are used as defined in (or by reference in) Appendix A , and the other interpretive provisions set out in Appendix A shall be applied in the interpretation of this Agreement.

ARTICLE I

PURCHASES AND REINVESTMENTS

SECTION 1.1 Purchases; Limits on Purchasers’ Obligations .

(a) Upon the terms and subject to the conditions of this Agreement, from time to time prior to the Purchase Termination Date, Seller may request that Administrative Agent, on behalf of Conduit Purchasers or, if any Conduit Purchaser is unable or unwilling to make a purchase, the related Committed Purchaser in such Conduit Purchaser’s Purchaser Group, purchase from Seller the Pool Assets and Related Assets from time to time (each such purchase, a “ Purchase ”) and Administrative Agent, on behalf of such Purchasers, shall make such Purchase subject to the terms and conditions of this Agreement in an amount (the “ Purchase Price ”) equal in each instance to the lesser of: (i) the amount requested by Seller under Section 1.2(a) , and (ii) the largest amount that will not cause (a) with respect to any Purchaser Group, such Purchaser Group’s Purchaser Group Investment to exceed such Purchaser Group’s Purchaser Group Commitment, (b) the aggregate Total Investment to exceed the Purchasers’ Total Commitment, or (c) the Total Investment to exceed the sum of the Receivables Investment Base and the Loan Investment Base at such time; provided , however , that if any requested Conduit Purchaser is unwilling or unable for any reason to make such Purchase, Seller shall be deemed to have requested that the related Committed Purchaser in such Conduit Purchaser’s Purchaser Group make such Purchase subject to the limitations set forth in the foregoing clause (ii) . Each Purchase made pursuant to this Section 1.1 shall be in an amount at least equal to $5,000,000 and, in each case, in integral multiples of $100,000 in excess thereof. Each Committed Purchaser hereby agrees, on the terms and subject to the conditions hereof, to make Purchases deemed to be so requested by Seller under this Section 1.1 if the Conduit Purchaser in such Committed Purchaser’s Purchaser Group is unable or unwilling to make such Purchase, so long as after giving effect to such Purchase (and any other Purchase to be made on such date) (i) the aggregate Total Investment would not exceed the Purchasers’ Total Commitment, (ii) the Purchaser Group’s Purchaser Group Investment would not exceed such Purchaser Group’s Purchaser Group Commitment, and (iii) the aggregate Total Investment would not exceed the sum of the Receivables Investment Base and the Loan Investment Base at such time. At no time shall a Conduit Purchaser that is not a Committed Purchaser have any obligation or commitment to make any Purchase.

SECTION1.2 Purchase Procedures; Assignment of Seller’s Interests .

(a) Notice of Purchase . Except as set forth in Section 1.3 , each Purchase shall be made pursuant to a Notice of Purchase delivered by Seller and received by Administrative Agent and each Purchaser Agent not later than 11:00 a.m. (New York City time) on the second (2nd) Business Day preceding the date of such proposed Purchase. Each such Notice of Purchase shall specify (A) the desired Purchase Price and date of such proposed Purchase (which shall be a Business Day), (B) the amount of such proposed Purchase to be allocated to each Purchaser Group in accordance with each Purchaser Group’s Ratable Share, and (C) a pro forma calculation of the Asset Interest after giving effect to such Purchase and any other Purchase proposed to be made on such day; provided , however , that Seller shall not request, and the Purchasers shall not be required to fund, more than six (6) Purchases per calendar month (for the avoidance of doubt, this shall not, however, restrain the making of Reinvestments of Collections in accordance with the terms and conditions of this Agreement in any calendar month). If any Conduit Purchaser is willing and able, in its sole discretion, to make its Ratable Share of a Purchase requested of it pursuant to this Section 1.2(a) subject to the terms and conditions hereof, such Conduit Purchaser shall make such Purchase by transferring such amount in accordance with clause (b) below on the requested date of Purchase. If any Conduit Purchaser is unwilling or unable for any reason to make its Ratable Share of such Purchase, subject to the terms and conditions hereof, the Committed Purchaser in such Conduit Purchaser’s Purchaser Group, subject to the terms and conditions hereof, shall make its Ratable Share of such Purchase by transferring such amount in accordance with clause (b) below.

(b) Payment of Purchase Price . On the date of each Purchase hereunder, the applicable Purchasers, or the related Purchaser Agent, shall, upon satisfaction of the applicable conditions set forth herein (including in Article V ), make available to the Seller their Ratable Share of the aggregate Purchase Price with respect to such Purchase in immediately available funds at the following account:

Holder Name: COFINA FUNDING, LLC

Bank Name: BMO Harris Bank, N.A.

Address: 320 E. Lake St., Minneapolis, MN 55408

Account Number: XXXXXXX

ABA Number: 071000288

Reference: Cofina Funding Securitization Program

(Attn: Brent Dickson)

or such other account as designated from time to time by Seller in a written notice to Administrative Agent and each Purchaser Agent.

(c) Sale and Assignment of Asset Interest . Seller hereby absolutely and irrevocably sells, assigns and transfers to Administrative Agent (on behalf of Purchasers) (ratably, according to each Purchaser Group’s Purchaser Group Investment), upon the payment of the aggregate Purchase Price, effective on and as of the date of each Purchase and Reinvestment hereunder, all of its right, title and interest in, to and under all Pool Assets and Related Assets and all proceeds of any of the foregoing, whether currently owned or existing or thereafter arising, acquired or originated, or in which Seller now or hereafter has any rights, and wherever so located (the assets so assigned to include not only the Pool Assets and Related Assets existing as of the date of such Purchase but also all future Pool Assets and the Related Assets acquired by Seller from time to time as provided in Section 1.3 ). Administrative Agent’s (on behalf of the Purchasers) right, title and interest in, to and under all such assets is herein called the “ Asset Interest ”.

On any date the Asset Interest will represent Purchasers’ ownership interest in all then outstanding Pool Assets and all Related Assets with respect thereto (including all Collections and other proceeds thereof as described in this Section 1.2(c) ), as at such date. On any date, the Asset Interest will be equal to a percentage, expressed as the following fraction:

TI + RR

NPB

where:



TI	=	Total Investment;
RR	=	the Required Reserves; and
NPB	=	the Net Pool Balance;

in each case as of that date; provided , that the Asset Interest will remain constant at 100% of the Net Pool Balance at all times on and after the Purchase Termination Date until the Final Payout Date. Administrative Agent’s right, title and interest in and to such assets, for the benefit of the Purchasers, is herein called the “ Asset Interest ”.

(d) Characterization as a Purchase and Sale; Recharacterization . It is the intention of the parties to this Agreement that the conveyance of Seller’s right, title and interest in, to and under the Asset Interest to Administrative Agent (on behalf of Purchasers) pursuant to this Agreement shall not constitute a purchase and sale and shall instead constitute a pledge and financing, and such purchase and sale of the Asset Interest to Administrative Agent (on behalf of Purchasers) hereunder shall be treated as a financing for all purposes including, U.S. federal, state and local income and franchise tax and accounting purposes. The provisions of this Agreement and all related Transaction Documents shall be construed to further these intentions of the parties. Accordingly, the Seller hereby grants to Administrative Agent (on behalf of the Affected Parties) a security interest to secure Seller’s Obligations hereunder in the Asset Interest as provided in Section 9.1 . Each of the parties hereto hereby acknowledges and intends that no Purchase hereunder shall constitute, or be deemed to constitute, a Security under U.S. securities laws or within the meaning of the UCC. The provisions of this Agreement and all related Transaction Documents shall be construed to further these intentions of the parties hereto.

(e) Tax Treatment . It is the intention of the parties to this Agreement that for U.S. federal, state and local income and franchise tax purposes, each Purchase will be treated as a loan from the applicable Purchaser to Seller (it being understood that all payments to the Purchasers, in their capacity as such, representing Yield, fees and other amounts accrued under this Agreement or the other Transaction Documents shall be deemed to constitute interest payments).

(f) Purchasers’ Limitation on Payments . Notwithstanding any provision contained in this Agreement or any other Transaction Document to the contrary, none of the Purchasers, Purchaser Agents or Administrative Agent shall, and none of them shall be obligated (whether on behalf of a Purchaser or otherwise) to, pay any amount to Seller as a Reinvestment under Section 1.3 , except to the extent that Collections are available for distribution to Seller for such purpose in accordance with this Agreement. In addition, notwithstanding anything to the contrary contained in this Agreement

or any other Transaction Document, the obligations of any Conduit Purchaser under this Agreement and all other Transaction Documents shall be payable by such Conduit Purchaser solely to the extent of funds received from Seller in accordance herewith or from any party to any Transaction Document in accordance with the terms thereof in excess of funds necessary to pay such Person’s matured and maturing Commercial Paper Notes or other senior indebtedness when due. Any amount which Administrative Agent, a Purchaser Agent or a Purchaser is not obligated to pay pursuant to the operation of the two preceding sentences shall not constitute a claim (as defined in § 101 of the Bankruptcy Code) against, or corporate obligation of, any Purchaser Agent, any Purchaser or Administrative Agent, as applicable, for any such insufficiency unless and until such amount becomes available for distribution to Seller pursuant to the terms hereof.

(g) Obligations Not Assumed . The foregoing sale, assignment and transfer does not constitute, and is not intended to result in, the creation or an assumption by Administrative Agent, any Purchaser Agent, any Purchaser or any other Affected Party of any obligation or liability of the Seller, any Originator, the Servicer or any other Person under or in connection with all, or any portion of, the Asset Interest (including the Pool Assets and Related Assets), all of which shall remain the obligations and liabilities of the Seller, the Originators, the Servicer and such other Persons, as applicable.

(h) Obligations . Each Committed Purchaser’s obligations hereunder shall be several, such that the failure of any Committed Purchaser to make a payment in connection with any Purchase hereunder shall not relieve any other Committed Purchaser of its obligations hereunder to make payment for any Purchase.

(i) [Reserved] .

SECTION1.3 Reinvestments of Certain Collections; Payment of Remaining Collections;

Asset Interest .

(a) On the close of business on each Business Day during the period from the Effective Date to the Final Payout Date, Servicer shall, on behalf of Administrative Agent (for the benefit of the Affected Parties), out of all Collections from Pool Assets received since the end of the immediately preceding Business Day:

(i) set aside and hold in trust for Administrative Agent on behalf of the Affected Parties, an amount (based on information provided by Administrative Agent pursuant to Article II ) equal to the sum of (a) the estimated amount of Yield accrued in respect of each Rate Tranche, (b) all other amounts due to Administrative Agent, Purchaser Agents, Purchasers or any other Affected Party hereunder (including Deemed Collections, Repurchase Payments and costs and expenses described in Section 13.6 ), (c) all Custodian fees and expenses due to the Custodian under the Custodian Agreement, (d) the Servicing Fee (in each case, accrued through such day and not so previously set aside or anticipated to accrue through the end of the then current Settlement Period, as determined by Servicer based upon, among other relevant information, the then outstanding Total Investment and the Yield Rates then in effect) and (e) any other obligations of Seller hereunder and under the other Transaction Documents accrued through such day and not previously set aside, or then due and owing or otherwise outstanding (other than any portion of the Total Investment that is not otherwise payable on the following Settlement Date); and

(ii) subject to Sections 3.1(c)(iv) and 3.2(c) , set aside such Collections as are not required to be set aside and held in trust pursuant to clause (i) above (including any such Collections not set aside but commingled), for Seller to pay to the Originators for additional Pool Assets and Related Assets with respect to such Pool Assets (each such purchase being a “ Reinvestment ”); provided , that, (A) if (I) the Total Investment would exceed the sum of the Receivables Investment Base and the Loan Investment Base, (II) any Purchaser Group’s Purchaser Group Investment would exceed the related Purchaser Group Commitment or (III) the Total Investment would exceed the Purchasers’ Total Commitment (in each case, at such time and after giving effect to such Reinvestment), then Servicer (for the benefit of the Purchasers) shall only make Reinvestments after first setting aside and holding in trust for the benefit of Administrative Agent on behalf of the Affected Parties in accordance with Section 3.4 , a portion of such Collections which, together with other Collections previously set aside for such purpose and then so held, shall equal the amount necessary to reduce (i) the Total Investment to an amount equal to or less than the Purchasers’ Total Commitment, (ii) each Purchaser Group’s Purchaser Group Investment to an amount equal to or less than the related Purchaser Group Commitment and (iii) the Total Investment to an amount equal to or less than the sum of the Receivables Investment Base and the Loan Investment Base, in each case, at such time (any remaining Collections after giving effect to this proviso shall then be applied as described above in this Section 1.3(a)(ii) ); and (B) if the conditions precedent to Reinvestment in clause (a) , (b) or (d) of Section 5.3 are not satisfied or no Reinvestments are to be made in accordance with Section 3.2(c) , then Servicer shall not apply any of such remaining Collections to a Reinvestment.

(b) Unreinvested Collections . Subject to Sections 1.3(a)(ii) and 3.1(c)(iv) , Servicer shall set aside and hold in trust for the benefit of Administrative Agent on behalf of the applicable Affected Parties, all Collections which, pursuant to clause (ii) of Section 1.3(a) , may not be reinvested in the Pool Assets and Related Assets. If, prior to the date when such Collections are required to be paid to the applicable Purchaser Agents for the benefit of the applicable Affected Parties, pursuant to Section 1.3(c) , the amount of Collections so set aside exceeds the amount, if any, necessary to reduce (i) the Total Investment to an amount equal to or less than the Purchasers’ Total Commitment, (ii) each Purchaser Group’s Purchaser Group Investment to an amount equal to or less than the related Purchaser Group Commitment and (iii) Total Investment to an amount equal to or less than the sum of the Receivables Investment Base and the Loan Investment Base (in each case, at such time), and the conditions precedent to Reinvestment set forth in clauses (a) , (b) and (d) of Section 5.3 are satisfied and Reinvestments are permitted in accordance with Section 3.2(c) , then Servicer shall apply such Collections (or, if less, a portion of such Collections equal to the amount of such excess) in accordance with Section 1.3(a)(ii) to the making of a Reinvestment.

(i) Servicer shall pay all amounts of Collections set aside and held in trust pursuant to clause (i) of Section 1.3(a) in respect of Yield on a Rate Tranche not funded by the issuance of Commercial Paper Notes (including under a Liquidity Agreement or an Enhancement Agreement) to the applicable Purchaser Agent on the last day of the then current Yield Period for such Rate Tranche based on information provided by such Purchaser Agent pursuant to Article II , or during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, on such earlier date or dates as any such Purchaser Agent shall require on at least two (2) Business Days’ prior written notice to Servicer.

(ii) Servicer shall pay all amounts of Collections set aside and held in trust pursuant to clause (i) of Section 1.3(a) above and not applied pursuant to clause (i) of this Section 1.3(c) to the applicable Purchaser Agent on the Settlement Date for each Settlement Period, as provided in Section 3.1 , or during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, on such earlier date or dates as any such Purchaser Agent shall require on at least two (2) Business Days’ prior written notice to Servicer.

(iii) Servicer shall pay all amounts set aside and held in trust pursuant to Section 1.3(b) above (and not otherwise applied pursuant to the last sentence of such Section) to the applicable Purchaser Agent for the account of the Affected Parties (A) on the last day of the then current Yield Period for any Rate Tranche not funded by the issuance of Commercial Paper Notes in an amount not exceeding each Committed Purchaser’s Tranche Investment of such Rate Tranche (based on information provided by the applicable Purchaser Agent pursuant to Article II ), and (B) on the Settlement Date for each Settlement Period, as provided in Section 3.1 , in an amount not exceeding each Conduit Purchaser’s Tranche Investment of the Rate Tranche funded by Commercial Paper Notes (based on information provided by the applicable Purchaser Agent pursuant to Article II ), or, in the case of clause (A) or clause (B) above, during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, on such earlier date or dates as any Purchaser Agent shall require on at least two (2) Business Days’ prior written notice to Servicer.

(d) Reduction of Total Investment . Neither the Total Investment nor any Purchaser Group’s Purchaser Group Investment, shall be reduced by the amount of Collections set aside pursuant to this Section unless and until such Collections are actually received by the applicable Purchaser Agent for application hereunder to reduce Total Investment and the applicable Purchaser Group’s Purchaser Group Investment in accordance with the terms hereof.

ARTICLE II

COMPUTATIONAL RULES

SECTION 2.1 Selection of Rate Tranches . Subject to the requirements set forth in this Article II , each Purchaser Agent shall from time to time, only for purposes of computing Yield with respect to each Purchaser in its Purchaser Group, account for the Asset Interest in terms of one or more Rate Tranches, and the applicable Yield Rate may be different for each Rate Tranche. Each Purchaser Group’s Purchaser Group Investment shall be allocated to each Rate Tranche by the related Purchaser Agent to reflect the funding sources for each portion of the Asset Interest, so that:

(a) there will be one or more Rate Tranches, selected by each Purchaser Agent, reflecting the portion, if any, of the Asset Interest funded or maintained by its related Committed Purchaser other than through the issuance of Commercial Paper Notes (including by outstanding Liquidity Advances or by funding under an Enhancement Agreement); and

(b) there will be a Rate Tranche, selected by each Purchaser Agent, equal to the excess of such Purchaser Group’s aggregate Purchaser Group Investment over the aggregate amounts allocated at such time pursuant to clause (a) above, which Rate Tranche shall reflect the portion of the Asset Interest funded or maintained by Commercial Paper Notes.

SECTION 2.2 Computation of each Purchaser Group Investment and each Purchaser’s Tranche Investment . In making any determination of any Total Investment, any Purchaser Group’s Purchaser Group Investment and any Purchaser’s Tranche Investment, the following rules shall apply:

(a) each Purchaser Group’s Purchaser Group Investment shall not be considered reduced by any allocation, setting aside or distribution of any portion of Collections unless such Collections shall have been actually received by the applicable Purchaser Agent in accordance with the terms hereof;

(b) each Purchaser Group’s Purchaser Group Investment (or any other amounts payable under any Transaction Document) shall not be considered reduced (or paid) by any distribution of any portion of Collections or other payments, as applicable, if at any time such distribution or payment is rescinded or must otherwise be returned for any reason; and

(c) if there is any reduction in any Purchaser Group’s Purchaser Group Investment, there shall be a corresponding reduction (in the aggregate) in such Purchaser’s Tranche Investment with respect to one or more Rate Tranches selected by the related Purchaser Agent in its sole discretion (subject to Section 1.3(c)(iii) ).

SECTION 2.3 Computation of Account Debtor Concentration Limit, Account Debtor Concentration Overage Amount, Concentration Overage Amount (Loans) and Unpaid Balance . In the case of any Account Debtor which is an Affiliate of any other Account Debtor, the Account Debtor Concentration Limit, the Account Debtor Concentration Overage Amount and the aggregate Unpaid Balance of Pool Receivables of such Account Debtors shall be calculated as if such Account Debtors were one Account Debtor. In the case of any Obligor which is an Affiliate of any other Obligor, the Concentration Overage Amount (Loans) and the aggregate Unpaid Balance of Pool Loans of such Obligors shall be calculated as if such Obligors were one Obligor.

SECTION 2.4 Computation of Yield . In making any determination of Yield, the following rules shall apply:

(a) each Purchaser Agent shall determine the Yield accruing with respect to each Rate Tranche for the Purchasers in its Purchaser Group, based on the Yield Period therefor determined in accordance with Section 2.1 and the other terms hereof (or, in the case of the Rate Tranche funded by Commercial Paper Notes, each Settlement Period), in accordance with the definition of Yield;

(b) no provision of this Agreement shall require the payment or permit the collection of Yield in excess of the maximum permitted by Applicable Law; and

(c) Yield for any Rate Tranche shall not be considered paid by any distribution or other payment if at any time such distribution or payment is rescinded or must otherwise be returned for any reason.

SECTION 2.5 Estimates of Yield Rate, Fees, Etc . It is understood and agreed that (a) the Yield Rate for any Rate Tranche may change from one applicable Yield Period or Settlement Period to the next, and the applicable Bank Rate, Base Rate or CP Rate used to calculate the applicable Yield Rate may, to the extent set forth in the definitions thereof contained in Appendix A , change from time to time and at any time during an applicable Yield Period or Settlement Period, (b) any rate information provided by any Purchaser Agent to Seller or Servicer shall be based upon such Purchaser Agent’s good faith estimate, (c)

the amount of Yield actually accrued with respect to a Rate Tranche during any Yield Period (or, in the case of the Rate Tranche funded by Commercial Paper Notes, any Settlement Period) may exceed, or be less than, the amount set aside with respect thereto by Servicer, and (d) the amount of fees and amounts provided for in Section 4.3 payable to any Affected Party accrued hereunder with respect to any Settlement Period may exceed, or be less than, the amount set aside with respect thereto by Servicer. Failure to set aside any amount so accrued shall not relieve Servicer of its obligation to remit Collections to the applicable Purchaser Agent or otherwise to any other Person with respect to such accrued amount, as and to the extent provided in Section 3.1 .

ARTICLE III

SETTLEMENTS

SECTION 3.1 Settlement Procedures .

The parties hereto will take the following actions with respect to each Settlement Period:

(a) Information Package . On the twentieth (20 ^th ) day of each calendar month (or if such day is not a Business Day, the next Business Day) following the Cut-Off Date for such Settlement Period (each a “ Reporting Date ” for and related to the Settlement Period ending immediately prior to such date), Servicer shall deliver to Administrative Agent and each Purchaser Agent an e-mail attaching an Excel file and a file in .pdf or similar format signed by Servicer containing the information described in Exhibit 3.1(a) , including the information calculated by Servicer pursuant to this Section 3.1 (each, an “ Information Package ”) for the related Settlement Period; provided that Administrative Agent may modify, in any reasonable respect, the information required to be provided by Servicer in, or the form of, the Information Package upon reasonable prior notice to Servicer; provided further that during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, Administrative Agent or any Purchaser Agent may request, in its sole discretion, Servicer to, and Servicer agrees to, deliver any information related to the Asset Interest or the transactions contemplated hereby as Administrative Agent or any Purchaser Agent shall request (including a calculation of Required Reserves and each component thereof) on each Business Day.

(b) Yield; Other Amounts Due . On or before the second (2 ^nd ) Business Day prior to the Reporting Date for each Settlement Period, each Purchaser Agent shall notify Servicer of (i) the amount of Yield accrued in respect of each related Rate Tranche for the Purchasers in its Purchaser Group during such Settlement Period and (ii) all fees and other amounts accrued and payable or to be paid by Seller under this Agreement and the other Transaction Documents on the related Settlement Date (other than amounts described in clause (c) below) to such Purchaser Agent or any Purchaser in, or Affected Party related to, its Purchaser Group. Seller (or Servicer on its behalf), on the Settlement Date for such Settlement Period, or when otherwise required hereunder prior to each such date, shall pay such Yield and all fees and other amounts due in respect of such Settlement Period to the applicable Purchaser Agent or Affected Party out of amounts set aside pursuant to Section 1.3 for such purpose and, to the extent such amounts were not so set aside, Seller hereby agrees to pay such amounts (notwithstanding any limitation on recourse or other liability limitation contained herein to pay such amounts) to the applicable Purchaser Agent or Affected Party.

(i) Before each Reporting Date, Servicer shall compute, as of the most recent Cut-Off Date and based upon the assumption in the next sentence, (A) the Total Investment, the Purchaser Group Investment of each Purchaser Group, the Required Reserves, the Required Loan Reserves, the Required Receivable Reserves, the Loan Investment Base, the Receivables Investment Base, the Net Loan Pool Balance, the Net Receivables Pool Balance, the Net Pool Balance and each component of each of the foregoing, (B) the amount of the reduction or increase (if any) in each of the Required Reserves, the Required Receivable Reserves, the Required Loan Reserves, the Net Receivables Pool Balance, the Net Loan Pool Balance, the Net Pool Balance, the Purchaser Group Investment of each Purchaser Group, the Loan Investment Base, the Receivables Investment Base and the Total Investment since the immediately preceding Cut-Off Date, (C) the excess (if any) of the aggregate Total Investment over the sum of the Receivables Investment Base and the Loan Investment Base, (D) the excess (if any) of the Total Investment, over the Purchasers’ Total Commitment, (E) the excess (if any) of the Purchaser Group Investment of each Purchaser Group, over the Purchaser Group Commitment of each such Purchaser Group and (F) each of the components of any of the foregoing. Such calculations shall be based upon the assumption that Collections set aside pursuant to Section 1.3(b) (and not otherwise applied in accordance with such Section) will be paid to the applicable Purchaser Agent for the benefit of the applicable Purchasers in its Purchaser Group in accordance with the related Purchaser Group’s Ratable Share of such Collections on the Settlement Date for the Settlement Period related to such Reporting Date.

(ii) If, according to the computations made pursuant to clause (i) of this Section 3.1(c) , the Total Investment at such time shall exceed the sum of the Receivables Investment Base and the Loan Investment Base, the Total Investment at such time shall exceed the Purchasers’ Total Commitment or the Purchaser Group Investment of any Purchaser Group shall exceed the Purchaser Group Commitment of such Purchaser Group, Servicer shall, on behalf of Seller, (i) promptly notify Administrative Agent and each Purchaser Agent thereof and (ii) immediately pay to the applicable Purchaser Agents for the benefit of the applicable Purchasers the amount necessary to reduce (A) the Total Investment to no more than the Purchasers’ Total Commitment, (B) the aggregate Total Investment to no more than the sum of the Receivables Investment Base and the Loan Investment Base at such time and (C) the Purchaser Group Investment of each Purchaser Group to no more than the Purchaser Group Commitment of each such Purchaser Group, as applicable.

(iii) The payment described in clause (ii) of this Section 3.1(c) shall be made out of amounts set aside pursuant to Section 1.3 for such purpose and, to the extent such amounts were not so set aside, Seller hereby agrees to pay such amounts (notwithstanding any limitation on recourse or other liability limitation contained herein to pay such amounts) to Servicer during the relevant Settlement Period. Notwithstanding anything to the contrary set forth above, on any date on or prior to the Final Payout Date, if the Total Investment exceeds the sum of the Loan Investment Base and the Receivables Investment Base at such time, Servicer shall immediately pay to each Purchaser Agent (ratably, based on the Purchaser Group Investment of such Purchaser Agent’s Purchaser Group at such time) an amount equal to such excess.

(iv) In addition to the payments described in clause (ii) of this Section 3.1(c) , during the Liquidation Period or after the occurrence of an Event of Default that has not been waived

in accordance with this Agreement, Servicer shall pay to each Purchaser Agent the Ratable Share of its Purchaser Group of all other Collections on all Pool Assets, whether or not required to be set aside pursuant to Section 1.3 on the dates specified pursuant to Section 1.3(c) .

(d) Order of Application . Servicer (for the benefit of the Affected Parties) shall distribute the funds required to be distributed pursuant to this Section 3.1 with respect to any Settlement Period, in the following order of priority:

(i) to each Purchaser Agent ratably (based on the aggregate accrued and unpaid Yield) Yield accrued and unpaid on all Rate Tranches for the Purchasers in its Purchaser Group howsoever funded or maintained during the related Settlement Period;

(ii) to each Purchaser Agent ratably (based on the aggregate accrued and unpaid Unused Fee) the accrued and unpaid Unused Fee for its Purchaser Group and to the accrued and unpaid Program Fee for its Purchase Group;

(iii) to the Servicer all accrued and unpaid Servicing Fee (if Servicer is not CHS or an Affiliate thereof);

(iv) to the Custodian, any fees then due and payable to the Custodian pursuant to that certain Schedule of Fees for Services as Custodian for Cofina Funding, LLC “Seller” MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), “Administrative Agent” Secured Facility, dated as of July 21, 2016;

(v) to Administrative Agent and each Purchaser Agent ratably (based on the aggregate accrued and unpaid amounts owing to such Person) accrued and unpaid amounts owed to Administrative Agent and each Purchaser Agent hereunder (including all fees payable to Administrative Agent, Purchaser Agents and Purchasers pursuant to the Fee Letter other than fees paid pursuant to clause (ii) above);

(vi) to each Purchaser Agent ratably (based on the related Purchaser Group Investment), the reduction of Total Investment, to the extent such reduction is required under Section 3.1(c) or 3.2(c) or, during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, with respect to each Purchaser Group, as set forth on a Notice of Payment to be delivered to the Administrative Agent and each Purchaser Agent on the applicable Settlement Date, first , to pay any outstanding Commercial Paper (as defined in the UCC) funding or maintaining the related Purchaser Group Investment and second , to ratably reduce the remainder of the related Purchaser Group Investment;

(vii) prior to the Liquidation Period, and as long as no Event of Default has occurred and is continuing, to the Seller to be used as a Reinvestment to acquire additional Pool Assets and Related Assets sold by the Seller since the previous Settlement Date;

(viii) to (A) the Custodian, any fees and expenses then due and payable to the Custodian pursuant to the Custodian Agreement and not paid pursuant to Section 3.1(d)(iv) above and (B) each Affected Party (or the related Purchaser Agent on their behalf) ratably (based on the aggregate accrued and unpaid Obligations) accrued and unpaid Obligations owed to such Affected Parties;

(ix) to the Servicer all accrued and unpaid Servicing Fee (if Servicer is CHS or an Affiliate thereof); and

(x) to the Seller, any remaining amounts.

(e) Non-Distribution of Servicing Fee . If Administrative Agent and each Purchaser Agent consent (which consent is granted as of the Closing Date but which consent shall be deemed to have been revoked upon the occurrence of an Event of Default that has not been waived in accordance with this Agreement), the amounts (if any) set aside by Servicer pursuant to Section 1.3 in respect of the Servicing Fee may be retained by Servicer or any permitted subservicer for its own account. To the extent Servicer sets aside and retains such amounts, no distribution shall be made in respect of such amounts pursuant to clause (d)(iv) or clause (d)(ix) above.

SECTION 3.2 Deemed Collections; Event of Repurchase; Reduction of Total Investment, Etc .

(a) Deemed Collections . If, on any day, the Unpaid Balance of a Pool Asset is reduced (but not cancelled) as a result of any Dilution, Seller shall be deemed to have received on such day a Collection of such Pool Asset in the amount of such reduction. If, on any day, a Pool Asset is canceled (or reduced to zero) as a result of any Dilution, Seller shall be deemed to have received on such day a Collection of such Pool Asset in the amount of the Unpaid Balance (as determined immediately prior to such Dilution) of such Pool Asset. If, on any day, the Unpaid Balance of a Pool Asset is less than the amount included in calculating the Net Pool Balance for purposes of any Information Package (for any reason other than such Pool Asset becoming a Defaulted Loan or Defaulted Receivable, as applicable, or due to the application of Collections received with respect to such Pool Asset), Seller shall be deemed to have received a Collection of such Pool Asset in the amount of such difference. Any amount deemed to have been received under this Section 3.2(a) shall constitute a “ Deemed Collection ”. In the event of any such Deemed Collection, Seller shall, if (i) the Liquidation Period has commenced, or (ii) the aggregate Total Investment at such time exceeds the sum of the Loan Investment Base and Receivables Investment Base at such time after giving effect to such Deemed Collection, deposit an amount equal to such Deemed Collection into the Concentration Account by no later than the fourth (4 ^th ) Business Day after Seller or Servicer obtains knowledge or notice thereof (or during the Liquidation Period, within two (2) Business Days from the event giving rise to such Deemed Collection) for application as provided in this Agreement.

(b) Repurchase Event . If any of the following events (each, an “ Event of Repurchase ”) occurs and is continuing with respect to a Pool Asset:

(i) any representation or warranty by Seller hereunder with respect to such Pool Asset is incorrect either (A) in any material respect or (B) in any manner that adversely affects the value or collectability of such Pool Asset, in each case, when made or deemed made;

(ii) Seller or Servicer fails to perform or observe any other term, covenant or agreement with respect to such Pool Asset set forth in any Transaction Document or any related Receivable Documentation or Loan Documents, as applicable, on its part to be performed or observed and such failure shall or could reasonably be expected to have an adverse effect on the ability to collect the Unpaid Balance of such Pool Asset on the due date thereof; or

(iii) either (A) Seller or Servicer instructs the related Account Debtor or Obligor to pay any amount with respect to such Pool Asset to an account other than a Lockbox, an Originator Specified Account, a Collection Account or the Concentration Account or (B) the related Account Debtor or Obligor refuses to make any payment to a Lockbox, an Originator Specified Account, a Collection Account or the Concentration Account (unless to the extent such refusal to pay is due to the financial or credit condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to such Account Debtor or Obligor)),

then, Seller shall immediately deliver notice thereof to the Administrative Agent and, at the time, in the manner and otherwise as hereinafter set forth, repurchase such Pool Asset at the Administrative Agent’s option and demand; provided , however , that if a “Sale Agreement Event of Repurchase” (as defined in the Sale Agreement) shall have occurred under the Sale Agreement with respect to such Pool Asset, then such event shall also constitute an Event of Repurchase for purposes of this Agreement. The repurchase price for a Pool Asset shall be the amount equal to the Unpaid Balance of such Pool Asset at such time and shall be paid to the Concentration Account in immediately available funds by no later than the second (2 ^nd ) Business Day following demand therefor by the Administrative Agent. Upon the payment in full of the repurchase price with respect to a Pool Asset, such Pool Asset shall hereby be, and be deemed to be, repurchased by Seller from the applicable Purchasers without recourse to or warranty by the Administrative Agent or any Purchaser but free and clear of any lien, encumbrance or other Adverse Claim created by or through the Administrative Agent and each Purchaser. Except as specifically set forth in this clause (b) , the Seller shall not have any right or obligation to repurchase Pool Assets.

(c) Seller’s Optional Reduction of Total Investment . Subject to Sections 1.2(a) and 4.3 , Seller may at any time and from time to time elect to reduce (in whole or in part) Total Investment as follows:

(i) Seller shall give Administrative Agent and each Purchaser Agent a Notice of Payment with respect to such elected reduction (including the amount of such proposed reduction and the proposed date on which such reduction will commence) no later than 11:00 a.m. (New York City time) three (3) Business Days prior to the proposed reduction date;

(ii) on the proposed date of commencement of such reduction and on each day thereafter, Servicer shall refrain from reinvesting Collections pursuant to Section 1.3 until the amount thereof not so reinvested shall equal the desired amount of reduction; and

(iii) Servicer shall hold such Collections in trust for Purchasers, pending payment to the applicable Purchaser Agents, as provided in Section 1.3 ; provided that

(A) the amount of any such reduction shall be not less than $5,000,000 and shall be an integral multiple of $100,000; and

(B) Seller shall use reasonable efforts to choose a reduction amount, and the date of commencement thereof, so that such reduction shall commence and conclude in the same Settlement Period.

(d) No Further Reinvestments . Notwithstanding anything to the contrary set forth herein (including Section 3.1 ), after giving effect to any reduction of the Total Investment under Section 3.2(c) , or otherwise, which reduces the Total Investment to zero, so long as there are no outstanding

amounts constituting liabilities or other obligations of Seller, any Originator, Servicer or Performance Guarantor hereunder or under any other Transaction Document owing to any Purchaser, any Purchaser Agent, Administrative Agent, any Indemnified Party or any Affected Party, no further Reinvestments shall be made unless and until a new Purchase is made in accordance with Sections 1.1 and 1.2 .

(e) Seller’s Optional Reduction of Purchaser’s Total Commitment . Seller may at any time and from time to time elect to reduce the unused portion of the Purchaser’s Total Commitment by giving the Administrative Agent and each Purchaser Agent a Notice of Payment with respect to such elected reduction (including the amount of such proposed reduction and the proposed date on which such reduction will commence) no later than 11:00 a.m. (New York City time) 30 days prior to the proposed reduction date; provided that the amount of any such reduction shall be not less than $5,000,000 and shall be an integral multiple of $100,000. Any such reduction shall be applied pro rata to the Commitment of each Committed Purchaser.

SECTION 3.3 Payments and Computations, Etc .

(a) Payments . All amounts to be paid to, or deposited by Seller, Servicer, CHS or Performance Guarantor with, Administrative Agent, any Purchaser Agent or any other Person hereunder (other than amounts payable under Section 4.2 ) shall be paid or deposited in accordance with the terms hereof no later than 11:00 a.m. (New York City time) on the day when due in USD in same day funds to the applicable account set forth on Schedule I or to such other account as Administrative Agent or any Purchaser Agent, as applicable, shall designate in writing to Servicer from time to time.

(b) Late Payments . Seller or Servicer, as applicable, shall, out of amounts set aside pursuant to Section 1.3 for such purpose and to the extent permitted by Applicable Law, pay to the applicable Purchaser Agent, for the benefit of the applicable Affected Party, interest on all amounts not paid or deposited by such party on the date when due hereunder at an annual rate equal to 2.0% above the Base Rate, payable on demand; provided that such interest rate shall not at any time exceed the maximum rate permitted by Applicable Law.

(c) Method of Computation . All computations of interest, Yield, any fees payable under Section 4.1 and any other fees payable by Seller to any Purchaser, any Purchaser Agent, Administrative Agent or any other Affected Party in connection with Purchases hereunder shall be made on the basis of a year of 360 days for the actual number of days (including the first day but excluding the last day) elapsed (except that calculations with respect to the Prime Rate shall be on the basis of a year of 365 or 366 days, as the case may be).

(d) Payment of Currency and Setoff . All payments by Seller or Servicer to any Affected Party or any other Person shall be made in USD and without set-off or counterclaim. Any of Seller’s or Servicer’s obligations hereunder shall not be satisfied by any tender or recovery of another currency except to the extent such tender or recovery results in receipt of the full amount of USD.

(e) Taxes . (i) Except to the extent required by Applicable Law, any and all payments and deposits required to be made hereunder, under any other Transaction Document or under any instrument delivered hereunder or thereunder to any Affected Party or otherwise hereunder or thereunder by Seller or Servicer shall be made free and clear of, and without withholding or deduction for, any and all present or future Taxes. If Seller or Servicer shall be required by Applicable Law to make any such withholding or deduction, (A) if such Tax is an Indemnified Tax, Seller (or Servicer,

on its behalf) shall make an additional payment to such Affected Party, in an amount sufficient so that, after making all required withholdings or deductions (including withholdings or deductions applicable to additional sums payable under this Section 3.3(e) ), such Affected Party receives an amount equal to the sum it would have received had no such withholdings or deductions been made, (B) Seller (or Servicer, on its behalf) shall make such deductions and (C) Seller (or Servicer, on its behalf) shall pay the full amount deducted to the relevant taxation authority or other Governmental Authority in accordance with Applicable Law.

(i) Seller will indemnify each Affected Party for the full amount of (A) Indemnified Taxes (including any Indemnified Taxes imposed by any jurisdiction on amounts payable under this Section paid by such Affected Party, as the case may be, and any liability (including penalties, interest and expenses) paid or payable by such Affected Party arising therefrom or with respect thereto) and (B) Taxes that arise because a Purchase or the Asset Interest is not treated for U.S. federal, state or local income or franchise tax purposes as intended under Section 1.2(e) (such indemnification will include any U.S. federal, state or local income and franchise taxes necessary to make such Affected Party whole on an after-tax basis taking into account the taxability of receipt of payments under the this clause (B) and any reasonable expenses (other than Taxes) arising out of, relating to, or resulting from the foregoing). Any indemnification under this Section 3.3(e)(ii) shall be paid on the next Settlement Date (or during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with the terms of this Agreement, within two (2) Business Days) after the date any Affected Party makes written demand therefor, together with a statement of reasons for such demand and the calculations of such amount. Such calculations, absent manifest error, shall be final and conclusive on all parties.

(ii) Within 30 days after the date of any payment of Taxes withheld by any of Seller or Servicer, as applicable, in respect of any payment to any Affected Party, Seller or Servicer, as applicable, will furnish to Administrative Agent and each Purchaser Agent, the original or a certified copy of a receipt evidencing payment thereof (or other evidence reasonably satisfactory to Administrative Agent).

(iii) Without prejudice to the survival of any other agreement contained herein, the agreements and obligations contained in this Section shall survive the payment in full of Obligations hereunder.

(iv) Any Affected Party that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Transaction Document shall deliver to CHS and Administrative Agent, at the time or times reasonably requested by CHS or Administrative Agent, such properly completed and executed documentation reasonably requested by CHS or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Affected Party, if reasonably requested by CHS or Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by CHS or Administrative Agent as will enable CHS or Administrative Agent to determine whether or not such Affected Party is subject to backup withholding or information reporting requirements.

(v) Any Affected Party that is a “United States person” within the meaning of Section 7701(a)(30) of the Code (a “ U.S. Person ”) shall deliver to CHS and the Administrative Agent on or prior to the date on which such Affected Party becomes a Affected Party under

this Agreement (and from time to time thereafter upon the reasonable request of CHS or the Administrative Agent), executed copies of IRS Form W-9 certifying that such Affected Party is exempt from U.S. federal backup withholding tax.

(vi) Any Affected Party that is not a U.S. Person (a “ Foreign Affected Party ”) shall, to the extent it is legally entitled to do so, deliver to CHS and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Affected Party becomes an Affected Party under this Agreement (and from time to time thereafter upon the reasonable request of CHS or the Administrative Agent), whichever of the following is applicable:

(1) in the case of a Foreign Affected Party claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Transaction Document, executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Transaction Document, IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2) executed copies of IRS Form W-8ECI;

(3) in the case of a Foreign Affected Party claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate to the effect that such Foreign Affected Party is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “ U.S. Tax Compliance Certificate ”) and (y) executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E; or

(4) to the extent a Foreign Affected Party is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Affected Party is a partnership and one or more direct or indirect partners of such Foreign Affected Party are claiming the portfolio interest exemption, such Foreign Affected Party may provide a U.S. Tax Compliance Certificate on behalf of each such direct and indirect partner.

(vii) If a payment made to a Purchaser under any Transaction Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Purchaser were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Purchaser shall deliver to CHS and Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by CHS or Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by CHS or Administrative Agent as may be necessary for CHS and Administrative Agent to comply with their obligations under FATCA

and to determine that such Purchaser has complied with such Purchaser’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (viii) , “FATCA” shall include any amendments made to FATCA after the Closing Date.

(viii) Each Purchaser Agent (on behalf of its related Purchasers) agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Seller and the Administrative Agent in writing of its legal inability to do so.

SECTION 3.4 Treatment of Collections and Deemed Collections . Seller shall immediately deliver to Servicer all Deemed Collections and Repurchase Payments, and Servicer shall hold or distribute such Deemed Collections and Repurchase Payments as Yield, accrued Servicing Fee, repayment of Total Investment or as otherwise applicable hereunder to the same extent as if such Collections had actually been received on the date of such delivery to Servicer. So long as Seller or Servicer shall hold any Collections (including Deemed Collections and Repurchase Payments) required to be paid to Servicer, any Purchaser, any Purchaser Agent or Administrative Agent, Seller or Servicer shall hold and apply such Collections in accordance with Section 1.3 and Section 3.2 , as applicable, and shall clearly mark its records to reflect the same. Seller shall promptly enforce all obligations of Originators under the Sale Agreement, including, payment of Deemed Collections (as defined in the Sale Agreement).

ACTICLE IV

FEES AND YIELD PROTECTION

SECTION 4.1 Fees . From the Effective Date until the Final Payout Date, Seller and CHS, jointly and severally, shall pay to Administrative Agent, each Purchaser Agent and each Purchaser, as applicable, all fees specified in the Fee Letter or any other Transaction Document in accordance with the terms of the Fee Letter, such Transaction Document and this Agreement.

SECTION 4.2 Yield Protection .

(a) If any Regulatory Change including any Specified Regulation:

(i) shall subject an Affected Party to any tax, duty or other charge with respect to any Asset Interest owned, maintained or funded by it (or its participation in any of the foregoing), or any obligations or right to make Purchases or Reinvestments or to provide funding or maintenance therefor (or its participation in any of the foregoing), or shall change the basis of taxation of payments to the Affected Party or other Indemnified Party of Total Investment or Yield owned by, owed to, funded or maintained in whole or in part by it (or its participation in any of the foregoing) or any other amounts due under this Agreement in respect of the Asset Interest owned, maintained or funded by it or its obligations or rights, if any, to make or participate in Purchases or Reinvestments or to provide funding therefor or the maintenance thereof;

(ii) shall impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of any Affected Party, deposits or obligations with or for the account of any Affected Party or with or for the account of any Affiliate (or entity deemed by the

Federal Reserve Board or other Governmental Authority to be an affiliate) of any Affected Party, or credit extended by any Affected Party;

(iii) shall impose any other condition affecting any Asset Interest owned, maintained or funded (or participated in) in whole or in part by any Affected Party, or its obligations or rights, if any, to make (or participate in) Purchases or Reinvestments or to provide (or to participate in) funding therefor or the maintenance thereof;

(iv) shall increase the rate for, or changes the manner in which the Federal Deposit Insurance Corporation (or a successor thereto) or similar Person assesses, deposit insurance premiums or similar charges which an Affected Party is obligated to pay; or

(v) shall increase the amount of capital or liquidity maintained or required or requested or directed to be maintained by any Affected Party;

and the result of any of the foregoing is or would be, in each case, as determined by the applicable Purchaser Agent or the applicable Affected Party:

(A) to increase the cost to (or impose a cost on) (1) an Affected Party funding or making or maintaining any Purchases or Reinvestments, any purchases, reinvestments, or loans or other extensions of credit under any Liquidity Agreement, any Enhancement Agreement or any commitment (hereunder or under any Liquidity Agreement or any Enhancement Agreement) of such Affected Party with respect to any of the foregoing, or (2) any Purchaser Agent or Administrative Agent for continuing its relationship with any Purchaser;

(B) to reduce the amount of any sum received or receivable by an Affected Party under this Agreement, any Liquidity Agreement or any Enhancement Agreement (or its participation in any such Liquidity Agreement or Enhancement Agreement) with respect thereto; or

(C) (i) to reduce the rate of return on the capital of such Affected Party as a consequence of its obligations hereunder, under any Liquidity Agreement or under any Enhancement Agreement (or its participation in any such Liquidity Agreement or Enhancement Agreement), including its funding or maintenance of any portion of the Asset Interest, or arising in connection herewith (or therewith) to a level below that which such Affected Party could otherwise have achieved hereunder or thereunder or (ii) to increase the liquidity required of such Affected Party as a consequence of its obligations hereunder or under any Liquidity Agreement or any Enhancement Agreement (or its participation in any such Liquidity Agreement or Enhancement Agreement), including its funding or maintenance of any portion of the Asset Interest, or arising in connection herewith (or therewith) to a level greater than that which such Affected Party could otherwise have achieved hereunder or thereunder,

then, subject to Section 4.2(d) below, on the Settlement Date (or during the Liquidation Period or after the occurrence of an Event of Default that has not been waived in accordance with the terms of this Agreement, within two (2) Business Days) following its receipt of notice from such Affected Party (or by the Administrative Agent or a Purchaser Agent on its behalf) in accordance with Section 4.2(c) below, Seller shall pay directly to such Affected Party such additional amount or amounts as will compensate such Affected Party for such additional or increased cost or such reduction or liquidity increase; provided that such additional

amount or amounts shall not be payable with respect to any Regulatory Change for any period in excess of 180 days prior to the date of demand by the Affected Party unless (1) the effect of such Regulatory Change was retroactive by its terms to a period prior to the date of such Regulatory Change, in which case any additional amount or amounts shall be payable for the retroactive period but only if the Affected Party provides its written demand not later than 180 days after such Regulatory Change; or (2) the Affected Party reasonably and in good faith did not believe such Regulatory Change resulted in such an additional or increased cost or charge or such a reduction during such prior period.

(b) Each Affected Party (or the Administrative Agent or a Purchaser Agent on its behalf), shall use commercially reasonable efforts to notify Seller and Administrative Agent of any event of which it has knowledge which will entitle such Affected Party to compensation pursuant to this Section 4.2 ; provided that no failure to give or delay in giving such notification shall adversely affect the rights of any Affected Party to such compensation.

(c) In determining any amount provided for or referred to in this Section 4.2 , an Affected Party may use any reasonable averaging and attribution methods that it, in its reasonable discretion, shall deem applicable. Any Affected Party (or the Administrative Agent or a Purchaser Agent on its behalf) when making a claim under this Section 4.2 shall submit to Seller and Administrative Agent a written statement of such increased cost or reduced return, which statement, in the absence of manifest error, shall be conclusive and binding upon Seller.

(d) Except as set forth in clause (a) above, failure or delay on the part of any Affected Party (or Administrative Agent or a Purchaser Agent) to demand compensation pursuant to this Section 4.2 shall not constitute a waiver of such Affected Party’s (or the Administrative Agent’s or a Purchaser Agent’s on its behalf) right to demand such compensation.

SECTION 4.3 Funding Losses . If any Affected Party incurs any cost, loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Affected Party), at any time, as a result of (a) any optional or required settlement or repayment with respect to such Purchaser’s Tranche Investment of any Rate Tranche, howsoever funded, being made on any day other than the scheduled last day of an applicable Yield Period with respect thereto, (b) any Purchase not being completed by Seller in accordance with its request therefor under Section 1.2 , (c) the failure to exercise or complete (in accordance with Section 3.2(c) ) any reduction in Total Investment elected to be made under Section 3.2(c) , (d) any reduction in Total Investment elected under Section 3.2(c) exceeding the total amount of Rate Tranches, howsoever funded, with respect to which the last day of the related Yield Period is the date of such reduction or (e) any other mandatory or voluntary reduction in Total Investment, then, upon written notice from such Affected Party (or the Administrative Agent or a Purchaser Agent on its behalf) to Seller and Servicer, Seller shall pay to the applicable Purchaser Agent for the account of the applicable Affected Parties, on the next Settlement Date (or during the Liquidation Period, after the occurrence of an Event of Default that has not been waived in accordance with this Agreement, within two (2) Business Days from the receipt of such notice) the amount of such cost, loss or expense. Such written notice shall, in the absence of manifest error, be conclusive and binding upon Seller. If an Affected Party incurs any cost, loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Affected Party), at any time, and is not entitled to reimbursement for such loss or expense in the manner set forth above, such Affected Party shall individually bear such loss or expense without recourse to, or payment from, any other Affected Party.

ARTICLE V

CONDITIONS PRECEDENT

SECTION 5.1 Closing Date . The parties hereto acknowledge that the Original Agreement became effective on the Closing Date.

SECTION 5.2 Effective Date . This Agreement shall become effective on the Effective Date, or such later date as all of the conditions in this Section 5.2 have been satisfied. The occurrence of the Effective Date is subject to the condition precedent that the Administrative Agent shall have received, on or before such date, the following, each (unless otherwise indicated) dated such date or another recent date reasonably acceptable to the Required Purchasers and in form and substance reasonably satisfactory to the Required Purchasers:

(a) A copy of the resolutions or unanimous written consent, as applicable, of the board of directors or board of managers, as the case may be, of each of Seller, Originators, Servicer and Performance Guarantor required to authorize the execution, delivery and performance by it of each Transaction Document to be delivered by it hereunder and the transactions contemplated thereby, certified by its secretary or any other authorized person.

(b) A certificate issued by the Secretary of State of the applicable state or organization as to the legal existence and good standing of Seller, Servicer, Originators and Performance Guarantor.

(c) A certificate of the Secretary or Assistant Secretary of each of Seller, Servicer, Originators and Performance Guarantor certifying attached copies of the organizational documents of such Person and all documents evidencing necessary limited liability company or corporate action (as the case may be) to be taken by and governmental approvals, if any, to be obtained by such Person with respect to this Agreement and each of the other Transaction Documents and the names and true signatures of the incumbent officers of such Person authorized to sign this Agreement or any of the other Transaction Documents, as applicable, and any other documents to be delivered by it hereunder or thereunder or in connection herewith or therewith.

(d) A counterpart of each of this Agreement, the Fee Letter and the Effective Date Amendments, fully executed by the parties thereto.

(e) Completed requests for information (UCC search results) dated within 30 days prior to the Effective Date, and a schedule thereof listing all effective financing statements filed in the appropriate states of formation or incorporation, as applicable, of each of CHS, CHS Capital and Seller that name CHS, CHS Capital and Seller as debtor, together with copies of all such financing statements filed against CHS, CHS Capital and Seller and acknowledgment copies of proper termination statements (Form UCC-3) necessary to evidence the release of all security interests, ownership and other rights of any Person previously granted by CHS, CHS Capital and Seller in the Pool Assets and the Related Assets.

(f) Favorable opinions of legal counsel to Seller, each Originator, Servicer and Performance Guarantor, including legal opinions as to general organizational matters, enforceability, no conflicts with laws and agreements, security interest creation, attachment and perfection, the Volcker Rule and true sale and non-consolidation matters.

(g) A copy of the Information Package as of the Effective Date.

(h) A certificate of a Responsible Officer of each of Originators and Seller certifying that (i) no effective financing statement or other instrument similar in effect covering any Pool Asset or any other Seller Assets is on file in any recording office and (ii) none of the financing statements included in the UCC search results referenced in clause (e) above describe any Pool Asset or any other Seller Assets.

(i) Such other agreements, instruments, certificates and documents as the Administrative Agent may reasonably request.

SECTION 5.3 Conditions Precedent to All Purchases and Reinvestments . Each Purchase (including the initial Purchase) and each Reinvestment hereunder shall be subject to the further conditions precedent that on the date of such Purchase or Reinvestment, the following statements shall be true (and Seller, by accepting the amount of such Purchase or by receiving the proceeds of such Reinvestment, shall be deemed to have certified that):

(a) each of the representations and warranties contained in Article VI , in the Sale Agreement and in each other Transaction Document that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects, in each case, on and as of such day as though made on and as of such day (except to the extent such representations and warranties explicitly refer solely to an earlier date or period, in which case they shall be true and correct as of such earlier date or period);

(b) no event has occurred and is continuing or would result from such Purchase or Reinvestment, that constitutes an Event of Default, an Unmatured Event of Default, a Servicer Termination Event or an Unmatured Servicer Termination Event;

(c) after giving effect to each proposed Purchase or Reinvestment, (i) with respect to any Purchaser Group, such Purchaser Group’s Purchaser Group Investment will not exceed such Purchaser Group’s Purchaser Group Commitment, (ii) the Total Investment will not exceed the Purchasers’ Total Commitment, and (iii) the Total Investment will not exceed the sum of the Receivables Investment Base and the Loan Investment Base; and

(d) the Purchase Termination Date has not occurred.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

SECTION 6.1 Representations and Warranties of Seller . Seller represents and warrants, as of the Effective Date and as of each date on which a Purchase or Reinvestment is made, as follows:

(a) Seller is a limited liability company duly formed and existing in good standing under the laws of the State of Delaware; has all necessary limited liability company power to carry on its present business; and has made all necessary filings in order to be licensed or qualified and in good standing in each jurisdiction in which the nature of the business transacted by it or the nature of the property owned or leased by it makes such licensing or qualification necessary and in which the failure to be so licensed or qualified would have a Material Adverse Change with respect to Seller.

(b) The execution, delivery and performance by Seller of each Transaction Document to which it is party and each other document to be delivered by it thereunder, (i) are within its limited liability company powers, (ii) have been duly authorized by all necessary limited liability company action, (iii) do not contravene, violate or breach (1) its organizational documents, (2) any Applicable Law, (3) any Contractual Obligation of or affecting Seller or any of its properties, or (4) any order, writ, judgment, award, injunction or decree binding on or affecting it or its property and (iv) do not result in the creation or imposition of any Adverse Claim upon any of its properties pursuant to the terms of any such Contractual Obligation, other than this Agreement and the other Transaction Documents.

(d) No authorization or approval or other action by, and no notice to, license from or filing with, any Governmental Authority is required for the due execution, delivery and performance by Seller of each Transaction Document to which it is party or any other document to be delivered by it thereunder.

(e) Each Transaction Document to which Seller is a party constitutes a legal, valid and binding obligation of Seller, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent conveyance or other laws relating to the enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is sought at equity or law).

(f) There is no pending or, to its knowledge, threatened action, proceeding, investigation or injunction, writ or restraining order affecting Seller or its properties before any Governmental Authority which could reasonably be expected to result in a Material Adverse Change with respect to Seller.

(g) Seller is Solvent and no Insolvency Event has occurred with respect to Seller.

(h) Since the date of the Seller’s most recent audited financial statements, no Material Adverse Change or event which, individually or in the aggregate, is reasonably likely to result in a Material Adverse Change has occurred with respect to Seller.

(i) No Change of Control has occurred.

(j) All assets of Seller are free and clear of any Adverse Claim in favor of the Internal Revenue Service, any employee benefit plan, the PBGC or similar entity.

(k) All information furnished by or on behalf of Seller to the Administrative Agent or any other Affected Party for purposes of or in connection with any Information Package, the Transaction Documents or any transaction contemplated thereby is, at the time the same is furnished, taken as a whole, true and accurate in all material respects and such information does not omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(l) Seller has not changed its name or the location of its jurisdiction of formation since the Formation Date.

(m) Seller (i) is not required to register as an investment company under the Investment Company Act, without reliance of Section 3(c)(1) or Section 3(c)(7) of the Investment Company Act, and (ii) is not a “covered fund” under the Volcker Rule. In determining that Seller is not a “covered fund” under the Volcker Rule, Seller is entitled to rely on the exemption from the definition of “investment company” set forth in Rule 3c-5(A) of the Investment Company Act.

(n) No transaction contemplated by this Agreement or any other Transaction Document requires compliance by it with any bulk sales act or similar law.

(o) Each Asset included in the Net Pool Balance as an Eligible Receivable or Eligible Loan, as applicable, on the date of any Purchase or Reinvestment or on the date of any Information Package was an Eligible Receivable or Eligible Loan, as applicable, on such date. Upon and after giving effect to any Purchase or Reinvestment to be made on such date, sufficient Eligible Receivables exist in the Receivables Pool and sufficient Eligible Loans exist in the Loan Pool such that (i) the Total Investment will not exceed the Purchasers’ Total Commitment, and (ii) the Total Investment will not exceed the sum of the Receivables Investment Base and the Loan Investment Base.

(p) Each sale of an Asset and the Related Assets to Seller under the Sale Agreement constitutes the absolute and irrevocable sale and transfer of all right, title and interest of such Originator in such Asset and Related Security to Seller and no further action, including any filing or recording of any document or any notice to, license from or approval from any Governmental Authority is necessary in order to establish the ownership interest of Seller effected by such sale or to permit Seller to service, enforce or otherwise collect such Asset from the related Account Debtor or Obligor.

(q) The Administrative Agent has a first priority perfected security interest in the Seller Assets, free and clear of any Adverse Claim.

(r) No event has occurred and is continuing and no condition exists, or would result from any Purchase or Reinvestment hereunder, that constitutes, individually or in the aggregate, an Event of Default, an Unmatured Event of Default, a Servicer Termination Event or an Unmatured Servicer Termination Event.

(s) Seller is in compliance in all material respects with the Receivable Documentation relating to the Pool Receivables and the Loan Documents relating to the Pool Loans, and none of (i) the Pool Receivables or the Receivable Documentation related thereto or (ii) the Pool Loans or the Loan Documents related thereto are subject to any defense, dispute, Dilution or any offset, counterclaim or other defense, whether arising out of the transactions contemplated by this Agreement or any other Transaction Document or independently thereof.

(t) No effective financing statement or other instrument similar in effect covering any Pool Asset or any other Seller Assets is on file in any recording office (except any financing statements or other instruments filed pursuant to this Agreement or any other Transaction Document), and, to the knowledge of Seller, no competing notice or notice inconsistent with the transactions contemplated in this Agreement or any other Transaction Document is in effect with respect to any Account Debtor or Obligor.

(u) Seller has filed all material tax returns and reports required by Applicable Law to have been filed by it and has paid all material taxes, assessments and governmental charges thereby shown to be owing by it, other than any such taxes, assessments or charges that are not yet delinquent or are being contested in good faith by appropriate proceedings.

(v) Seller is, and shall at all relevant times continue to be, a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3.

(w) The facts regarding Seller, each Originator, Servicer, Performance Guarantor, the Pool Assets, the Related Assets and the related matters set forth or assumed in each of the opinions of counsel delivered in connection with this Agreement and the Transaction Documents are true and correct in all material respects.

(x) No sale, contribution or assignment of Assets under the Sale Agreement constitutes a fraudulent transfer or conveyance under any United States federal or applicable state bankruptcy or insolvency laws or is otherwise void or voidable under such or similar laws or principles or for any other reason.

(y) All Pool Assets (i) were originated by CHS or CHS Capital in the ordinary course of its business, (ii) were sold by CHS or CHS Capital to Seller for fair consideration and reasonably equivalent value and (iii) solely with respect to Pool Receivables, represent all, or a portion of the purchase price of merchandise, insurance or services within the meaning of Section 3(c)(5)(A) of the Investment Company Act.

(z) Policies and procedures have been implemented and maintained by or on behalf of Seller that are designed to achieve compliance by Seller, Originators and each of their respective Subsidiaries, Affiliates, directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, giving due regard to the nature of such Person’s business and activities, and Seller, Originators, their respective Subsidiaries, Affiliates, officers, employees, directors and agents acting in any capacity in connection with or directly benefitting from the credit facility established hereby, are in compliance with Anti-Corruption Laws, Anti-Terrorism Laws, and Sanctions. (i) None of Seller, Originators or any of their Subsidiaries, Affiliates, directors, officers, employees, or agents that will act in any capacity in connection with or directly benefit from the credit facility established hereby, is a Sanctioned Person, (ii) neither Seller, Originators nor any of their respective Subsidiaries is organized or resident in a Sanctioned Country and (iii) neither Seller nor any Originator has violated, been found in violation of or is under investigation by any Governmental Authority for possible violation of any Anti-Corruption Laws, Anti-Terrorism Laws, or of any Sanctions. No Purchase or Reinvestment or use of proceeds thereof by Seller or any of its Subsidiaries or Affiliates will be used in any manner that will violate Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.

(aa) Seller does not have outstanding any security of any kind except membership interests issued to CHS in connection with its organization, and has not incurred, assumed, guaranteed or otherwise become directly or indirectly liable for, or in respect of, any Debt and no Person has any commitment or other arrangement to extend credit to Seller, in each case, other than as will occur in accordance with the Transaction Documents.

(ab) The use of all funds obtained by Seller under this Agreement will not conflict with or contravene any of Regulations T, U and X promulgated by the Board of Governors of the Federal Reserve System.

(bb) None of the Seller, any Affiliate of the Seller or any third party with which the Seller or any Affiliate thereof has contracted has delivered, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.

(cc) Each of the Concentration Account and each Seller Collection Account constitutes a “deposit account” within the meaning of the applicable UCC. The Concentration Account and each Seller Collection Account are in the name of the Seller, and the Seller owns and has good and marketable title to the Concentration Account and each Seller Collection Account free and clear of any Adverse Claim. The Seller has delivered to the Administrative Agent a fully executed Seller Account Agreement relating to the Concentration Account and each Seller Collection Account, pursuant to which the applicable Account Bank has agreed to comply with the instructions originated by the Administrative Agent directing the disposition of funds in the Concentration Account or the Seller Collection Accounts, as applicable, without further consent by the Seller, the Servicer or any other Person. The Administrative Agent has “control” (as defined in Section 9-104 of the UCC) over the Concentration Account and each Seller Collection Account.

(dd) Each of the Originator Collection Accounts and Originator Specified Accounts constitutes a “deposit account” within the meaning of the applicable UCC. Each of the Originator Collection Accounts and Originator Specified Accounts is in the name of an Originator, and such Originator owns and has good and marketable title to the such accounts free and clear of any Adverse Claim. The Originator has delivered to the Administrative Agent a fully executed Originator Account Agreement relating to the Originator Collection Accounts, pursuant to which the applicable Account Bank has agreed to comply with the instructions originated by the Administrative Agent directing the disposition of funds in the Originator Collection Accounts without further consent by the Seller, the Servicer or any other Person. The Administrative Agent has “control” (as defined in Section 9-104 of the UCC) over the Originator Collection Accounts.

(ee) Seller has complied in all material respects with the Credit and Collection Policy and has not, since the Effective Date, made any changes in the Credit and Collection Policy that would impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to Seller without the consent of the Required Purchasers.

(ff) Each remittance of Collections by or on behalf of Seller to Administrative Agent under this Agreement will have been (i) in payment of a debt incurred by Seller in the ordinary course of business or financial affairs of Seller and (ii) made in the ordinary course of business or financial affairs of Seller.

(gg) Immediately prior to and as of the Effective Date, no event has occurred and is continuing and no condition exists, that constitutes, individually or in the aggregate, (i) an Event of Default, (ii) an Unmatured Event of Default, (iii) a Servicer Termination Event or (iv) an Unmatured

Servicer Termination Event, in each case, as such capitalized terms in clauses (i) through (iv) are defined in the Original Agreement.

(hh) Immediately prior to and as of the Effective Date, each of the representations and warranties of the Seller contained in the Original Agreement that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects, in each case, on and as of the Effective Date as though made on and as of the Effective Date (except to the extent such representations and warranties explicitly refer solely to an earlier date or period, in which case they shall be true and correct as of such earlier date or period).

(ii) As of the Omnibus Amendment Effective Date, Seller has delivered to the Administrative Agent a Beneficial Ownership Certification and the information included in such Beneficial Ownership Certification is true and correct in all respects.

SECTION 6.2 Representations and Warranties of CHS . CHS, individually and as Servicer, represents and warrants, as of the Effective Date and as of each date on which a Purchase or Reinvestment is made, as follows:

(a) CHS is a corporation duly formed and existing in good standing and whose by-laws provide that it shall be governed by the laws of the State of Minnesota; has all necessary corporate power to carry on its present business; and has made all necessary filings in order to be licensed or qualified and in good standing in each jurisdiction in which the nature of the business transacted by it or the nature of the property owned or leased by it makes such licensing or qualification necessary and in which the failure to be so licensed or qualified would have a Material Adverse Change with respect to CHS.

(b) The execution, delivery and performance by Servicer of each Transaction Document to which it is party and each other document to be delivered by it thereunder, (i) are within its corporate powers, (ii) have been duly authorized by all necessary corporate action, (iii) do not contravene, violate or breach (1) its by-laws or its other organizational documents, (2) any Applicable Law, (3) any Contractual Obligation of or affecting Servicer or any of its properties, or (4) any order, writ, judgment, award, injunction or decree binding on or affecting it or its property and (iv) do not result in the creation or imposition of any Adverse Claim upon any of its properties pursuant to the terms of any such Contractual Obligation, other than this Agreement and the other Transaction Documents.

(d) No authorization or approval or other action by, and no notice to, license from or filing with, any Governmental Authority is required for the due execution, delivery and performance by Servicer of each Transaction Document to which it is party or any other document to be delivered by it thereunder.

(e) Each Transaction Document to which Servicer is a party constitutes a legal, valid and binding obligation of Servicer, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent conveyance or other laws relating to the enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is sought at equity or law).

(f) There is no pending or, to its knowledge, threatened action, proceeding, investigation or injunction, writ or restraining order affecting Servicer or any of its Affiliates before any Governmental Authority which could reasonably be expected to result in a Material Adverse Change with respect to Servicer.

(g) Servicer is Solvent and no Insolvency Event has occurred with respect to Servicer.

(h) Since the date of the Servicer’s most recent audited financial statements, no Material Adverse Change or event which, individually or in the aggregate, is reasonably likely to result in a Material Adverse Change has occurred with respect to Servicer.

(i) No Change of Control has occurred.

(j) All information furnished by or on behalf of Servicer to the Administrative Agent or any other Affected Party for purposes of or in connection with any Information Package, the Transaction Documents or any transaction contemplated thereby is, at the time the same is furnished, taken as a whole, true and accurate in all material respects and such information does not omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(k) Servicer is not required to register as an investment company under the Investment Company Act.

(l) No transaction contemplated by the Sale Agreement requires compliance by it with any bulk sales act or similar law.

(m) Each Asset included in the Net Pool Balance as an Eligible Receivable or Eligible Loan, as applicable, on the date of any Purchase or Reinvestment or on the date of any Information Package was an Eligible Receivable or Eligible Loan, as applicable, on such date. Upon and after giving effect to any Purchase or Reinvestment to be made on such date, sufficient Eligible Receivables exist in the Receivables Pool and sufficient Eligible Loans exist in the Loan Pool such that (i) the Total Investment will not exceed the Purchasers’ Total Commitment, and (ii) the Total Investment will not exceed the sum of the Receivables Investment Base and the Loan Investment Base.

(n) Since the Effective Date, there has been no material adverse change in the ability of Servicer to service, enforce or otherwise collect the Pool Assets and the Related Security.

(o) No event has occurred and is continuing and no condition exists, or would result from any Purchase or Reinvestment hereunder, that constitutes, individually or in the aggregate, an Event of Default, an Unmatured Event of Default, a Servicer Termination Event or an Unmatured Servicer Termination Event.

(p) Servicer is in compliance in all material respects with the Receivable Documentation relating to the Pool Receivables and the Loan Documents relating to the Pool Loans, and none of the (i) Pool Receivables or the Receivable Documentation related thereto and (ii) Pool Loans or the Loan Documents related thereto are subject to any defense, dispute, Dilution or any offset, counterclaim or other defense, whether arising out of the transactions contemplated by this Agreement or any other Transaction Document or independently thereof.

(q) No effective financing statement or other instrument similar in effect covering any Pool Asset or any other Seller Assets is on file in any recording office (except any financing statements or other instruments filed pursuant to this Agreement or any other Transaction Document), and, to the knowledge of Servicer, no competing notice or notice inconsistent with the transactions contemplated in this Agreement is in effect with respect to any Account Debtor or Obligor.

(r) Servicer has filed all material tax returns and reports required by Applicable Law to have been filed by it and has paid all material taxes, assessments and governmental charges, to its knowledge, owing by it, other than any such taxes, assessments or charges that are not yet delinquent or are being contested in good faith by appropriate proceedings.

(s) The facts regarding Seller, each Originator, Servicer, Performance Guarantor, the Pool Assets, the Related Assets and the related matters set forth or assumed in each of the opinions of counsel delivered in connection with this Agreement and the Transaction Documents are true and correct in all material respects.

(t) Policies and procedures have been implemented and maintained by or on behalf of CHS that are designed to achieve compliance by CHS and each of its respective Subsidiaries, Affiliates, directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, giving due regard to the nature of such Person’s business and activities, and CHS, its respective Subsidiaries, Affiliates, officers, employees, directors and agents acting in any capacity in connection with or directly benefitting from the credit facility established hereby, are in compliance with Anti-Corruption Laws, Anti-Terrorism Laws, and Sanctions. (i) None of CHS or any of its Subsidiaries, Affiliates, directors, officers, employees, or agents that will act in any capacity in connection with or directly benefit from the credit facility established hereby, is a Sanctioned Person, (ii) neither CHS nor any of its Subsidiaries is organized or resident in a Sanctioned Country and (iii) CHS has not violated, been found in violation of or is under investigation by any Governmental Authority for possible violation of any Anti-Corruption Laws, Anti-Terrorism Laws, or of any Sanctions. No Purchase or Reinvestment or use of proceeds thereof by CHS or any of its Subsidiaries or Affiliates will be used in any manner that will violate Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.

(u) None of the Servicer, any Affiliate of the Servicer or any third party with which the Servicer or any Affiliate thereof has contracted has delivered, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.

(v) Each of the Concentration Account and each Seller Collection Account constitutes a “deposit account” within the meaning of the applicable UCC. The Concentration Account and each Seller Collection Account are in the name of the Seller, and the Seller owns and has good and marketable title to the Concentration Account and each Seller Collection Account free and clear of any Adverse Claim. The Seller has delivered to the Administrative Agent a fully executed Seller Account Agreement relating to the Concentration Account and each Seller Collection Account, pursuant to which the applicable Account Bank has agreed to comply with the instructions originated by the Administrative Agent directing the disposition of funds in the Concentration Account or the Seller Collection Accounts, as applicable, without further consent by the Seller, the Servicer or any

other Person. The Administrative Agent has “control” (as defined in Section 9-104 of the UCC) over the Concentration Account and each Seller Collection Account.

(w) Each of the Originator Collection Accounts and Originator Specified Accounts constitutes a “deposit account” within the meaning of the applicable UCC. Each of the Originator Collection Accounts and Originator Specified Accounts is in the name of an Originator, and such Originator owns and has good and marketable title to such accounts free and clear of any Adverse Claim. The Originator has delivered to the Administrative Agent a fully executed Originator Account Agreement relating to the Originator Collection Accounts, pursuant to which the applicable Account Bank has agreed to comply with the instructions originated by the Administrative Agent directing the disposition of funds in the Originator Collection Accounts without further consent by the Seller, the Servicer or any other Person. The Administrative Agent has “control” (as defined in Section 9-104 of the UCC) over the Originator Collection Accounts.

(x) Servicer has complied in all material respects with the Credit and Collection Policy and has not, since the Effective Date, made any changes in the Credit and Collection Policy that would impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to Servicer without the consent of the Required Purchasers.

(y) Immediately prior to and as of the Effective Date, no event has occurred and is continuing and no condition exists, that constitutes, individually or in the aggregate, (i) an Event of Default, (ii) an Unmatured Event of Default, (iii) a Servicer Termination Event or (iv) an Unmatured Servicer Termination Event, in each case, as such capitalized terms in clauses (i) through (iv) are defined in the Original Agreement.

(z) Immediately prior to and as of the Effective Date, each of the representations and warranties of CHS contained in the Original Agreement that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects, in each case, on and as of the Effective Date as though made on and as of the Effective Date (except to the extent such representations and warranties explicitly refer solely to an earlier date or period, in which case they shall be true and correct as of such earlier date or period).

ARTICLE VII

GENERAL COVENANTS OF SELLER AND SERVICER

SECTION 7.1 Covenants of Seller . From the Effective Date until the Final Payout Date:

(a) Existence . Seller will preserve, renew and maintain in full force and effect its limited liability company existence and good standing under the laws of the jurisdiction of its organization and take all reasonable action to maintain all rights, privileges, permits and licenses necessary in the normal conduct of its business. Seller will at all times be organized under the laws of the State of Delaware and shall not take any action to change its jurisdiction of organization. Seller will keep its principal place of business and chief executive office and the office where it keeps its records concerning the Pool Assets (unless then held by the Custodian) at the address set forth in Schedule 13.2 or, upon 30 days’ prior written notice to the Administrative Agent, at any other locations in jurisdictions where all actions reasonably requested by the Administrative Agent or any Purchaser

Agent or otherwise necessary to protect, perfect and maintain the Administrative Agent’s ownership and security interest in the Pool Assets and the other Seller Assets have been taken and completed.

(b) Compliance with Laws . Seller will comply in all material respects with all Applicable Laws with respect to it, the Pool Receivables and the Receivable Documentation and the Pool Loans and the Loan Documents.

(c) Books and Records . Seller will keep its books and accounts in accordance with GAAP and shall make a notation on its books and records, including any computer files, to indicate which Assets have been pledged to the Administrative Agent. Seller will maintain such books and accounts in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over it. Other than Custodian File held by Custodian in accordance with the Custodian Agreement, Seller will maintain and implement administrative and operating procedures (including an ability to recreate records evidencing (i) Receivables and related Receivable Documentation and (ii) Loans and related Loan Documents in the event of the destruction of the originals thereof), and keep and maintain all documents, books, records and other information reasonably necessary for collecting all Pool Assets (including records adequate to permit the daily identification of each Asset and all collections of and adjustments to each existing Asset).

(d) Sales, Liens and Debt . Seller will not sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim upon or with respect to, the Pool Assets or any other Seller Assets or upon or with respect to any account or lockbox to which Collections are required to be sent, or assign any right to receive income in respect thereof, in each case, except the dispositions to the Administrative Agent contemplated hereunder and the Adverse Claims in favor of the Administrative Agent created hereunder.

(e) Extension or Amendment of Assets . Seller will not (i) extend, or otherwise amend or modify the payment terms under any Pool Asset or (ii) otherwise waive or permit or agree to any deviation from the terms or conditions of any Pool Asset. Seller will not take, or cause to be taken, any action that reduces the amount payable of any Pool Asset or materially impairs the full and timely collection thereof.

(f) Audits and Visits . Seller will, upon reasonable advance notice of not less than five (5) Business Days (or at any time following the occurrence of an Event of Default that has not been waived in accordance with this Agreement), during regular business hours, permit the Administrative Agent and each Purchaser Agent and representatives thereof at Seller’s expense, (i) to examine and make abstracts from all books, records and documents (including computer tapes and disks) in its possession or under its control relating to Pool Assets and the other Seller Assets, including the Receivable Documentation and Loan Documents, and (ii) to visit its offices and properties for the purpose of examining and auditing such materials described in clause (i) above, and, subject to the foregoing, to discuss matters relating to Pool Assets or its performance hereunder or under the related Receivable Documentation and Loan Documents with any of its officers having knowledge of such matters, in each case, at such reasonable times and as often as may reasonably be desired by the Administrative Agent or any such Purchaser Agent; provided , however , that unless an Event of Default has occurred that has not been waived in accordance with this Agreement, Seller shall be required to reimburse the Administrative Agent and the Purchaser Agents for the costs and expenses related to (x) only one such audit or visitation during any calendar year, (y) any audit following a material change in the systems of Seller or Servicer that occurs after any audit specified in clause (x) or (z) any follow-up audit that is required as a result of any audit specified in clauses (x) or (y) .

(g) Reporting Requirements . Seller will provide to the Administrative Agent the following:

(i) as soon as available and in any event within ninety (90) days after the end of each annual accounting period of CHS, a copy of the balance sheet of Seller as of the last day of the period then ended and the statements of income and cash flows of Seller for the period then ended, and accompanying notes thereto, each in reasonable detail showing in comparative form the figures for the previous fiscal year, accompanied by a statement of Seller (with, if necessary, qualifications related to changes in GAAP), to the effect that the financial statements have been prepared in accordance with GAAP and present fairly in accordance with GAAP the financial condition of Seller as of the close of such fiscal year and the results of its operations and cash flows for the fiscal year then ended;

(ii) at least 30 days prior to any change in Seller’s name or jurisdiction of organization, a notice setting forth the new name or jurisdiction, as applicable, and the proposed effective date thereof;

(iii) such data, reports and information relating to the Pool Assets and the other Seller Assets reasonably requested by the Administrative Agent or any Purchaser Agent from time to time;

(iv) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of any Adverse Claim or dispute asserted or claim made against a Pool Asset or any other Seller Assets;

(v) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the failure of any representation or warranty made or deemed to be made by Seller under this Agreement or any other Transaction Document to be true and correct in any material respect when made;

(vi) promptly (and in no event later than three (3) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the occurrence of any Event of Default, Unmatured Event of Default, Servicer Termination Event or Unmatured Servicer Termination Event and the action that Seller proposes to take with respect thereto;

(vii) at least fifteen (15) days prior to (i) the effectiveness of any change in or amendment to the Credit and Collection Policy, a description or, if available, a copy of the Credit and Collection Policy after giving effect to such change or amendment and a written notice (A) indicating such change or amendment and (B) if such proposed change or amendment would be reasonably likely to adversely affect the value, validity, enforceability or collectability of, or increase the days to pay or Dilution with respect to, any Pool Asset or decrease the credit quality of any newly created Asset, requesting the consent of the Required Purchasers thereto (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) Seller making any change or changes in the character of its business, written notice indicating such change and requesting the consent of the Required Purchasers thereto (which consent shall not be unreasonably withheld, conditioned or delayed);

(viii) promptly (and in no event later than five (5) Business Days) following receipt thereof, a copy of all periodic statements regarding the Seller Collection Accounts from the applicable Account Banks; and

(ix) as soon as possible and in any event within three (3) Business Days after knowledge or notice of the occurrence thereof, written notice of any matter that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change with respect to Seller.

(h) Further Assurances . Seller will, at its expense, promptly execute, deliver and file all further instruments and documents (including UCC-3 financing statement amendments and continuation statements) necessary or desirable, and take all further action that the Administrative Agent or any Purchaser Agent may reasonably request, from time to time, in order to perfect, protect or more fully evidence the Administrative Agent’s first priority perfected security interest in the Pool Assets and the other Seller Assets, or to enable the Administrative Agent to exercise or enforce the rights of the Administrative Agent or any other Affected Party hereunder or under or in connection with the Pool Assets and the other Seller Assets. In connection with any change in its name or jurisdiction of organization, Seller will, at its expense, cause to be delivered to the Administrative Agent (i) one or more opinions of counsel to Seller, in form and substance reasonably acceptable to the Administrative Agent, as to such corporate and UCC perfection matters as the Administrative Agent may request at such time and (ii) one or more certificates of a Responsible Officer of Seller, in form and substance reasonably acceptable to the Administrative Agent, with respect to the review of UCC search results.

(i) Taxes . Seller will pay any and all taxes relating to the transactions contemplated under this Agreement, including the sale, transfer and assignment of each Pool Asset and the other Seller Assets, unless the same are being contested in good faith by appropriate proceedings and adequate reserves in accordance with GAAP are being maintained by Seller.

(j) Perform Terms . Seller will duly perform and comply in all material respects with all terms under the Receivable Documentation and Loan Documents and promptly inform the Administrative Agent and each Purchaser Agent of any breach or default by Seller or any Account Debtor or Obligor of any of the terms thereof.

(k) Not Adversely Affect the Administrative Agent’s Rights . Seller will refrain from any act or omission which, individually or in the aggregate, could reasonably be expected to prejudice, diminish or limit, in each case in any material respect, the Administrative Agent’s or any other Affected Party’s rights under or with respect to any of the Pool Assets, any other Seller Assets or this Agreement, except to the extent such act or omission is expressly permitted under this Agreement, any other Transaction Document.

(l) Compliance with Credit and Collection Policy . Seller will comply with the Credit and Collection Policy in all material respects in connection with the enforcement and collection of Pool Assets and the other Seller Assets.

(m) Anti-Corruption Laws and Sanctions . Seller shall ensure that policies and procedures are maintained and enforced by or on behalf of Seller to promote and achieve compliance by the Seller, Originators and each of their Subsidiaries, Affiliates, and their respective directors, officers, employees and agents, with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions. The Seller

shall not use or permit its Subsidiaries, Affiliates, or its or their respective directors, officers, employees or agents to use, the proceeds of any Purchase or Reinvestment (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws or Anti-Terrorism Laws, (ii) for the purpose of funding or financing any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, in each case, to the extent doing so would violate any Sanctions, or (iii) in any other manner that would result in liability to any Person under any applicable Sanctions or result in the violation of any Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions. Neither the Seller nor any of its Subsidiaries, Affiliates or any director, officer, employee, agent or other Person acting on behalf of the Seller or any of its Subsidiaries in any capacity in connection with or directly benefitting from this Agreement will engage in, or will conspire to engage in, any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions.

(n) No Change in Business, Credit and Collection Policy or Organizational Documents . Seller shall not (i) make any change in (A) the character of its business without the prior written consent of the Required Purchasers or (B) the Credit and Collection Policy, which change would impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to Seller without the prior written consent of the Required Purchasers, or (ii) amend or otherwise modify its limited liability company agreement or certificate of formation, in either case, without the prior written consent of the Required Purchasers.

(o) Mergers, Acquisitions, Sales, etc. Seller shall not (i) change its jurisdiction of organization, or make any other change such that any financing statement filed in connection with the Transaction Documents would become seriously misleading or would otherwise be rendered ineffective, (ii) be a party to any merger or consolidation, or purchase or otherwise acquire all or substantially all of the assets or any stock of any class of, or any partnership or joint venture interest in, any other Person, (iii) sell, transfer, convey, contribute or lease all or any substantial part of its assets, or sell or assign with or without recourse any Assets or any interest therein to any Person (other than pursuant hereto and to any Transaction Document) or (iv) have any Subsidiaries or make any investments in any other Person.

(p) Debt and Business Activity . Except for Seller’s obligation to pay the “Payoff Amount” as defined in the Payoff Letter and any contingent indemnification obligations arising under the Payoff Letter that are not then due and payable, Seller shall not incur, assume, guarantee or otherwise become directly or indirectly liable for or in respect of any Debt or other obligation, purchase any asset (or make any investment by share purchase, loan or otherwise) or engage in any other activity (whether or not pursued for gain or other pecuniary advantage), in any case, other than as will occur pursuant to the Transaction Documents.

(q) Payment of Obligations . The Seller shall duly and punctually pay Deemed Collections, Repurchase Payments, Yield, fees and all other amounts payable by the Seller hereunder in accordance with the terms of this Agreement.

(r) Collection Accounts; Lockbox; Originator Specified Accounts . The Seller shall (i) direct (x) each Account Debtor to pay all amounts owing under the Pool Receivables only to a Lockbox, a Collection Account, an Originator Specified Account or the Concentration Account and (y) each Obligor to pay all amounts owing under the Pool Loans only to a Seller Collection Account or the

Concentration Account, (ii) not to change such payment instructions while any Pool Assets remain outstanding, (iii) take any and all other reasonable actions, including actions reasonably requested by the Administrative Agent, to ensure that all amounts owing under the Pool Assets will be deposited in accordance with clause (i) , (iv) hold in trust and cause the Servicer to hold in trust as the Affected Parties’ exclusive property and safeguard for the benefit of the Affected Parties all Collections and other amounts remitted or paid to the Seller or the Servicer (or any of their respective Affiliates) in respect of Pool Assets for prompt deposit into the Concentration Account in the manner set forth below, (v) cause the Servicer to deposit in a Collection Account all Collections remitted to an Originator Specified Account within two (2) days following receipt thereof and (vi) cause the Servicer to endorse, to the extent necessary, all checks or other instruments received in any Lockbox so that the same can be deposited in a Collection Account, in the form so received (with all necessary endorsements), on the first Business Day after the date of receipt thereof. The Seller shall not deposit or otherwise credit, or cause or permit to be so deposited or credited, to any Seller Collection Account any amounts other than Collections or proceeds thereof. The Seller shall not terminate or permit the termination of any Collection Account, Originator Specified Account or Lockbox or any Account Agreement without the prior written consent of the Required Purchasers.

(s) Concentration Account . The Seller shall deposit or cause to be deposited in the Concentration Account all Available Collections and other amounts received by Seller, Servicer or an Originator (or any of their respective Affiliates) or deposited in a Lockbox, an Originator Specified Account or a Collection Account, in each case, with respect to Pool Assets or any other Seller Assets (whether such amounts were received by Seller directly or otherwise) without adjustment, setoff or deduction of any kind or nature no later than the Business Day preceding the Settlement Date immediately succeeding receipt thereof; provided that, so long as no Unmatured Event of Default or Event of Default exists, the Seller shall not be required to deposit Collections on the Business Day preceding the next Settlement Date in excess of the aggregate amount the Seller is required to pay on such Settlement Date in accordance with Section 3.1(d) . The Seller shall take any and all other actions, including actions reasonably requested by the Administrative Agent, to ensure that all amounts owing under the Pool Assets and the other Seller Assets will be deposited in the Concentration Account in a timely manner pursuant to the terms of this Agreement. The Seller shall not deposit or otherwise credit, or cause or permit to be so deposited or credited, to the Concentration Account any amounts other than Collections or proceeds thereof. The Seller shall not terminate or permit the termination of the Concentration Account without the prior written consent of the Required Purchasers.

(t) Misdirected Payments . If the Seller receives a misdirected payment of a Pool Asset from any Account Debtor or Obligor, the Seller shall remit such funds to a Collection Account no later than two (2) Business Days following receipt thereof. Until remitted to a Collection Account, the Seller shall hold such funds in trust as the Affected Parties’ exclusive property and safeguard such funds for the benefit of the Affected Parties.

(u) Restricted Payments . Seller shall not declare or pay any dividend or distributions or, or make any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, its membership interests, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in its obligations; provided , however , that so long as no Event of Default or Unmatured Event of Default has occurred and is continuing or would result therefrom, Seller may make, or cause to be made, distributions only out of the funds released to the Seller in accordance with Section 3.1 .

(v) Tax Status . Seller shall not take or cause any action to be taken that could result in it being treated as other than a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3.

(w) Right and Title . Seller shall hold all right, title and interest in each Pool Asset, except to the extent that any such right, title or interest has been transferred or granted to Administrative Agent (on behalf of Purchasers).

(x) Transaction Documents . Without limiting any of Seller’s covenants or agreements set forth herein or in any other Transaction Document, Seller shall comply with each and every of its covenants and agreements under each Transaction Document to which it is a party in any capacity and its certificate of formation and limited liability company agreement.

(y) Enforcement of Sale Agreement . On its own behalf and on behalf of Purchasers, Purchaser Agents and Administrative Agent, Seller shall (x) promptly enforce all covenants and obligations of each Originator contained in the Sale Agreement and (y) deliver to Administrative Agent and each Purchaser Agent all consents, approvals, directions, notices and waivers and take other actions under the Sale Agreement as may be reasonably directed by the Required Purchasers.

(z) Use of Funds . Seller shall not use any funds obtained under this Agreement in any manner that conflicts with or contravenes any of Regulations T, U and X promulgated by the Board of Governors of the Federal Reserve System.

(aa) Delivery of Custodian File and Obligor Notes .

(i) Not later than six (6) months following the Effective Date, the Seller shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to each Effective Date Loan, and shall cause the related Obligor Note for each Effective Date Loan to be (i) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (ii) delivered to the Custodian.

(ii) Not later than thirty (30) days following the date on which the Seller acquires an interest in any Pool Loan (other than any Effective Date Loan) pursuant to the Sale Agreement, the Seller shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to such Pool Loan, and shall cause the related Obligor Note to be (i) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (ii) delivered to the Custodian.

(iii) Not later than thirty (30) days following any amendment or modification to any Loan Document, the Seller shall deliver or cause to be delivered such Loan Document to the Custodian.

(bb) Beneficial Ownership Certification. Promptly following any change in the information included in a Beneficial Ownership Certification that would result in a change to the list of beneficial owners or control party identified in such Beneficial Ownership Certification, or a change in the address of any beneficial owners or control party, Seller shall execute and deliver to the Administrative Agent an updated Beneficial Ownership Certification.

SECTION 7.2 Covenants of CHS . From the Effective Date until the Final Payout Date:

(a) Existence . Servicer will preserve, renew and maintain in full force and effect its corporate existence and good standing under the laws of the jurisdiction of its organization and take all reasonable action to maintain all rights, privileges, permits and licenses necessary in the normal conduct of its business. Servicer will keep the office where it keeps its records concerning the Pool Assets (unless then held by the Custodian) at the address set forth in Schedule 13.2 or, upon 30 days’ prior written notice to the Administrative Agent, at any other locations in jurisdictions where all actions reasonably requested by the Administrative Agent or any Purchaser Agent or otherwise necessary to protect, perfect and maintain the Administrative Agent’s security interest in the Pool Assets and the other Seller Assets have been taken and completed.

(b) Compliance with Laws . Servicer will comply in all material respects with all Applicable Laws with respect to it, the Pool Receivables and the Receivable Documentation and the Pool Loans and the Loan Documents and the servicing and collection thereof.

(c) Books and Records . Servicer will keep its books and accounts in accordance with GAAP and shall make a notation on its books and records, including any computer files, to indicate which Assets have been pledged to the Administrative Agent. Servicer will maintain such books and accounts in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over it. Other than Records held by Custodian in accordance with the Custodian Agreement, Servicer will maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Receivables and related Receivable Documentation and Loans and related Loan Documents in the event of the destruction of the originals thereof), and keep and maintain all documents, books, records and other information reasonably necessary for collecting all Pool Assets (including records adequate to permit the daily identification of each Asset and all collections of and adjustments to each existing Asset).

(d) Extension or Amendment of Assets . Servicer will not (i) extend, or otherwise amend or modify, the principal payment terms under any Pool Asset, unless approved in writing in advance by the Required Purchasers, or (ii) otherwise waive or permit or agree to any deviation from the terms or conditions of any Pool Asset, except in the case of clause (ii) , in accordance with the Credit and Collection Policy. Servicer will not take, or cause to be taken, any action that reduces the amount payable of any Pool Asset or materially impairs the full and timely collection thereof unless (i) approved in writing in advance by the Required Purchasers or (ii) such reduction in the amount of such Pool Asset is paid to the Administrative Agent by the Servicer as a Deemed Collection in accordance with Section 3.2(a) .

(e) Audits and Visits . Servicer will, upon reasonable advance notice of not less than five (5) Business Days (or at any time following the occurrence of an Event of Default that has not been waived in accordance with this Agreement), during regular business hours, permit the Administrative Agent and each Purchaser Agent and representatives thereof, at Servicer’s expense, (i) to examine and make abstracts from all books, records and documents (including computer tapes and disks) in its possession or under its control relating to Pool Assets and the other Seller Assets, including the Receivable Documentation and Loan Documents, and (ii) to visit its offices and properties for the purpose of examining and auditing such materials described in clause (i) above, and, subject to the foregoing, to discuss matters relating to Pool Assets or its performance hereunder or under the related Receivable Documentation and Loan Documents with any of its officers having knowledge of such matters, in each case, at such reasonable times and as often as may reasonably be desired by the

Administrative Agent or any such Purchaser Agent; provided , however , that unless an Event of Default has occurred that has not been waived in accordance with this Agreement, Servicer shall be required to reimburse the Administrative Agent and the Purchaser Agent for the costs and expenses related to (x) only one such audit or visitation during any calendar year, (y) any audit following a material change in the systems of Seller or Servicer that occurs after any audit specified in clause (x) or (z) any follow-up audit that is required as a result of any audit specified in clauses (x) or (y) .

(f) Reporting Requirements . Servicer will provide to the Administrative Agent the following:

(i) as soon as available and in any event within sixty (60) days after the end of each of the first three quarterly accounting periods of CHS, a copy of the consolidated balance sheet of CHS and its Subsidiaries as of the last day of such period and the consolidated statement of income of CHS and its Subsidiaries for the fiscal quarter and for the fiscal year‑to‑date period then ended, prepared by CHS in accordance with GAAP and certified to by a Responsible Officer; provided that delivery within the time period specified above of copies of CHS’s quarterly reports on Form 10-Q prepared in compliance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.2(f)(i) ;

(ii) as soon as available and in any event within ninety (90) days after the end of each annual accounting period of CHS, a copy of the consolidated balance sheet of CHS and its Subsidiaries as of the last day of the period then ended and the consolidated statements of income and cash flows of CHS and its Subsidiaries for the period then ended, and accompanying notes thereto, each in reasonable detail showing in comparative form the figures for the previous fiscal year, accompanied by a statement of CHS (with, if necessary, qualifications related to changes in GAAP), to the effect that the financial statements have been prepared in accordance with GAAP and present fairly in accordance with GAAP the consolidated financial condition of CHS and its Subsidiaries as of the close of such fiscal year and the results of their operations and cash flows for the fiscal year then ended; provided that delivery within the time period specified above of copies of CHS’s annual report on Form 10-K prepared in compliance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.2(f)(ii) ;

(iii) at least 30 days prior to any change in Servicer’s name or jurisdiction of organization, a notice setting forth the new name or jurisdiction, as applicable, and the proposed effective date thereof;

(iv) such data, reports and information relating to the Pool Assets and the other Seller Assets reasonably requested by the Administrative Agent or any Purchaser Agent from time to time;

(v) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of any Adverse Claim or dispute asserted or claim made against a Pool Asset or any other Seller Assets;

(vi) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the failure of any representation or warranty made or deemed to be made by Servicer under this Agreement or any other Transaction Document to be true and correct in any material respect when made;

(vii) promptly (and in no event later than three (3) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the occurrence of any Event of Default, Unmatured Event of Default, Servicer Termination Event or Unmatured Servicer Termination Event and the action that the Servicer proposes to take with respect thereto;

(viii) at least fifteen (15) days prior to (i) the effectiveness of any change in or amendment to the Credit and Collection Policy, a description or, if available, a copy of the Credit and Collection Policy after giving effect to such change or amendment and a written notice (A) indicating such change or amendment and (B) if such proposed change or amendment would be reasonably likely to adversely affect the value, validity, enforceability or collectability of, or increase the days to pay or Dilution with respect to, any Pool Asset or decrease the credit quality of any newly created Asset, requesting the consent of the Required Purchasers thereto (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) Servicer making any material change or changes in the character of its business, written notice indicating such change and requesting the consent of the Required Purchasers thereto (which consent shall not be unreasonably withheld conditioned or delayed);

(ix) promptly (and in no event later than five (5) Business Days) following receipt thereof, a copy of all periodic statements regarding the Originator Collection Accounts from the applicable Account Banks; and

(x) as soon as possible and in any event within three (3) Business Days after knowledge or notice of the occurrence thereof, written notice of any matter that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change with respect to Servicer.

(g) Perform Terms . Servicer will duly perform and comply in all material respects with all terms under the Receivable Documentation and Loan Documents and promptly inform the Administrative Agent and each Purchaser Agent of any breach or default by Servicer or any Account Debtor or Obligor of any of the terms thereof.

(h) Not Adversely Affect the Administrative Agent’s Rights . Servicer will refrain from any act or omission which, individually or in the aggregate, could reasonably be expected to prejudice, diminish or limit, in each case in any material respect, the Administrative Agent’s or any other Affected Party’s rights under or with respect to any of the Pool Assets, any other Seller Assets or this Agreement, except to the extent such act or omission is expressly permitted under this Agreement or any other Transaction Document.

(i) Compliance with Credit and Collection Policy . Servicer will comply with the Credit and Collection Policy in all material respects in connection with the enforcement and collection of Pool Assets and Related Security.

(j) Anti-Corruption Laws and Sanctions . Servicer shall ensure that policies and procedures are maintained and enforced by or on behalf of Servicer to promote and achieve compliance by Servicer and each of its Subsidiaries, Affiliates, and their respective directors, officers, employees and agents, with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions. Servicer shall not use or permit its Subsidiaries, Affiliates, or its or their respective directors, officers, employees or agents to use, the proceeds of any Purchase or Reinvestment (i) in furtherance of an offer, payment, promise

to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws or Anti-Terrorism Laws, (ii) for the purpose of funding or financing any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, in each case, to the extent doing so would violate any Sanctions, or (iii) in any other manner that would result in liability to any Person under any applicable Sanctions or result in the violation of any Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions. Neither Servicer nor any of its Subsidiaries, Affiliates or any director, officer, employee, agent or other Person acting on behalf of Servicer or any of its Subsidiaries in any capacity in connection with or directly benefitting from this Agreement will engage in, or will conspire to engage in, any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions.

(k) No Change in Business or Credit and Collection Policy or Organizational Documents . Servicer shall not make any change in (A) the character of its business without the prior written consent of the Required Purchasers or (B) the Credit and Collection Policy, which change would impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to Seller without the prior written consent of the Required Purchasers.

(l) Collection Accounts; Lockbox; Originator Specified Accounts . The Servicer shall (i) direct (x) each Account Debtor to pay all amounts owing under the Pool Receivables only to a Lockbox, a Collection Account, an Originator Specified Account or the Concentration Account and (y) each Obligor to pay all amounts owing under the Pool Loans only to a Seller Collection Account or the Concentration Account, (ii) not to change such payment instructions while any Pool Assets remain outstanding, (iii) take any and all other reasonable actions, including actions reasonably requested by the Administrative Agent, to ensure that all amounts owing under the Pool Assets will be deposited in accordance with clause (i) , (iv) hold in trust as the Affected Parties’ exclusive property and safeguard for the benefit of the Affected Parties all Collections and other amounts remitted or paid to the Seller or the Servicer (or any of their respective Affiliates) in respect of Pool Assets for prompt deposit into the Concentration Account in the manner set forth below, (v) deposit in a Collection Account all Collections remitted to an Originator Specified Account within two (2) days following receipt thereof and (vi) endorse, to the extent necessary, all checks or other instruments received in any Lockbox so that the same can be deposited in a Collection Account, in the form so received (with all necessary endorsements), on the first Business Day after the date of receipt thereof. The Servicer shall not deposit or otherwise credit, or cause or permit to be so deposited or credited, to a Lockbox, a Collection Account or an Originator Specified Account any amounts other than Collections or proceeds thereof. The Servicer shall not terminate or permit the termination of any Collection Account, Originator Specified Account or Lockbox or any Account Agreement without the prior written consent of the Required Purchasers.

(m) Concentration Account . The Servicer shall deposit or cause to be deposited in the Concentration Account all Available Collections and other amounts received by Seller, Servicer or Originator (or any of their respective Affiliates) or deposited in a Lockbox, an Originator Specified Account or a Collection Account, in each case, with respect to Pool Assets or any other Seller Assets (whether such amounts were received by Seller directly or otherwise) without adjustment, setoff or deduction of any kind or nature no later than the Business Day preceding the Settlement Date immediately succeeding receipt thereof; provided that, so long as no Unmatured Event of Default or Event of Default exists, the Seller shall not be required to deposit Collections on the Business Day preceding the next Settlement Date in excess of the aggregate amount the Seller is required to pay

on such Settlement Date in accordance with Section 3.1(d) . The Servicer shall take any and all other actions, including actions reasonably requested by the Administrative Agent, to ensure that all amounts owing under the Pool Assets and the other Seller Assets will be deposited in the Concentration Account in a timely manner pursuant to the terms of this Agreement. The Servicer shall not deposit or otherwise credit, or cause or permit to be so deposited or credited, to the Concentration Account any amounts other than Collections or proceeds thereof. The Servicer shall not terminate or permit the termination of the Concentration Account without the prior written consent of the Required Purchasers.

(n) Misdirected Payments . If the Servicer receives a misdirected payment of a Pool Asset from any Account Debtor or Obligor, the Servicer shall remit such funds to a Collection Account no later than two (2) Business Days following receipt thereof. Until remitted to a Collection Account, the Servicer shall hold such funds in trust as the Affected Parties’ exclusive property and safeguard such funds for the benefit of the Affected Parties.

(o) Tax Status . Servicer shall not take or cause any action to be taken that could result in Seller being treated as other than a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3.

(p) Transaction Documents . Without limiting any of Servicer’s covenants or agreements set forth herein or in any other Transaction Document, so long as Servicer is an Originator or Performance Guarantor, Servicer shall comply with each and every of its covenants and agreements as an Originator or Performance Guarantor, as applicable, under each Transaction Document to which it is a party in any capacity.

(q) Delivery of Custodian File and Obligor Notes .

(i) Not later than six (6) months following the Effective Date, the Servicer shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to each Effective Date Loan, and shall cause the related Obligor Note for each Effective Date Loan to be (i) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (ii) delivered to the Custodian.

(ii) Not later than thirty (30) days following the date on which the Seller acquires an interest in any Pool Loan (other than any Effective Date Loan) pursuant to the Sale Agreement, the Servicer shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to such Pool Loan, and shall cause the related Obligor Note to be (i) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (ii) delivered to the Custodian.

(iii) Not later than thirty (30) days following any amendment or modification to any Loan Document, the Servicer shall deliver or cause to be delivered such Loan Document to the Custodian.

SECTION 7.3 Full Recourse . Notwithstanding any limitation on recourse contained herein or in any other Transaction Document: (i) Seller has the obligation to pay all Yield and other amounts due under Sections 3.1(c) and 3.4 or under Articles IV or XII (which obligation shall be full recourse general obligations of Seller), and (ii) all obligations of CHS so specified hereunder shall be full recourse general obligations of CHS.

SECTION 7.4 Corporate Separateness; Related Matters and Covenants . Each of Seller and Servicer covenant, until the Final Payout Date, as follows:

(a) Seller and Servicer shall assure that Seller, Servicer, CHS, Performance Guarantor and Originators (and each of their respective Affiliates) shall observe the applicable legal requirements for the recognition of Seller as a legal entity separate and apart from each of Originators, CHS, Servicer, Performance Guarantor and any of their respective Affiliates other than Seller, and comply with its organizational documents and assuring that each of the following is complied with:

(i) Seller shall maintain (or cause to be maintained) separate company records and books of account (each of which shall be sufficiently full and complete to permit a determination of Seller’s assets and liabilities and, in the case of such records and books of account, to permit a determination of the obligees thereon and the time for performance of each of Seller’s obligations) from those of Originators, CHS, Servicer, Performance Guarantor and their respective Affiliates (other than Seller);

(ii) except as otherwise permitted by this Agreement, Seller shall not commingle any of its assets or funds with those of Originators, CHS, Servicer, Performance Guarantor or any of their respective Affiliates (other than Seller);

(iii) at least one member of Seller’s Board of Managers shall be an Independent Manager and the limited liability company agreement of Seller shall provide: (i) for the same definition of “Independent Manager” as used herein, (ii) that Seller’s Board of Managers shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with respect to Seller unless the Independent Manager shall approve the taking of such action in writing before the taking of such action and (iii) that the provisions required by clauses (i) and (ii) of this sentence cannot be amended except in accordance with this Agreement and without the prior written consent of the Independent Manager and the Required Purchasers;

(iv) the members and Board of Managers of Seller shall hold all regular and special meetings appropriate to authorize Seller’s actions. The members and managers of Seller may act from time to time by unanimous written consent or through one or more committees in accordance with Seller’s certificate of formation and its limited liability company agreement. Seller shall not take any Material Actions (as defined in its limited liability company agreement) without the consent of all its managers, including its Independent Manager. Appropriate minutes of all meetings of Seller’s members and managers (and committees thereof) shall be kept by Seller;

(v) Seller shall compensate its Independent Manager in accordance with Seller’s limited liability company agreement;

(vi) decisions with respect to Seller’s business and daily operations shall be independently made by Seller and shall not be dictated by Originators, CHS, Servicer or any of their respective Affiliates (except by CHS Capital as a member and/or manager of Seller in accordance with Seller’s limited liability company agreement); provided that Servicer shall administer, service and collect the Pool Assets as contemplated by the Transaction Documents;

(vii) no transactions shall be entered between Seller, on the one hand and any Originator, Servicer, CHS, Performance Guarantor or any Affiliate of any of them (other than

Seller), on the other hand (other than as contemplated hereby and in the other Transaction Documents);

(viii) Seller shall act solely in its own name and through its own authorized managers, members, directors, officers and agents, except that, as a general matter, the Account Debtors and Obligors will not be informed in the first instance that Servicer is acting on behalf of Seller, that such Originator sold Assets to Seller or that Seller sold Assets to the Administrative Agent;

(ix) None of Originators, Servicer or any Affiliates of CHS shall be appointed as an agent of Seller, except in the capacity of servicer or subservicer hereunder;

(x) none of Servicer, Originators, CHS, Performance Guarantor or any of their respective Affiliates shall advance funds or credit to Seller; and none of Servicer, Originators, CHS or any Affiliate of Servicer, Originators, Performance Guarantor or CHS will otherwise supply funds or credit to, or guarantee any obligation of, Seller except as expressly contemplated by the Transaction Documents;

(xi) Seller shall maintain a separate space which shall be physically separate from space occupied by Originators, Servicer, Performance Guarantor or any Affiliate of any Originator, Performance Guarantor or Servicer (but may be in a separate space occupied solely by Seller at the offices of CHS or any Affiliate of CHS) and shall be clearly identified as Seller’s space so it can be identified by outsiders;

(xii) other than as permitted by the Transaction Documents, Seller shall not guarantee, or otherwise become liable with respect to, any obligation of CHS, Originators, Servicer, Performance Guarantor or any Affiliate thereof (other than Seller);

(xiii) Seller shall at all times hold itself out to the public under Seller’s own name as a legal entity separate and distinct from its equity holders, members, managers, CHS, Originators, Servicer, Performance Guarantor and each of their respective Affiliates (other than Seller) (the foregoing to include Seller not using the letterhead or telephone number of any such Person);

(xiv) CHS shall prepare its financial statements in compliance with GAAP consistently applied;

(xv) if any of Seller, CHS, Servicer, Performance Guarantor or Originators shall provide any information with respect to the Pool Assets to any creditor of Seller, CHS, Servicer, Performance Guarantor or such Originator, Seller or Servicer, as the case may be, shall also provide (or cause such Originator to provide) to such creditor a notice indicating that the Collections relating to such Pool Assets are held in trust for the Affected Parties;

(xvi) to the extent required by GAAP, CHS’s financial statements shall disclose the separateness of Seller and that the Pool Assets that are owned by Seller are not available to creditors of CHS or its Affiliates other than Seller;

(xvii) any allocations of direct, indirect or overhead expenses for items shared between Seller and Originators, Servicer, CHS, Performance Guarantor or any of their

respective Affiliates shall be made among Seller and Originators, Servicer, CHS, Performance Guarantor or any of their respective Affiliates to the extent practical on the basis of actual use or value of services rendered and otherwise on a basis reasonably related to actual use or the value of services rendered;

(xviii) Seller shall not be named, directly or indirectly, as a contingent beneficiary or loss payee on any insurance policy covering the Servicer, Originators, CHS, Performance Guarantor or any Affiliate of any of them (other than Seller) other than insurance policies entered into in the ordinary course of business covering other Affiliates of any of the foregoing;

(xix) Seller shall maintain adequate capital in light of its contemplated business operations;

(xx) Seller shall generally maintain an arm’s-length relationship with Originators, Servicer, CHS, Performance Guarantor and their respective Affiliates and each transaction entered into with Seller shall be undertaken in good faith for a bona fide business purpose; and

(xxi) the Independent Manager shall not at any time serve as a trustee in bankruptcy for Seller, CHS, Originators, Performance Guarantor, Servicer or any of their respective Affiliates.

(b) Seller and Servicer agree that:

(i) Seller shall not (A) issue any security of any kind except certificates evidencing membership interests issued to CHS Capital in connection with its formation, or (B) incur, assume, guarantee or otherwise become directly or indirectly liable for or in respect of any Debt or obligation other than as expressly permitted by the Transaction Documents.

(ii) Seller shall not sell, pledge or dispose of any of its assets, except as permitted by, or as provided in, the Transaction Documents.

(iii) Seller shall not purchase any asset (or make any investment, by share purchase, loan or otherwise) except as permitted by, or as provided in, the Transaction Documents.

(iv) Seller shall not engage in any activity (whether or not pursued for gain or other pecuniary advantage) other than as permitted by the Transaction Documents.

(v) Seller shall not create, assume or suffer to exist any Adverse Claim on any of its assets other than any Adverse Claim created pursuant to the Transaction Documents.

(vi) Seller shall not make any payment, directly or indirectly, to, or for the account or benefit of, any owner of any security interest or equity interest in Seller or any Affiliate of any such owner (except, in each case, as expressly permitted by the Transaction Documents).

(vii) Seller shall not acquiesce in, or direct Servicer or any other agent to take, any action that is prohibited to be taken by Seller in clauses (i) through (vi) above.

(viii) Seller shall not have any employees.

(ix) Seller will provide not less than ten (10) Business Days’ prior written notice to the Administrative Agent of any removal or replacement of any person that is currently serving or is proposed to be appointed as an Independent Manager, such notice to include the identity of the proposed replacement Independent Manager, together with a certification that such replacement satisfies the requirements for an Independent Manager set forth in this Agreement and the limited liability company agreement of Seller.

(c) Neither Seller nor Servicer shall take any action or permit any of their respective Affiliates to take any action inconsistent with subsection (a) or (b) above.

ARTICLE VIII

ADMINISTRATION AND COLLECTION

SECTION 8.1 Designation of Servicer .

(a) CHS as Initial Servicer . The servicing, administering and collection of the Pool Assets on behalf of Seller, Administrative Agent, Purchaser Agents and Purchasers shall be conducted by the Person designated as Servicer hereunder (“ Servicer ”) from time to time in accordance with this Section 8.1 . Until Administrative Agent (with the consent, or acting at the direction of, the Required Purchasers) gives to CHS a Successor Notice (as defined in Section 8.1(b) ), CHS is hereby designated as, and hereby agrees to perform the duties and obligations of, Servicer pursuant to the terms hereof. Servicer shall receive the Servicing Fee, payable as described in Article III , for the performance of its duties hereunder.

(b) Successor Notice . In the event that a Servicer Termination Event has occurred and has not been waived in accordance with this Agreement, Administrative Agent (with the consent of, or at the direction of, the Required Purchasers) shall have the right, upon not less than five (5) Business Days’ notice to CHS and Seller, to designate a successor Servicer pursuant to the terms hereof (a “ Successor Notice ”). Upon effectiveness of a Successor Notice, CHS agrees that it shall terminate its activities as Servicer hereunder in a manner that Administrative Agent reasonably believes will facilitate the transition of the performance of such activities to the successor Servicer, and such successor Servicer shall assume each and all of CHS’s obligations to service and administer the Pool Assets, on the terms and subject to the conditions herein set forth, and CHS shall use commercially reasonable efforts to assist such successor Servicer in assuming such obligations.

(c) Subservicers; Subcontracts . Servicer may not subcontract with any Person that is not an Affiliate of Servicer (excluding Seller) or otherwise delegate any of its duties or obligations hereunder except with the prior written consent of Administrative Agent and each Purchaser Agent; provided that, notwithstanding any such designation, delegation or subcontract, Servicer shall remain primarily and directly liable for the performance of all the duties and obligations of Servicer pursuant to the terms hereof. For the avoidance of doubt, the parties agree that Servicer may so subcontract with CHS Capital subject to the proviso in the previous sentence.

SECTION 8.2 Duties of Servicer . Seller, each Purchaser, each Purchaser Agent and Administrative Agent hereby appoints as its agent Servicer, as from time to time designated pursuant to Section 8.1 , to enforce its rights and interests in and under the Pool Assets and the other Seller Assets. Servicer shall take or cause to be taken all necessary and appropriate commercial servicing and collection activities

in arranging the timely payment of amounts due and owing by any Account Debtor or Obligor (including the identification of the proceeds of the Pool Assets and related record keeping) all in accordance with Applicable Laws, with reasonable care and diligence, including diligently and faithfully performing all servicing and collection actions. In connection with its administration, collection and servicing obligations, Servicer will perform its duties under the Receivable Documentation related to the Pool Receivables and the Loan Documents related to the Pool Loans with the same care and applying the same policies as it applies to its own assets generally and would exercise and apply if it owned the Pool Assets and shall act in the best interest of the Affected Parties to maximize Collections.

(a) Allocation of Collections; Segregation . Servicer shall set aside and hold in trust Collections of Pool Assets in accordance with Section 1.3 . Servicer acknowledges and agrees that the Pool Assets have been sold and assigned to the Seller pursuant to the Sale Agreement and no portion of the Collections with respect thereto held by the Servicer prior to depositing into a Collection Account, an Originator Specified Account or the Concentration Account shall constitute property of the Servicer.

(b) Documents and Records . Other than the Custodian File held by the Custodian in accordance with the Custodian Agreement, Seller shall deliver to Servicer, and Servicer shall hold in trust for Seller, Administrative Agent, each Purchaser Agent, each Purchaser and each other Affected Party in accordance with their respective interests, all Records (and all original documents relating thereto) (and after the occurrence of any Event of Default, shall deliver the same to Administrative Agent promptly upon Administrative Agent’s written request). Upon written request of Administrative Agent or any Purchaser Agent, Servicer shall promptly provide (or cause Custodian to provide) Administrative Agent and the Purchaser Agents with the location(s) of all Records (and all original documents relating thereto).

(c) Certain Duties of Servicer and Seller . Servicer shall, promptly following receipt of the collections of any Asset that is not a Pool Asset, a Related Asset or any other property included in the grant set forth in Section 9.1 , turn over such collection to the Person entitled to such collection.

(d) Termination . Servicer’s obligations as such under this Agreement shall terminate upon the Final Payout Date.

(e) Power of Attorney . Seller hereby appoints Servicer as the true and lawful attorney-in-fact of Seller, with full power of substitution, coupled with an interest, and hereby authorizes and empowers Servicer to take in Seller’s name and on behalf of Seller any and all steps necessary or desirable, in the reasonable determination of Servicer, to collect all amounts due under any and all Pool Assets, including to make demands for any portion of Pool Assets remaining outstanding past its applicable due date, commence enforcement proceedings, exercise other powers under the Receivable Documentation and Loan Documents, endorse Seller’s name on checks and other instruments representing Collections, enforce Pool Receivables and the related Receivable Documentation, enforce Pool Loans and the related Loan Documents and take such other action and execute such other agreements, instruments and other documents in the name of Seller, to the extent necessary or desirable to accomplish the purposes hereof. Seller hereby appoints the Administrative Agent as the true and lawful attorney-in-fact of Seller, with full power of substitution, coupled with an interest, and hereby authorizes and empowers the Administrative Agent in the name and on behalf of Seller at any time following removal of CHS as Servicer pursuant to this Agreement or at any time following the occurrence of a Servicer Termination Event that has not been waived in accordance with this Agreement, to take such actions, and execute and deliver such documents, as the

Administrative Agent deems necessary or advisable in connection with any Pool Assets (i) to obtain the full benefits of the Transaction Documents and the Pool Assets, (ii) to perfect each of the ownership and/or security interests in the Pool Assets and the other Seller Assets under the Transaction Documents, including to send a notice of each purchase, sale and pledge of the Pool Assets under the Transaction Documents to the applicable Account Debtor or Obligor, (iii) to communicate directly with the applicable Account Debtor or Obligor to collect any portion of a Pool Asset that remains outstanding past its applicable due date, (iv) to notify and require (x) Account Debtors to remit the proceeds of Pool Receivables directly to a Lockbox, an Originator Specified Account, a Collection Account or the Concentration Account and (y) Obligors to remit the proceeds of Pool Loans directly to a Seller Collection Account or the Concentration Account or (v) to make collection of and otherwise realize the benefits of any Pool Asset. At any time that CHS is no longer serving as Servicer hereunder or at any time following the occurrence of a Servicer Termination Event that has not been waived in accordance with this Agreement, the Administrative Agent shall have the right to bring suit, in the Administrative Agent’s or Seller’s name, and generally have all other rights of an owner and holder respecting any Pool Assets, including the right to accelerate or extend the time of payment, settle, compromise, release in whole or in part any amounts owing on any Pool Assets and issue credits in its own name or the name of Seller. At any time following removal of CHS as Servicer or at any time following the occurrence of a Servicer Termination Event that has not been waived in accordance with this Agreement, the Administrative Agent may endorse or sign the Administrative Agent’s or Seller’s name on any checks or other instruments with respect to any Pool Assets or the goods covered thereby. This power of attorney, being coupled with an interest, is irrevocable and shall not expire until the Final Payout Date.

(f) Resignation of CHS as Servicer . CHS shall not resign in its capacity as Servicer hereunder without the prior written consent of Administrative Agent and each Purchaser Agent, which consent shall be given or withheld in the sole and absolute discretion of Administrative Agent and each Purchaser Agent.

SECTION 8.3 Rights of Administrative Agent . In addition to all of its other rights herein including under Articles IX and X , under the other Transaction Documents or at law or in equity, Administrative Agent shall have the other following rights set forth in this Section 8.3 :

(a) Notice to Account Debtors and Obligors . At any time after the occurrence of any Event of Default, Servicer shall (on behalf of Seller), at Administrative Agent’s or any Purchaser Agent’s request and at Seller’s expense, give notice of Administrative Agent’s ownership and security interest in the Pool Assets to each applicable Account Debtor or Obligor and instruct them that payments on the Pool Assets will only be effective if made to, or as otherwise instructed in writing by, Administrative Agent.

(b) [Reserved] .

(c) Other Rights . At any time after (i) the occurrence of an Event of Default that has not been waived in accordance with this Agreement or (ii) the commencement of the Liquidation Period, Servicer shall (on behalf of Seller), (A) at Administrative Agent’s request and at Seller’s expense, assemble all of the Records (other than the Custodian File held by the Custodian pursuant to the Custodian Agreement) and deliver such Records to or at the direction of Administrative Agent and (B) at the request of Administrative Agent or its designee, exercise or enforce any of their respective rights hereunder, under any other Transaction Document, under any Pool Asset or under any other Seller Assets (to the extent permitted hereunder or thereunder). Without limiting the generality of the

foregoing, each of Servicer and Seller shall upon the request of Administrative Agent or its designee and at Seller’s expense:

(I) authorize, execute (if required) and file such financing or continuation statements, or amendments thereto or assignments thereof, and such other instruments or notices, as may be necessary or appropriate;

(II) make a notation in its books and records to indicate that the Pool Assets have been transferred and pledged in accordance with this Agreement; and

(III) following the occurrence of an Event of Default that has not been waived in accordance with this Agreement, mark conspicuously all Receivable Documentation evidencing Pool Receivables and all Loan Documents evidencing Pool Loans with a legend reasonably acceptable to Administrative Agent evidencing that the Pool Assets have been sold or otherwise pledged pursuant to this Agreement.

(d) Additional Financing Statements; Performance by Administrative Agent . Seller hereby authorizes Administrative Agent or its designee to file one or more financing or continuation statements, and amendments thereto and assignments thereof, or any similar instruments in any relevant jurisdiction relative to all or any of the Pool Assets and the other Seller Assets now existing or hereafter arising in the name of Seller. Seller agrees that an “all assets” or similar filing against it may be filed for the purposes hereof and to perfect the security interest and transfers created hereby. If Seller fails to perform any of its agreements or obligations under this Agreement or any other Transaction Document, Administrative Agent or its designee may (but shall not be required to) itself perform, or cause performance of, such agreement or obligation, and the expenses of Administrative Agent or its designee incurred in connection therewith shall be payable by Seller as provided in Section 13.6 .

SECTION 8.4 Responsibilities of Servicer . Anything herein to the contrary notwithstanding:

(a) Contracts . Servicer shall, in accordance with the Credit and Collection Policy, Applicable Law and the terms of this Agreement, perform all of its obligations under the Records, so long as it is an Affiliate of Seller, to the same extent as if the Asset Interest had not been sold hereunder and the exercise by Administrative Agent or its designee of its rights hereunder shall not relieve Servicer from such obligations.

(b) Limitation of Liability . None of Administrative Agent, any Purchaser or any Purchaser Agent shall have any obligation or liability with respect to any Pool Asset or Related Assets related thereto, nor shall any of them be obligated to perform any of the obligations of Servicer or Seller thereunder.

SECTION 8.5 Further Action Evidencing Purchases and Reinvestments . Seller agrees that from time to time, at its expense, it shall (or cause Servicer to) promptly execute and deliver all further instruments and documents, and take all further actions, that Administrative Agent or its designee may reasonably request or that are necessary in order to perfect, protect or more fully evidence the transactions contemplated by the other Transaction Documents, the Purchases hereunder and the resulting Asset Interest.

SECTION 8.6 Application of Collections . The Servicer shall be responsible for promptly identifying, matching, applying and reconciling any payments received in the Collection Accounts or Originator Specified Accounts with the Asset associated with such payment.

SECTION 8.7 Funds and Documents to be held in Trust . Whenever this Agreement or any other Transaction Document requires the Seller or the Servicer to hold funds or documents in trust for the Administrative Agent, it is understood and agreed that CHS, Seller or Servicer is not required to establish trust accounts or arrangements with independent trustees, custodians or third parties, but may hold such funds for the Administrative Agent in Originator Collection Accounts which may be commingled with other deposit account maintained by CHS, Seller or Servicer, and may hold such documents for safekeeping for the Administrative Agent in such manner as CHS, Seller of Servicer holds its own documents in safekeeping; provided that, for the avoidance of doubt, (x) Seller, CHS and the Servicer shall not be permitted to deposit any funds in a Seller Collection Account or the Concentration Account other than Collections and proceeds thereof and (y) neither the Seller Collection Accounts nor the Concentration Account may be commingled with any other deposit accounts.

ARTICLE IX

SECURITY INTEREST

SECTION 9.1 Grant of Security Interest . To secure all obligations of Seller arising in connection with this Agreement and each other Transaction Document, whether now or hereafter existing, due or to become due, direct or indirect, or absolute or contingent, including, all Indemnified Amounts, payments on account of Collections received or deemed to be received and fees and expenses, in each case pro rata according to the respective amounts thereof, Seller hereby assigns and pledges to Administrative Agent, as collateral trustee, for the benefit of the Affected Parties, and hereby grants to Administrative Agent, as collateral trustee, for the benefit of the Affected Parties, a security interest in, and general lien on all of the following: all of Seller’s right, title and interest now or hereafter existing in, to and under all of Seller’s assets, whether now owned or hereafter acquired, and wherever located (whether or not in the possession or control of Seller), including all of its right, title and interest in, to and under each of the following, in each case, whether now owned or existing hereafter arising, acquired, or originated, or in which Seller now or hereafter has any rights, and wherever located (whether or not in the possession or control of Seller) and all proceeds of any of the foregoing (collectively, the “ Seller Assets ”): (I) all Pool Assets; (II) the Related Assets; (III) the Collections; (IV) all Accounts; (V) all Chattel Paper; (VI) all Contracts; (VII) all Deposit Accounts; (VIII) all Documents; (IX) all Payment Intangibles; (X) all General Intangibles; (XI) all Instruments; (XII) all Inventory; (XIII) all Investment Property; (XIV) all letter of credit rights and supporting obligations; (XV) the Sale Agreement and all rights and remedies of Seller thereunder; (XVI) the Custodian Agreement and all rights and remedies of the Administrative Agent thereunder; (XVII) all other assets in the Asset Interest; (XVIII) all rights, interests, remedies and privileges of Seller relating to any of the foregoing (including the right to sue for past, present or future infringement of any or all of the foregoing); (XIX) each Lockbox; and (XX) to the extent not otherwise included, all products and Proceeds (each capitalized term in clauses IV through XX , as defined in the UCC) of each of the foregoing and all accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing (including insurance proceeds), and all distributions (whether in money, securities or other property) and collections from or with respect to any of the foregoing.

Seller hereby authorizes the filing of financing statements, including those filed under Section 8.3(d) , describing the collateral covered thereby as “all of debtor’s personal property and assets” or words to that

effect, notwithstanding that such wording may be broader in scope than the collateral described in this Section 9.1 . This Agreement shall constitute a security agreement under Applicable Law.

SECTION 9.2 Further Assurances . The provisions of Section 8.5 shall apply to the security interest granted, and to the assignment effected, under Section 9.1 as well as to the Purchases, Reinvestments and the Asset Interest hereunder.

SECTION 9.3 Remedies; Waiver . After the occurrence and during the continuance of an Event of Default, Administrative Agent, on behalf of the Affected Parties, shall have, with respect to the Seller Assets granted pursuant to Section 9.1 , and in addition to all other rights and remedies available to any Affected Party under this Agreement and the other Transaction Documents or other Applicable Law, all the rights and remedies of a secured party under the UCC. To the fullest extent it may lawfully so agree, Seller agrees that it will not at any time insist upon, claim, plead, or take any benefit or advantage of any appraisal, valuation, stay, extension, moratorium, redemption or similar law now or hereafter in force in order to prevent, delay, or hinder the enforcement hereof or the absolute sale of any part of the Seller Assets; Seller for itself and all who claim through it, so far as it or they now or hereafter lawfully may do so, hereby waives the benefit of all such laws and all right to have the Seller Assets marshalled upon any foreclosure hereof, and agrees that any court having jurisdiction to foreclose this Agreement may order the sale of the Seller Assets in its entirety. Without limiting the generality of the foregoing, Seller hereby waives and releases any and all right to require Administrative Agent to collect any of such obligations from any specific item or items of the Seller Assets or from any other party liable as guarantor or in any other manner in respect of any of such obligations or from any collateral (including the Seller Assets) for any of such obligations.

ARTICLE X

EVENTS OF DEFAULT

SECTION 10.1 Events of Default . The following events shall be “ Events of Default ” hereunder:

(a) (i) Seller or Servicer shall fail to be in compliance with any of its covenants or obligations set forth in Section 3.1(a) , 7.1(d) , 7.1(f) , 7.1(g) , 7.1(o) , 7.1(u) , 7.1(w) , 7.1(aa)(i) , 7.2(e) , 7.2(f) , 7.2(q)(i) , 7.4(a)(iii) or 7.4(b)(ix) of this Agreement or (ii) Seller, any Originator, CHS or Servicer shall otherwise fail to be in compliance with any of its other covenants and obligations under this Agreement or any other Transaction Document (other than described in clause (i) hereof or clause (b) below), and such failure in this clause (ii) , solely to the extent capable of cure, shall continue unremedied for a period of at least ten (10) Business Days after the earlier of a Responsible Officer having actual knowledge of such failure or notice thereof given to Seller or the Servicer by the Administrative Agent or any other Affected Party;

(b) Seller, Servicer, Performance Guarantor or any Originator shall fail to make any payment or deposit or transfer of monies to be made by it hereunder or under any other Transaction Document as and when due and such failure is not remedied within one (1) Business Day;

(c) CHS shall fail to perform its duties and obligations as Servicer hereunder or under any other Transaction Document and such failure is not remedied within one (1) Business Day;

(d) CHS shall resign as Servicer other than in accordance with this Agreement;

(e) (i) an Insolvency Event shall have occurred with respect to Seller, any Originator, Performance Guarantor or (ii) Servicer, any Originator or Seller shall not be Solvent;

(f) any representation or warranty made or deemed to be made by Seller, Servicer, Performance Guarantor or any Originator in this Agreement, any Information Package or any other Transaction Document shall fail to be true and correct in any material respect, as of the date made or, in the case of any representation or warranty which speaks as to a particular date or period, as of that particular date or period;

(g) Administrative Agent shall fail to have a valid first priority perfected security interest in the Concentration Account and the Collection Accounts (and all amounts and instruments from time to time on deposit therein);

(h) Seller shall be required to register as an “investment company” within the meaning of the Investment Company Act;

(i) a Servicer Termination Event shall have occurred;

(j) a Change of Control shall have occurred;

(k) Seller shall fail to pay in full all of its obligations to Administrative Agent, the Purchaser Agents and Purchasers hereunder and under the other Transaction Documents on or prior to the Legal Final Settlement Date.

(l) there shall have occurred any event which materially adversely impairs the collectability, value, validity or enforceability of, or increases the days to pay or Dilution with respect to, the Pool Assets generally or any material portion thereof;

(m) this Agreement or any security interest granted pursuant to this Agreement or any other Transaction Document shall for any reason cease to create, or for any reason cease to be, a valid and enforceable first priority perfected security interest in favor of the Administrative Agent with respect to the Pool Assets and Related Assets and, in either case, free and clear of any Adverse Claim;

(n) any Transaction Document shall, in whole or in part, except pursuant to the terms thereof, terminate, cease to be effective or cease to be a legally valid, binding and enforceable obligation of any party thereto (other than any Affected Party) or any such party shall, directly or indirectly, contest in any manner the effectiveness, validity, binding nature or enforceability of such Transaction Document;

(o) in the reasonable opinion of the Required Purchasers, there shall have occurred any Material Adverse Change with respect to Servicer, Seller, any Originator or Performance Guarantor;

(p) For the Receivables Pool, (i) the average of the Default Ratio (Receivables) for the three preceding Settlement Periods shall at any time exceed 1.0%, (ii) the average of the Dilution Ratios for the three preceding Settlement Periods shall at any time exceed 5.0% or (iii) the average of the Days Sales Outstanding for the three preceding Settlement Periods shall at any time exceed 25.0 days;

(q) For the Loan Pool, the average of the Default Ratio (Loans) for the three preceding Settlement Periods shall at any time exceed (i) with respect to the August 2018 and September 2018 Reporting Dates, 4.25%, (ii) with respect to the October 2018, November 2018 and December 2018 Reporting Dates, 4.50%, (iii) with respect to the January 2018 Reporting Date, 3.75%, (iv) with respect to the February 2019 Reporting Date, 3.25%, and (v) with respect to any other Reporting Date, 3.0%; or the Monthly Loss Ratio (Loans) for the three preceding Settlement Periods shall at any time exceed 1.0%; or the Portfolio Weighted Average Loan Rating Factor for the three preceding Settlement Periods shall at any time be less than 3.25%;

(r) on any day, (i) the Total Investment exceeds the Purchasers’ Total Commitment, or (ii) the Total Investment exceeds the sum of the Receivables Investment Base and the Loan Investment Base, in each case, unless cured within two (2) Business Days;

(s) any Originator, Performance Guarantor or Servicer, or any of their respective Subsidiaries (i) fails to make payment when due (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise) in respect of any indebtedness for borrowed money (other than indebtedness arising under any Transaction Document or Subordinated Note Financing Document) aggregating in excess of $100,000,000 which was incurred, assumed or guaranteed by such Person, or (ii) fails to perform or observe any other condition or covenant, or any other event shall occur or condition shall exist, under any indenture, agreement or other instrument under which any indebtedness for borrowed money (other than indebtedness arising under any Transaction Document or Subordinated Note Financing Document) aggregating in excess of $100,000,000 was incurred, assumed or guaranteed by such Person, if the effect of such failure, event or condition is to cause, or to permit the holder or holders or beneficiary or beneficiaries of such indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, such indebtedness to be declared to be due and payable prior to its stated maturity, or such guaranty to become payable, without regard to whether such holder or holders, beneficiary or beneficiaries or such other Person shall have exercised or waived their right to do so;

(t) one or more judgments, orders, decrees or arbitration award is entered against any Originator, Performance Guarantor or Servicer, involving in the aggregate a liability (to the extent not covered by insurance from a Solvent insurer and as to which the insurer does not dispute coverage), as to any single or related series of transactions, incidents or conditions, of $25,000,000 or more, and the same shall remain undischarged, unvacated and unstayed pending appeal for a period of sixty (60) consecutive days after the entry thereof (or such longer period as may be permitted by Applicable Law or court order to obtain relief from payment of or to pay such judgments, orders, decrees or awards);

(u) one or more judgments, orders, decrees or arbitration awards is entered against Seller involving in the aggregate a liability of $15,775 or more, other than any judgment against Seller with respect to any taxes that are owing by Seller to any Governmental Authority that are being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP, that remain undischarged, unvacated and unstayed pending appeal for a period of sixty (60) consecutive days after the entry thereof (or such longer period as may be permitted by Applicable Law or court order to obtain relief from payment thereof);

(v) (i) an ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which would materially adversely affect the financial condition or results of operations of Seller, Servicer, any Originator, Performance Guarantor and their Subsidiaries, taken as a whole, or (ii) Seller, Servicer,

any Originator, Performance Guarantor or any ERISA Affiliate shall fail to pay when due under Section 412 of the Code any contribution to a Pension Plan in excess of $25,000,000 and such failure shall continue for 30 days;

(w) the Internal Revenue Service shall file notice of a lien pursuant to Section 6323 of the Code with regard to any assets of Seller, Servicer or Originators and such lien shall not have been released within five (5) Business Days, or the PBGC shall file notice of a lien pursuant to Section 4068 of ERISA with regard to any of the assets of Seller, Servicer or Originators and such lien shall not have been released within five Business Days; or

(x) any payment default shall occur under any Subordinated Note Financing Document (after giving effect to any applicable grace period).

SECTION 10.2 Remedies .

(a) Optional Liquidation . Upon, or any time after, the occurrence of an Event of Default (other than an Event of Default described in Section 10.1(e) ), Administrative Agent shall, at the request, or may with the consent, of the Required Purchasers, by notice to Seller and Servicer declare the Purchase Termination Date to have occurred and the Liquidation Period to have commenced and shall have all of the remedies set forth in Section 9.3 or otherwise herein or in equity or at law.

(b) Automatic Liquidation . Upon the occurrence of an Event of Default described in Section 10.1(e) , the Purchase Termination Date shall occur and the Liquidation Period shall commence automatically.

(c) Remedies . Upon, or at any time after, the declaration or automatic occurrence of the Purchase Termination Date pursuant to this Section 10.2 , no Purchases or Reinvestments thereafter will be made. Upon the declaration or automatic occurrence of the Purchase Termination Date pursuant to this Section 10.2 , Administrative Agent, on behalf of the Affected Parties, shall have, in addition to all other rights and remedies under this Agreement, any other Transaction Document or otherwise, (i) all other rights and remedies provided under the UCC of each applicable jurisdiction and other Applicable Laws (including all the rights and remedies of a secured party under the UCC (including the right to sell any or all of the Seller Assets subject hereto)) and (ii) all rights and remedies with respect to the Seller Assets granted pursuant to Section 9.1 , all of which rights shall be cumulative.

(d) Specific Remedies . (i) Without limiting Section 10.2(c) or any other provision herein or in any other Transaction Document, the parties hereto agree that the terms of this Section 10.2(d) are agreed upon in accordance with Section 9-603 of the New York UCC, that they do not believe the terms of this Section 10.2(d) to be “manifestly unreasonable” for purposes of Section 9-603 of the New York UCC, and that compliance therewith shall constitute a “commercially reasonable” disposition under Section 9-610 of the New York UCC, and further agree as follows:

(ii) After the occurrence of the Purchase Termination Date pursuant to Section 10.2(a) or Section 10.2(b) , Administrative Agent, on behalf of the Affected Parties, shall have all rights, remedies and recourse granted in any Transaction Document and any other instrument executed to provide security for or in connection with the payment and performance of the Obligations or existing at common law or equity (including specifically those granted by the New York UCC and the UCC of any other state which governs the creation or perfection (and the effect thereof) of any security interest in the Seller Assets), and such rights and

remedies: (A) shall be cumulative and concurrent; (B) may be pursued separately, successively or concurrently against Seller, any Originator and Performance Guarantor and any other party obligated under the Transaction Documents, or any of such Seller Assets, or any other security for the Obligations, or any of them, at the sole discretion of Administrative Agent, on behalf of the Affected Parties; (C) may be exercised as often as occasion therefor shall arise, it being agreed by Seller, Servicer, each Originator, Performance Guarantor and any other party obligated under the Transaction Documents, or any of such Seller Assets, or any other security for the Obligations, or any of them, that the exercise or failure to exercise any of same shall in no event be construed as a waiver or release thereof or of any other right, remedy or recourse; and (D) are intended to be and shall be, non exclusive. For the avoidance of doubt, with respect to any disposition of the Seller Assets or any part thereof (including any purchase by Administrative Agent, any Affected Party, or any Affiliate of any of them) in accordance with the terms of this Section 10.2 for consideration which is insufficient, after payment of all related costs and expenses of every kind, to satisfy the Obligations, (1) such disposition shall not act as, and shall not be deemed to be, a waiver of any rights by Administrative Agent or the Affected Parties and Administrative Agent on behalf of the Affected Parties shall have a claim for such deficiency and (2) Administrative Agent shall not be liable or responsible for any such deficiency.

(iii) Upon the declaration or automatic occurrence of the Purchase Termination Date pursuant to Section 10.2(a) or Section 10.2(b) , Administrative Agent, on behalf of the Affected Parties, shall (at the direction of the Required Purchasers) have the right, in accordance with this Section 10.2(d) , to dispose of the Seller Assets or any part thereof upon giving at least ten (10) Business Days’ prior notice to Seller and Servicer of the time and place of disposition, for cash or upon credit or for future delivery, with Seller and Servicer hereby waiving all rights, if any, to require Administrative Agent or any other Person to marshal the Seller Assets and at the option and in the complete discretion of Administrative Agent, Administrative Agent may:

(I) dispose of the Seller Assets or any part thereof at a public disposition;

(II) dispose of the Seller Assets or any part thereof at a private disposition, in which event such notice shall also contain a summary of the material terms of the proposed disposition, and Seller shall have until the time of such proposed disposition during which to redeem the Seller Assets or to procure a Person willing, ready and able to acquire the Seller Assets on terms at least as favorable to Seller and the Affected Parties, and if such an acquirer is so procured, then Administrative Agent shall dispose of the Seller Assets to the acquirer so procured;

(III) dispose of the Seller Assets or any part thereof in bulk or parcels;

(IV) dispose of the Seller Assets or any part thereof to any Affected Party or any Affiliate thereof at a public disposition;

(V) bid for and acquire, unless prohibited by Applicable Law, free from any redemption right, the Seller Assets or any part thereof, and, if the Affected Parties are then the holders of any Obligations or any participation or other interest therein, in lieu of paying cash therefor, Administrative Agent on behalf of the Affected Parties may make settlement for the selling price by crediting the net selling price, if any, after deducting all costs and expenses of every kind, upon the outstanding principal amount of the Obligations, in such

order and manner as Administrative Agent on behalf of the Affected Parties, in its discretion, may deem advisable and as permissible and required under the Transaction Documents. Administrative Agent for the benefit of Affected Parties, upon so acquiring the Seller Assets or any part thereof shall be entitled to hold or otherwise deal with or dispose of the same in any manner not prohibited by Applicable Law; or

(VI) enforce any other remedy available to Administrative Agent on behalf of the Affected Parties at law or in equity.

From time to time Administrative Agent may, but shall not be obligated to, postpone the time and change the place of any proposed disposition of any of the Seller Assets for which notice has been given as provided above and may retain the Seller Assets until such time as the proposed disposition occurs if, in the sole discretion of Administrative Agent, such postponement or change is necessary or appropriate in order that the provisions of this Agreement applicable to such disposition may be fulfilled or in order to obtain more favorable conditions under which such disposition may take place. Seller and CHS each acknowledges and agrees that private dispositions may be made at prices and upon other terms less favorable than might have been attained if the Seller Assets were disposed of at public disposition. For the avoidance of doubt, to the extent permitted by Applicable Law, Administrative Agent shall not be obligated to make any disposition of the Seller Assets or any part thereof notwithstanding any prior notice of a proposed disposition. No demand, advertisement or notice, all of which are hereby expressly waived by Seller and CHS to the extent permitted by Applicable Law, shall be required in connection with any disposition of the Seller Assets or any part thereof, except for the notice described in this clause (iii) .

In case of any disposition by Administrative Agent of any of the Seller Assets on credit, which may be elected at the option and in the complete discretion of Administrative Agent, on behalf of the Affected Parties, the Seller Assets so disposed may be retained by Administrative Agent for the benefit of the Affected Parties until the disposition price is paid by the purchaser, but neither Administrative Agent nor the Affected Parties shall incur any liability in case of failure of the purchaser to take up and pay for the Seller Assets so disposed. In case of any such failure, such Seller Assets so disposed may be again disposed.

After deducting all costs or expenses of every kind (including the attorneys’ fees and legal expenses incurred by Administrative Agent or the Affected Parties, or both), Administrative Agent shall apply the residue of the proceeds of any disposition or dispositions, if any, to pay the principal of and interest upon the Obligations in such order and manner as Administrative Agent in its discretion may deem advisable and as permissible and required under the Transaction Documents. The excess, if any, shall be paid to Seller in accordance with the Transaction Documents. Neither Administrative Agent nor the Affected Parties shall incur any liability as a result of the dispositions of the Seller Assets at any private or public disposition that complies with the provisions of this Section 10.2(d) .

Notwithstanding a foreclosure upon any of the Seller Assets or exercise of any other remedy by Administrative Agent on behalf of the Affected Parties in connection with the Purchase Termination Date pursuant to Section 10.2 , neither Seller nor CHS shall be subrogated thereby to any rights of Administrative Agent for the benefit of the Affected Parties against the Seller Assets or any other security for the Obligations, nor shall Seller or CHS be deemed to be the owner of any interest in any Obligations, or exercise any rights or remedies with respect to itself or any other party until the Obligations have been paid to Administrative

Agent for the benefit of the Affected Parties and are fully and indefeasibly performed and discharged.

Administrative Agent shall have no duty to prepare or process the Seller Assets for disposition.

ARTICLE XI

PURCHASER AGENTS; ADMINISTRATIVE AGENT;

CERTAIN RELATED MATTERS

SECTION 11.1 Authorization and Action of Program Administrator . Pursuant to its related Program Administration Agreement, each of Nieuw Amsterdam and Victory has appointed and authorized its related Program Administrator (or its respective designees) to take such action as agent on its behalf and to exercise such powers under this Agreement as are delegated to its related Program Administrator by the terms hereof, together with such powers as are reasonably incidental thereto.

SECTION 11.2 Limited Liability of Purchasers, Purchaser Agents and Administrative Agent . The obligations of Administrative Agent, each Program Administrator, each Purchaser, each Purchaser Agent, each Enhancement Provider, each Liquidity Provider and each agent for any Purchaser under the Transaction Documents are solely the corporate obligations of such Person. Except with respect to any claim arising out of the willful misconduct or gross negligence of such Person (including with respect to the servicing, administering or collecting Pool Assets by such Person as successor Servicer pursuant to Section 8.1 ), no claim may be made by CHS, Seller, Servicer, Performance Guarantor or any Originator against any Program Administrator, Administrative Agent, any Purchaser, any Purchaser Agent, any Enhancement Provider, any Liquidity Provider or any agent for any Purchaser or their respective Affiliates, directors, members, managers, officers, employees, attorneys or agents, including Global Securitization Services, LLC, any Program Administrator, MUFG and Rabobank, for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement or any other Transaction Document, or any act, omission or event occurring in connection therewith; and each of Seller and CHS hereby waives, releases, and agrees not to sue upon any claim for any such damages not expressly permitted by this Section 11.2 , whether or not accrued and whether or not known or suspected to exist in its favor. The parties agree that (a) MUFG shall have no obligation, in its capacity as a Program Administrator for Victory or otherwise to take any actions under this Agreement or any other Transaction Document if MUFG is relieved of its obligations as a Program Administrator and (b) Rabobank shall have no obligation, in its capacity as a Program Administrator for Nieuw Amsterdam or otherwise to take any actions under this Agreement or any other Transaction Document if Rabobank is relieved of its obligations as a Program Administrator. Notwithstanding any provision of this Agreement or any other Transaction Document to the contrary (i) in no event shall Administrative Agent or any Purchaser Agent ever be required to take any action which exposes it to personal liability or which is contrary to the provision of any Transaction Document or Applicable Law and (ii) neither Administrative Agent nor any Purchaser Agent shall have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any party hereto or any other Person, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on the part of Administrative Agent or any Purchaser Agent shall be read into this Agreement or the other Transaction Documents or otherwise exist against Administrative Agent or any Purchaser Agent. In performing its functions and duties hereunder, Administrative Agent shall act solely as the agent of the Purchasers, the Purchaser Agents and the other Affected Parties, as applicable, and does not assume nor shall be deemed to have assumed any obligation or

relationship of trust or agency with or for Seller, any Originator, Performance Guarantor, CHS or any other Person.

SECTION 11.3 Authorization and Action of each Purchaser Agent . By its execution hereof, in the case of each Conduit Purchaser and Committed Purchaser, and by accepting the benefits hereof, each Enhancement Provider and Liquidity Provider, each such party hereby designates and appoints its related Purchaser Agent to take such action as agent on its behalf and to exercise such powers as are delegated to such Purchaser Agent by the terms hereof, together with such powers as are reasonably incidental thereto. Each Purchaser Agent reserves the right, in its sole discretion, to take any actions and exercise any rights or remedies, in each case, authorized or provided for under this Agreement or any other Transaction Document and any related agreements and documents.

SECTION 11.4 Authorization and Action of Administrative Agent . By its execution hereof, in the case of each Conduit Purchaser, Committed Purchaser and Purchaser Agent, each such party hereby designates and appoints MUFG as the Administrative Agent to take such action as agent on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such powers as are reasonably incidental thereto. The Administrative Agent reserves the right, in its sole discretion, to take any actions and exercise any rights or remedies, in each case, authorized or provided for under this Agreement or any other Transaction Document and any related agreements and documents.

SECTION 11.5 Delegation of Duties of each Purchaser Agent . Each Purchaser Agent may execute any of its duties through agents or attorneys in fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. No Purchaser Agent shall be responsible to any Purchaser in its Purchaser Group for the negligence or misconduct of any agents or attorneys in fact selected by it with reasonable care.

SECTION 11.6 Delegation of Duties of Administrative Agent . Administrative Agent may execute any of its duties through agents or attorneys in fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. Administrative Agent shall not be responsible to any Purchaser, any Purchaser Agent or any other Person for the negligence or misconduct of any agents or attorneys in fact selected by it with reasonable care.

SECTION 11.7 Successor Agent . The Administrative Agent may, upon at least 30 days’ notice to the Seller and each Purchaser Agent, resign as Administrative Agent. Such resignation shall not become effective until a successor agent (i) is appointed by the Required Purchasers and, so long as no Event of Default has occurred and is continuing, the Seller and (ii) has accepted such appointment. Upon such acceptance of its appointment as Administrative Agent hereunder by a successor agent, such successor agent shall succeed to and become vested with all the rights and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under the Transaction Documents.

SECTION 11.8 Indemnification . Each Committed Purchaser shall indemnify and hold harmless the Administrative Agent and its officers, directors, employees, representatives and agents (to the extent not reimbursed by the Seller or the Servicer and without limiting the obligation of the Seller or the Servicer to do so), ratably in accordance with its Commitment from and against any and all liabilities, obligations, losses, damages, penalties, judgments, settlements, costs, expenses and disbursements of any kind whatsoever (including in connection with any investigative or threatened proceeding, whether or not the Administrative Agent or such Person is designated a party thereto) that may at any time be imposed on, incurred by or asserted against the Administrative Agent for such Person as a result of, or related to, any of the transactions contemplated by the Transaction Documents or the execution, delivery or performance of

the Transaction Documents or any other document furnished in connection therewith (but excluding any such liabilities, obligations, losses, damages, penalties, judgments, settlements, costs, expenses or disbursements to the extent resulting solely from the gross negligence or willful misconduct of the Administrative Agent or such Person as finally determined by a court of competent jurisdiction).

SECTION 11.9 Reliance, etc. Without limiting the generality of Section 11.2 , each of any Program Administrator, Administrative Agent, any Purchaser Agent, any Enhancement Provider and any Liquidity Provider (a) may consult with legal counsel (including counsel for Seller), independent certified public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (b) makes no warranty or representation to any Purchaser or any other holder of any interest in Pool Assets and shall not be responsible to any Purchaser or any such other holder for any statements, warranties or representations made by other Persons in or in connection with any Transaction Document; (c) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of any Transaction Document on the part of Seller or to inspect the property (including the books and records) of Seller; (d) shall not be responsible to any Purchaser or any other holder of any interest in the Asset Interest for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Transaction Document; and (e) shall incur no liability under or in respect of this Agreement or any other Transaction Document by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by facsimile or telex) believed by it to be genuine and signed or sent by the proper party or parties.

SECTION 11.10 Purchasers and Affiliates . Any Purchaser, any Purchaser Agent, any Program Administrator, Administrative Agent and any of their respective Affiliates may generally engage in any kind of business with Seller, each Originator, Servicer, CHS, Performance Guarantor or any Account Debtor or Obligor, any of their respective Affiliates and any Person who may do business with or own securities of Seller, each Originator, Servicer, CHS, Performance Guarantor or any Account Debtor or Obligor or any of their respective Affiliates, all as if it was not a Purchaser, a Purchaser Agent, a Program Administrator or Administrative Agent hereunder, and without any duty to account therefor to any Purchaser or any other holder of an interest in Pool Assets.

SECTION 11.11 Sharing of Recoveries . Each Purchaser agrees that if it receives any recovery, through set-off, judicial action or otherwise, on any amount payable or recoverable hereunder in a greater proportion than should have been received hereunder or otherwise inconsistent with the provisions hereof, then the recipient of such recovery shall purchase for cash an interest in amounts owing to the other Purchasers (as return of such Purchaser Group’s Purchaser Group Investment or otherwise), without representation or warranty except for the representation and warranty that such interest is being sold by each such other Purchaser free and clear of any lien created or granted by such other Purchaser, in the amount necessary to create proportional participation by the Purchaser in such recovery. If all or any portion of such amount is thereafter recovered from the recipient, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.

SECTION 11.12 Non-Reliance on Administrative Agent, Purchaser Agents and Other Purchasers . Each Purchaser expressly acknowledges that none of the Administrative Agent, the Purchaser Agents nor any of their respective officers, directors, members, partners, certificateholders, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrative Agent, or any Purchaser Agent hereafter taken, including any review of the affairs of the Seller, Servicer, Performance Guarantor or each Originator, shall be deemed to constitute any representation or warranty by the Administrative Agent or such Purchaser Agent, as applicable. Each Purchaser represents

and warrants to the Administrative Agent and the Purchaser Agents that, independently and without reliance upon the Administrative Agent, Purchaser Agents or any other Purchaser and based on such documents and information as it has deemed appropriate, it has made and will continue to make its own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Seller, Servicer, Performance Guarantor or each Originator, and the Assets and its own decision to enter into this Agreement and to take, or omit, action under any Transaction Document. Except for items specifically required to be delivered hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Purchaser Agent with any information concerning the Seller, Servicer, Performance Guarantor or each Originator or any of their Affiliates that comes into the possession of the Administrative Agent or any of its officers, directors, members, partners, certificateholders, employees, agents, attorneys-in-fact or Affiliates.

ARTICLE XII

INDEMNIFICATION

SECTION 12.1 Indemnities by Seller .

(a) General Indemnity . Without limiting any other rights which any such Person may have hereunder or under Applicable Law, but subject to Sections 12.1(b) and 13.5 , Seller agrees to indemnify and hold harmless Administrative Agent, each Program Administrator, each Purchaser, each Purchaser Agent, each Enhancement Provider, each Liquidity Provider, each other Affected Party, any sub-agent of Administrative Agent, any Purchaser Agent, any assignee or successor of any of the foregoing and each of their respective Affiliates, and all directors, members, managers, directors, shareholders, officers, employees and attorneys or agents of any of the foregoing (each an “ Indemnified Party ”), forthwith on demand, from and against any and all damages, losses, claims, liabilities and related costs and expenses (including all filing fees), including reasonable attorneys’, consultants’ and accountants’ fees and disbursements but excluding all Excluded Taxes other than any amounts reimbursable pursuant to Section 4.3 (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) awarded against or incurred by any of them arising out of, relating to or in connection with the Transaction Documents, any of the transactions contemplated thereby, or the ownership, maintenance or funding, directly or indirectly, of the Asset Interest (or any part thereof) or in respect of or related to any Seller Assets, including Pool Assets or any Related Assets or otherwise arising out of or relating to or resulting from the actions or inactions of Seller, any Originator, Servicer, CHS, Performance Guarantor or any other party to a Transaction Document; provided , however , notwithstanding anything to the contrary in this Article XII , in all events there shall be excluded from the foregoing indemnification any damages, claims, losses, costs, expenses, liabilities or other Indemnified Amounts to the extent resulting from (x) the gross negligence or willful misconduct of an Indemnified Party as determined in a final non-appealable judgment by a court of competent jurisdiction or (y) the failure of an Account Debtor or Obligor to pay any sum due under its Pool Assets by reason of the financial or credit condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor or Obligor). Without limiting the foregoing, Seller shall indemnify, subject to the express limitations set forth in this Section 12.1 , and hold harmless each Indemnified Party for any and all Indemnified Amounts arising out of, relating to or resulting from:

(i) Any Pool Asset treated as or represented by Seller or Servicer to be an Eligible Receivable or Eligible Loan, as applicable, which is not at the applicable time an Eligible Receivable or Eligible Loan, as applicable;

(ii) the transfer by Seller or any Originator of any interest in any Pool Asset other than the transfer of any Pool Asset and Related Assets to Administrative Agent and any Purchaser pursuant to this Agreement, to Administrative Agent and to Seller pursuant to the Sale Agreement and the grant of a security interest to Administrative Agent pursuant to this Agreement and to Seller pursuant to the Sale Agreement;

(iii) any representation or warranty made by Seller, CHS or any other party to a Transaction Document (other than such Indemnified Party) (or any of their respective officers or Affiliates) under or in connection with any Transaction Document, any Information Package or any other information or report delivered by or on behalf of Seller pursuant hereto, which shall have been untrue, false or incorrect when made or deemed made;

(iv) the failure of Seller, CHS or any other party to a Transaction Document (other than such Indemnified Party) to comply with the terms of any Transaction Document or any Applicable Law (including with respect to any Pool Asset or Related Assets), or the nonconformity of any Pool Asset or Related Assets with any such Applicable Law;

(v) the lack of an enforceable ownership interest, or a first priority perfected security interest, in the Pool Assets (and all Related Assets) against all Persons (including any bankruptcy trustee or similar Person);

(vi) the failure to file, or any delay in filing of, financing statements or other similar instruments or documents under the UCC of any applicable jurisdiction or under any other Applicable Laws with respect to any Pool Asset whether at the time of any Purchase or Reinvestment or at any time thereafter;

(vii) any dispute, claim, offset or defense (other than discharge in bankruptcy) of the Account Debtor or Obligor, as applicable, to the payment of any Pool Asset in, or purporting to be in, the Asset Pool (including a defense based on such (x) Pool Receivable’s or the related Receivable Documentation’s or (y) Pool Loan’s or the related Loan Documents’ not being a legal, valid and binding obligation of such Account Debtor or Obligor, as applicable, enforceable against it in accordance with its terms) or any other claim resulting from the sale of the merchandise or services related to such Pool Asset or the furnishing or failure to furnish such merchandise or services;

(viii) any suit or claim related to the Pool Assets or any Transaction Document (including any products liability or environmental liability claim arising out of or in connection with merchandise or services that are the subject of any Pool Asset to the extent not covered pursuant to Section 13.5 ), other than any such suit or claim that arises as a result of the failure of any Account Debtor or Obligor, as applicable, to pay any sum due under its Pool Asset by reason of the financial or credit condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor or Obligor);

(ix) the ownership, delivery, non-delivery, possession, design, construction, use, maintenance, transportation, performance (whether or not according to specifications), operation (including the failure to operate or faulty operation), condition, return, sale, repossession or other disposition or safety of any Related Assets (including claims for patent,

trademark, or copyright infringement and claims for injury to persons or property, liability principles, or otherwise, and claims of breach of warranty, whether express or implied);

(x) the failure by Seller, CHS or any other party to a Transaction Document (other than such Indemnified Party) to notify any Account Debtor or Obligor of the assignment pursuant to the terms hereof of any Pool Asset to Administrative Agent for the benefit of Purchasers or the failure to require that payments (including any under the related insurance policies) be made directly to Administrative Agent for the benefit of Purchasers;

(xi) failure by Seller, CHS or any other party to a Transaction Document (other than such Indemnified Party) to comply with the “bulk sales” or analogous laws of any jurisdiction;

(xii) any Taxes (other than Excluded Taxes) imposed upon any Indemnified Party or upon or with respect to the Pool Assets, all interest and penalties thereon or with respect thereto, and all costs and expenses related thereto or arising therefrom, including the fees and expenses of counsel in defending against the same;

(xiii) any loss arising, directly or indirectly, as a result of the imposition of sales or similar transfer type taxes or the failure by Seller, any Originator, Performance Guarantor or Servicer to timely collect and remit to the appropriate authority any such taxes;

(xiv) any commingling of any Collections by Seller, any Originator, Performance Guarantor or Servicer relating to the Pool Assets with any of their funds or the funds of any other Person;

(xv) any failure by Seller, CHS, any Originator, Performance Guarantor or any other party to a Transaction Document (other than such Indemnified Party) to perform its duties or obligations in accordance with the provisions of the Transaction Documents;

(xvi) the failure or delay to provide any Account Debtor or Obligor with an invoice or other evidence of indebtedness;

(xvii) any inability of any Originator or Seller to assign any Pool Asset or Related Asset as contemplated under the Transaction Documents; or the violation or breach by any Originator, Seller, Servicer, Performance Guarantor or any of their respective Affiliates of any confidentiality provision, or of any similar covenant of non-disclosure, or any other Indemnified Amount with respect to or resulting from any such violation or breach; or

(xviii) any civil penalty or fine assessed by OFAC or any other Governmental Authority administering any Anti-Terrorism Law, Anti-Corruption Law or Sanctions, and all reasonable costs and expenses (including reasonable documented legal fees and disbursements) incurred in connection with defense thereof by, any Indemnified Party in connection with the Transaction Documents as a result of any action of Seller, CHS, any Originator, Performance Guarantor or any of their respective Affiliates.

(b) Contest of Tax Claim; After-Tax Basis . Subject to the provisions of Section 3.3 , if any Indemnified Party shall have notice of any attempt to impose or collect any Indemnified Tax or governmental fee or charge for which indemnification will be sought from Seller under Sections

12.1(a)(xii) or (xiii) , such Indemnified Party shall give prompt and timely notice of such attempt to Seller and Seller shall, provided that Seller shall first deposit with the applicable Purchaser Agent amounts which are sufficient to pay both the aforesaid tax, fee or charge and the costs and expenses of the Indemnified Parties, have the right, at its sole expense, to control any proceedings resisting or objecting to the imposition or collection of any such Tax, governmental fee or charge and no such contest shall be settled or otherwise compromised without such Indemnified Party’s prior written consent. Indemnification in respect of such tax, governmental fee or charge shall be in an amount necessary to make the Indemnified Party whole after taking into account any tax consequences to the Indemnified Party of the payment of any of the aforesaid Taxes and the receipt of the indemnity provided hereunder or of any refund of any such Tax previously indemnified hereunder, including the effect of such Tax or refund on the amount of Tax measured by net income or profits which is or was payable by the Indemnified Party.

(c) Contribution . If for any reason the indemnification provided above in this Section 12.1 is unavailable to an Indemnified Party or is insufficient to hold an Indemnified Party harmless, then Seller shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received by such Indemnified Party on the one hand and Seller on the other hand but also the relative fault of such Indemnified Party as well as any other relevant equitable considerations.

SECTION 12.2 Indemnity by Servicer . Without limiting any other rights which any such Person may have hereunder or under Applicable Law, Servicer agrees to indemnify and hold harmless each Indemnified Party from any and all Indemnified Amounts incurred by any of them and arising out of, relating to or resulting from: (i) any failure by Servicer to perform its duties or obligations as Servicer hereunder or under any other Transaction Document in accordance with this Agreement and the other Transaction Documents or to comply with any Applicable Law, (ii) any breach of any of Servicer’s representations, warranties or covenants under any Transaction Document, (iii) any claim brought by any Person other than an Indemnified Party arising from Servicer’s servicing or collection activities with respect to the Pool Assets, (iv) any commingling of any funds by it (in any capacity) relating to the Asset Interest with any of its funds or the funds of any other Person, or (v) any civil penalty or fine assessed by OFAC or any other Governmental Authority administering any Anti-Terrorism Law, Anti-Corruption Law or Sanctions, and all reasonable costs and expenses (including reasonable documented legal fees and disbursements) incurred in connection with defense thereof by, any Indemnified Party in connection with the Transaction Documents as a result of any action of Servicer or any of its respective Affiliates; provided , however , that in all events there shall be excluded from the foregoing indemnification any damages, claims, losses, costs, expenses or liabilities to the extent resulting from (x) the gross negligence or willful misconduct of an Indemnified Party as determined in a final non-appealable judgment by a court of competent jurisdiction or (y) the failure of an Account Debtor or Obligor to pay any sum due under its Pool Asset by reason of the financial or credit condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor or Obligor).

ARTICLE XIII

MISCELLANEOUS

SECTION 13.1 Amendments, Etc . No amendment, modification or waiver of any provision of this Agreement nor consent to any departure by Seller or Servicer therefrom shall in any event be effective unless the same shall be in writing and signed by Seller, Administrative Agent, Servicer and the Required Purchasers, and then such waiver or consent shall be effective only in the specific instance and for the specific

purpose for which given; provided , however , that no such amendment, waiver or modification shall (i) decrease the outstanding amount of, or extend the repayment of or any scheduled payment date for the payment of, any Yield in respect of the Total Investment or any fees owed to any Purchaser, any Purchaser Agent or Administrative Agent without the prior written consent of such Person; (ii) forgive or waive or otherwise excuse any repayment of the Total Investment without the prior written consent of each Purchaser and the related Purchaser Agent affected thereby; (iii) increase the Commitment of any Purchaser without its prior written consent; (iv) amend or modify the ratable share of any Committed Purchaser’s Commitment or its percentage of the Purchasers’ Total Commitment without such Committed Purchaser’s prior written consent; (v) amend or modify the provisions of this Section 13.1 , Section 10.1 or the definition of “Account Debtor Concentration Overage Amount”, “Adjusted Loan Yield and Servicing Fee Reserve Percentage (Receivables)”, “Concentration Overage Amount (Loans)”, “Delinquent Loan”, “Delinquent Receivable”, “Defaulted Loan”, “Defaulted Receivable”, “Eligible Loan”, “Eligible Receivable”, “Event of Default”, “Legal Final Settlement Date”, “Loan Investment Base”, “Loan Pool Excess Spread Percentage”, “Loan Yield and Servicing Fee Reserve Percentage”, “Net Loan Pool Balance”, “Net Pool Balance”, “Net Receivables Pool Balance”, “Purchase Termination Date”, “Receivables Investment Base”, “Related Asset”, “Related Security”, “Required Purchasers”, “Required Loan Reserves”, “Required Receivable Reserves”, “Required Reserves”, “Servicer Termination Event”, “Specified Regulation”, “Total Investment”, ”Unmatured Event of Default”, “Unmatured Servicer Termination Event” or “Yield Period” or any of the definitions used in any such preceding definition, in each case without the prior written consent of each Committed Purchaser and each Purchaser Agent or (vi) release all or any material part of the Asset Interest from the security interest granted by the Seller to the Administrative Agent hereunder without the prior written consent of each Committed Purchaser and each Purchaser Agent; provided , further , that the consent of Seller and Servicer shall not be required for the effectiveness of any amendment which modifies on a prospective basis, the representations, warranties, covenants or responsibilities of Servicer at any time when Servicer is not CHS or an Affiliate of CHS or a successor Servicer is designated by Administrative Agent through a Successor Notice; provided , further , that (x) any amendment, waiver or modification to Section 3.1(d) that adversely affects the rights, duties or obligations of the Custodian or any other amendment, waiver or modification that adversely affects the fees, expenses or indemnities due to the Custodian or (y) any other amendment, modification or waiver that adversely affects the rights, duties or obligations of the Custodian in any material respect, in each case, shall require the prior written consent of the Custodian. Notwithstanding anything in any Transaction Document to the contrary, none of Seller or Servicer shall amend, waive or otherwise modify any other Transaction Document, or consent to any such amendment or modification, without the prior written consent of Administrative Agent and the Required Purchasers.

SECTION 13.2 Notices, Etc . All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile and email communication) and shall be personally delivered or sent by express mail or nationally recognized overnight courier or by certified mail, first class postage prepaid, or by facsimile or email, to the intended party at the address, facsimile number or email address of such party set forth in Schedule 13.2 or at such other address, facsimile number or email address as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective, (a) if personally delivered or sent by express mail or courier or if sent by certified mail, when received, and (b) if transmitted by facsimile or email, when receipt is confirmed by telephonic or electronic means.

SECTION 13.3 Successors and Assigns; Participations; Assignments .

(a) Successors and Assigns . This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Except as otherwise provided herein, neither Seller nor Servicer may assign or transfer any of its rights or delegate any of its duties hereunder

or under any Transaction Document without the prior consent of Administrative Agent and each Purchaser Agent.

(b) Participations . Any Purchaser may sell to one or more Persons (each a “ Participant ”) participating interests in the interests of such Purchaser hereunder; provided , however , that no Purchaser shall grant any participation under which the Participant shall have rights to approve any amendment to or waiver of this Agreement or any other Transaction Document. Such Purchaser shall remain solely responsible for performing its obligations hereunder, and Seller, Servicer, each Purchaser Agent and Administrative Agent shall continue to deal solely and directly with such Purchaser in connection with such Purchaser’s rights and obligations hereunder. A Purchaser shall not agree with a Participant to restrict such Purchaser’s right to agree to any amendment hereto, except amendments that require the consent of all Purchasers. Such Purchaser shall notify the Seller of any such Participant and the amount of such Participant’s participating interest.

(c) Assignment by Conduit Purchasers . This Agreement and each Conduit Purchaser’s rights and obligations under this Agreement (including its interest in the Asset Interest) or any other Transaction Document shall be freely assignable in whole or in part by such Conduit Purchaser and its successors and permitted assigns to any Eligible Assignee without the consent of Seller unless Seller’s consent is required pursuant to the definition of “Eligible Assignee”. Each assignor of all or a portion of its interest in the Asset Interest shall notify Administrative Agent, the related Purchaser Agent and Seller of any such assignment. Each assignor of all or a portion of its interest in the Asset Interest may, in connection with such assignment and subject to Section 13.8 , disclose to the assignee any information relating to the Asset Interest, furnished to such assignor by or on behalf of Seller, Servicer or Administrative Agent.

(d) Assignment by Committed Purchasers . (i) Each Committed Purchaser may freely assign to any Eligible Assignee without the consent of Seller unless Seller’s consent is required pursuant to the definition of “Eligible Assignee” all or a portion of any of its other rights and obligations under this Agreement or in any other Transaction Document (including all or a portion of its Commitment and its interest in the Asset Interest), in each case, with prior written notice to Administrative Agent, the related Purchaser Agent and Seller; provided , however , that the parties to each such assignment shall execute and deliver to Administrative Agent and to Seller, for its recording in the Register, a duly executed and enforceable joinder to this Agreement (“ Joinder ”).

(ii) From and after the effective date specified in such Joinder, (x) the assignee thereunder shall be a party to this Agreement and, to the extent that rights and obligations under this Agreement have been assigned to it pursuant to such Joinder, have the rights and obligations of a Committed Purchaser thereunder and (y) the assigning Committed Purchaser shall, to the extent that rights and obligations have been assigned by it pursuant to such Joinder, relinquish such rights and be released from such obligations under this Agreement. In addition, any Committed Purchaser may assign all or any portion of its rights (including its interest in the Asset Interest) under this Agreement to any Federal Reserve Bank without notice to or consent of Seller, Servicer, any other Committed Purchaser, Conduit Purchaser or Administrative Agent.

(e) Register .

(i) Seller or CHS on Seller’s behalf shall maintain a register for the recordation of the names and addresses of the Purchasers, and the Purchases (and Yield, fees and other

similar amounts under this Agreement) pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive absent manifest error, and Seller, CHS and the Purchasers shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a lender solely for U.S. federal income tax and accounting purposes. The Register shall be available for inspection by any Purchaser, at any reasonable time and from time to time upon reasonable prior notice.

(ii) Seller or CHS on Seller’s behalf shall also maintain in the Register each Participant’s and/or assignee’s interest or obligations under the Transaction Documents with respect to each participation or assignment pursuant to Section 13.3(b) or 13.3(c) and shall record such participation or assignment upon notice from the Administrative Agent or the applicable Purchaser; provided that no Person shall have any obligation to disclose all or any portion of the Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, purchases or its other obligations under any Transaction Document) to any Person except to the extent that such disclosure is necessary to establish that such interest or obligation that is treated as indebtedness for U.S. federal income tax purposes is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Register shall be conclusive absent manifest error.

(f) Opinions of Counsel . If requested by Administrative Agent or an assigning Purchaser or related Purchaser Agent or necessary to maintain the ratings of any Conduit Purchaser’s Commercial Paper Notes, each assignment agreement or transfer supplement, as the case may be, must be accompanied by an opinion of counsel of the assignee as to such matters as Administrative Agent or such Purchaser or related Purchaser Agent may reasonably request.

SECTION 13.4 No Waiver; Remedies . No failure on the part of Administrative Agent, any Liquidity Provider, any Enhancement Provider, any Affected Party, any Purchaser, any Purchaser Agent or any Indemnified Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by Applicable Law. Any waiver of this Agreement shall be effective only in the specific instance and for the specific purpose for which given. Without limiting the foregoing, each Purchaser, each Purchaser Agent, MUFG, individually and as Administrative Agent, each Enhancement Provider, each Liquidity Provider, each Affected Party, and any of their Affiliates (the “ Set-off Parties ”) are each hereby authorized by Servicer and Seller at any time and from time to time following the occurrence of any Event of Default that has not been waived in accordance with this Agreement (without notice to Servicer, Seller or any other Person (any such notice being expressly waived by Servicer and Seller)), to the fullest extent permitted by Applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing to, any such Set-off Party to or for the credit to the account of Servicer or Seller, as applicable, against any and all obligations of Servicer or Seller, as applicable, now or hereafter existing under this Agreement or any other Transaction Document, to any Set-off Party.

SECTION 13.5 Binding Effect; Survival .

(a) This Agreement shall be binding upon and inure to the benefit of Seller, CHS, Administrative Agent, each Purchaser and each Purchaser Agent, and the provisions of Section 4.2

and Article XII shall inure to the benefit of the Affected Parties and Indemnified Parties, respectively, and their respective successors and assigns.

(b) Each Liquidity Provider, each Enhancement Provider and each other Affected Party are express third party beneficiaries hereof. Subject to clause (i) of Section B of Appendix A , this Agreement shall not confer any rights or remedies upon any other Person, other than the third party beneficiaries specified in this Section 13.5(b) .

(c) This Agreement shall create and constitute the continuing obligations of the parties hereto in accordance with its terms, and shall remain in full force and effect until the Final Payout Date. The rights and remedies with respect to any breach of any representation and warranty made by Seller pursuant to Article VI and the indemnification and payment provisions of Article XII and Sections 1.2(f) , 3.2 , 3.3 , 4.1 , 4.2 , 4.3 , 11.8 , 11.11 , 13.4 , 13.5 , 13.6 , 13.7 , 13.8 , 13.11 , 13.12 , 13.13 , 13.15 , 13.16 and 13.17 shall be continuing and shall survive any termination of this Agreement.

SECTION 13.6 Costs, Expenses and Taxes . In addition to its obligations under Article XII , Seller agrees to pay on demand:

(a) All reasonable costs and expenses incurred by or on behalf of Administrative Agent, each Liquidity Provider, each Enhancement Provider, each Purchaser, each Purchaser Agent and each other Affected Party in connection with:

(i) the negotiation, preparation, execution and delivery of this Agreement and the other Transaction Documents and any amendment of or consent or waiver under any of the Transaction Documents (whether or not consummated), or the enforcement of, or any actual or reasonably claimed breach of, this Agreement or any of the other Transaction Documents, including reasonable accountants’, auditors’, Rating Agencies’, consultants’ and attorneys’ fees and expenses to any of such Persons and the fees and charges of any independent accountants, auditors, Rating Agencies, consultants or other agents incurred in connection with any of the foregoing or in advising such Persons as to their respective rights and remedies under any of the Transaction Documents in connection with any of the foregoing; and

(ii) the administration (including periodic auditing as provided for herein) of this Agreement and the other Transaction Documents and the transactions contemplated thereby, including all reasonable expenses and accountants’, consultants’ and attorneys’ fees incurred in connection with the administration and maintenance of this Agreement and the other Transaction Documents and the transactions contemplated thereby; and

(b) all stamp and other similar Taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement or the other Transaction Documents.

SECTION 13.7 No Proceedings .

(a) Seller, Servicer, Administrative Agent, each Purchaser and each Purchaser Agent each hereby agrees that it will not institute against any Conduit Purchaser, or join any other Person in instituting against any Conduit Purchaser, any proceeding of the type referred to in the definition of Insolvency Event from the Closing Date until one year (or, if longer, any applicable preference period then in effect) plus one day following the last day on which all Commercial Paper Notes and other

publicly or privately placed indebtedness for borrowed money of such Conduit Purchaser shall have been indefeasibly paid in full. The foregoing shall not limit any such Person’s right to file any claim in or otherwise take any action with respect to any insolvency proceeding that was instituted by any Person other than such parties.

(b) Servicer, each Purchaser and each Purchaser Agent each hereby agrees that it will not institute against Seller, or join any other Person in instituting against Seller, any proceeding of the type referred to in the definition of Insolvency Event; provided , however , that Administrative Agent, with the prior consent of the Required Purchasers, may, or shall at the direction of the Required Purchasers institute or join any other Person in instituting any such proceeding against Seller. The foregoing shall not limit any such Person’s right to file any claim in or otherwise take any action with respect to any insolvency proceeding that was instituted by any Person other than such parties.

SECTION 13.8 Confidentiality .

(a) Each of Seller and Servicer agrees to maintain the confidentiality of the Program Information (as defined below), except that Program Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Program Information and instructed to keep such Program Information confidential); (ii) to the extent requested by any Governmental Authority; (iii) to the extent required by Applicable Laws or by any subpoena or similar legal process; (iv) to any other party to this Agreement; (v) in connection with any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (vi) with the consent of the Purchaser Agent (such consent not to be unreasonably withheld, conditioned or delayed); or (vii) to the extent such Program Information (A) becomes publicly available other than as a result of a breach of this Section 13.8(a) or (B) becomes available to Seller or Servicer on a nonconfidential basis from a source other than Administrative Agent (or any Affiliate thereof). For the purposes of this Section, “ Program Information ” means (i) any information regarding the pricing terms contained in this Agreement or any other Transaction Document, (ii) any information regarding the organization, business or operations of any Purchaser generally or the services performed by Administrative Agent or any Purchaser under the Transaction Documents or (iii) any information which is furnished by Administrative Agent or any Purchaser Agent to Seller or Servicer and is designated by Administrative Agent or any Purchaser Agent to such party in writing as confidential. Any Person required to maintain the confidentiality of Program Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Program Information as such Person would accord to its own confidential information.

(b) Availability of Confidential Information . This Section 13.8 shall be inoperative as to such portions of the Program Information which are or become generally available to the public or such party on a nonconfidential basis from a source other than Administrative Agent or were known to such party on a nonconfidential basis prior to its disclosure by Administrative Agent.

(c) Legal Compulsion to Disclose . In the event that any party or anyone to whom such party or its representatives transmits the Program Information is requested or becomes legally compelled (by interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Program Information, such party shall, to the extent permitted by applicable law, provide Administrative Agent, each Purchaser Agent and CHS with prompt written notice so that Administrative Agent may at the expense of CHS seek a protective order

or other appropriate remedy and/or if it so chooses, agree that such party may disclose such Program Information pursuant to such request or legal compulsion. In the event that such protective order or other remedy is not obtained, or Administrative Agent waives compliance with the provisions of this Section 13.8(c) , such party will furnish only that portion of the Program Information which (in such party’s good faith judgment) is legally required to be furnished and will exercise commercially reasonable efforts to obtain reliable assurance that confidential treatment will be accorded the Program Information.

(d) Confidentiality of Administrative Agent and Purchasers . Each Affected Party and its successors and assigns agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and be instructed and agree or be otherwise bound to keep such Information confidential), (ii) to the extent requested by any Governmental Authority, (iii) to the extent required by Applicable Laws or by any subpoena or similar legal process, provided , however , to the extent permitted by Applicable Law and if practical to do so under the circumstances, that the Person relying on this clause (iii) shall provide Seller with prompt notice of any such required disclosure so that Seller may seek a protective order or other appropriate remedy, and in the event that such protective order or other remedy is not obtained, such Person will furnish only that portion of the Information which is legally required, (iv) to any other Affected Party, (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder, (vi) subject to an agreement containing provisions substantially the same as those of this Section, (vii) to any prospective participant or assignee provided such person agrees to be bound by this Section 13.8(d) , (viii) with the consent of Seller, (ix) to the extent such Information (1) becomes publicly available other than as a result of a breach of this Section or any Transaction Document or (2) becomes available to such Person on a nonconfidential basis from a source other than Servicer or its Subsidiaries (and not in breach of this Section or any agreement contemplated by this Section) or (x) to any nationally recognized statistical rating organization as contemplated by Section 17g-5 of the Exchange Act or in connection with obtaining or monitoring a rating on any Commercial Paper Notes. For the purposes of this Section, “ Information ” means all information received from Seller or Servicer or any Affiliate relating to Seller or Servicer or any Affiliate or their business, other than any such information that is available to such Person on a nonconfidential basis prior to disclosure by Servicer or any Affiliate. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

SECTION 13.9 Captions and Cross References . The various captions (including the table of contents) in this Agreement are provided solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Agreement. Unless otherwise indicated, references in this Agreement to any Section, Appendix, Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to this Agreement, as the case may be, and references in any Section, subsection, or clause to any subsection, clause or subclause are to such subsection, clause or subclause of such Section, subsection or clause.

SECTION 13.10 Integration . This Agreement, together with the other Transaction Documents, contains a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire understanding among the parties hereto with respect to the subject matter hereof, superseding all prior oral or written understandings.

SECTION 13.11 Governing Law . THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF, EXCEPT TO THE EXTENT THAT THE PERFECTION, THE EFFECT OF PERFECTION OR PRIORITY OF THE INTERESTS OF ADMINISTRATIVE AGENT OR ANY PURCHASER IN THE POOL ASSETS OR RELATED ASSETS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK).

SECTION 13.12 Waiver of Jury Trial . EACH PARTY HERETO IRREVOCABLY WAIVES ANY RIGHT THAT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN OR IN ANY OTHER TRANSACTION DOCUMENT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.

SECTION 13.13 Consent to Jurisdiction; Waiver of Immunities . EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:

(a) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OTHER TRANSACTION DOCUMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING.

(b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.

SECTION 13.14 Execution in Counterparts . This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. Delivery of an executed counterpart hereof by facsimile or by electronic mail attachment in portable document format (.pdf) shall be effective as delivery of an originally executed counterpart.

SECTION 13.15 No Recourse Against Other Parties . No recourse under any obligation, covenant or agreement of Seller, Servicer or any of the other parties hereto contained in this Agreement shall be had against any stockholder, employee, officer, director, member, manager, incorporator or organizer of such party or any Affiliate thereof other than CHS in its capacities as a stockholder or member.

SECTION 13.16 Pledge to a Federal Reserve Bank . Notwithstanding anything to the contrary set forth herein (including in Section 13.3 ), (i) each Committed Purchaser or any assignee or participant thereof or (ii) in the event that any Conduit Purchaser assigns any of its interest in, to and under the Asset Interest to any Liquidity Provider or Enhancement Provider, any such Person, may at any time pledge, grant a security interest in or otherwise transfer all or any portion of its interest in the Asset Interest or under this Agreement to secure the obligations of such Person to a Federal Reserve Bank or otherwise to any other federal Governmental Authority or special purpose entity formed or sponsored by any such federal Governmental Authority, in each case without notice to or the consent of Seller or Servicer, but such pledge, grant or transfer shall not relieve any Person from its obligations hereunder.

SECTION 13.17 Pledge to a Collateral Trustee . Notwithstanding anything to the contrary set forth herein (including in Section 13.3 ), each Conduit Purchaser may at any time pledge, grant a security interest in or otherwise transfer all or any portion of its interest in the Asset Interest or under this Agreement to its collateral agent or trustee under such Conduit Purchaser’s commercial paper note program, in each case without notice to or the consent of Seller or Servicer, but such pledge, grant or transfer shall not relieve any Person from its obligations (if any) hereunder.

SECTION 13.18 Severability . Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

SECTION 13.19 No Party Deemed Drafter . CHS, Servicer, Seller, each Purchaser, each Purchaser Agent and Administrative Agent agree that no party hereto shall be deemed to be the drafter of this Agreement.

SECTION 13.20 PATRIOT Act . Each Purchaser Agent hereby notifies Seller and Servicer that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Patriot Act ”), one or more of the Affected Parties are required to obtain, verify and record information that identifies Seller and Servicer, which information includes the name and address of Seller and Servicer and other information that will allow the Affected Parties to identify Seller and Servicer in accordance with the Patriot Act. Seller and Servicer shall, promptly following a request by any Affected Party, provide all documentation and other information that any Affected Party requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

SECTION 13.21 Acknowledgement and Consent to Bail-In if EEA Financial Institutions . Notwithstanding anything to the contrary in any Transaction Document or in any other agreement, arrangement or understanding among any of the parties hereto, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Transaction Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Transaction Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

SECTION 13.22 Amendment and Restatement . This Agreement amends and restates in its entirety the Original Agreement among the parties hereto. Upon the occurrence of the Effective Date, (a) the terms and provisions of the Original Agreement shall be amended, superseded and restated in their entirety by the terms and provisions of this Agreement and, unless expressly stated to the contrary, each reference to the Original Agreement in any of the Transaction Documents or any other document, instrument or agreement delivered in connection therewith shall mean and be a reference to this Agreement, (b) this Agreement is not intended to and shall not constitute a novation of the Original Agreement or the obligations and liabilities existing thereunder, (c) the commitment of each “Committed Purchaser” (as defined in the Original Agreement) that is a party to the Original Agreement shall, on the Effective Date, automatically be deemed restated and the only Commitments shall be those hereunder, (d) with respect to any date or time period occurring and ending prior to the Effective Date, the rights and obligations of the parties to the Original Agreement shall be governed by the Original Agreement and the other Transaction Documents (as defined therein), and (e) with respect to any date or time period occurring and ending on or after the Effective Date, the rights and obligations of the parties hereto shall be governed by this Agreement and the other Transaction Documents (as defined herein). The liens, security interests and other interests in the Seller Assets granted under the Original Agreement are and shall remain legal, valid, binding and enforceable to the extent also constituting Seller Assets hereunder. Each of the parties hereto hereby acknowledge and confirm the continuing existence and effectiveness of such liens, security interests and other interests in such Seller Assets granted under the Original Agreement, and further agree that the execution and delivery of this Agreement shall not in any way release, diminish, impair, reduce or otherwise affect such liens, security interests and other interests in such Seller Assets granted under the Original Agreement.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF , the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

CHS INC. ,
individually and as initial Servicer

By:
Name:
Title:

COFINA FUNDING, LLC , as Seller

By:
Name:
Title:

MUFG BANK, LTD. (F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.) ,
as Administrative Agent

By:
Name:
Title:

VICTORY RECEIVABLES CORPORATION ,
as a Conduit Purchaser

By:
Name:
Title:

MUFG BANK, LTD. (F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.) ,
as a Committed Purchaser

By:
Name:
Title:

MUFG BANK, LTD. (F/K/A THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.) ,
as Purchaser Agent for the MUFG Purchaser Group

By:
Name:
Title:

NIEUW AMSTERDAM RECEIVABLES CORPORATION B.V. ,
as a Conduit Purchaser

By:
Name:
Title:

COÖPERATIEVE RABOBANK U.A. ,
as a Committed Purchaser

By:
Name:
Title:

COÖPERATIEVE RABOBANK U.A., NEW YORK BRANCH ,
as Purchaser Agent for the Rabobank Purchaser Group

By:
Name:
Title:

APPENDIX A

DEFINITIONS

This is Appendix A to the Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 as amended as of June 28, 2018, among CHS INC., a Minnesota corporation, individually and as initial Servicer, COFINA FUNDING, LLC, a Delaware limited liability company, as Seller, the various CONDUIT PURCHASERS, COMMITTED PURCHASERS and PURCHASER AGENTS from time to time party thereto, and MUFG Bank, Ltd. (f/k/a THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.), as Administrative Agent.

A. Defined Terms.

As used in this Agreement, unless the context requires a different meaning, the following terms have the meanings indicated herein below:

“ Account Agreements ” means each Seller Account Agreement and each Originator Account Agreement.

“ Account Banks ” means BMO Harris Bank, N.A., Merchants Bank, National Association, U.S. Bank National Association and Wells Fargo Bank, N.A.

“ Account Debtor ” means a Person obligated to make payments with respect to a Receivable, including any guarantor thereof.

“ Account Debtor Concentration Limit ” means, at any time for any Account Debtor, the product of (i) 2.5% and (ii) the aggregate Unpaid Balance of the Eligible Receivables and Eligible Loans at the time of determination.

“ Account Debtor Concentration Overage Amount ” means, at any time, the aggregate dollar amount (without duplication) by which each limitation set forth below is exceeded:

(i) the aggregate Unpaid Balance of all Eligible Receivables of any Account Debtor cannot exceed the Account Debtor Concentration Limit for such Account Debtor;

(ii) the aggregate Unpaid Balance of all Eligible Receivables the Account Debtors of which are Governmental Authorities cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Receivables;

(iii) the aggregate Unpaid Balance of all Eligible Receivables the Account Debtors of which are principally located in each of the following states (individually) cannot exceed:

(a) 35% (in the case of the largest state in terms of the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans); provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Receivables for such state, after giving effect to this clause (iii)(a) plus the unpaid balance of all Eligible Loans for such state after giving effect to clause (ii)(a) of the definition of Concentration Overage Amount (Loans) shall not exceed the product of 35% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance,

Appendix 1

state after giving effect to clause (ii)(b) of the definition of Concentration Overage Amount (Loans) shall not exceed the product of 30% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance, and

(c) 15% (in the case of the third (3 ^rd ) largest state in terms of the aggregate Unpaid Balance of all Eligible Loans and Eligible Receivables); provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Receivables for such state, after giving effect to this clause (iii)(c) plus the unpaid balance of all Eligible Loans for such state after giving effect to clause (ii)(c) of the definition of Concentration Overage Amount (Loans) shall not exceed the product of 15% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance; and

(iv) the aggregate Unpaid Balance of all Eligible Receivables the Account Debtors of which are principally located in any state, other than the three largest states in terms of Unpaid Balances referenced in clause (iii) above, cannot exceed 10% of the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans; provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Receivables for any such state, after giving effect to this clause (iv) plus the unpaid balance of all Eligible Loans for such state after giving effect to clause (iii) of the definition of Concentration Overage Amount (Loans) shall not exceed the product of 10% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance.

“ Adjusted Loan Yield and Servicing Fee Reserve Percentage ” means, at any time, an amount equal to (a) if the Loan Pool APR Percentage is equal to or higher than the Loan Yield and Servicing Fee Reserve Percentage, zero and (b) at all other times, the Loan Yield and Servicing Fee Reserve Percentage minus the Loan Pool APR Percentage.

“ Administrative Agent ” is defined in the preamble .

“ Adverse Claim ” means any ownership interest or claim, mortgage, deed of trust, pledge, lien, security interest, hypothecation, charge or other encumbrance or security arrangement of any nature whatsoever, whether voluntarily or involuntarily given, including, but not limited to, any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing); it being understood that any of the foregoing in favor of, or assigned to, Administrative Agent shall not constitute an Adverse Claim.

“ Affected Party ” means Administrative Agent, each Purchaser, each Purchaser Agent, each Liquidity Provider, each Enhancement Provider and each Program Administrator.

“ Affiliate ” when used with respect to a Person means any other Person Controlling, Controlled by, or under common Control with, such Person.

“ Agreement ” is defined in the preamble .

“ Anti-Corruption Laws ” means all laws, rules, and regulations of any jurisdiction applicable to any CHS Party or any of their respective Subsidiaries from time to time concerning or relating to bribery or corruption including, but not limited to, the U.S. Foreign Corrupt Practices Act of 1977, as amended, the UK Bribery Act 2010, and any other applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.

Appendix 2

“ Anti-Terrorism Laws ” means each of: (a) the Executive Order; (b) the PATRIOT Act;(c) the Money Laundering Control Act of 1986, 18 U.S.C. Sect. 1956 and any successor statute thereto; (d) the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada);(e) the Bank Secrecy Act, and the rules and regulations promulgated thereunder; and (f) any other Applicable Law of the United States, Canada or any member state of the European Union now or hereafter enacted to monitor, deter or otherwise prevent: (i) terrorism or (ii) the funding or support of terrorism or (iii) money laundering.

“ Applicable Law ” means any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree, judgment, award or similar item of or by a Governmental Authority or any interpretation, implementation or application thereof.

“ Asset ” means any of, and “ Assets ” means all of, the Loans and the Receivables.

“ Asset Interest ” is defined in Section 1.2(c) .

“ Asset Pool ” means, collectively, the Loan Pool and the Receivables Pool.

“ Available Collections ” means all Collections other than those Collections used by the Seller to purchase Assets under the Sale Agreement.

“ Bail-In Action ” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“ Bail-In Legislation ” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“ Bank Rate ” for any day falling in a particular Yield Period with respect to any Rate Tranche and any Purchaser Group means an interest rate per annum equal to the applicable LIBO Rate for such Yield Period.

“ Bankruptcy Code ” means Title 11 of the United States Code.

“ Base Rate ” means, with respect to any Purchaser, on any date, a fluctuating rate of interest per annum equal to the highest of:

(a) the applicable Prime Rate for such date;

(b) the Federal Funds Rate for such date, plus 0.50%;

(d) zero.

“ Basel II ” has the meaning set forth in the definition of Specified Regulation.

“ Basel III ” has the meaning set forth in the definition of Specified Regulation.

“ Basel Accord ” has the meaning set forth in the definition of Specified Regulation.

“ Basel Committee ” has the meaning set forth in the definition of Specified Regulation.

Appendix 3

“ Beneficial Ownership Certification ” means a certification regarding beneficial ownership required by the Beneficial Ownership Regulation, which certification shall be substantially similar in form and substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers published jointly, in May 2018, by the Loan Syndications and Trading Association and Securities Industry and Financial Markets Association.

“ Beneficial Ownership Regulation ” means 31 C.F.R. § 1010.230.

“ Business Day ” means (a) any day that is not a Saturday, Sunday or other day on which banks in New York City are required or permitted to close and (b) if this definition of “Business Day” is utilized in connection with the LIBO Rate, dealings are carried out in the London interbank market.

“ Change of Control ” means any of the following: (a) the failure of CHS to own, directly or indirectly (through one or more wholly owned subsidiaries), at least 100% of the membership interests in Seller and CHS Capital, free and clear of any Adverse Claim and (b) with respect to CHS, (i) any merger or consolidation of such entity into another Person, (ii) any merger or consolidation to which such entity shall be a party resulting in the creation of another Person, (iii) any Person succeeding to the properties and assets of such entity substantially as a whole or (iv) the acquisition by any Person, or two or more Persons acting in concert, together with Affiliates thereof, who is not a voting member of CHS as of the Effective Date (or such later date as agreed to by the Administrative Agent in its sole discretion), of beneficial ownership (within the meaning of Rule 13d‑3 of the SEC under the Exchange Act) of in the aggregate more than 50% of the aggregate voting power of the Voting Interests of CHS.

“ CHS ” is defined in the preamble .

“ CHS Capital ” means CHS Capital, LLC, a Minnesota limited liability company.

“ Closing Date ” means July 22, 2016.

“ Code ” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute and the regulations promulgated and rulings issued thereunder.

“ Collection Accounts ” means the Seller Collection Accounts and the Originator Collection Accounts.

“ Collections ” means, with respect to any Pool Asset, all funds which either (a) are received by Seller, any Originator, CHS, Servicer or any other Person from or on behalf of the related Account Debtors or Obligors in payment of any amounts owed (including purchase prices, finance charges, principal, interest and all other charges, recoveries and proceeds of Related Security) in respect of such Pool Asset, or applied to such other charges in respect of such Pool Asset, or applied to such amounts owed by such Account Debtors or Obligors, (b) are deemed to have been received by Seller or any other Person as a Collection pursuant to Section 3.2(a) (it being understood that Collections shall not refer to the purchase price paid by any Purchaser to Seller for Purchases of the Pool Assets and Related Assets pursuant to Section 1.1 ), (c) are paid or deemed paid by Seller as Repurchase Payments pursuant to Section 3.2(b) , or (d) constitute proceeds from the sale of such Pool Asset or any participation interest therein to the extent permitted by the Transaction Documents.

“ Commercial Loan ” means a loan facility characterized as a “Commercial Loan” under the Credit and Collection Policy.

“ Commercial Paper Notes ” means short-term promissory notes issued or to be issued by a Conduit Purchaser to fund its investments in accounts receivable or other financial assets.

Appendix 4

“ Commitment ” means, with respect to any Committed Purchaser, the maximum amount which such Committed Purchaser is obligated to pay hereunder on account of any Purchase, which amount is the amount set forth as its “Commitment” in the right column of Exhibit C .

“ Committed Purchaser ” means each Person listed as such as set forth on the signature pages of this Agreement.

“ Concentration Account ” means the account 2051415 maintained at the Account Bank in the name of the Seller.

“ Concentration Overage Amount (Loans) ” means, at any time, the aggregate dollar amount (without duplication) by which each limitation set forth below is exceeded:

(i) the aggregate Unpaid Balance of all Eligible Loans of any Obligor cannot exceed the product of 2.5% and the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans;

(ii) the aggregate Unpaid Balance of all Eligible Loans the Obligors of which are principally located in each of the following states (individually) cannot exceed:

(a) 35% (in the case of the largest state in terms of the aggregate Unpaid Balance of all Eligible Loans and Eligible Receivables); provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Loans for such state, after giving effect to this clause (ii)(a) plus the unpaid balance of all Eligible Receivables for such state after giving effect to clause (iii)(a) of the definition of Account Debtor Concentration Overage Amount shall not exceed the product of 35% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance,

(b) 30% (in the case of the second (2 ^nd ) largest state in terms of the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans); provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Loans for such state, after giving effect to this clause (ii)(b) plus the unpaid balance of all Eligible Receivables for such state after giving effect to clause (iii)(b) of the definition of Account Debtor Concentration Overage Amount shall not exceed the product of 30% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance, and

(c) 15% (in the case of the third (3 ^rd ) largest state in terms of the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans); provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Loans for such state, after giving effect to this clause (ii)(c) plus the unpaid balance of all Eligible Receivables for such state after giving effect to clause (iii)(c) of the definition of Account Debtor Concentration Overage Amount shall not exceed the product of 15% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance;

(iii) the aggregate Unpaid Balance of all Eligible Loans the Obligors of which are principally located in any state, other than the three largest states in terms of Unpaid Balances referenced in clause (ii) above, cannot exceed 10% of the aggregate Unpaid Balance of all Eligible Receivables and Eligible Loans; provided that, for the avoidance of doubt, the sum of the aggregate Unpaid Balance of all Eligible Loans for such state, after giving effect to this clause (iii) plus the unpaid balance of all Eligible Receivables for such state after giving effect to clause (iv) of the definition of Account Debtor Concentration Overage Amount shall not exceed the product of 10% of the sum of the Net Receivables Pool Balance and the Net Loan Pool Balance;

Appendix 5

(iv) the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans with an “A” Risk Rating and a remaining tenor greater than 24 months cannot exceed 2.5% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(v) the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans with an “A2” Risk Rating and a remaining tenor greater than 24 months cannot exceed 15% of the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans;

(vi) the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans with an “A3” Risk Rating and a remaining tenor greater than 24 months cannot exceed 5.0% of the aggregate Unpaid Balance of all Commercial Loans that are Eligible Loans;

(vii) the aggregate Unpaid Balance of all Eligible Loans that are unsecured Producer Loans with an “A” Risk Rating and a remaining tenor less than or equal to 24 months cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(viii) the aggregate Unpaid Balance of all Eligible Loans that are unsecured Producer Loans with a fixed rate of interest, an “A” Risk Rating and a remaining tenor less than or equal to 24 months cannot exceed 0% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(ix) the aggregate Unpaid Balance of all Eligible Loans that are Junior Lien Producer Loans with a “A” Risk Rating and a remaining tenor less than or equal to 24 months cannot exceed 30% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(x) the aggregate Unpaid Balance of all Eligible Loans that are Junior Lien Producer Loans with a “B” Risk Rating and a remaining tenor less than or equal to 24 months cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(xi) the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans with a fixed interest rate cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(xii) the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans with a fixed interest rate cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans;

(xiii) the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans with a “B” Risk Rating cannot exceed 30% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(xiv) the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans with a “A2” Risk Rating cannot exceed 35% of the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans;

(xv) the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans with a “A3” Risk Rating cannot exceed 7.5% of the aggregate Unpaid Balance of all Eligible Loans that are Commercial Loans;

(xvi) the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans with a “C” Risk Rating cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans;

(xvii) the aggregate Unpaid Balance of all Eligible Loans the Obligors of which are Joint Ventures cannot exceed 10% of the aggregate Unpaid Balance of all Loans;

(xviii) the aggregate Unpaid Balance of all Eligible Loans that are Producer Loans cannot exceed 50% of the aggregate Unpaid Balance of all Eligible Loans and Eligible Receivables; and

(xix) the aggregate Unpaid Balance of all Eligible Loans the Obligors of which are Governmental Authorities cannot exceed 5% of the aggregate Unpaid Balance of all Eligible Loans;

provided that a Joint Venture shall be treated for purposes of this definition as a single, separate Obligor.

Appendix 6

“ Conduit Purchaser ” means each commercial paper conduit listed as such as set forth on the signature pages of this Agreement.

“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“ Control ” when used with respect to any specified Person, means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of such Person, whether through the ownership of voting securities or membership interests, by contract or otherwise, and the terms “Controlling” and “Controlled” have meanings correlative to the foregoing.

“ CP Rate ” means, for any period and with respect to any Rate Tranche funded by Commercial Paper Notes of any Conduit Purchaser, the per annum rate equivalent to the weighted average cost (as determined by the applicable Purchaser Agent for such Conduit Purchaser and which shall include commissions and fees of placement agents and dealers, incremental carrying costs incurred with respect to Commercial Paper Notes maturing on dates other than those on which corresponding funds are received by such Conduit Purchaser, other borrowings by such Conduit Purchaser (other than under any Liquidity Agreement) and any other costs and expenses associated with the issuance of Commercial Paper Notes) of or related to the issuance of Commercial Paper Notes that are allocated, in whole or in part, by such Conduit Purchaser or the applicable Purchaser Agent to fund or maintain such Rate Tranche (and which may be also allocated in part to the funding of other assets of such Conduit Purchaser) (determined in the case of Commercial Paper Notes issued on a discount by converting the discount to an interest equivalent rate per annum ); provided that notwithstanding anything in this Agreement or the other Transaction Documents to the contrary, Seller agrees that any amounts payable to the applicable Conduit Purchaser in respect of Yield for any Yield Period with respect to any Rate Tranche funded by such Conduit Purchaser at the CP Rate shall include an amount equal to the portion of the face amount of the outstanding Commercial Paper Notes issued by such Conduit Purchaser to fund or maintain such Rate Tranche that corresponds to the portion of the proceeds of such Commercial Paper Notes that was used to pay the interest component of maturing Commercial Paper Notes issued by such Conduit Purchaser to fund or maintain such Rate Tranche, to the extent that such Conduit Purchaser had not received payments of interest in respect of such interest component prior to the maturity date of such maturing Commercial Paper Notes (for purposes of the foregoing, the “interest component” of Commercial Paper Notes equals the excess of the face amount thereof over the net proceeds received by such Conduit Purchaser from the issuance of Commercial Paper Notes, except that if such Commercial Paper Notes are issued on an interest-bearing basis its “interest component” will equal the amount of interest accruing on such Commercial Paper Notes through maturity).

“ Credit and Collection Policy ” means, as the context may require, those credit and collection policies and practices of Seller and Servicer in effect on the Effective Date and described in Exhibit A , as modified in compliance with this Agreement.

“ Cumulative Loss Ratio ” means, as of any date of determination, the sum of the Monthly Loss Ratios for the twelve calendar months preceding such date of determination.

“ Cumulative Loss Ratio Factor ” means, as of any date of determination, a percentage equal to the product of (a) the highest Cumulative Loss Ratio during the most recent twelve calendar months multiplied by (b) 5.0.

“ Custodian ” means the Person acting as custodian under the Custodian Agreement, which shall be U.S. Bank National Association as of the Closing Date.

Appendix 7

“ Custodian Agreement ” means the Custodian Agreement, dated as of the Closing Date, among Seller, Administrative Agent and Custodian.

“ Custodian File ” means, with respect to any Loan, (i) the original executed Obligor Note and electronic copies of each loan agreement, security agreement, guaranty and letter of credit executed in connection therewith or related thereto and (ii) acknowledgment copies of applicable UCC filings against the related Obligor with respect to such Loan.

“ Cut-Off Date ” means the last day of each Settlement Period.

“ Days Sales Outstanding ” means, on any date, the number of days equal to the product of (a) 30 and (b) the amount obtained by dividing (i) the aggregate Unpaid Balance of the Eligible Receivables as of the Cut-Off Date of the most recently ended Settlement Period by (ii) the aggregate Unpaid Balance of Eligible Receivables which were originated by any Originator during the most recently ended Settlement Period.

“ Debt ” means, at any time, with respect to any Person, (a) all obligations for money borrowed or raised, all obligations (other than accounts payable and other similar items arising in the ordinary course of business) for the deferred payment of the purchase price of property, and all capital lease obligations or other obligations which, in each case, in accordance with GAAP, would be included in determining total liabilities as shown on the liability side of the balance sheet of such Person and (b) all guarantees (whether contingent or otherwise) of such Person guaranteeing the Debt of any other Person, whether directly or indirectly (other than endorsements for collection or deposit in the ordinary course of business).

“ Debtor Relief Laws ” means the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization or similar debtor relief laws of the United States of America or other applicable jurisdiction from time to time affecting the rights of creditors generally.

“ Deemed Collections ” is defined in Section 3.2(a) .

“ Default Ratio (Loans) ” means, for any Settlement Period, a fraction (expressed as a percentage), (a) the numerator of which is the aggregate Unpaid Balance of all Defaulted Loans as of the last day of such Settlement Period, and (b) the denominator of which is the aggregate Unpaid Balance of all Loans as of the last day of such Settlement Period.

“ Default Ratio (Receivables) ” means, for any Settlement Period, a fraction (expressed as a percentage), (a) the numerator of which is the aggregate Unpaid Balance of all Defaulted Receivables as of the last day of such Settlement Period, and (b) the denominator of which is the aggregate Unpaid Balance of all Receivables as of the last day of such Settlement Period.

“ Defaulted Loan ” means a Pool Loan (a) as to which any payment, or part thereof, remains unpaid for more than 90 days from the original due date thereof, (b) as to which any Obligor thereof is subject to an Insolvency Event or (c) which, consistent with the Credit and Collection Policy, would be or should have been written off as uncollectible.

“ Defaulted Receivable ” means a Pool Receivable (a) as to which any payment, or part thereof, remains unpaid for more than 60 days from the original invoice due date thereof, (b) as to which any Account Debtor thereof is subject to an Insolvency Event or (c) which, consistent with the Credit and Collection Policy, would be or should have been written off as uncollectible.

Appendix 8

“ Delinquent Loan ” means a Pool Loan (that is not a Defaulted Loan) as to which any payment, or part thereof, remains unpaid for more than 45 days from the original due date thereof.

“ Delinquent Receivable ” means a Pool Receivable (that is not a Defaulted Receivable) as to which any payment, or part thereof, remains unpaid for more than 31 days from the original invoice due date with respect thereto.

“ Dilution ” means, as of any date of determination with respect to any Pool Receivable, an amount equal to the sum, without duplication, of the aggregate reduction effected in the Unpaid Balance of such Pool Receivable due to credits, rebates, refunds, disputes, setoff, netting, billing errors, sales or similar taxes, cash discounts, volume discounts, allowances, chargebacks, returned or repossessed goods, defective goods or services, sales and marketing discounts, warranties, any unapplied credit memos and other adjustments or reductions that are made in respect of the applicable Account Debtor; provided , however , that writeoffs to the extent related to the financial or credit condition of an Account Debtor (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor) shall not constitute Dilution.

“ Dilution Horizon Ratio ” means 1.25.

“ Dilution Ratio ” means, with respect to any Settlement Period, a fraction (expressed as a percentage), (a) the numerator of which is the aggregate amount of all Dilutions in respect of Pool Receivables which occurred during such Settlement Period and (b) the denominator of which is the aggregate initial Unpaid Balance of all Receivables originated by any Originator during the Settlement Period immediately prior to such Settlement Period.

“ Dilution Reserve Floor Percentage ” means, as of any date of determination, a percentage determined as follows:

DR x DHR

where :


DR	= the average of the Dilution Ratios for the preceding twelve Settlement Periods; and


DHR	= the Dilution Horizon Ratio on such day.

“ Dilution Volatility Ratio ” means, on any day, a percentage determined as follows:

(DS-DR) x (DS/DR)

where :


DS	= the highest average Dilution Ratio for any three (3) consecutive Settlement Periods observed over the preceding twelve Settlement Periods; and


DR	= the average of the Dilution Ratios for the preceding twelve Settlement Periods.

“ Dodd-Frank Act ” has the meaning set forth in the definition of Specified Regulation.

Appendix 9

“ Doubtful ” means, with respect to any Loan, that such Loan has a Risk Rating of “Doubtful” in accordance with the Credit and Collection Policy.

“ Dynamic Dilution Reserve Percentage (Receivables) ” means, as of any date of determination, a percentage determined as follows:

{(SF x DR) + DVR} x DHR

where :


SF	= 2.0;


DR	= the average of the Dilution Ratios for the preceding twelve Settlement Period;


DVR	= the Dilution Volatility Ratio on such day; and


DHR	= the Dilution Horizon Ratio on such day.

“ Dynamic Loss Reserve Percentage (Receivables) ” means, as of any date of determination, a percentage determined as follows:

SF x LR x LHR

where :


SF	= 2.0;


LR	= the highest average of the Loss Ratio (Receivables) for any three (3) consecutive Settlement Periods observed over the preceding twelve Settlement Periods; and


LHR	= Loss Horizon Ratio on such day.

“ Dynamic Reserve Percentage (Loans) ” means, at any time, an amount equal to the sum of (i) 12%, (ii) the Cumulative Loss Ratio Factor and (iii) the Portfolio Weighted Average Loan Rating Factor.

“ EEA Financial Institution ” means (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“ EEA Member Country ” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“ EEA Resolution Authority ” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“ Effective Date ” means July 18, 2017.

Appendix 10

“ Effective Date Amendments ” means each of (i) that certain Omnibus Amendment No. 2, dated as of the Effective Date, by and among the Originators, the Administrative Agent and Seller, and (ii) that certain Reaffirmation of Performance Guaranty, dated as of the Effective Date, by the Performance Guarantor.

“ Effective Date Loans ” means each of the Pool Loans sold or purported to be sold by the applicable Originator to the Seller pursuant to the Sale Agreement on or prior to the Effective Date; provided that no Loan shall be deemed an Effective Date Loan to the extent such Loan has been amended or modified following the Effective Date, and as a result of such amendment or modification, a new Obligor Note has been executed and delivered by the applicable Obligor.

“ Eligible Assignee ” means (i) Administrative Agent, any Purchaser Agent, any Purchaser or any of their respective Affiliates that are financial institutions, insurance company entities or manage a commercial paper conduit or similar entity, (ii) any Liquidity Provider, any Program Administrator or any Enhancement Provider, (iii) any commercial paper conduit or similar entity that is managed by Administrative Agent, any Purchaser or any Purchaser Agent or any of their respective Affiliates and (iv) any financial or other institution that is acceptable to Administrative Agent and, solely with respect to this clause (iv) so long as no Event of Default has occurred and is continuing, the Seller (such consent not to be unreasonably withheld, conditioned or delayed).

“ Eligible Loan ” means, as of any date of determination, a Loan:

(a) which is denominated and payable only in USD in the United States;

(b) which is not a Syndicated CHS Loan;

(d) which is not an unsecured Producer Loan with a “B” or “C” Risk Rating and a remaining tenor less than or equal to 24 months;

(e) which is not a Junior Lien Producer Loan with a “C” Risk Rating and a remaining tenor less than or equal to 24 months;

(f) which is not a Junior Lien Commercial Loan with a “A2” or “A3” Risk Rating and a remaining tenor less than or equal to 24 months;

(g) which is not an unsecured Commercial Loan with a “A2” or “A3” Risk Rating, a fixed interest rate and a remaining tenor less than or equal to 24 months;

(h) which is not a Junior Lien Producer Loan with a “A” or “B” Risk Rating, a fixed interest rate and a remaining tenor less than or equal to 24 months;

(i) which is not a First Lien Producer Loan with a “B” or “C” Risk Rating, a fixed interest rate and a remaining tenor less than or equal to 24 months;

(j) which is not a First Lien Commercial Loan with a “A3” Risk Rating, a fixed interest rate and a remaining tenor less than or equal to 24 months;

(k) which is not a Producer Loan with a “D” Risk Rating;

(l) which is not a Commercial Loan with a “M4” Risk Rating;

(m) the Obligor of which (A) is a resident of, or organized under the laws of, the United States of America and (B) is not a Sanctioned Person;

(n) which is not a (A) Defaulted Loan or (B) Delinquent Loan, in each case, on the date of acquisition by the Seller;

(o) (A) the Obligor of which is Solvent and (B) no Insolvency Event has occurred with respect to such Obligor;

(p) which was originated in the ordinary course of business of the applicable Originator under Loan Documents substantially in the form as set forth as Exhibit D ;

Appendix 11

(q) which is currently owing under an Obligor Note, which Obligor Note and the related Loan Documents have been duly authorized and are in full force and effect and constitute the legal, valid and binding obligation of the related Obligor enforceable against such Obligor in accordance with their respective terms;

(r) which is not subject to any litigation, right of rescission, setoff, counterclaim, dispute or other defense of any Obligor;

(s) which, together with the Loan Documents related thereto, constitutes an “account,” a “payment intangible,” “chattel paper” or an “instrument” within the meaning of the UCC of all jurisdictions which govern the perfection of the applicable Originator’s, Seller’s and Administrative Agent’s respective interest therein;

(t) in respect of which no material default exists and there is not then in effect any waiver by the applicable Originator, Servicer or Seller of any (A) material default with respect thereto or (B) any event or circumstance that would, with notice, the passage of time, or both, become a material default with respect thereto;

(u) the Obligor of which has incurred the obligations relating to such Loan strictly for business purposes and not for personal, family or household purposes;

(v) the Obligor of which is not an Affiliate of any Originator, Seller, Servicer or Performance Guarantor; provided that Joint Ventures shall be permitted so long as (A) such Obligor does not beneficially own or hold more than 50% of any class of voting securities or the equity interests in CHS and (B) more than 50% of any class of voting securities or the equity interests in such Obligor is not beneficially owned or held by CHS ( provided that all Obligors which have Joint Ventures shall be treated as a single Obligor for purposes of the definition of “Concentration Overage Amount (Loans)”);

(w) which, with respect to any Operating Loan (other than any Operating Loan that is also a Producer Loan), requires interest payments to be made not less frequently than monthly and the outstanding principal balance to be paid in full not later than the applicable due date or commitment termination date for such Operating Loan, but in no event later than fourteen (14) months from the closing date of such Operating Loan;

(x) which, with respect to any Term Loan (other than any Term Loan that is also a Producer Loan), requires principal payments (A) to be made not less frequently than in equal monthly installments sufficient to fully amortize the outstanding principal balance over the term of the Term Loan and (B) to be paid in full not later than the applicable due date for such Term Loan, but in no event longer than ten (10) years from the closing date of such Term Loan, and interest payments to be made not less frequently than monthly;

(y) which, when added to the Pool Assets, does not result in the aggregate Weighted Average Life of the Eligible Receivables and Eligible Loans to exceed one and a half (1.5) years;

(z) the Obligor of which was not classified as Substandard, Doubtful or Loss in accordance with the Credit and Collection Policy at the time of acquisition by the Seller;

(aa) which is secured by a perfected, assignable, first priority security interest in the Related Security in favor of the applicable Originator (or, in the case of a Participation Loan, the agent for the related lender group on behalf of the lenders in such lender group), free and clear of all Adverse Claims prior to the acquisition by the Seller and the applicable Originator (or, in the case of a Participation Loan, the agent for the related lender group on behalf of the lenders in such lender group) has filed an “all assets” UCC-1 filing against each related Obligor;

(bb) which has not been compromised, adjusted or similarly modified other than in accordance with the Credit and Collection Policy and as permitted by the Transaction Documents;

(cc) which, together with the related Loan Documents, satisfies in all material respects the applicable requirements of the Credit and Collection Policy;

Appendix 12

(dd) which does not represent a refinancing by the applicable Originator of an existing Loan due to credit reasons or a restructured Loan due to credit reasons;

(ee) (i) with respect to any Effective Date Loan, the Custodian File and Obligor Note (other than any Obligor Note that has been signed electronically) with respect to such Loan shall have been delivered to the Custodian by the Seller, the Servicer or the Originator, (ii) with respect to any Loan other than an Effective Date Loan, the Custodian File and Obligor Note (other than any Obligor Note that has been signed electronically) with respect to such Loan shall have been delivered within thirty (30) days following the date on which the Seller acquires an interest in such Loan pursuant to the Sale Agreement, and (iii) with respect to any Loan that has been amended or modified following the Effective Date, the applicable amended or modified Loan Documents with respect to such Loan (including any new Obligor Note) shall have been delivered to the Custodian by the Seller, the Servicer or the Originators within thirty (30) days following the date of such amendment or modification;

(ff) which is not subordinated in any respect to any other Debt of the relevant Obligor;

(gg) which is not subject to any right of rescission, setoff, counterclaim or any other defense (including defenses arising out of violations of usury laws) of any Obligor, other than defenses arising out of applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights in general and general equity principles;

(hh) the Obligor of which has been instructed to make all payments directly to a Seller Collection Account or the Concentration Account;

(ii) in respect of which no security deposit or reserve paid or created by the related Obligor exists;

(jj) no portion of the Unpaid Balance of such Loan represents any sales tax, value-added tax or other similar tax;

(kk) which, together with the Loan Documents related thereto, does not contravene any laws, rules or regulations applicable thereto (including laws, rules and regulations relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) and with respect to which no party to the Loan Documents related thereto is in violation of any such law, rule or regulation in any respect;

(ll) the Related Security of which is insured as required by the Credit and Collection Policy;

(mm) the Unpaid Balance to Stressed Realizable Value for the related Obligor does not exceed 90%;

(nn) with respect to which all material consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the origination, transfer or pledge of such Loan have been duly obtained, effected or given and are in full force and effect;

(oo) which is prepayable at any time and, together with the related Loan Documents and Related Security, is fully assignable;

(pp) with respect to which the Loan Documents are complete and in accordance with the Credit and Collection Policy; provided that, prior to the Obligor Note Delivery Date, such Loan Documents may exclude the related Obligor Note (excluding any Obligor Note that is delivered electronically) until the Obligor Note Delivery Date has occurred, at which time such Obligor Note shall be or shall have been delivered to the Custodian;

(qq) the Obligor of which has provided the Servicer with monthly financial statements in accordance with the Loan Documents within 35 days of each month end;

(rr) as to which the applicable Originator has satisfied all obligations on its part with respect to such Loan required to be fulfilled pursuant to the applicable Loan Documents or in connection with the transfer and any applicable agreement pursuant to which such transfer occurs;

Appendix 13

(ss) as to which none of the applicable Originator, Seller, Servicer or Performance Guarantor has taken any action which would impair, or failed to take any action necessary to avoid impairing, the rights of the Administrative Agent for the benefit of the Purchasers therein, other than actions or failures to take action by the Servicer which are permitted under the Credit and Collection Policy and the Transaction Documents;

(tt) which complies with the representations and warranties made with respect thereto by the applicable Originator in the Sale Agreement;

(uu) the Unpaid Balance of which is less than the related Loan Commitment amount under the Loan Documents;

(vv) for which the contract giving rise to such Loan is governed by the law of one of the States of the United States, the District of Columbia or any territory of the United States;

(ww) for which the Seller has good and marketable title to, and is the sole legal and beneficial owner of, such Loan free and clear of any Adverse Claim, and the Administrative Agent has a first priority perfected security interest in such Loan and a perfected security interest in the Related Security with respect to such Loan;

(xx) in the case of any Participation Loan:

(i) written notice of the transfer of such Participation Loan to the Seller has been delivered to the Obligor thereof and the agent of the related lender group and all other requirements under the related Loan Documents with respect to the transfer of such Participation Loan to the Seller have been satisfied; and

(ii) no material amendment to or consent under any of the related Loan Documents can be made without the consent of the Seller (or the Servicer on its behalf);

(yy) that has been sold or contributed by an Originator to Seller pursuant to the Sale Agreement with respect to which sale or contribution all conditions precedent under the Sale Agreement have been met; and

(zz) that, with respect to any Loan that is executed electronically, (i) the electronic execution of such Loan is in compliance with the Credit and Collection Policy, and (ii) each Purchaser Agent shall have received (and shall be an addressee of) a legal opinion from external counsel to the Originators, in form and substance reasonably satisfactory to the Purchaser Agents, opining that under the state law which governs such Loan’s related Loan Documents, any documents or agreements that are governed by the laws of such state and that are executed electronically constitute the valid and enforceable obligations of each party to such documents or agreements (and such external counsel shall be licensed to practice law in such state).

“ Eligible Receivable ” means, as of any date of determination, a Receivable:

(a) that is denominated and payable only in USD in the United States;

(b) the related Account Debtor (i) is a resident of, or organized under the laws of, the United States of America and (ii) is not a Sanctioned Person;

(c) that is not (A) a Defaulted Receivable or (B) a Delinquent Receivable, in each case, on the date of acquisition by the Seller;

(d) (i) the Account Debtor of which is Solvent and (ii) no Insolvency Event has occurred with respect to such Account Debtor;

(e) (i) that has been generated by the applicable Originator in the United States of America and in the ordinary course of its business, subject to a valid invoice or contract, from the bona fide sale of goods or services to an Account Debtor, (ii) all obligations of the applicable Originator in connection with such Receivable have been fully performed, (iii) no portion of such Receivable is in respect of any amount as to which the related Obligor is permitted to withhold payment until the occurrence of a specified event or conditions (including “guaranteed” or “conditional” sales or any performance by an Originator), (iv) which is not owed to any Originator or Seller as a bailee or

Appendix 14

consignee for another Person, and (v) which is not issued under cash-in-advance or cash-on-account terms date; provided that, for the avoidance of doubt, no portion of any Receivable billed to any Account Debtor for which the related goods or services have not been delivered or performed by an Originator shall constitute an “Eligible Receivable”;

(f) that, together with the related Receivable Documentation, is in full force and effect and is a valid and binding obligation of the related Account Debtor, enforceable in accordance with its terms;

(g) which is not subject to any litigation, right of rescission, setoff, counterclaim, dispute or other defense of the related Account Debtor;

(h) the Seller has good and marketable title to, and is the sole legal and beneficial owner of, such Receivable and the Related Security free and clear of any Adverse Claim;

(i) in respect of which no material default exists and there is not then in effect any waiver by the applicable Originator, Servicer or Seller of any (i) material default with respect thereto or (ii) any event or circumstance that would, with notice, the passage of time, or both, become a material default with respect thereto;

(j) which constitutes an “account” or “payment intangible” within the meaning of Article 9 of the UCC of all jurisdictions which govern the perfection of the applicable Originator’s, Seller’s and Administrative Agent’s respective interest therein and is not evidenced by instruments or chattel paper;

(k) the Account Debtor of which has incurred the obligations relating to such Receivable strictly for business purposes and not for personal, family or household purposes;

(l) the Account Debtor of which is not an Affiliate of any Originators, Seller, Servicer, CHS or Performance Guarantor;

(m) no more than 35% of the aggregate Unpaid Balance of all Receivables of the related Account Debtor are Defaulted Receivables;

(n) that has a remaining payment term that does not exceed 90 days from the date of the related invoice; provided that the Unpaid Balance of all Eligible Receivables the remaining tenor of which exceeds 90 days but does not exceed 180 days cannot exceed 15% of the aggregate Unpaid Balance of all Eligible Receivables;

(o) which has not been compromised, adjusted or similarly modified other than in accordance with the Credit and Collection Policy and as permitted by the Transaction Documents;

(p) that, together with the related Receivable Documentation, satisfies in all material respects the applicable requirements of the Credit and Collection Policy;

(q) which represents part or all of the price of the sale of “merchandise,” “insurance” or “services” within the meaning of Section 3(c)(5) of the Investment Company Act and which is an “eligible asset” as defined in Rule 3a-7 under the Investment Company Act;

(r) the related Account Debtor has been instructed to make payments on such Receivable only to a Lockbox, a Collection Account, an Originator Specified Account or the Concentration Account;

(s) is not subordinated in any respect to any other Debt of the relevant Account Debtor;

(t) in respect of which no security deposit or reserve paid or created by the related Account Debtor exists;

(u) no portion of the Unpaid Balance of such Receivable represents any sales tax, value-added tax or other similar tax;

(v) which does not constitute finance charges, service charges or similar charges (it being understood that only the portion of the Receivable so constituted shall not be eligible);

(w) which, together with the related Receivable Documentation, does not contravene any laws, rules or regulations applicable thereto (including laws relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy);

Appendix 15

(x) for which the sale, pledge, contribution or assignment of such Receivable and the Related Security pursuant to this Agreement and the Sale Agreement does not (i) violate or contravene any Applicable Law or the related Receivable Documentation, (ii) require notice thereof to the related Account Debtor or any consent therefrom (other than any such notices that have been provided or consents that have been obtained and are in effect) or (iii) require any notice thereof or any consent from any Governmental Authority that has not been provided or obtained;

(y) that has not been previously sold, assigned, pledged or otherwise transferred by the applicable Originator to any other Person;

(z) that has been sold or contributed by any Originator to Seller pursuant to the Sale Agreement with respect to which sale or contribution all conditions precedent under the Sale Agreement have been met;

(aa) that is not a Receivable which arose as a result of the sale of consigned goods or finished goods that have incorporated any consigned goods into such finished goods or a sale in which Seller, any Originator, CHS, Performance Guarantor or Servicer acted as a bailee, consignee or agent of any other Person or otherwise not as principal or otherwise in respect of deferred or unearned revenues;

(bb) that does not constitute a re-billed amount arising from a deduction taken by the related Account Debtor with respect to a previously arising Receivable;

(cc) that (i) does not arise from a sale of accounts made as part of a sale of a business or constitute an assignment for the purpose of collection only, (ii) is not a transfer of a single account made in whole or partial satisfaction of a preexisting indebtedness or an assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract and (iii) is not a transfer of an interest in or an assignment of a claim under a policy of insurance;

(dd) the Administrative Agent has a valid and enforceable first priority perfected security interest in such Receivable and the Related Security, in either case, free and clear of any Adverse Claim; and

(ee) with respect to which all material consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the origination, transfer or pledge of such Receivable have been duly obtained, effected or given and are in full force and effect.

“ Enhancement Agreement ” means any agreement between a Conduit Purchaser and any other Person(s), entered into to provide (directly or indirectly) credit enhancement to such Conduit Purchaser’s commercial paper facility.

“ Enhancement Provider ” means any Person providing credit support to a Conduit Purchaser under an Enhancement Agreement, including pursuant to an unfunded commitment, or any similar entity with respect to any permitted assignee of such Conduit Purchaser.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended, or any successor statute.

“ ERISA Affiliate ” means any trade or business (whether or not incorporated) under common control with Seller, Servicer, Performance Guarantor or any Originator within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“ ERISA Event ” means: (i) a Reportable Event with respect to a Pension Plan; (ii) a withdrawal by Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA); (iii) a complete or partial withdrawal by Seller, Servicer, any Originator,

Appendix 16

Performance Guarantor or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (iv) the filing of a notice of intent to terminate, the treatment of a Pension Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (v) an event or condition which is reasonably expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (vi) the imposition of any liability under Title IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of ERISA, upon Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate; or (vii) a transaction by Seller, Servicer, any Originator, Performance Guarantor or an ERISA Affiliate that is reasonably expected to be subject to Sections 4069 or 4212(c) of ERISA.

“ EU Bail-In Legislation Schedule ” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“ Event of Default ” is defined in Section 10.1 .

“ Event of Repurchase ” is defined in Section 3.2(b) .

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended or otherwise modified from time to time.

“ Excluded Taxes ” means any of the following Taxes imposed on or with respect to an Affected Party or required to be withheld or deducted from a payment to an Affected Party: (i) any Taxes imposed on, or measured by, net income or gains and any franchise Taxes, branch Taxes or branch profits Taxes, but only to the extent such Taxes are imposed by a taxing authority in a jurisdiction (or political subdivision thereof) (a) under the laws of which such Affected Party is organized or incorporated or maintains a lending office (or branch), and (b) as a result of a present or former connection between such Affected Party and the jurisdiction imposing such Tax (other than connections arising from such Affected Party having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced this Agreement, or sold or assigned an interest in this Agreement), (ii) any U.S. federal withholding Tax to the extent it is imposed on amounts payable to such Affected Party (I) when such Affected Party becomes a party to this Agreement or (II) because such Affected Party designates a new lending office, except to the extent that such Affected Party was entitled, at the time of designation of a new lending office (or assignment), to receive such additional amounts from Seller or Servicer, as applicable, pursuant to Section 3.3 , (iii) Taxes attributable to such Affected Party’s failure to comply with Section 3.3(e)(vii) , and (iv) any U.S. federal withholding tax imposed under FATCA.

“ FAS 166/167 Capital Guidelines ” has the meaning set forth in the definition of Specified Regulation.

“ FATCA ” means Sections 1471 through 1474 of the Code, as of the Closing Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code, any applicable intergovernmental agreement entered into in connection with the implementation of the foregoing and any fiscal or regulatory legislation, rules or practices adopted pursuant to any such intergovernmental agreement.

Appendix 17

“ Federal Funds Rate ” means, for any period, a fluctuating interest rate per annum , determined by Administrative Agent, equal (for each day during such period) to:

(a) the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York; or

(b) if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the applicable Liquidity Provider or Purchaser Agent from three federal funds brokers of recognized standing selected by it.

“ Federal Reserve Bank ” means the Board of Governors of the Federal Reserve System, or any successor thereto or to the functions thereof.

“ Fee Letter ” means the Second Amended and Restated Fee Letter, dated as of June 28, 2018, among Seller, CHS, Administrative Agent and the Purchaser Agents.

“ Final Payout Date ” means the date following the Purchase Termination Date on which Total Investment shall have been reduced to zero and all other amounts then accrued or payable to any of the Affected Parties under the Transaction Documents shall have been paid in full in cash.

“ First Lien Commercial Loan ” means a Commercial Loan that is entitled to the benefit of a first lien and first priority perfected security interest on the assets of the respective Obligor.

“ First Lien Producer Loan ” means a Producer Loan that is entitled to the benefit of a first lien and first priority perfected security interest on the assets of the respective Obligor.

“ Floor Reserve Percentage (Loans) ” means, at any time, 15%.

“ Foreign Affected Party ” is defined in Section 3.3(e)(vii) .

“ Formation Date ” means the date that Seller was originally formed under the laws of the State of Delaware.

“ GAAP ” means generally accepted accounting principles in the United States of America as consistently applied. If at any time Seller or Servicer notifies Administrative Agent that Seller or Servicer requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Effective Date in GAAP or in the application thereof on the operation of such provision (or if Administrative Agent notifies Seller or Servicer that the Purchasers request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP without giving effect to such change in GAAP or in the application thereof that is the subject of such notice until such notice shall have been withdrawn or such provision amended in accordance herewith.

“ Governmental Authority ” means any government, supranational or political subdivision or any agency, authority, bureau, regulatory body, central bank, commission, department or instrumentality of any such government or political subdivision, or any other entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government or any court, tribunal, grand jury or arbitrator, or any accounting board or authority (whether or not part of a government) which is responsible for the establishment or interpretation of national or international accounting principles, in each case whether foreign or domestic.

Appendix 18

“ Indemnified Amounts ” is defined in Section 12.1(a) .

“ Indemnified Party ” is defined in Section 12.1(a) .

“ Indemnified Taxes ” means Taxes other than Excluded Taxes.

“ Independent Manager ” means a natural person who is a manager of Seller who (I) is not at the time of initial appointment, or at any time while serving as Independent Manager of Seller, and has not been at any time during the preceding five (5) years (a) a stockholder, member, director (with the exception of serving as an independent director of any Affiliates of Seller), manager (with the exception of serving as an independent manager of Seller or any of its Affiliates), officer, employee, partner, attorney or counsel of Seller, Servicer, any Originator, Performance Guarantor or CHS or any of their respective Affiliates; (b) a customer, supplier or other Person who derives any of its purchases or revenues from its activities with Seller, Servicer, any Originator, Performance Guarantor or CHS or any of their respective Affiliates; (c) a Person Controlling or under common Control with any such customer, supplier, stockholder, member, director, manager, officer, employee, partner, attorney, counsel or other Person described in clauses (a) or (b) above; or (d) a member of the immediate family of any such customer, supplier, stockholder, member, director, manager, officer, employee, partner, attorney, counsel or other Person described in clauses (a) , (b) or (c) above; and (II) (1) has prior experience as an independent manager or independent director for a company whose charter documents required the unanimous consent of all independent managers or independent directors thereof before such company could consent to the institution of bankruptcy or insolvency proceedings against it or could file a petition seeking relief under any applicable federal or state law relating to bankruptcy and (2) has at least three years of employment experience with one or more entities that provide, in the ordinary course of their respective businesses, advisory, management or placement services to issuers of securitization or structured finance instruments, agreements or securities.

“ Information Package ” is defined in Section 3.1(a) .

“ Insolvency Event ” means, with respect to any Person, (i) a court or governmental agency having jurisdiction in the premises shall enter a decree or order for relief in respect of such Person in an involuntary case under any Debtor Relief Law now or hereafter in effect, or appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of such Person or for any substantial part of its property or ordering the winding up or liquidation of its affairs, (ii) an involuntary case under any applicable Debtor Relief Law now or hereafter in effect is commenced against such Person and, unless such Person is Seller, an Obligor or an Account Debtor, such petition remains unstayed and in effect for a period of sixty (60) consecutive days, (iii) such Person shall commence a voluntary case under any applicable Debtor Relief Law now or hereafter in effect, or consent to the entry of an order for relief in an involuntary case under any such law, or consent to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of such Person or any substantial part of its property or make any general assignment for the benefit of creditors, (iv) such Person shall (A) fail to pay its debts generally as such debts become due, (B) make a general assignment for the benefit of creditor or (C) admit in writing its inability to pay its debts generally as they become due or (v) such Person shall take any action to authorize any of the actions in furtherance of any of the aforesaid purposes.

“ Investment Company Act ” means the Investment Company Act of 1940, as amended.

“ Joint Venture ” means an Obligor constituting a joint venture of an Originator and one or more unaffiliated entities where (i) such Originator has no more than 50% of the ownership or voting rights in or with respect to such joint venture, (ii) such Originator does not have the ability to directly or indirectly control

Appendix 19

such joint venture and (iii) the joint venture satisfies the definition of Eligible Loan and has been subject to the same underwriting and credit and collection policies as any other Obligor.

“ Junior Lien Commercial Loan ” means a Commercial Loan that is entitled to the benefit of a lien and priority perfected security interest on the assets of the respective Obligor and is not a First Lien Commercial Loan.

“ Legal Final Settlement Date ” means the Settlement Date following the 138 ^th complete month following the Liquidation Period.

“ LIBO Rate ” means for any Yield Period, (a) the interest rate per annum designated as the LIBO Rate by the applicable Purchaser Agent for a period of time comparable to such Yield Period that appears on the Reuters Screen LIBO Page as of 11:00 a.m. (London, England time) with respect to such Purchaser Agent or related Committed Purchaser on the second Business Day preceding the first day of such Yield Period or (b) if a rate cannot be determined under either of the foregoing clauses, an annual rate equal to the average (rounded upwards if necessary to the nearest 1/100th of 1%) of the rates per annum at which deposits in USD with a duration comparable to such Yield Period in a principal amount substantially equal to the principal amount of the applicable Rate Tranche are offered to the principal London office of the applicable Purchaser Agent (or its related Committed Purchaser) by three London banks, selected by Administrative Agent in good faith, at about 11:00 a.m. London time on the second Business Day preceding the first day of such Yield Period. If the calculation of the LIBO Rate results in a LIBO Rate of less than zero (0), the LIBO Rate shall be deemed to be zero (0) for all purposes of this Agreement and the Transaction Documents.

“ Liquidation Fee ” means, for each Rate Tranche (or portion thereof) for each day in any Yield Period or Settlement Period (computed without regard to clause (iii) of the proviso of the definition of “ Yield Period ”) during the Liquidation Period, the amount, if any, by which:

(a) the additional Yield (calculated without taking into account any Liquidation Fee) which would have accrued on the reductions of such Purchaser’s Tranche Investment effected pursuant to Section 1.3(c)(ii) or (iii) with respect to such Rate Tranche for such day during such Yield Period or Settlement Period (as so computed) if such reductions had not been made until the last day of such Yield Period or Settlement Period exceeds,

(b) the income, if any, received for such day during such Yield Period or Settlement Period by the affected Purchaser from investing the proceeds of such reductions of such Purchaser’s Tranche Investment.

“ Liquidation Period ” means the period commencing on the date on which the Administrative Agent notifies the Seller and the Servicer that any condition precedent to Purchases and Reinvestments set forth in Section 5.3 is not satisfied (or expressly waived by each Purchaser) and that the Liquidation Period has commenced, and ending on the Final Payout Date.

“ Liquidity Advance ” means a loan, advance, purchase or other similar action made by a Liquidity Provider pursuant to a Liquidity Agreement.

“ Liquidity Agreement ” means any agreement entered into, directly or indirectly, in connection with or related to this Agreement pursuant to which a Liquidity Provider agrees to make loans or advances to, or purchase assets from, a Conduit Purchaser (directly or indirectly) in order to provide liquidity or other enhancement for such Conduit Purchaser’s Commercial Paper Notes or other senior indebtedness.

“ Liquidity Provider ” means MUFG or any of its Affiliates, Rabobank or any of its Affiliates or any other lender, credit enhancer or liquidity provider that is at any time party to a Liquidity Agreement or any

Appendix 20

successor or assign of such lender, credit enhancer or liquidity provider or any similar entity with respect to any permitted assignee of a Conduit Purchaser.

“ Loan ” shall mean the indebtedness of any Obligor under or with respect to an Obligor Note, whether constituting an account, chattel paper, an instrument, a general intangible, payment intangible, promissory note or otherwise, and shall include (i) the right to payment of such indebtedness and any interest or finance charges and other obligations of such Obligor with respect thereto (including the principal amount of such indebtedness, periodic finance charges, late fees and returned check fees), (ii) all proceeds of, and payments or Collections on, under or in respect of any of the foregoing and (iii) all Related Security with respect thereto.

“ Loan Commitment ” means, with respect to any Obligor, the maximum aggregate amount required to be advanced to the related Obligor under the terms of the related Loan Documents.

“ Loan Document ” means, with respect to any Loan, the related Obligor Note and any related loan agreements, security agreements, mortgages, acknowledgements (if required), financing statements and other documents, instruments, certificates or assignments (including amendments or modifications thereof) executed by the Obligor thereof or by another Person on the Obligor’s behalf or for the Obligor’s benefit in respect of such Loan and related Obligor Note, including letters of credit, general or limited guaranties or other credit enhancement.

“ Loan Investment Base ” means, at any time, the Net Loan Pool Balance less the Required Loan Reserves.

“ Loan Losses ” means the Unpaid Balance of any Pool Loans that have been, or should have been, written-off as uncollectible by Servicer in accordance with the Credit and Collection Policy.

“ Loan Pool ” means, at any time, all then outstanding Loans sold or contributed, or purported to be sold or contributed, to Seller pursuant to the Sale Agreement and transferred or purported to be transferred to the Administrative Agent, on behalf of the Purchasers, pursuant to Section 1.2(c) .

“ Loan Pool APR Percentage ” means, at any time, an amount equal to the product of (a) the product of (i) the Weighted Average Interest Rate for the Eligible Loans multiplied by (ii) a fraction (expressed as a percentage), (x) the numerator of which is equal to the aggregate Unpaid Balances of all Eligible Loans and (y) the denominator of which is equal to the aggregate Loan Commitments of all Eligible Loans multiplied by (b) the Weighted Average Life (in years) for the Eligible Loans.

“ Loan Yield and Servicing Fee Reserve Percentage ” means, at any time, an amount equal to the product of (a) the sum of (i) the weighted average Yield Rate for the most recently ended Settlement Period multiplied by 1.5 plus (ii) the sum of the Program Fee Rate and the Servicing Fee Rate multiplied by (b) the Weighted Average Life (in years) of the Loan Pool.

“ Lockbox ” means the lockboxes specified as such in Exhibit B , each of which shall be maintained at an Account Bank in the name of Originator.

“ Loss ” means, with respect to any Loan, that such Loan has a Risk Rating of “Loss” in accordance with the Credit and Collection Policy.

“ Loss Horizon Ratio ” means 3.75.

“ Loss Ratio (Loans) ” means the highest average Default Ratio for any three (3) consecutive Settlement Periods observed over the preceding twelve Settlement Periods.

Appendix 21

“ Loss Ratio (Receivables) ” means, as of any date of determination, the ratio (expressed as a percentage) of (a) the sum of (i) the aggregate Unpaid Balance of all Receivables that were 61-90 days past their original due date as of the end of the most recently ended Settlement Period plus (ii) the aggregate Unpaid Balance of all Receivables that were charged-off during the most recently ended Settlement Period that were 60 days or fewer days past their due date when charged off, to (b) the initial Unpaid Balance of all Receivables generated by all the Originators during the Settlement Period that is three (3) Settlement Periods prior to the most recently ended Settlement Period.

“ Loss Reserve Floor Percentage (Receivables) ” means, at any time, 15%.

“ Market Value ” means, with respect to any Pool Asset and Related Assets, a percentage of the principal amount of the Pool Asset, not to exceed 100%, determined by the applicable Originator, as of the date such Pool Asset is transferred to the Seller by the Originator, to be the fair market value of such Pool Asset and Related Assets.

“ Material Adverse Change ” means, with respect to any Person (or if no Person is specified, with respect to Seller, CHS, Servicer, Performance Guarantor or any Originator) an event or circumstance that, individually or in the aggregate, results in, or could reasonably be expect to result in, a material adverse change in:

(i) the financial condition or results of operations of such Person and its Subsidiaries, taken as a whole;

(ii) the ability of such Person to perform any of its obligations under this Agreement or any other Transaction Document to which it is a party;

(iii) the status, existence, perfection, priority, enforceability or other rights and remedies of Administrative Agent associated with its interests in the Pool Assets or any material portion thereof; or

(iv) (a) the validity or enforceability against such Person of any Transaction Document or any Receivable Documentation or Loan Documents to which it is a party or (b) the validity, enforceability or collectability of a material portion of the Pool Assets, including if such event or circumstance would increase the days to pay or Dilution with respect to a material portion of the Pool Receivables.

“ Monthly Loss Ratio ” means, as of any date of determination, a fraction (expressed as a percentage), (a) the numerator of which is equal to the sum of Loan Losses during the most recently ended Settlement Period and (b) the denominator of which is the aggregate Unpaid Balance of all Pool Loans as of the Cut-Off Date of the most recently ended Settlement Period.

“ Moody’s ” means Moody’s Investors Service, Inc.

“ MUFG ” is defined in the preamble .

“ MUFG Purchaser Group ” means the Purchaser Group with Victory, as a Conduit Purchaser, MUFG, as Committed Purchaser and MUFG, as Purchaser Agent.

“ Multiemployer Plan ” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA to which Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate makes or is obligated to make contributions or has any liability.

Appendix 22

“ Net Loan Pool Balance ” means, at any time, an amount equal to (a) the aggregate Unpaid Balance of all Eligible Loans at such time, minus (b) the Concentration Overage Amount (Loans) at such time.

“ Net Pool Balance ” means, at any time, an amount equal to the sum of (a) the Net Loan Pool Balance at such time plus (b) the Net Receivables Pool Balance at such time.

“ Net Receivables Pool Balance ” means, at any time, an amount equal to (a) the aggregate Unpaid Balance of all Eligible Receivables at such time, minus (b) the Account Debtor Concentration Overage Amount at such time.

“ Nieuw Amsterdam ” means Nieuw Amsterdam Receivables Corporation B.V.

“ No Petition Agreement ” means that certain no proceedings letter agreement, dated as of September 4, 2018, between the Administrative Agent and each Subordinated Note Financier, as such agreement may be amended, restated, supplemented or otherwise modified from time to time.

“ Notice of Payment ” means a Notice of Payment substantially in the form of Exhibit F attached hereto, delivered by the Seller to the Administrative Agent and each Purchaser Agent pursuant to Sections 3.1(d)(vi) , 3.2(c) and 3.2(e) , as applicable.

“ Notice of Purchase ” means a Notice of Purchase substantially in the form of Exhibit E attached hereto, delivered by the Seller to the Administrative Agent and each Purchaser Agent pursuant to Section 1.2(a) .

“ Obligations ” means all obligations of Seller arising in connection with this Agreement and each other Transaction Document, whether now or hereafter existing, due or to become due, direct or indirect, or absolute or contingent, including, all Indemnified Amounts, payments on account of Collections received or deemed to be received and fees.

“ Obligor ” shall mean, with respect to any Loan, the Person or Persons directly or indirectly obligated to make payments with respect to such Loan, including any guarantor thereof.

“ Obligor Note ” shall mean, with respect to any Loan, the promissory note, instrument or other writing entered into by the related Obligor in connection with or evidencing the indebtedness of the Obligor under such Loan.

“ Obligor Note Delivery Date ” means July 20, 2017.

“ OFAC ” has the meaning set forth in the definition of Sanctioned Person.

“ Omnibus Amendment Effective Date ” means September 4, 2018.

“ Operating Loan ” means any Loan used to finance working capital and current or seasonal assets (e.g., inventories and accounts receivable) with an original maturity date of fourteen (14) months or less.

“ Original Agreement ” is defined in the preamble .

“ Originator ” means each Person from time to time party to the Sale Agreement as an originator. As of the Effective Date, CHS and CHS Capital are the only Originators.

“ Originator Account Agreements ” means each Deposit Account Control Agreement, dated as of the Closing Date, among CHS or CHS Capital, as applicable, an Account Bank and the Administrative Agent.

Appendix 23

“ Originator Collection Accounts ” means the accounts specified as such in Exhibit B , each of which shall be maintained at an Account Bank in the name of Originator.

“ Originator Specified Accounts ” means the accounts specified as such in Exhibit B , each of which shall be in the name of Originator.

“ Participant ” is defined in Section 13.3(b) .

“ Participation Loan ” means any advance by an Originator to an Obligor under a syndicated loan facility (a) that has closed (without regard to any contemporaneous or subsequent syndication of such advance) prior to such advance becoming a part of the Loan Pool and (b) pursuant to which such Originator acts as administrative agent of the related lender group.

“ Patriot Act ” is defined in Section 13.20 .

“ Payoff Letter ” means that certain Payoff and Termination Agreement, dated as of the Closing Date, by and among the Seller, CHS, CHS Capital, Rabobank, Nieuw Amsterdam, Victory, MUFG and U.S. Bank National Association.

“ PBGC ” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

“ Pension Plan ” means an “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate or to which Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate contributes or has an obligation to contribute or to which Seller, Servicer, any Originator, Performance Guarantor or any ERISA Affiliate has any liability.

“ Performance Guarantor ” means CHS.

“ Performance Guaranty ” means the Performance Guaranty, dated as of the Closing Date, entered into by Performance Guarantor in favor of Administrative Agent.

“ Person ” means an individual, partnership, sole proprietorship, corporation (including a business trust), limited liability company, limited partnership, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

“ Pool Asset ” means any of, and “ Pool Assets ” means all of, the Pool Receivables and the Pool Loans.

“ Pool Loan ” means a Loan in the Loan Pool sold or purported to be sold by the applicable Originator to the Seller pursuant to the Sale Agreement.

“ Pool Receivable ” means a Receivable in the Receivables Pool sold or purported to be sold by the applicable Originator to the Seller pursuant to the Sale Agreement.

“ Portfolio Weighted Average Loan Rating Factor ” means, with respect to any Obligor, the percentage appearing opposite such Obligor’s applicable rating on the table below:

Appendix 24



Rating Bucket	WA Rating Factor	Portfolio WA Rating Factor
1	Greater than 4.0	0.50%
2	4.0 to 3.75	1.00%
3	3.5 to < 3.75	1.50%
4	3.25 to < 3.5	3.00%
5	Less than 3.25	5.00%

“ Prime Rate ” means, with respect to any Purchaser Group, the rate of interest in effect for such day as publicly announced from time to time by the applicable Purchaser Agent, the related Committed Purchaser or their Affiliates as its “reference rate” or “prime rate”, as applicable. Such “reference rate” or “prime rate” is set by the applicable Purchaser Agent, the related Committed Purchaser or their Affiliates based upon various factors, including such Person’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above or below such announced rate, and is not necessarily the lowest rate charged to any customer.

“ Producer Loan ” means a Loan characterized as a “Producer Loan” under the Credit and Collection Policy.

“ Program Administration Agreement ” means that certain administration agreement between a Conduit Purchaser and Program Administrator governing certain aspects of the administration of such Conduit Purchaser’s commercial paper facility or any other agreement having similar purposes, as in effect from time to time.

“ Program Administrator ” means the administrator designated for a Conduit Purchaser under the Program Administration Agreement.

“ Program Fee ” is defined in the Fee Letter.

“ Program Fee Rate ” is defined in the Fee Letter.

“ Program Information ” is defined in Section 13.8(a) .

“ Purchase ” is defined in Section 1.1 .

“ Purchase Price ” is defined in Section 1.1 .

“ Purchase Termination Date ” means the earlier of (i) June 27, 2019, (ii) the occurrence of an Event of Default and (iii) sixty (60) days following the date of receipt by each of the other parties to this Agreement of a written notice of termination provided by Seller.

“ Purchaser ” means each Conduit Purchaser and Committed Purchaser, as applicable.

“ Purchaser Agent ” means each Person acting as agent on behalf of a Purchaser Group and listed as such as set forth on the signature pages of this Agreement.

“ Purchaser Group ” means, for each Conduit Purchaser, such Conduit Purchaser, its related Committed Purchaser and its related Purchaser Agent as set forth on Exhibit C .

Appendix 25

“ Purchaser Group Commitment ” means, at any time with respect to any Purchaser Group, the aggregate Commitments of all Committed Purchasers at such time in such Purchaser Group as set forth on Exhibit C .

“ Purchaser Group Investment ” means, at any time with respect to any Purchaser Group, the Total Investment of all Purchasers at such time in such Purchaser Group.

“ Purchasers’ Total Commitment ” means, at any time, the aggregate Commitments of all Committed Purchasers at such time as set forth on Exhibit C .

“ Purchaser’s Tranche Investment ” means, in relation to any Rate Tranche and any Purchaser, the amount of the Purchasers’ Total Investment allocated by such Purchaser’s Purchaser Agent to such Rate Tranche pursuant to Section 2.1 ; provided that at all times the aggregate amounts allocated to all Rate Tranches shall equal the Total Investment.

“ Rabobank ” means Coöperatieve Rabobank U.A.

“ Ratable Share ” means, at any time, (i) for any Purchaser Group, a percentage equal to the quotient of (a) the Purchaser Group Commitment for such Purchaser Group at such time, divided by (b) the Purchasers’ Total Commitment at such time and (ii) for any Purchaser, a percentage equal to the quotient of (a) such Purchaser’s Commitment (or, for any Conduit Purchaser, the Commitment of the Committed Purchaser in such Conduit Purchaser’s Purchaser Group) at such time divided by (b) the Purchasers’ Total Commitment at such time.

“ Rate Tranche ” means at any time a portion of the Asset Interest selected by the applicable Purchaser Agent pursuant to Section 2.1 and designated as a Rate Tranche solely for purposes of computing Yield.

“ Rating Agency ” mean each of S&P and Moody’s (and/or each other rating agency then rating the Commercial Paper Notes of any Conduit Purchaser).

“ Receivable ” means any right to payment of a monetary obligation, whether or not earned by performance, owed to any Originator, Seller (as assignee of any Originator) or any other Person (as assignee of Seller) by an Account Debtor, whether constituting an account, instrument, document, contract right, general intangible, chattel paper or payment intangible, in each instance arising in connection with the sale of goods or for services rendered, and includes the obligation to pay any finance charges, fees and other charges with respect thereto, together with the Related Security with respect thereto, and with respect to each of the foregoing, all Collections and proceeds thereof. Any such right to payment arising from any one transaction, including any such right to payment represented by an individual invoice or agreement, shall constitute a Receivable separate from a Receivable consisting of any such right to payment arising from any other transaction.

“ Receivable Documentation ” means, for each Pool Receivable, the invoice therefor and any other agreement or documentation between the applicable Originator and the applicable Account Debtor giving rise to, and/or setting forth terms and conditions related to the creation and payment of, such Pool Receivable, including in each case any amendments.

“ Receivables Investment Base ” means, at any time, the Net Receivables Pool Balance less the Required Receivable Reserves.

Appendix 26

“ Receivables Pool ” means at any time, all then outstanding Receivables sold or contributed, or purported to be sold or contributed, to Seller pursuant to the Sale Agreement and transferred or purported to be transferred to Administrative Agent, on behalf of the Purchasers, pursuant to Section 1.2(c) .

“ Records ” means all Receivable Documentation and Loan Documents and other documents, instruments, books, records, purchase orders, agreements, reports and other information (including computer programs, tapes, disks, other information storage media, data processing software and related property and rights) prepared or maintained by any Originator, CHS, Servicer, or Seller, respectively, with respect to, or that evidence or relate to, the Pool Assets, the other Seller Assets or the Account Debtors or Obligors of such Pool Assets.

“ Regulatory Change ” means the occurrence, after the Closing Date, of any of the following: (a) the adoption or taking effect or implementation of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, each Specified Regulation shall be deemed to be a “Regulatory Change”, regardless of the date enacted, adopted, implemented or issued.

“ Reinvestment ” is defined in Section 1.3(a)(ii) .

“ Related Assets ” means (a) all rights to, but not any obligations under, all Related Security with respect to the Pool Assets, (b) all Records (but excluding any obligations under the Receivable Documentation and Loan Documents), (c) all Collections in respect of, and other proceeds of, the Pool Assets or any other Related Security, (d) all rights and remedies of Seller or any Originator, as applicable, under the Sale Agreement, and the other Transaction Documents and any other rights or assets pledged, sold or otherwise transferred to Seller thereunder and (e) all the products and proceeds of any of the foregoing.

“ Related Security ” means, with respect to any Asset:

(i) all of Seller’s or any Originator’s, as applicable, interest in any goods (including returned goods) and documentation of title evidencing the shipment or storage of any goods (including returned goods), relating to any sale giving rise to such Asset;

(ii) all instruments and chattel paper that may evidence such Asset;

(iii) all security interests or liens and property subject thereto from time to time purporting to secure payment of such Asset, whether pursuant to the Receivable Documentation related to such Receivable, the Loan Documents related to such Loan or otherwise, together with all financing statements describing any collateral securing such Asset;

(iv) all tax refunds and the insurance policies, if any, relating to such Asset including the right to terminate such policies and to receive unearned premiums payable upon such termination, and rights to loss payments under such insurance policies;

(v) the Receivable Documentation, the Loan Documents and all guaranties, letters of credit, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Asset whether pursuant to the Receivable Documentation related to such Receivable, the Loan Documents related to such Loan or otherwise;

Appendix 27

(vi) all of Seller’s or any Originator’s, as applicable, rights, interests and claims under the Transaction Documents, the Loan Documents and the Receivable Documentation with respect to such Asset;

(vii) all books, records and other information (including computer programs, tapes, discs, punch cards, data processing software and related property and rights) relating to such Asset and the related Account Debtor or Obligor; and

(viii) all proceeds of, and payments or collections on, under or in respect of, any of the foregoing.

“ Reportable Event ” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30‑day notice period has been waived by the PBGC.

“ Reporting Date ” is defined in Section 3.1(a) .

“ Repurchase Payments ” means payments of the repurchase price for Pool Assets under Section 3.2(b) .

“ Required Loan Reserves ” means, for any day, an amount equal to the product of (a) the sum of (i) the greater of (A) the Floor Reserve Percentage (Loans) at such time and (B) the Dynamic Reserve Percentage (Loans) at such time, plus (ii) the Adjusted Loan Yield and Servicing Fee Reserve Percentage multiplied by (b) the Net Loan Pool Balance at such time.

“ Required Purchasers ” means, at any time, two or more Committed Purchasers whose Commitments at such time aggregate more than 66 2/3% of the Purchasers’ Total Commitment at such time (or, if at such time, the Purchasers’ Total Commitment is zero, two or more Committed Purchasers whose Purchaser Group’s Purchaser Group Investment at such time aggregate more than 66 2/3% of the Total Investment at such time); provided that if at any time there is only one Committed Purchaser, Required Purchasers shall mean such Committed Purchaser.

“ Required Receivable Reserves ” means, for any day, an amount equal to the product of (a) the sum of (i) the greater of (A) the sum of (1) the Dynamic Dilution Reserve Percentage (Receivables) at such time, plus (2) the Dynamic Loss Reserve Percentage (Receivables) at such time, and (B) the sum of (1) the Dilution Reserve Floor Percentage at such time, plus (2) the Loss Reserve Floor Percentage (Receivables) at such time, and (ii) the Yield and Servicing Fee Reserve Percentage (Receivables) multiplied by (b) the Net Receivables Pool Balance at such time.

“ Required Reserves ” means, for any day, an amount equal to the sum of (a) the Required Receivable Reserves plus (b) the Required Loan Reserves.

“ Responsible Officer ” means the chief executive officer, the chief financial officer, the general counsel, the president, the treasurer or an assistant treasurer of CHS, and any other officer, similar official or employee of CHS responsible for the administration of the obligations of CHS in respect of this Agreement, including any person referenced in Schedule 13.2 of this Agreement with respect to Seller or the Servicer, or any replacement of such person.

“ Risk Rating ” shall mean the score or classification, as determined for each Loan in accordance with the Credit and Collection Policy.

“ S&P ” means S&P Global Ratings, a Standard & Poor’s Financial Services LLC business, and any successor thereto.

Appendix 28

“ Sale Agreement ” means the Sale and Contribution Agreement, dated as of the Closing Date, among Originators, as sellers, and Seller, as buyer.

“ Sanctioned Country ” means, at any time, a country or territory which is the subject or target of any Sanctions, including as of the Closing Date, Cuba, Crimea (Ukraine), Iran, Syria and North Korea.

“ Sanctioned Person ” means, at any time, (a) any Person currently the subject or the target of any Sanctions, including any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“ OFAC ”) (or any successor thereto) or the U.S. Department of State, or as otherwise published from time to time; (b) that is fifty-percent or more owned, directly or indirectly, in the aggregate by one or more Persons described in clause (a) above; (c) that is operating, organized or resident in a Sanctioned Country; (d) with whom engaging in trade, business or other activities is otherwise prohibited or restricted by Sanctions; or (e) (i) an agency of the government of a Sanctioned Country, (ii) an organization controlled by a Sanctioned Country, or (iii) a Person resident in a Sanctioned Country, to the extent subject to a sanctions program administered by OFAC.

“ Sanctions ” means the laws, rules, regulations and executive orders promulgated or administered to implement economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time (a) by the United States government, including those administered by OFAC, the US State Department, the US Department of Commerce (b) by the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom or (c) by other relevant sanctions authorities to the extent compliance with the sanctions imposed by such other authorities would not entail a violation of Applicable Law.

“ SEC ” means the Securities and Exchange Commission or any successor governmental authority.

“ Securities Act ” means the Securities Act of 1933, as amended or otherwise modified from time to time.

“ Security ” is defined in Section 2(a)(1) of the Securities Act.

“ Seller ” is defined in the preamble .

“ Seller Account Agreement ” means that certain Deposit Account Control Agreement, dated as of the Closing Date, among the Seller, an Account Bank and the Administrative Agent.

“ Seller Assets ” is defined in Section 9.1 .

“ Seller Collection Accounts ” means the accounts specified as such in Exhibit B , each of which shall be maintained at an Account Bank in the name of Seller.

“ Servicer ” is defined in Section 8.1(a) .

“ Servicer Termination Event ” means the occurrence of (i) a Material Adverse Change after the Effective Date with respect to Servicer, (ii) an Insolvency Event with respect to Servicer or (iii) an Event of Default.

“ Servicing Fee ” means the fee for each Settlement Period equal, for each day of such Settlement Period to, the Servicing Fee Rate multiplied by the aggregate Unpaid Balance of all Pool Assets as of the Cut-Off Date of such Settlement Period, multiplied by 1/360, payable in arrears.

Appendix 29

“ Servicing Fee Rate ” means 0.25% per annum.

“ Settlement Date ” means, with respect to any Settlement Period, the third (3 ^rd ) Business Day following the Reporting Date for such Settlement Period; provided that the last Settlement Date shall be the last day of the last Settlement Period.

“ Settlement Period ” means:

(a) the period from the Closing Date to the end of the next calendar month thereafter; and

(b) thereafter, each subsequent calendar month;

provided that the last Settlement Period shall end on the Final Payout Date; provided further that when used with respect to any period prior to the Closing Date, “Settlement Period” shall mean each calendar month.

“ Solvent ” means, with respect to any Person and as of any particular date, (i) the present fair market value (or present fair saleable value) of the assets of such Person is not less than the total amount required to pay the probable liabilities of such Person on its total existing debts and liabilities (including contingent liabilities) as they become absolute and matured, (ii) such Person is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature and become due in the normal course of business, (iii) such Person’s debts or liabilities are not beyond its ability to pay such debts and liabilities as they mature and (iv) such Person is not engaged in any business or transaction, and is not about to engage in any business or transaction, for which its property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged. The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual and matured liability.

“ Specified Regulation ” means (A) the final rule titled Risk-Based Capital Guidelines; Capital Adequacy Guidelines; Capital Maintenance: Regulatory Capital; Impact of Modifications to Generally Accepted Accounting Principles; Consolidation of Asset-Backed Commercial Paper Programs; and Other Related Issues , adopted by the United States bank regulatory agencies on December 15, 2009 (the “ FAS 166/167 Capital Guidelines ”), (B) the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and all requests, rules, guidelines or directives thereunder or issued in connection therewith (the “ Dodd-Frank Act ”), (C) all requests, rules, guidelines and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities relating to (i) the July 1988 paper or the June 2006 paper prepared by the Basel Committee on Banking Supervision (“ Basel Committee ”) as set out in the publication entitled: “International Convergence of Capital Measurements and Capital Standards: a Revised Framework”, as updated from time to time, or any rules, regulations, guidance, interpretations or directives promulgated or issued in connection therewith by any bank regulatory agency (whether or not having the force of law) (“ Basel II ”) or (ii) the paper prepared by the Basel Committee as set out in the publication entitled “Basel III: A global regulatory framework for more resilient banks and banking systems”, as updated from time to time, or any rules, regulations, guidance, interpretations or directives promulgated or issued in connection therewith by any bank regulatory agency (whether or not having the force of law) (“ Basel III ” and together with Basel II, the “ Basel Accord ”) and (D) any existing or future rules, regulations, guidance, interpretations or directives from any Governmental Authority relating to Accounting Standards Codification 860-10-40-5(a), the FAS 166/167 Capital Guidelines, the Dodd-Frank Act or the BASEL Accord (whether or not having the force of law) or any rules or regulations promulgated in connection therewith by any United Stated bank regulatory agency.

Appendix 30

“ Stressed Realizable Value ” means, with respect to any Loan, the value of all Related Security with respect thereto as calculated by the Servicer in accordance with the Credit and Collection Policy using the Obligor’s most recent monthly financial statements received by the Servicer.

“ Subordinated Note ” has the meaning set forth in the Sale Agreement.

“ Subordinated Note Financiers ” means each of: MUFG Bank, Ltd., as buyer and buyer agent, each other financial institution from time to time party to any Subordinated Note Financing Document, as buyer, and any of their respective Affiliates that is a party to any Subordinated Note Financing Document.

“ Subordinated Note Financing ” means any transaction or series of transactions that may be entered into by one or more Originators and the Subordinated Note Financiers pursuant to which one or more Originators may (a) sell, transfer, assign or convey one or more Subordinated Notes to the Subordinated Note Financiers and/or (b) grant a security interest in one or more Subordinated Notes to the Subordinated Note Financiers.

“ Subordinated Note Financing Document ” means each purchase agreement, sale agreement, credit agreement, loan agreement, repurchase agreement, security agreement and/or other financing agreement entered into from time to time between the Subordinated Note Financiers and one or more Originators in connection with a Subordinated Note Financing, in each case, as amended, restated, supplemented or otherwise modified from time to time.

“ Subsidiary ” means, with respect to any Person, any corporation, partnership, limited liability company, association or other business entity of which (i) if a corporation, more than 50% of the total voting power of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled by that Person either directly or through one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a partnership, limited liability company, association or business entity other than a corporation, more than 50% of the partnership or other similar ownership interests thereof is at the time owned or controlled by that Person either directly or through one or more of the other Subsidiaries of that Person or a combination thereof.

“ Substandard ” means, with respect to any Loan, one which has a Risk Rating of “adverse” and is classified as Doubtful or Loss in accordance with the Credit and Collection Policy.

“ Successor Notice ” is defined in Section 8.1(b) .

“ Syndicated CHS Loan ” means any advance by an Originator to an Obligor under a syndicated loan facility in which such Originator participates as a member of the lender group but is not the originating lender or facility or administrative agent.

“ Taxes ” means all income, gross receipts, rental, franchise, excise, stamp, occupational, capital, value added, sales, use, ad valorem (real and personal), property (real and personal) and taxes, fees, levies, imposts, charges or withholdings of any nature whatsoever, together with any assessments, penalties, fines, additions to tax and interest thereon, howsoever imposed, by any Governmental Authority or other taxing authority in the United States or by any foreign government, foreign governmental subdivision or other foreign or international taxing authority.

“ Term Loan ” means any Loan which is not an Operating Loan used for the purpose of purchasing fixed assets, expansion, remodeling, or building working capital.

Appendix 31

“ Total Investment ” means, at any time with respect to the Asset Interest, an amount equal to (a) the aggregate of the amounts theretofore paid to Seller as the Purchase Price pursuant to Section 1.1 less (b) the aggregate amount of Collections theretofore received and actually distributed to the Purchasers, and not reinvested as a Reinvestment, on account of each Purchaser Group’s aggregate Purchaser Group Investment pursuant to Section 1.3 (and not rescinded or otherwise returned or reinvested pursuant to Section 1.3 ).

“ Tranche Investment ” means in relation to any Rate Tranche and any Purchaser Group the amount of such Purchaser Group’s Purchaser Group Investment allocated by the related Purchaser Agent to such Rate Tranche pursuant to Section 2.1 ; provided that at all times the aggregate amounts allocated to all Rate Tranches of all Purchaser Groups shall equal the Total Investment; provided , further , that at all times the aggregate amounts allocated to all Rate Tranches of any Purchaser Group shall equal the aggregate Purchaser Group Investment of such Purchaser Group.

“ Transaction Documents ” means this Agreement, the Sale Agreement, the Performance Guaranty, the No Petition Agreement, the Fee Letter, the Custodian Agreement, the Account Agreements, the Effective Date Amendments, each Notice of Purchase, Seller’s limited liability company agreement, the Payoff Letter, and all other documents, agreements and certificates to be executed and delivered in connection herewith or in connection with any of the foregoing as to which Seller, Servicer, CHS, the Performance Guarantor, any Originator or any of their Affiliates is a party. For the avoidance of doubt, no Subordinated Note Financing Document (other than the No Petition Agreement) shall constitute a Transaction Document hereunder.

“ Transaction Information ” shall mean any information provided to any Rating Agency, in each case, to the extent related to such Rating Agency providing or proposing to provide a rating of any Commercial Paper Notes or monitoring such rating including, without limitation, information in connection with the Seller, any Originator, the Servicer or the Pool Assets.

“ UCC ” means, in respect of each state in the United States of America, the Uniform Commercial Code as from time to time in effect in such state.

“ Unmatured Event of Default ” means any event which, with the giving of notice or lapse of time, or both, would, unless cured or waived, become an Event of Default.

“ Unmatured Servicer Termination Event ” means any event which, with the giving of notice or lapse of time, or both, would, unless cured or waived, become a Servicer Termination Event.

“ Unpaid Balance ” of (i) any Receivable means, at any time, the sum of (a) the unpaid amount thereof, plus (b) the unpaid amount of all finance charges, interest payments and other amounts actually accrued thereon at such time, but excluding, in the case of clause (b) above, all late payment charges, delinquency charges, and extension or collection fees and (ii) any Loan means, at any time, the outstanding principal balance thereof, excluding any accrued and outstanding finance charges and interest payments related thereto; provided that, for the avoidance of doubt, the Unpaid Balance of each Participation Loan shall only include the outstanding principal balance owed to the applicable Originator under such Participation Loan and not the outstanding principal balance owed to any other lender under such Participation Loan.

“ Unpaid Balance to Stressed Realizable Value ” means, with respect to any Obligor, the ratio of (i) the Obligor’s combined Unpaid Balances to (ii) the related Stressed Realizable Value.

“ Unused Fee ” is defined in the Fee Letter.

“ U.S. Person ” is defined in Section 3.3(e)(vi) .

Appendix 32

“ U.S. Tax Compliance Certificate ” is defined in Section 3.3(e)(vii)(3) .

“ USD ” means United States Dollars, the lawful currency of the United States of America.

“ Victory ” means Victory Receivables Corporation, a Delaware corporation.

“ Volcker Rule ” means Section 13 of the U.S. Bank Holding Company Act of 1956, as amended, and the applicable rules and regulations thereunder.

“ Voting Interest ” shall mean membership or other ownership interests in CHS whose holders are entitled under ordinary circumstances to vote for the election of the directors of CHS or persons performing similar functions (irrespective of whether at the time membership or other ownership interests of any other class or classes shall have or might have voting power by reasoning of the happening of any contingency).

“ Weighted Average Interest Rate ” means, for each Settlement Period (determined as of the last day of each calendar month), the sum, for all Loans, of the amount determined in respect of each Loan by multiplying (i) a fraction, the numerator of which is the Unpaid Balance of such Loan and the denominator of which is the Unpaid Balance of all Loans, multiplied by (ii) the applicable interest rate for such Loan.

“ Weighted Average Life ” means, for each Settlement Period (determined as of the last day of each calendar month), the sum, for the Pool Receivables or Pool Loans (calculated separately), of the amount determined in respect of each Receivable or Loan by multiplying (i) a fraction, the numerator of which is the Unpaid Balance of such Receivable or Loan and the denominator of which is the Unpaid Balance of all Receivables or Loans (as applicable), multiplied by (ii) the remaining term to maturity of such Receivable or Loan, expressed in years.

“ Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

“ Yield ” means, for any day with respect to any Rate Tranche:



{(PTI x YR)/360} + LF
where :
YR	=	the Yield Rate for such Rate Tranche;
PTI	=	Purchaser’s Tranche Investment in such Rate Tranche on such day; and
LF	=	the Liquidation Fee, if any, for such day.

“ Yield and Servicing Fee Reserve Percentage (Receivables) ” means, on any day, a percentage determined as follows:

((YRxSF)+SFR + PR) x {( DSO)/360}

where :


YR	= the weighted average Yield Rate for the prior Settlement Period;


SFR	= the Servicing Fee Rate;


PR	= the Program Fee Rate;

Appendix 33


SF	= 1.5; and


DSO	= the Days Sales Outstanding on such day.

“ Yield Period ” means (x) with respect to any Rate Tranche that is funded or maintained other than through the issuance of Commercial Paper Notes:

(a) the period commencing on the date of the initial Purchase of the Asset Interest, the making of such Liquidity Advance or funding under such Enhancement Agreement or the creation of such Rate Tranche pursuant to Section 2.1 (whichever is latest) and ending such number of days thereafter as the applicable Purchaser Agent shall select in its sole discretion; and

(b) each period commencing on the last day of the immediately preceding Yield Period for the related Rate Tranche and ending such number of days thereafter as the applicable Purchaser Agent shall select in its sole discretion;

provided , that:

(i) any such Yield Period (other than a Yield Period consisting of one day) which would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day;

(ii) in the case of Yield Periods of one day for any Rate Tranche, (A) the initial Yield Period shall be the date such Yield Period commences as described in clause (a) above; and (B) any subsequently occurring Yield Period which is one day shall, if the immediately preceding Yield Period is more than one day, be the last day of such immediately preceding Yield Period, and if the immediately preceding Yield Period is one day, shall be the next day following such immediately preceding Yield Period; and

(iii) in the case of any Yield Period for any Rate Tranche which commences before the Purchase Termination Date and would otherwise end on a date occurring after the Purchase Termination Date, such Yield Period shall end on the Purchase Termination Date and the duration of each such Yield Period which commences on or after the Purchase Termination Date for such Rate Tranche shall be of such duration as shall be selected by the applicable Purchaser Agent; and

(y) with respect to any Rate Tranche that is funded or maintained through the issuance of Commercial Paper Notes, each Settlement Period.

“ Yield Rate ” means for any Rate Tranche on any day:

(a) in the case of a Rate Tranche funded by Commercial Paper Notes, the applicable CP Rate; and

(b) in the case of a Rate Tranche not funded by Commercial Paper Notes, the applicable Bank Rate for such Rate Tranche;

provided , that:

(i) on any day as to any Rate Tranche which is not funded by Commercial Paper Notes, the Yield Rate shall equal the applicable Base Rate if (A) Administrative Agent does not receive notice or determine, by 12:00 noon (New York City time) on the third Business Day prior to the first day of the related Yield Period, that such Rate Tranche shall not be funded by Commercial Paper Notes or (B) Administrative Agent or Purchaser Agent determines that (I) funding that Rate Tranche on a basis consistent with pricing based on

Appendix 34

the applicable Bank Rate would violate any Applicable Law or (II) that deposits of a type and maturity appropriate to match fund such Rate Tranche based on the applicable Bank Rate are not available; and

(ii) on any day when any Event of Default shall have occurred that has not been waived in accordance with this Agreement or the Purchase Termination Date has occurred by virtue of clause (b) of the definition thereof, the applicable Yield Rate for each Rate Tranche means a rate per annum equal to the higher of (A) the applicable Bank Rate, plus 2.5% per annum and (B) the applicable Prime Rate for such date.

B. Other Interpretive Matters.

All accounting terms defined directly or by incorporation in this Agreement or the Sale Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant thereto unless otherwise defined therein. For purposes of this Agreement, the Sale Agreement and all such certificates and other documents, unless the context otherwise requires: (a) except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; (b) terms defined in Article 9 of the UCC and not otherwise defined in such agreement are used as defined in such Article; (c) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (d) the words “hereof,” “herein” and “hereunder” and words of similar import refer to such agreement (or the certificate or other document in which they are used) as a whole and not to any particular provision of such agreement (or such certificate or document); (e) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to such agreement (or the certificate or other document in which the reference is made), and references to any paragraph, subsection, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (f) the term “including” means “including without limitation”; (g) references to any Applicable Law refer to that Applicable Law as amended from time to time and include any successor Applicable Law; (h) references to any agreement refer to that agreement as from time to time amended, restated, extended or supplemented or as the terms of such agreement are waived or modified in accordance with its terms; (i) references to any Person include that Person’s permitted successors and assigns; (j) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof; (k) unless otherwise provided, in the calculation of time from a specified date to a later specified date, the term “from” means “from and including”, and the terms “to” and “until” each means “to but excluding”; (l) if any calculation to be made hereunder refers to a Settlement Period (or any portion thereof) that would have occurred prior to the Closing Date, such reference shall be deemed to be a reference to a calendar month; and (m) terms in one gender include the parallel terms in the neuter and opposite gender.

Appendix 35

SCHEDULE I

PAYMENT INSTRUCTIONS

With respect to MUFG:

Bank:            MUFG Bank, Ltd.
ABA #:         026-009-632
Account #:         -----------
Account Name:     VRC
Customer Name:     Cofina Funding LLC

With respect to Rabobank:

Bank:             JPMorgan Chase Bank, N.A.
Swift Address:     CHASUS33
ABA #:         021-000-021
Account #:         ----------
FAO:             Rabobank International, New York Branch
Reference:         Cofina Funding, LLC

With respect to Nieuw Amsterdam Receivables Corporation B.V.:

Bank:             Deutsche Bank Trust Company Americas
ABA #:         021-001-033
Account #:         ----------
Account Name:     NYLTD Funds Control Account
Reference:         PORT RABO09.1 // NieuwAm // Cofina Funding LLC

Schedule II

SCHEDULE 13.2

ADDRESSES FOR NOTICES

If to Seller:

Cofina Funding, LLC

5500 Cenex Drive
St. Paul, Minnesota 55077
Attention: Eric Born
Tel: 651-355-5479

Fax: 651-355-4917

Email: eric.born@chsinc.com

If to Servicer

CHS Inc.

5500 Cenex Drive
St. Paul, Minnesota 55077
Attention: Brent Dickson
Tel: 651-355-5433

Fax: 800-232-3639

Email: brent.dickson@chsinc.com

If to MUFG Bank, Ltd.:

MUFG Bank, Ltd.
1221 Avenue of the Americas
New York, NY 10020
Attn: Securitization Group
Tel: 212-782-6957
Fax: 212-782-6448
Email: securitization_reporting@us.mufg.jp

If to Victory Receivables Corporation:

Victory Receivables Corporation
c/o Global Securitization Services, LLC
68 South Service Road, Suite 120
Melville, NY 11747
Attn:David V. DeAngelis
Tel: 631-930-7216
Fax:212-302-8767
Email: ddeangelis@gssnyc.com

Schedule 13.2-1

If to Nieuw Amsterdam Receivables Corporation B.V.:

Prins Bernhardplein 200

1097 JB Amsterdam

The Netherlands

Attention: The Directors

Email: secuitisation@intertrustgroup.com

Facsimile No.: +31 ( 0)20 5214888

With a Copy to:

Coöperatieve Rabobank U.A. (New York Branch)
245 Park Avenue

New York, NY 10167
Attn: NYSG
Tel: 212-8-08-6816
Fax: (914) 304-9324
Email: naconduit@rabobank.com

If to Coöperatieve Rabobank U.A.:

Coöperatieve Rabobank U.A.

Coreselaan 18

3521 CB Utrecht

The Netherlands

With a Copy to:

Coöperatieve Rabobank U.A., New York Branch
245 Park Avenue

New York, NY 10167
Attn: NYSG
Tel: 212-8-08-6816
Fax: (914) 304-9324
Email: naconduit@rabobank.com

If to Coöperatieve Rabobank U.A., New York Branch:

Coöperatieve Rabobank U.A., New York Branch
245 Park Avenue

New York, NY 10167
Attn: NYSG
Tel: 212-8-08-6816
Fax: (914) 304-9324
Email: naconduit@rabobank.com

Schedule 13.2-2

EXHIBIT A

CREDIT AND COLLECTION POLICY

(attached)

Exhibit A-1

Exhibit B

Collection Accounts

1. CHS Inc. Owned Accounts :


•	Collection Account for Energy & CN A/R:

Bank: Wells Fargo Bank, N.A.

Address: 420 Montgomery

San Francisco, CA 94104

Routing number: 121000248

Account name: CHS Inc.

Account number: ----------


•	Lockboxes for Energy & CN A/R:

Lockbox Number: ----

Lockbox Site Code: SP

Address: CHS

NW5912

PO Box 1450

Minneapolis, MN 55485-5912

Lockbox Number: ----

Lockbox Site Code: SP

Address: CHS

NW9087

PO Box 1450

Minneapolis, MN 55485-9087

2. CHS Capital, LLC Owned Accounts :


•	Collection Account for CHS Capital, LLC Loans:

Bank: Merchants Bank

Address: 102 E 3 ^rd St, Winona, MN 55987

Routing number: 091900193

Account number: ----------

3. Cofina Funding, LLC Owned Accounts:


•	Collection Account for Cofina Funding, LLC:

Bank: BMO Harris Bank

Address: 320 E Lake St. Minneapolis, MN 55408

Routing number: 071000288

Exhibit B-1

Account number: ----------


•	Concentration Account

Bank: BMO Harris Bank, N.A.

Address: 320 E Lake St. Minneapolis, MN 55408

Routing number: 071000288

Account number: ----------

Exhibit B-2

Exhibit C

Purchaser Groups



Purchaser Group: MUFG Purchaser Group Conduit Purchaser: Victory Receivables Corporation Committed Purchaser: MUFG Bank, Ltd. Purchaser Agent: MUFG Bank, Ltd.	Purchaser Group Commitment: $350,000,000
Purchaser Group: Rabobank Purchaser Group Conduit Purchaser: Nieuw Amsterdam Receivables Corporation B.V. Committed Purchaser: Coöperatieve Rabobank U.A. Purchaser Agent: Coöperatieve Rabobank U.A., New York Branch	Purchaser Group Commitment: $350,000,000
	Purchasers’ Total Commitment: $700,000,000

Exhibit C-1

Exhibit D

Form of Loan Documents

On file with the Administrative Agent

Exhibit D-1

Exhibit E

Form of Notice of Purchase

[Date of Notice of Purchase]

MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as Administrative Agent and Purchaser Agent for the MUFG Purchaser Group

1221 Avenue of the Americas

New York, NY 10020

Attn: Securitization Group

Tel: 212-782-6957

Fax: 212-782-6448

Email: securitization_reporting@us.mufg.jp

Coöperatieve Rabobank U.A., New York Branch, as Purchaser Agent for the Rabobank Purchaser Group

245 Park Avenue

New York, NY 10167
Attn: NYSG
Tel: 212-8-08-6816
Fax: (914) 304-9324
Email: naconduit@rabobank.com

Ladies and Gentlemen:

Reference is made to the Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 (and as further amended, supplemented or otherwise modified from time to time, the “ Receivables Purchase Agreement ”) between, amongst others, Cofina Funding, LLC (the “ Seller ”), CHS Inc., as servicer (the “ Servicer ”), each Person from time to time party thereto as a Purchaser and/or a Purchaser Agent and MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as Administrative Agent. Capitalized terms defined in the Receivables Purchase Agreement are used herein with the same meanings.

Pursuant to Section 1.2(a) of the Receivables Purchase Agreement, the Seller (or the Servicer on its behalf) hereby requests that the Purchasers make a ratable Purchase as follows:


1.	The date of the Purchase is __________________ (the “ Purchase Date ”). ¹


2.	The requested Purchase Price for the Purchase is $__________________.


3.	The amount of the Purchase is to be allocated to each Purchaser Group in accordance with each Purchaser Group’s Ratable Share of the Purchase.

____________________

¹ This date must be a Business Day, and the related Notice of Purchase must be delivered no later than 11:00 a.m. (New York City time) on the second (2 ^nd ) Business Day preceding this date.

Exhibit E-1

The Seller hereby certifies, represents and warrants to the Administrative Agent and each Purchaser Agent that on and as of the Purchase Date:


(a)	Attached as Exhibit A hereto is a pro forma Information Package after giving effect to the Purchase and any other Purchase proposed to be made on the Purchase Date;

(b)

each of the representations and warranties contained in Article VI of the Receivables Purchase Agreement, in the Sale Agreement and in each other Transaction Document that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects, in each case, on and as of such day as though made on and as of the Purchase Date (except to the extent such representations and warranties explicitly refer solely to an earlier date or period, in which case they shall be true and correct as of such earlier date or period);


(c)	no event has occurred and is continuing or would result from the Purchase and any other Purchase proposed to be made on the Purchase Date, that constitutes an Event of Default, an Unmatured Event of Default, a Servicer Termination Event or an Unmatured Servicer Termination Event;

(d)

after giving effect to the Purchase and any other Purchase proposed to be made on the Purchase Date, (i) with respect to any Purchaser Group, such Purchaser Group’s Purchaser Group Investment will not exceed such Purchaser Group’s Purchaser Group Commitment, (ii) the Total Investment will not exceed the Purchasers’ Total Commitment, and (iii) the Total Investment will not exceed the sum of the Receivables Investment Base and the Loan Investment Base; and


(e)	the Purchase Termination Date has not occurred.

Exhibit E-2

IN WITNESS WHEREOF, the Seller has caused this Notice of Purchase to be executed and delivered as of this ____ day of _______________, _____.

COFINA FUNDING, LLC , as Seller

By:
Name:
Title:

Exhibit E-3

Exhibit F

Form of Notice of Payment

[Date of Notice of Payment]

MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as Administrative Agent and Purchaser Agent for the MUFG Purchaser Group

1221 Avenue of the Americas

New York, NY 10020

Attn: Securitization Group

Tel: 212-782-6957

Fax: 212-782-6448

Email: securitization_reporting@us.mufg.jp

Coöperatieve Rabobank U.A., New York Branch, as Purchaser Agent for the Rabobank Purchaser Group

245 Park Avenue

New York, NY 10167
Attn: NYSG
Tel: 212-8-08-6816
Fax: (914) 304-9324
Email: naconduit@rabobank.com

Ladies and Gentlemen:

Pursuant to [Section 3.1(d)(vi)][Section 3.2(c)][Section 3.2(e)] of the Receivables Purchase Agreement, the Seller (or the Servicer on its behalf) hereby notifies the Administrative Agent and each Purchaser Agent that it will make payments to the reduction of the Obligations in the aggregate principal amount of $________________ on [date].

Exhibit F- 1

IN WITNESS WHEREOF, the Seller has caused this Notice of Payment to be executed and delivered as of this ____ day of _______________, _____.

COFINA FUNDING, LLC , as Seller

By:
Name:
Title:

Exhibit F- 2

EXHIBIT 3.1(a)

FORM OF INFORMATION PACKAGE

See Attached

Exhibit 13.1(a)

SALE AND CONTRIBUTION AGREEMENT

dated as of July 22, 2016

and

as amended by Omnibus Amendment No. 1 dated as of February 14, 2017, Omnibus Amendment No. 2 dated as of July 18, 2017 and Omnibus Amendment No. 3 dated as of September 4, 2018

among

CHS INC. and

CHS CAPITAL, LLC,

as Originators

and

COFINA FUNDING, LLC,

as the Company

TABLE OF CONTENTS



		Page
ARTICLE I	DEFINITIONS AND RELATED MATTERS	1
SECTION 1.1	Defined Terms	1
SECTION 1.2	Other Interpretive Matters	2
ARTICLE II	AGREEMENT TO PURCHASE, SELL AND CONTRIBUTE	3
SECTION 2.1	Purchase, Sale and Contribution	3
SECTION 2.2	Timing of Purchases	3
SECTION 2.3	Purchase Price	4
SECTION 2.4	Addition Date	5
SECTION 2.5	Deliveries	5
SECTION 2.6	No Recourse or Assumption of Obligations	5
ARTICLE III	ADMINISTRATION AND COLLECTION	6
SECTION 3.1	Deemed Collections	6
SECTION 3.2	Actions Evidencing Purchases	6
SECTION 3.3	Repurchase Events	6
ARTICLE IV	REPRESENTATIONS AND WARRANTIES	7
SECTION 4.1	Representations and Warranties	7
ARTICLE V	GENERAL COVENANTS	11
SECTION 5.1	Originator Covenants	11
SECTION 5.2	Reporting Requirements	15
ARTICLE VI	TERMINATION OF PURCHASES	16
SECTION 6.1	Automatic Termination	16
ARTICLE VII	INDEMNIFICATION	16
SECTION 7.1	Originators’ Indemnity	16
SECTION 7.2	Tax Indemnification	18
SECTION 7.3	Contribution	18
ARTICLE VIII	MISCELLANEOUS	18
SECTION 8.1	Amendments, etc	18

- i -

Table of Contents

(continued)



		Page
SECTION 8.2	No Waiver; Remedies	19
SECTION 8.3	Notices, Etc	19
SECTION 8.4	Binding Effect; Assignment	19
SECTION 8.5	Survival	19
SECTION 8.6	Expenses	20
SECTION 8.7	Execution; Counterparts	20
SECTION 8.8	Governing Law	20
SECTION 8.9	Waiver of Jury Trial	20
SECTION 8.10	CONSENT TO JURISDICTION	21
SECTION 8.11	WAIVER OF IMMUNITIES	21
SECTION 8.12	Captions and Cross References	21
SECTION 8.13	No Party Deemed Drafter	21
SECTION 8.14	Calculation of Interest	21
SECTION 8.15	No Non-Direct Damages	21
SECTION 8.16	No Proceedings	22
SECTION 8.17	Grant of Security Interest	22
SECTION 8.18	Severability	22
SECTION 8.19	Confidentiality	22
SECTION 8.20	Waiver of Setoff	22

ANNEX 1 UCC Details Schedule

ANNEX 2 Notice Information

ANNEX 3 Designated Loan Agreements

SCHEDULE 1 Form of Purchase Notice

SCHEDULE 2 Form of Subordinated Note

- ii -

SALE AND CONTRIBUTION AGREEMENT

THIS SALE AND CONTRIBUTION AGREEMENT, dated as of July 22, 2016, as amended as of February 14, 2017, as of July 18, 2017 and as of September 4, 2018 (this “ Agreement ”), is among CHS INc., a Minnesota corporation (“ CHS ”), as an originator, CHS CAPITAL, LLC (“ CHS Capital ”), a Minnesota limited liability company, as an originator (CHS and CHS Capital are referred to herein, individually, as an “ Originator ” and, collectively, as the “ Originators ”), and COFINA FUNDING, LLC, a Delaware limited liability company (the “ Company ”).

For good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS AND RELATED MATTERS

SECTION 1.1 Defined Terms . In this Agreement, unless otherwise specified: (a) capitalized terms used but not defined herein shall have the meanings specified in the Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 (as amended, restated, modified or otherwise supplemented from time to time, the “ Receivables Purchase Agreement ”) among the Company, as Seller, CHS, individually and as Servicer, the various Conduit Purchasers, Committed Purchasers, and Purchaser Agents from time to time party thereto, and MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as Administrative Agent (the “ Administrative Agent ”) and (b) the following terms have the meanings indicated below:

“ Addition Date ” shall have the meaning set forth in Section 2.4 .

“ Additional Designated Loan Agreement ” means a loan facility designated by the Seller for addition to Schedule 1 after the Closing Date.

“ CRR ” means the European Union Capital Requirements Regulation (Regulation (EU) No. 575/2013) and any related guidelines and regulatory technical standards or implementing technical standards published by the European Banking Authority and adopted by the European Commission.

“ CRR Requirements ” shall have the meaning set forth in Section 5.1(r) .

“ Designated Loan Agreements ” means (i) the Initial Designated Loan Agreements and (ii) from and after the applicable Addition Date with respect thereto, each Additional Designated Loan Agreement.

“ Discount Factor ” means a percentage calculated to provide the Company with a reasonable return on its investment in the Pool Assets after taking account of (i) the time value of money based upon the anticipated dates of collection of such Assets and the cost to the Company of financing its investment in such Assets during such period and (ii) the risk of nonpayment by the Account Debtors or Obligors. The Originators and the Company may agree from time to time to change the Discount Factor based on changes in one or more of the items affecting the calculation thereof; provided that any change to the Discount Factor shall apply only prospectively. As of the date hereof, the Discount Factor is 1%.

“ Indemnified Amounts ” shall have the meaning set forth in Section 7.1 .

“ Initial Designated Loan Agreements ” means the loan facilities identified on Annex 3 on the date hereof.



	1

“ Net Worth ” means, as of the last Business Day of each Collection Period preceding any date of determination, the excess, if any, of (a) the aggregate Unpaid Balance of the Pool Assets at such time and any cash then held by the Company, over (b) the sum of (i) the Total Investment at such time, plus (ii) the aggregate outstanding principal balance of the Subordinated Loans (including any Subordinated Loan proposed to be made on the date of determination) and (iii) any other outstanding amounts owed by the Seller to any Person (including, for the avoidance of doubt, any other outstanding amounts owed by the Seller under the Receivables Purchase Agreement).

“ Originator Indemnified Party ” shall have the meaning set forth in Section 7.1 .

“ Prior Transaction Taxes ” shall have the meaning set forth in Section 7.2 .

“ Purchase ” means each purchase by the Company from an Originator of the Assets and Related Assets pursuant to Section 2.1 .

“ Purchase Notice ” is defined in Section 2.2 .

“ Purchase Price ” means, with respect to each Purchase from an Originator on a Sale Date, the aggregate price to be paid by the Company to such Originator for such Purchase in accordance with Section 2.3 for the Assets being sold to the Company, which price shall equal on any date (i) the product of (x) the Unpaid Balance of such Asset on such date, multiplied by (y) one minus the Discount Factor in effect on such date, minus (ii) any amounts payable in accordance with Section 3.1 or Section 3.3 .

“ Required Capital Amount ” means an amount equal to $16,000.

“ Retained Interest ” means a material net economic interest of not less than five percent (5%) of the aggregate Unpaid Balance of all Pool Assets in accordance with the text of the CRR.

“ Sale Agreement Event of Repurchase ” is defined in Section 3.3 .

“ Sale Date ” means each date that an Originator sells or contributes (or purportedly sells or contributes) Receivables or Loans to the Company hereunder determined in accordance with Section 2.2 .

“ Sale Transaction Taxes ” shall have the meaning set forth in Section 7.2 .

“ Second Amendment Effective Date ” means July 18, 2017.

“ Subordinated Loan ” has the meaning set forth in Section 2.3(a) .

“ Subordinated Note ” means a promissory note in substantially the form of Schedule 2 hereto as more fully described in Section 2.3 .

“ Termination Date ” means the date that sales and contributions of Receivables and Loans and Related Assets cease under this Agreement pursuant to Article VI hereof.

SECTION 1.2 Other Interpretive Matters . The interpretation of this Agreement, unless otherwise specified, is subject to Appendix A of the Receivables Purchase Agreement.



	2

ARTICLE II

AGREEMENT TO PURCHASE, SELL AND CONTRIBUTE

SECTION 2.1 Purchase, Sale and Contribution . Upon the terms and subject to the conditions set forth in this Agreement, each Originator hereby sells or contributes, as applicable, to the Company, and the Company hereby purchases or acquires from each Originator, as applicable, all of such Originator’s right, title and interest in, to and under:

(a) each Receivable of such Originator that exists and is owing to such Originator as of the Closing Date and the Related Assets with respect to such Receivable;

(b) each Receivable of such Originator originated by such Originator from and after the Closing Date to and including the Termination Date and the Related Assets with respect to such Receivable;

(c) each Loan of such Originator that exists and is owing to such Originator under the Initial Designated Loan Agreements as of the Closing Date and the Related Assets with respect to such Loan;

(d) each Loan of such Originator that exists and is owing to such Originator under each Additional Designated Loan Agreement as of the applicable Addition Date and the Related Assets with respect to such Loan; and

(e) each Loan of such Originator acquired, originated or created by such Originator (A) under the Initial Designated Loan Agreements from and after the Closing Date to and including the Termination Date and the Related Assets with respect to such Loan, or (B) under the Additional Designated Loan Agreements from and after the applicable Addition Date to and including the Termination Date and the Related Assets with respect to such Loan;

provided that , notwithstanding anything herein to the contrary, CHS shall not be permitted to sell or contribute any Loans to the Company.

SECTION 2.2 Timing of Purchases . All of the Assets sold or contributed pursuant to Sections 2.1(a) and (c) on the Closing Date are hereby sold or contributed, as applicable, to the Company on such date in accordance with the terms hereof. On and after the Closing Date until the Termination Date, (i) each Receivable sold or contributed to the Company pursuant to Section 2.1(b) shall be deemed to have been conveyed by an Originator to the Company immediately (and without further action by any Person) upon the creation or origination of such Receivable, (ii) each Loan sold or contributed to the Company pursuant to Section 2.1(d) shall be deemed to have been conveyed by an Originator to the Company on the applicable Addition Date and (iii) each Loan sold or contributed to the Company pursuant to Section 2.1(e) shall be deemed to have been conveyed by an Originator to the Company on the date the applicable Originator delivers a purchase notice in the form of Schedule 1 (each, a “ Purchase Notice ”) including such Loans. The Related Assets with respect to each Asset shall be sold at the same time as such Asset, whether such Related Assets exist at such time or arise, are acquired or are originated thereafter.



	3

SECTION 2.3 Purchase Price .

(a) The Purchase Price for the Purchase from an Originator of its Assets described in Sections 2.1(a) and (c) shall be payable in full by Company to such Originator on the Closing Date, and shall be paid to such Originator in the following manner:

(i) by delivery of immediately available funds, to the extent of funds made available to the Company under the Receivables Purchase Agreement; provided that a portion of such funds shall be offset by amounts owed by CHS to the Company on account of the issuance of equity having a total value of not less than the Required Capital Amount; and

(ii) the balance, by delivery of the proceeds of a subordinated revolving loan from such Originator to the Company (a “Subordinated Loan” ) in an amount not to exceed the lesser of (A) the remaining unpaid portion of such Purchase Price, and (B) the maximum Subordinated Loan that could be borrowed without rendering the Company’s Net Worth less than the Required Capital Amount. Each Originator is hereby authorized by the Company to endorse on the schedule attached to its Subordinated Note an appropriate notation evidencing the date and amount of each advance thereunder, as well as the date of each payment with respect thereto; provided that the failure to make such notation shall not affect any obligation of the Company thereunder.

(b) The Purchase Price for each Asset sold or contributed by an Originator pursuant to Sections 2.1(b) , (d) or (e) shall be due and owing in full by the Company to the applicable Originator or its designee on the applicable Sale Date for such Asset (except that the Company may, with respect to any such Purchase Price, offset against such Purchase Price any amounts owed by such Originator to the Company hereunder and which have become due but remain unpaid) and shall be paid to such Originator in the following manner:

(i) by delivery to such Originator or its designee of immediately available funds, to the extent of funds available to the Company from its subsequent sale of an interest in all of the Assets to the Administrative Agent for the benefit of the Purchasers under the Receivables Purchase Agreement or other cash on hand;

(ii) by an increase in the outstanding balance of the Subordinated Loan of such Originator; provided that the making of any such Subordinated Loan shall be subject to the provisions set forth in Section 2.3(a)(ii) ; and

(iii) solely in the case of Receivables originated by CHS, unless the Termination Date has occurred in accordance with this Agreement, by accepting a contribution to its capital in an amount equal to the remaining unpaid balance of such Purchase Price.

Subject to the limitations set forth in Section 2.3(a)(ii) , each Originator irrevocably agrees to advance each Subordinated Loan requested by the Company in accordance with this Section 2.3 on or prior to the Termination Date. The Subordinated Loans owing to each Originator shall be evidenced by, and shall be payable in accordance with the terms and provisions of its Subordinated Note and shall be payable solely from funds which the Company is not required under the Receivables Purchase Agreement to set aside for the benefit of, or otherwise pay over to, the Purchasers.



	4

(c) From and after the Termination Date, (i) each Originator shall not be obligated to (but may, at its option) sell its Assets to the Company, or (ii) CHS shall not be obligated to (but may, at its option) contribute its Assets to the Company’s capital pursuant to Section 2.3(b)(iii) .

SECTION 2.4 Addition Date . Prior to the Termination Date, each Originator may, but shall not be obligated to, designate from time to time in its discretion additional loan facilities to be included as Designated Loan Agreements as of an applicable date (the “ Addition Date ” with respect to such Designated Loan Agreements) by providing written notice, on or before the Business Day prior to the applicable Addition Date, to the Company that the applicable Additional Designated Loan Agreements will be included as Designated Loan Agreements.

SECTION 2.5 Deliveries . Each Originator (a) shall deliver to the Custodian (x) with respect to any Effective Date Loan, within six (6) months after the Effective Date, and (y) with respect to all other Loans, within thirty (30) days after the date the Company acquires an interest in any Loans pursuant to this Agreement, as applicable, the Custodian File with respect to each Loan transferred by it to the Company ( provided that if any Loan transferred by an Originator to the Company does not contain an Obligor Note, then the applicable Originator may electronically deliver the Custodian File with respect to such Loan) and (b) has recorded and filed, at its own expense, any financing statements (and continuation statements with respect to such financing statements when applicable) naming such Originator as transferor and the Company as purchaser covering the Loans and the Related Assets thereof then existing and thereafter created or acquired meeting the requirements of applicable state law in such manner and in such jurisdictions as are reasonably requested by the Company or necessary to perfect the transfer and assignment of the Loans and Related Assets from such Originator to the Company. The Company shall provide the Custodian with an updated copy of Annex 3 hereto concurrently with any update thereto hereunder. Each Originator has delivered a file-stamped copy of such financing statements or other evidence of such filings to the Company and has taken, or shall take, at the Company’s expense, all other steps as are necessary under applicable law to perfect such transfers and assignments and has delivered, or shall deliver, confirmation of such steps as are reasonably requested by the Company or the Required Purchasers.

SECTION 2.6 No Recourse or Assumption of Obligations . Except as specifically provided in this Agreement, the purchase and sale or contribution, as applicable, of Pool Assets and Related Assets under this Agreement shall be without recourse to any Originator. Each Originator and the Company intend the transactions hereunder to constitute absolute and irrevocable true sales or valid contributions of Pool Assets and the Related Assets by such Originator to the Company, providing the Company with the full risks and benefits of ownership of the Pool Assets and Related Assets (such that the Pool Assets and the Related Assets would not be property of such Originator’s estate in the event of such Originator’s bankruptcy). Notwithstanding anything to the contrary in this Agreement or any other Transaction Document, no payments by any Originator shall be made to the Company to the extent that they constitute recourse with respect to a Pool Asset and the Related Assets by reason of the financial or credit condition of the related Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to the related Account Debtor or Obligor); provided that , for the avoidance of doubt, this paragraph shall not relieve any Originator from making any payments pursuant to this Agreement with respect to any Deemed Collections.

None of the Company, any Purchaser, any Purchaser Agent or the Administrative Agent shall have any obligation or liability under any Pool Assets or Related Assets (including any commitment to fund loans under any Loan Documents), nor shall the Company, any Purchaser, any Purchaser Agent or the Administrative Agent have any obligation or liability to any Account Debtor, Obligor or other customer or client of any Originator (including any commitment to fund loans under any Loan Documents or any other obligation to perform any of the obligations of an Originator under any Pool Assets or Related Assets).



	5

ARTICLE III

ADMINISTRATION AND COLLECTION

SECTION 3.1 Deemed Collections . If, on any day, the Unpaid Balance of a Pool Receivable is reduced (but not cancelled) as a result of any Dilution, the related Originator shall be deemed to have received on such day a Collection of such Pool Receivable in the amount of such reduction. If, on any day, a Pool Receivable is canceled (or reduced to zero) as a result of any Dilution, the related Originator shall be deemed to have received on such day a Collection of such Pool Receivable in the amount of the Unpaid Balance (as determined immediately prior to such Dilution) of such Pool Receivable. Any amount deemed to have been received under this Section 3.1 shall constitute a “ Deemed Collection ”. In the event of any such Deemed Collection, the related Originator shall, if (a) the Liquidation Period has commenced, or (b) the aggregate Total Investment at such time exceeds the sum of the Loan Investment Base and Receivables Investment Base at such time after giving effect to such Deemed Collection, deposit an amount equal to such Deemed Collection into the Concentration Account by no later than the fourth (4 ^th ) Business Day after such Originator obtains knowledge or notice thereof (or during the Liquidation Period, within two (2) Business Days from the event giving rise to such Deemed Collection).

SECTION 3.2 Actions Evidencing Purchases .

(a) Each Originator hereby authorizes the Company, the Administrative Agent or their respective designees to file one or more financing or continuation statements, and amendments thereto and assignments thereof, relative to all or any of the Pool Assets and the Related Assets now existing or hereafter arising in the name of such Originator.

(b) Each Originator shall authorize and deliver and file or cause to be filed appropriate continuation statements, not earlier than six months and not later than three months prior to the fifth anniversary of the date of filing of the financing statements filed in connection with this Agreement or any other financing statement filed pursuant to this Agreement.

SECTION 3.3 Repurchase Events . If any of the following events (each, a “ Sale Agreement Event of Repurchase ”) occurs and is continuing with respect to a Pool Asset:

(a) any representation or warranty by an Originator hereunder with respect to such Pool Asset is incorrect either (i) in any material respect or (ii) in any manner that adversely affects the value or collectability of such Pool Asset, in each case, when made or deemed made;

(b) an Originator fails to perform or observe any other term, covenant or agreement with respect to such Pool Assets set forth in any Transaction Document or any related Receivable Documentation or Loan Documents, as applicable, on its part to be performed or observed and such failure shall or could reasonably be expected to have an adverse effect on the collectability of such Pool Asset; or

(c) either (i) an Originator instructs the related Account Debtor or Obligor to pay any amount with respect to such Pool Asset to an account other than a Lockbox, an Originator Specified Account, an Originator Collection Account, a Seller Collection Account or the Concentration Account or (ii) the related Account Debtor or Obligor refuses to make any payment to a Lockbox, an Originator Specified Account, an Originator Collection Account, a Seller Collection Account or the Concentration Account (unless to the extent such refusal to pay is due to the financial or credit



	6

condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to such Account Debtor or Obligor)),

then, the related Originator shall immediately deliver notice thereof to the Company and the Administrative Agent and, at the time, in the manner and otherwise as hereinafter set forth, repurchase such Pool Asset; provided , however , that if an Event of Repurchase shall have occurred under the Receivables Purchase Agreement with respect to such Pool Asset, then such event shall also constitute a Sale Agreement Event of Repurchase for purposes of this Agreement. The repurchase price for a Pool Asset shall be the amount equal to the Unpaid Balance of such Pool Asset at such time and shall be paid to the Concentration Account in immediately available funds by no later than the second (2 ^nd ) Business Day following demand therefor by the Company or the Administrative Agent. Upon the payment in full of the repurchase price with respect to a Pool Asset, such Pool Asset shall hereby be, and be deemed to be, repurchased by the related Originator from the Company without recourse to or warranty by the Company, the Administrative Agent or any Purchaser but free and clear of any lien, encumbrance or other Adverse Claim created by or through the Company, the Administrative Agent and each Purchaser.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

SECTION 4.1 Representations and Warranties . Each Originator represents and warrants to the Company, as to itself, as of the date hereof and as of each Sale Date, as follows:

(a) Such Originator is a corporation or limited liability company, as applicable, duly formed and existing in good standing under the laws of its jurisdiction of organization; has all necessary corporate or limited liability company power, as applicable, to carry on its present business; and has made all necessary filings in order to be licensed or qualified and in good standing in each jurisdiction in which the nature of the business transacted by it or the nature of the property owned or leased by it makes such licensing or qualification necessary and in which the failure to be so licensed or qualified would have a Material Adverse Change with respect to such Originator.

(b) The execution, delivery and performance by such Originator of each Transaction Document to which it is party and each other document to be delivered by it thereunder, (i) are within its corporate or limited liability company powers, as the case may be, (ii) have been duly authorized by all necessary corporate or limited liability company action, as the case may be, (iii) do not contravene, violate or breach (1) its organizational documents, (2) any Applicable Law, (3) any Contractual Obligation of or affecting such Originator or any of its properties, or (4) any order, writ, judgment, award, injunction or decree binding on or affecting it or its property and (iv) do not result in the creation or imposition of any Adverse Claim upon any of its properties pursuant to the terms of any such Contractual Obligation, other than this Agreement and the other Transaction Documents.

(c) Each Transaction Document to which such Originator is a party has been duly executed and delivered by such Originator.

(d) No authorization or approval or other action by, and no notice to, license from or filing with, any Governmental Authority is required for the due execution, delivery and performance by such Originator of each Transaction Document to which it is a party or any other document to be delivered by it thereunder.



	7

(e) Each Transaction Document to which such Originator is a party constitutes the legal, valid and binding obligation of such Originator, enforceable against it in accordance with its terms, except as limited by bankruptcy, insolvency, moratorium, fraudulent conveyance or other laws relating to the enforcement of creditors’ rights generally and general principles of equity (regardless of whether enforcement is sought at equity or law).

(f) There is no pending or, to its knowledge, threatened action, proceeding, investigation or injunction, writ or restraining order affecting such Originator, its Subsidiaries or their respective properties before any Governmental Authority which could reasonably be expected to result in a Material Adverse Change with respect to such Originator.

(g) Such Originator is Solvent and no Insolvency Event has occurred with respect to such Originator.

(h) Since August 31, 2015, no Material Adverse Change or event which, individually or in the aggregate, is reasonably likely to result in a Material Adverse Change has occurred with respect to such Originator.

(i) No Change of Control has occurred.

(j) All assets of such Originator are free and clear of any Adverse Claim in favor of the Internal Revenue Service, any employee benefit plan, the PBGC or similar entity.

(k) All information furnished by or on behalf of such Originator to the Company, the Administrative Agent or any other Originator Indemnified Party for purposes of or in connection with the Transaction Documents or any transaction contemplated thereby (including in any Purchase Notice) is, at the time the same is furnished, taken as a whole, true and accurate in all material respects and such information does not omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(l) Such Originator has not changed its name or the location of its jurisdiction of formation during the prior five years.

(m) Such Originator is not required to register as an investment company under the Investment Company Act.

(n) No transaction contemplated by this Agreement requires compliance by it with any bulk sales act or similar law.

(o) Each Asset included in the Net Pool Balance as an Eligible Receivable or Eligible Loan, as applicable, on the date of the first Information Package delivered after the Sale Date for such Asset, was an Eligible Receivable or Eligible Loan, as applicable, on such Sale Date.

(p) Each sale by such Originator of a Pool Asset and Related Assets to the Company under this Agreement constitutes the absolute and irrevocable sale and transfer of all right, title and interest of such Originator in such Pool Asset and Related Assets to the Company and no further action, including any filing or recording of any document or any notice to, license from or approval from any Governmental Authority is necessary in order to establish the ownership interest of the Company



	8

effected by such sale or to permit the Company to service, enforce or otherwise collect such Pool Asset from the related Account Debtor or Obligor.

(q) The Company has an ownership interest in the Pool Assets and the Related Assets, free and clear of any Adverse Claim.

(r) No event has occurred and is continuing and no condition exists, or would result from any sale or contribution by such Originator of any Pool Asset, that constitutes, individually or in the aggregate, an Event of Default, an Unmatured Event of Default, a Servicer Termination Event or an Unmatured Servicer Termination Event.

(s) Such Originator is in compliance in all material respects with the Receivable Documentation and Loan Documents relating to the Pool Assets as of the Sale Date for such Pool Assets, and, as of the Sale Date of each Pool Asset sold by such Originator pursuant to the terms of this Agreement, neither such Pool Asset nor the Receivable Documentation or Loan Documents related thereto is subject to any defense, dispute, Dilution or any offset, counterclaim or other defense, whether arising out of the transactions contemplated by this Agreement or independently thereof.

(t) No effective financing statement or other instrument similar in effect covering any Pool Asset or any Related Assets is on file in any recording office (except any financing statements or other instruments filed pursuant to this Agreement or any other Transaction Document), and, to the knowledge of such Originator, no competing notice or notice inconsistent with the transactions contemplated in this Agreement is in effect with respect to any Account Debtor or Obligor.

(u) Such Originator has filed all material tax returns and reports required by Applicable Law to have been filed by it and has paid all material taxes, assessments and governmental charges, to its knowledge, owing by it, other than any such taxes, assessments or charges that are not yet delinquent or are being contested in good faith by appropriate proceedings.

(v) The facts regarding the Company, such Originator, Servicer, the Performance Guarantor, the Pool Assets, the Related Assets and the related matters set forth or assumed in each of the opinions of counsel delivered in connection with this Agreement and the Transaction Documents are true and correct in all material respects.

(w) No sale or contribution by such Originator of Pool Assets hereunder constitutes a fraudulent transfer or conveyance under any United States federal or applicable state bankruptcy or insolvency laws or is otherwise void or voidable under such or similar laws or principles or for any other reason.

(x) All Pool Assets sold by such Originator hereunder (i) were originated by such Originator in the ordinary course of its business, (ii) are being sold by such Originator to the Company for fair consideration and reasonably equivalent value and (iii) solely with respect to Pool Receivables, represent all, or a portion of the purchase price of merchandise, insurance or services within the meaning of Section 3(c)(5)(A) of the Investment Company Act.

(y) Policies and procedures have been implemented and maintained by or on behalf of such Originator that are designed to achieve compliance by such Originator and each of its respective Subsidiaries, Affiliates, directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, giving due regard to the nature of such Person’s business and



	9

activities, and such Originator, its respective Subsidiaries, Affiliates, officers, employees, directors and agents acting in any capacity in connection with or directly benefitting from this Agreement, are in compliance with Anti-Corruption Laws, Anti-Terrorism Laws, and Sanctions. (i) None of such Originator or any of its Subsidiaries, Affiliates, directors, officers, employees, or agents that will act in any capacity in connection with or directly benefit from this Agreement, is a Sanctioned Person, (ii) neither such Originator nor any of its Subsidiaries is organized or resident in a Sanctioned Country and (iii) such Originator has not violated, been found in violation of or is under investigation by any Governmental Authority for possible violation of any Anti-Corruption Laws, Anti-Terrorism Laws, or of any Sanctions. No purchases hereunder or use of proceeds thereof by such Originator or any of its Subsidiaries or Affiliates will be used in any manner that will violate Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.

(z) None of such Originator, any Affiliate of such Originator or any third party with which such Originator or any Affiliate thereof has contracted has delivered, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.

(aa) Each Lockbox is in the name of an Originator, and each Originator owns and has good and marketable title to the applicable Lockboxes free and clear of any Adverse Claim. The Company has a first priority perfected security interest in each Lockbox.

(bb) Each of the Originator Collection Accounts and Originator Specified Accounts constitutes a “deposit account” within the meaning of the applicable UCC. Each of the Originator Collection Accounts and Originator Specified Accounts is in the name of an Originator, and such Originator owns and has good and marketable title to the such accounts free and clear of any Adverse Claim. The Originator has delivered to the Administrative Agent a fully executed Originator Account Agreement relating to the Originator Collection Accounts, pursuant to which the applicable Account Bank has agreed to comply with the instructions originated by the Administrative Agent directing the disposition of funds in the Originator Collection Accounts without further consent by the Company, the Servicer or any other Person. The Administrative Agent has “control” (as defined in Section 9-104 of the UCC) over the Originator Collection Accounts.

(cc) Each Originator has complied in all material respects with the Credit and Collection Policy and has not, since the Closing Date, made any changes in the Credit and Collection Policy that would impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to such Originator without the consent of the Required Purchasers.

(dd) [Reserved].

(ee) Each Originator as an originator for CRR purposes, represents that, on the Closing Date, its pro rata share of the Retained Interest takes the form of a material net economic interest in accordance with the text of paragraph (d) of Article 405(1) of the CRR represented by the aggregate outstanding principal balance of the Subordinated Loans owed the Originators hereunder.



	10

ARTICLE V

GENERAL COVENANTS

SECTION 5.1 Originator Covenants . Until the Final Payout Date:

(a) Existence . Each Originator will preserve, renew and maintain in full force and effect its corporate or limited liability company existence (as applicable) and good standing under the laws of the jurisdiction of its organization and take all reasonable action to maintain all rights, privileges, permits and licenses necessary in the normal conduct of its business. Each Originator will keep its principal place of business and chief executive office and the office where it keeps its records concerning the Pool Assets (unless then held by the Custodian) at the address set forth in Annex 1 hereof or, upon 30 days’ prior written notice to the Company and the Administrative Agent, at any other locations in jurisdictions where all actions reasonably requested by the Company and the Administrative Agent or any Purchaser Agent or otherwise necessary to protect, perfect and maintain the Company’s ownership interest in the Pool Assets and Related Assets and security interest in the Lockboxes and the Originator Collection Accounts have been taken and completed.

(b) Compliance with Laws . Each Originator will comply in all material respects with all Applicable Laws with respect to it, the Pool Assets and the Receivable Documentation and Loan Documents.

(c) Books and Records . Each Originator will keep its books and accounts in accordance with GAAP and shall make a notation on its books and records, including any computer files, to indicate which Pool Assets have been sold to the Company and its assigns. Each Originator will maintain such books and accounts in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over it. Other than Custodian File held by Custodian in accordance with the Custodian Agreement, each Originator will maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Pool Assets and related Receivable Documentation and Loan Documents in the event of the destruction of the originals thereof) and keep and maintain all documents, books, records and other information reasonably necessary for collecting all Pool Assets (including records adequate to permit the daily identification of each Pool Asset and all collections of and adjustments to each existing Pool Asset).

(d) Sales, Liens and Debt . Neither Originator will sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim upon or with respect to, the Pool Assets or Related Assets or upon or with respect to any account or lockbox to which Collections are required to be sent, or assign any right to receive income in respect thereof, in each case, except the dispositions to the Company and the Administrative Agent and their respective assigns contemplated hereunder and under the other Transaction Documents and the Adverse Claims in favor of the Company and the Administrative Agent and their respective assigns created hereunder and under the other Transaction Documents.

(e) Audits and Visits . Each Originator will, upon reasonable advance notice of not less than five (5) Business Days (or at any time following the occurrence of an Event of Default that has not been waived in accordance with the Receivables Purchase Agreement), during regular business hours, permit the Company, the Administrative Agent and each Purchaser Agent and representatives thereof, at such Originator’s expense, (i) to examine and make abstracts from all books, records and documents (including computer tapes and disks) in its possession or under its control relating to Pool



	11

Assets and Related Assets, including the Receivable Documentation and Loan Documents, and (ii) to visit its offices and properties for the purpose of examining and auditing such materials described in clause (i) above, and, subject to the foregoing, to discuss matters relating to Pool Assets or its performance hereunder or under the related Receivable Documentation and Loan Documents with any of its officers having knowledge of such matters, in each case, at such reasonable times and as often as may reasonably be desired by the Company, the Administrative Agent or any such Purchaser Agent; provided , however , that unless an Event of Default has occurred that has not been waived in accordance with the Receivables Purchase Agreement, such Originator shall be required to reimburse the Company, the Administrative Agent and the Purchaser Agents for the costs and expenses related to (x) only one such audit or visitation with respect to such Originator during any calendar year (y) any audit following a material change in the systems of such Originator that occurs after any audit specified in clause (x) or (z) any follow-up audit that is required as a result of any audit specified in clauses (x) or (y) .

(f) Further Assurances . Each Originator will, at its expense, promptly execute, deliver and file all further instruments and documents (including UCC-3 financing statement amendments and continuation statements) necessary or desirable, and take all further action that the Company, the Administrative Agent or any Purchaser Agent may reasonably request, from time to time, in order to perfect, protect or more fully evidence the Company’s full and complete ownership in the Pool Assets and Related Assets and security interest in the Lockboxes and the Originator Collection Accounts, or to enable the Company or the Administrative Agent to exercise or enforce the rights of the Company or the Administrative Agent hereunder or under or in connection with the Pool Assets and Related Assets and the Lockboxes and the Originator Collection Accounts. In connection with any change in its name or jurisdiction of organization, the related Originator will, at its expense, cause to be delivered to the Company and the Administrative Agent (i) one or more opinions of counsel to such Originator, in form and substance reasonably acceptable to the Company and the Administrative Agent, as to such corporate or limited liability company, as applicable, and UCC perfection matters as the Company or the Administrative Agent may request at such time and (ii) one or more certificates of a Responsible Officer of such Originator, in form and substance reasonably acceptable to the Company and the Administrative Agent, with respect to the review of UCC search results.

(g) Taxes . Each Originator will pay any and all taxes relating to the transactions contemplated under this Agreement, including the sale, transfer and assignment of each Pool Asset and Related Assets, unless the same are being contested in good faith by appropriate proceedings and adequate reserves in accordance with GAAP are being maintained by such Originator.

(h) Not Adversely Affect Company’s Rights . Each Originator will refrain from any act or omission which, individually or in the aggregate, could reasonably be expected to prejudice, diminish or limit, in each case in any material respect, the Company’s or the Administrative Agent’s rights under or with respect to any of the Pool Assets or Related Assets or this Agreement, except to the extent such act or omission is expressly permitted under this Agreement or any other Transaction Document.

(i) Anti-Corruption Laws and Sanctions . Such Originator shall ensure that policies and procedures are maintained and enforced by or on behalf of such Originator to promote and achieve compliance by such Originator and each of its Subsidiaries, Affiliates, and their respective directors, officers, employees and agents, with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions. Such Originator shall not use or permit its Subsidiaries, Affiliates, or its or their respective directors,



	12

officers, employees or agents to use, the proceeds of any purchases hereunder (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws or Anti-Terrorism Laws, (ii) for the purpose of funding or financing any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, in each case, to the extent doing so would violate any Sanctions, or (iii) in any other manner that would result in liability to any Person under any applicable Sanctions or result in the violation of any Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions. Neither such Originator nor any of its Subsidiaries, Affiliates or any director, officer, employee, agent or other Person acting on behalf of such Originator or any of its Subsidiaries in any capacity in connection with or directly benefitting from this Agreement will engage in, or will conspire to engage in, any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions.

(j) No Change in Business, Credit and Collection Policy . Neither Originator shall make any change in (A) the character of its business without the prior written consent of the Required Purchasers or (B) the Credit and Collection Policy, which change would, in either case, impair in any material respect the collectability, value, validity or enforceability of, or increase the days to pay or Dilution with respect to, any Pool Asset or otherwise have a Material Adverse Change with respect to such Originator without the prior written consent of the Required Purchasers.

(k) Mergers, Acquisitions, Sales, etc. Neither Originator shall consolidate or merge with or into, or sell, lease, transfer or otherwise dispose of all or substantially all of its assets to, any other Person, unless in the case of any such action by such Originator (i) no Unmatured Event of Default or Event of Default exists and is continuing or would be reasonably likely to occur as a result of such transaction and (ii) such Originator is the surviving entity.

(l) Lockboxes; Originator Collection Accounts; Originator Specified Accounts . No Originator shall terminate or permit the termination of any Originator Specified Account, Originator Collection Account or Lockbox without the prior written consent of the Required Purchasers.

(m) Misdirected Payments . If an Originator receives a misdirected payment of a Pool Asset from any Account Debtor or Obligor, such Obligor shall remit such funds to an Originator Specified Account no later than two (2) Business Days following receipt thereof. Until remitted to an Originator Specified Account, each Originator shall hold such funds in trust as the Affected Parties’ exclusive property and safeguard such funds for the benefit of the Affected Parties.

(n) Tax Status . No Originator shall take or cause any action to be taken that could result in the Company being treated as other than a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3.

(o) Transaction Documents . Without limiting any of each Originator’s covenants or agreements set forth herein or in any other Transaction Document, comply with each and every of its covenants and agreements under each Transaction Document to which it is a party in any capacity.

(p) Separateness . Each Originator shall comply with Section 7.4 of the Receivables Purchase Agreement at all times and neither Originator will take any action inconsistent with Section 7.4 of the Receivables Purchase Agreement or the Company’s limited liability company agreement.



	13

(q) Originator Collection Accounts and Originator Specified Accounts . Each Originator shall take all actions required pursuant to Section 6.2(w) of the Receivables Purchase Agreement to (i) ensure that each of the Originator Collection Accounts and Originator Specified Accounts continue to constitute “deposit accounts” within the meaning of the applicable UCC and (ii) permit the Administrative Agent to have “control” (as defined in Section 9-104 of the UCC) over the Originator Collection Accounts. Each Originator shall take all actions necessary to permit the Servicer to apply Collections in accordance with Sections 3.1(d) and 8.6 of the Receivables Purchase Agreement.

(r) CRR . Each Originator undertakes, for the benefit of each Purchaser Group that is required to comply with the requirements of Articles 404-410 of the CRR, together with any applicable guidelines, technical standards or related documents published by the European Banking Authority (or any predecessor or successor agency or authority) or the European Commission (collectively, the “ CRR Requirements ”), that it shall so long as any Purchaser in any Purchaser Group is required to comply with the applicable CRR Requirements (as determined by such Purchaser in good faith):

(i) hold and maintain its pro rata share of the Retained Interest based upon the aggregate outstanding principal balance of the Subordinated Loans owed the Originators hereunder on an ongoing basis for so long as the Pool Assets are outstanding;

(ii) not sell or subject its pro rata share of the Retained Interest to any credit risk mitigation or any short positions or any other hedge in a manner which would be contrary to the CRR;

(iii) for the purpose of each Information Package, confirm to the Servicer that such Originator continues to comply with clauses (i) and (ii) above;

(iv) provide notice promptly to each Purchaser Agent in the event such Originator has breached clauses (i) or (ii) above;

(v) notify each Purchaser Agent of any change to the form of retention of its pro rata share of the Retained Interest;

(vi) provide confirmation to the Servicer of such Originator’s continued compliance with this clause (r) promptly following a request by any Purchaser Agent delivered as a result of a material change in (i) the performance of any of the Pool Assets or the Receivables Assets, (ii) the risk characteristics of any of the Pool Assets or the Receivables Assets or (iii) the Pool Assets; and

(vii) provide all information which any Purchaser Group would reasonably require in order for such Purchaser Group to comply with its obligations under the CRR.

(s) Delivery of Custodian File and Obligor Notes .

(i) Not later than six (6) months following the Effective Date, the applicable Originator shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to each Effective Date Loan, and shall cause all Obligor Notes (other than any Obligor Note that has been signed electronically) related to



	14

such Effective Date Loan to be (x) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (y) delivered to the Custodian;

(ii) Not later than thirty (30) days following the date the Company acquires an interest any Loan (other than any Effective Date Loan) pursuant to this Agreement, the applicable Originator shall deliver or cause to be delivered directly to the Custodian for the benefit of the Affected Parties the Custodian File relating to such Pool Assets, and shall cause all Obligor Notes (other than any Obligor Note that has been signed electronically) related to such Pool Assets to be (x) duly indorsed in blank with note transfer powers in the form set forth in the Custodian Agreement and (y) delivered to the Custodian; and

(iii) Not later than thirty (30) days following any amendment or modification to any Loan Document, the applicable Originator shall deliver or cause to be delivered such Loan Document to the Custodian.

(t) Subordinated Note . No Originator shall transfer or pledge its Subordinated Note to any Person other than in connection with the Subordinated Note Financing in effect as of September 4, 2018 so long as each Subordinated Note Financier under such Subordinated Note Financing is then party to the No Petition Agreement.

(u) Amendments to Subordinated Note Financing Documents . At least five (5) Business Days prior to the effectiveness of any amendment, restatement, supplement, waiver or other modification to any Subordinated Note Financing Document, the applicable Originator or Originators shall provide to the Company, the Administrative Agent and the Purchaser Agents (A) a copy of such amendment, restatement, supplemented, waiver or other modification and (B) a written notice indicating such agreement could not reasonably be expected to have a material adverse effect on (I) the ability of any Originator or the Company to perform its obligations under this Agreement or any other Transaction Document, (II) the validity or enforceability against any Originator of any Transaction Document, (III) the value, validity, enforceability or collectability of the Assets and the Related Security with respect thereto or, in each case, any material portion thereof, (IV) the status, existence, perfection, priority, enforceability or other rights and remedies of the Company or the Administrative Agent under the Transaction Documents or associated with its respective interest in the Assets and Related Security with respect thereto or (V) the business, assets, liabilities, property, operations or financial condition of any Originator; provided that, if the Company, the Administrative Agent or any Purchaser Agent is a party to the Subordinated Note Financing Document being amended, restated, supplemented, waived or otherwise modified, the Originator’s notice obligation under this clause (u) shall be deemed satisfied solely with respect to such Person.

SECTION 5.2 Reporting Requirements . From the date hereof until the Final Payout Date, each Originator will furnish to the Company and to the Administrative Agent (without duplication of any reports provided under the Receivables Purchase Agreement):

(a) at least 30 days prior to any change in such Originator’s name or jurisdiction of organization, a notice setting forth the new name or jurisdiction, as applicable, and the proposed effective date thereof;

(b) such data, reports and information relating to the Pool Assets reasonably requested by the Company, the Administrative Agent or any Purchaser Agent from time to time;



	15

(c) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of any Adverse Claim or dispute asserted or claim made against a Pool Asset or any Related Assets;

(d) promptly (and in no event later than five (5) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the failure of any representation or warranty made or deemed to be made by such Originator under this Agreement or any other Transaction Document to be true and correct in any material respect when made;

(e) promptly (and in no event later than three (3) Business Days) following knowledge or notice thereof, written notice in reasonable detail of the occurrence of any Event of Default, Unmatured Event of Default, Servicer Termination Event or Unmatured Servicer Termination Event and the action that such Originator proposes to take with respect thereto;

(f) at least fifteen (15) days prior to (i) the effectiveness of any change in or amendment to the Credit and Collection Policy, a description or, if available, a copy of the Credit and Collection Policy after giving effect to such change or amendment and a written notice (A) indicating such change or amendment and (B) if such proposed change or amendment would be reasonably likely to adversely affect the value, validity, enforceability or collectability of, or increase the days to pay or Dilution with respect to, any Pool Asset or decrease the credit quality of any newly created Assets, requesting the consent of the Company and the Required Purchasers thereto (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) such Originator making any material change or changes in the character of its business, written notice indicating such change and requesting the consent of the Company and the Required Purchasers thereto (which consent shall not be unreasonably withheld, conditioned or delayed;

(g) promptly (and in no event later than five (5) Business Days) following receipt thereof, a copy of all periodic statements regarding the Originator Collection Accounts from the applicable Account Banks; and

(h) as soon as possible and in any event within three (3) Business Days after knowledge or notice of the occurrence thereof, written notice of any matter that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change with respect to such Originator.

ARTICLE VI

TERMINATION OF PURCHASES

SECTION 6.1 Automatic Termination . The sale or contribution by the applicable Originator of Pool Assets and Related Assets pursuant to this Agreement shall automatically terminate if an Insolvency Event with respect to such Originator shall have occurred and remain continuing.

ARTICLE VII

INDEMNIFICATION

SECTION 7.1 Originators’ Indemnity . Each Originator hereby agrees, on a several (and not joint or joint and several) basis, to indemnify and hold harmless the Company and its officers, directors, agents, representatives, shareholders, counsel and employees and each of their respective Affiliates,



	16

successors and assigns and all other Affected Parties (each, an “ Originator Indemnified Party ”) from and against any and all damages, claims, losses, costs, expenses and liabilities (including reasonable and documented attorneys’ fees and expenses) (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) incurred by any such Originator Indemnified Party arising out of or resulting from or related to this Agreement or any other Transaction Document or any of the transactions contemplated by any of the foregoing (to the extent any such Indemnified Amounts are attributed to such Originator or otherwise arise out of or result from or relate to the Pool Assets originated by such Originator) or the ownership, maintenance or funding, directly or indirectly, of the Pool Assets (or any of them) sold by such Originator or otherwise arising out of or resulting from the actions or inactions of such Originator, including any of the following: (i) any representation or warranty made or deemed made by such Originator (or any of its officers) under or in connection with this Agreement or any other Transaction Document which shall have been incorrect when made; (ii) the failure by such Originator to perform any of its covenants or obligations under any Transaction Document; (iii) the failure by such Originator or any Pool Asset originated by such Originator or the related Receivable Documentation or Loan Documents, as applicable, to comply with any Applicable Law; (iv) the failure to vest in the Company ownership of each Pool Asset sold by such Originator and all Collections in respect thereof, and a first priority perfected security interest (within the meaning of the UCC) in, each Pool Receivable sold by such Originator and all Collections in respect thereof, in each case, free and clear of any Adverse Claim; (v) any dispute, Dilution or any other claim by any Account Debtor or Obligor, as applicable, or any Affiliate or assignee thereof resulting from the services performed or merchandise furnished in connection with any Pool Asset originated by such Originator or the furnishing or failure to furnish such services or merchandise or relating to collection activities with respect to any Pool Asset originated by such Originator; (vi) any suit or claim related to any Pool Asset originated by such Originator, any related Receivable Documentation or Loan Documents, as applicable, or, to the extent attributed to or otherwise relating to such Originator, any Transaction Document (other than any such suit or claim that arises as a result of the failure of any Account Debtor or Obligor, as applicable, to pay any sum due under its Pool Asset by reason of the financial or credit condition of such Account Debtor or Obligor, as applicable (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor or Obligor)); (vii) the failure of such Originator to notify any Account Debtor or Obligor, as applicable, of the sale of the Pool Assets (x) by such Originator to the Company pursuant to this Agreement or (y) by the Company to the Administrative Agent (on behalf of Purchasers) pursuant to the Receivables Purchase Agreement; (viii) the commingling by such Originator or any of its Affiliates of Collections at any time with other funds of such Originator or any other Person; (ix) the failure to file, or any delay in filing of, financing statements or other similar instruments or documents under the UCC of any applicable jurisdictions or under any other Applicable Laws with respect to any Pool Asset at the time of purchase or acquisition; (x) any loss arising, directly or indirectly, as a result of the imposition of sales or similar transfer type taxes or the failure by any Originator to timely collect and remit to the appropriate authority any such taxes; (xi) the failure by an Originator to comply with the “bulk sales” or analogous laws of any jurisdiction; (xii) any Taxes (other than Excluded Taxes) imposed upon any Originator Indemnified Party or upon or with respect to the Pool Assets, all interest and penalties thereon or with respect thereto, and all costs and expenses related thereto or arising therefrom, including the fees and expenses of counsel in defending the same; (xiii) the ownership, delivery, non-delivery, possession, design, construction, use, maintenance, transportation, performance (whether or not according to specifications), operation (including the failure to operate or faulty operation), condition, return, sale, repossession or other disposition or safety of any Related Assets (including claims for patent, trademark, or copyright infringement and claims for injury to persons or property, liability principles, or otherwise, and claims of breach of warranty, whether express or implied); (xiv) the violation or breach by any Originator or any of their respective Affiliates of any confidentiality provision, or of any similar covenant of non-disclosure, or any other Indemnified Amount with respect to or resulting from any such violation or breach; or (xv) any civil penalty or fine assessed by OFAC or any other Governmental Authority administering any Anti-Terrorism Law, Anti-Corruption Law or Sanctions, and all reasonable costs and expenses (including



	17

reasonable documented legal fees and disbursements) incurred in connection with defense thereof by, any Originator Indemnified Party in connection with the Transaction Documents as a result of any action of such Originator or any of its respective Affiliates; provided , however , that in all events there shall be excluded from the foregoing indemnification any damages, claims, losses, costs, expenses or liabilities to the extent resulting from (x) the gross negligence or willful misconduct of the Administrative Agent, its officers, directors, agents, representatives, shareholders, counsel or employees or any of their respective Affiliates, successors and permitted assigns, as determined in a final non-appealable judgment by a court of competent jurisdiction or (y) the failure of an Account Debtor or Obligor, as applicable, to pay any sum due under its Assets by reason of the financial or credit condition of such Account Debtor or Obligor (including the occurrence of an Insolvency Event with respect to the applicable Account Debtor or Obligor). Any amount due and payable pursuant to this Section 7.1 shall be paid to the applicable Originator Indemnified Party in immediately available funds by no later than the tenth (10 ^th ) Business Day following demand therefor by such Originator Indemnified Party.

SECTION 7.2 Tax Indemnification . All payments on the Pool Assets received by the related Originator, the Company or any Affiliate thereof from the Account Debtors or Obligors, as applicable, will be paid to the Company free and clear of any present or future taxes, withholdings or other deductions whatsoever which arise by reason of the sale of the Pool Assets from such Originator to the Company (“ Sale Transaction Taxes ”) or relating to the underlying transactions between such Originator and the Account Debtors and Obligors, as applicable, which gave rise to such Pool Assets (“ Prior Transaction Taxes ”). Such Originator will indemnify each Originator Indemnified Party and hold each Originator Indemnified Party harmless for any Sale Transaction Taxes and Prior Transaction Taxes. Further, such Originator shall pay, and indemnify and hold each Originator Indemnified Party harmless from and against, any Sale Transaction Taxes or Prior Transaction Taxes that may at any time be asserted (including any sales, occupational, excise, gross receipts, personal property, privilege or license taxes, or withholdings, but not including taxes imposed upon any Originator Indemnified Party with respect to its overall net income) and reasonable and documented out-of-pocket costs and expenses (including reasonable and documented attorneys’ fees and expenses) in defending against the same, whether arising by reason of the acts to be performed by such Originator hereunder or otherwise. Any amount due and payable pursuant to this Section 7.2 shall be paid to the applicable Originator Indemnified Party in immediately available funds by no later than the tenth (10 ^th ) Business Day following demand therefor by such Originator Indemnified Party.

SECTION 7.3 Contribution . If for any reason the indemnification provided above in this Article VII is unavailable to an Originator Indemnified Party or is insufficient to hold an Originator Indemnified Party harmless, then each Originator shall contribute to the amount paid or payable by such Originator Indemnified Party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received by such Originator Indemnified Party on the one hand and such Originator on the other hand but also the relative fault of such Originator Indemnified Party as well as any other relevant equitable consideration.

ARTICLE VIII

MISCELLANEOUS

SECTION 8.1 Amendments, etc. No amendment or waiver of any provision of this Agreement nor consent to any departure by any Originator therefrom shall in any event be effective unless the same shall be in writing and signed by the Company, the Administrative Agent, the Required Purchasers, and (if an amendment) each Originator, and then any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. Neither Originator may amend or otherwise



	18

modify any other Transaction Document executed by it without the written consent of the Company, the Administrative Agent and the Required Purchasers.

SECTION 8.2 No Waiver; Remedies . No failure on the part of the Company or any Originator Indemnified Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by Applicable Law. Each Originator hereby irrevocably instructs and authorizes the Company and the Administrative Agent at any time following the occurrence of any Event of Default that has not been waived in accordance with the Receivables Purchase Agreement to setoff, appropriate and apply (without presentment, demand, protest or other notice which are hereby expressly waived) any deposits and any other indebtedness held or owing by the Company, the Administrative Agent or any branch, agency or Affiliate thereof to, or for the account of, any Originator or any of their respective Affiliates against amounts owing by any Originator to the Company or the Administrative Agent hereunder or under any other Transaction Document (even if contingent or unmatured).

SECTION 8.3 Notices, Etc. . Unless otherwise provided herein, all communications by any Originator or the Company under this Agreement or any other agreement entered into in connection herewith shall be in a writing personally delivered or sent by a recognized overnight delivery service, certified mail, postage prepaid, return receipt requested, by e-mail or by telecopier (with confirmed receipt) to such Originator or Company, as the case may be, at its address set forth in Annex 2 or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. Any documentation in connection herewith, such as copies of invoices, may be sent by any Originator or Company by facsimile or by electronic mail attachment in portable document format (.pdf), and each Originator and Company may otherwise communicate by electronic mail or facsimile. Each Originator agrees that Company may presume the authenticity, genuineness, accuracy, completeness and due execution of any email or fax communication bearing a facsimile or scanned signature resembling a signature of an authorized Person of such Originator without further verification or inquiry by Company. Notwithstanding the foregoing, Company in its sole discretion may elect not to act or rely upon such a communication that it reasonably believes may not be authentic or genuine and shall be entitled (but not obligated) to make inquiries or require further action from such Originator to authenticate any such communication.

SECTION 8.4 Binding Effect; Assignment . Each Originator acknowledges that institutions providing financing pursuant to the Receivables Purchase Agreement may rely upon the terms of this Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns and shall also, to the extent provided herein, inure to the benefit of the parties to the Receivables Purchase Agreement. Each Originator acknowledges that the Company’s rights under this Agreement may be assigned to the Administrative Agent and the Purchasers under the Receivables Purchase Agreement, consents to such assignments and to the exercise of those rights directly by Administrative Agent to the extent permitted by the Receivables Purchase Agreement and acknowledges and agrees that Administrative Agent, each Purchaser and each of their successors and assigns are express third party beneficiaries of this Agreement.

SECTION 8.5 Survival . All covenants, representations and warranties made herein shall continue in full force and effect until the Final Payout Date. Each Originator’s obligations to indemnify Originator Indemnified Parties pursuant to the terms of this Agreement or any other Transaction Document with respect to expenses, damages, losses, costs and liabilities shall survive until the later of (x) the Final



	19

Payout Date and (y) all applicable statute of limitations periods with respect to actions that may be brought by the Company or the Administrative Agent under the Transaction Documents have run.

SECTION 8.6 Expenses . Without limiting any other provisions herein, the Originators hereby agree to reimburse each Originator Indemnified Party promptly (but in any event no later than ten (10) Business Days) after demand for:

(a) all reasonable and documented out-of-pocket costs and expenses (including reasonable and documented attorneys’ fees and expenses) that any Originator Indemnified Party incurs in connection with (i) the preparation, negotiation, documentation and delivery of this Agreement and the other Transaction Documents and any amendment of or consent or waiver under any of the Transaction Documents (whether or not consummated) and (ii) the enforcement of, or any actual or reasonably claimed breach of, this Agreement or any of the other Transaction Documents or in advising any Originator Indemnified Party as to its rights and remedies under this Agreement or any of the other Transaction Documents, including, in the case of clause (i) above with respect to any amendment, consent or waiver or clause (ii) above, in each case, reasonable and documented external accountants’, external auditors’, Rating Agencies’ and external consultants’ fees, expenses and charges;

(b) all reasonable and documented out-of-pocket costs and expenses the Administrative Agent incurs in connection with the administration (including periodic auditing as provided for herein) of this Agreement and the other Transaction Documents and the transactions contemplated thereby, including all reasonable and documented attorneys’ and accountants’ fees, expenses and charges incurred in connection with the administration and maintenance of this Agreement and the other Transaction Documents and the transactions contemplated thereby; and

(c) all stamp and other similar taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement or the other Transaction Documents.

SECTION 8.7 Execution; Counterparts . This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or by electronic mail attachment in portable document format (.pdf) shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 8.8 Governing Law . THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF, EXCEPT TO THE EXTENT THAT THE PERFECTION, THE EFFECT OF PERFECTION OR NONPERFECTION OR THE PRIORITY OF THE INTERESTS OF THE COMPANY IN THE POOL ASSETS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK).

SECTION 8.9 Waiver of Jury Trial . EACH ORIGINATOR AND COMPANY IRREVOCABLY WAIVES ANY RIGHT THAT IT MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE TRANSACTIONS



	20

CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS.

SECTION 8.10 CONSENT TO JURISDICTION . EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OTHER TRANSACTION DOCUMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING.

SECTION 8.11 WAIVER OF IMMUNITIES . EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.

SECTION 8.12 Captions and Cross References . The various captions in this Agreement are provided solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Agreement. Unless otherwise indicated, references in this Agreement to any Section, Schedule or Exhibit are to such Section of or Schedule or Exhibit to this Agreement, as the case may be, and references in any Section, subsection, or clause to any subsection, clause or subclause are to such subsection, clause or subclause of such Section, subsection or clause.

SECTION 8.13 No Party Deemed Drafter . Each of the parties hereto hereby agrees that no party hereto shall be deemed to be the drafter of this Agreement.

SECTION 8.14 Calculation of Interest . All interest amounts calculated on a per annum basis hereunder are calculated on the basis of a year of 360 days and actual days elapsed.

SECTION 8.15 No Non-Direct Damages . To the fullest extent permitted by Applicable Law, each of the parties hereto agrees not to assert, and hereby waives, any claim against any other party hereto, any of its Affiliates or any of its respective directors, officers, employees, attorneys, agents and advisors, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Transaction Document, any agreement or instrument contemplated hereby, or the transactions contemplated hereby or thereby (other than in respect of any such damages incurred or paid by an Originator Indemnified Party to a third party and to which such Originator Indemnified Party is otherwise entitled to indemnification as provided herein). No Originator Indemnified Party shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Transaction Documents or the transactions contemplated hereby or thereby; provided that the waiver provided for in this sentence shall not apply to damages to the extent resulting from such Originator Indemnified Party’s own gross negligence



	21

or willful misconduct as determined by a court of competent jurisdiction in a final and non-appealable judgment.

SECTION 8.16 No Proceedings . Each Originator hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, the Company any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or any other proceeding under any federal or state bankruptcy or similar law, for one year (or if longer, any applicable preference period then in effect) and one day after the Final Payout Date. The provisions of this paragraph shall survive any termination of this Agreement.

SECTION 8.17 Grant of Security Interest . It is the intention of the parties to this Agreement that the conveyance of each Originator’s right, title and interest in and to the Pool Assets, the Related Assets and all the proceeds of all of the foregoing to the Company pursuant to this Agreement shall constitute an absolute and irrevocable purchase and sale or capital contribution, as applicable, and not a loan or pledge. If, notwithstanding the foregoing, the conveyance of the Pool Assets and the Related Assets to the Company is characterized by any third party as a loan or pledge, the parties intend that such Originator shall be deemed hereunder to have granted, and such Originator does hereby grant, to the Company a security interest to secure such Originator’s obligations hereunder in all of such Originator’s now or hereafter existing right, title and interest in, to and under the Pool Assets and the Related Assets and that this Agreement shall constitute a security agreement under Applicable Law. In addition, each Originator does hereby grant, to the Company a security interest to secure such Originator’s obligations hereunder in all of such Originator’s now or hereafter existing right, title and interest in, to and under each Lockbox and each Originator Collection Account. With respect to each such grant of a security interest, the Company may at its option exercise from time to time any and all rights and remedies available to it hereunder, under the UCC or otherwise.

SECTION 8.18 Severability . Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

SECTION 8.19 Confidentiality . Each party hereto agrees to comply with, and be bound by, the confidentiality provisions of Section 13.8 of the Receivables Purchase Agreement as if they were set forth herein mutatis mutandis.

SECTION 8.20 Waiver of Setoff . Notwithstanding anything in this Agreement to the contrary, (a) all payments to be made by the Company to the Originators under the Subordinated Notes shall be made without setoff, counterclaim or other defense, (b) the Company hereby waives any and all of its rights to assert any right of setoff, counterclaim or other defense to the making of a payment due to the Originators under the Subordinated Notes (which waiver shall be binding on the Administrative Agent as assignee of the Company’s rights hereunder) and (c) each Originator hereby waives any and all rights it may have to set off any amounts owing by such Originator to the Company (whether under the Transaction Documents or otherwise) against any amounts owing to such Originator under the applicable Subordinated Note; provided , however , that, notwithstanding the foregoing, no payment shall be made by the Company to any Originator under any Subordinated Note (i) in violation of the provisions of such Subordinated Note or (ii) prior to the Final Payout Date, with any Collections on Assets except to the extent such amounts have been distributed to the Company in accordance with the Receivables Purchase Agreement.

[SIGNATURE PAGES FOLLOW]



	22

IN WITNESS WHEREOF , the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

CHS INC. ,

as an Originator

By:_________________________________

Name:

Title:

CHS CAPITAL, LLC ,

as an Originator

By:_________________________________

Name:

Title:

COFINA FUNDING, LLC , as the Company

By:_________________________________

Name:

Title:

Schedule 13.2-1

ANNEX 1

UCC DETAILS SCHEDULE


(1)	CHS INC.:

(a) Chief Executive Office

5500 Cenex Drive

St. Paul Minnesota 55077

(b) Locations Where Records Are Kept

5500 Cenex Drive

St. Paul, Minnesota 55077

Not Applicable

(d) Federal Taxpayer ID Number

41-0251095

(e) Jurisdiction of Organization

Minnesota

(f) True Legal Name

CHS Inc.

(g) Organizational Identification Number

COOP-1328

Annex 1, Page 1


(2)	CHS CAPITAL, LLC:

(a) Chief Executive Office

5500 Cenex Drive

St. Paul, Minnesota 55077

(b) Locations Where Records Are Kept

5500 Cenex Drive

St. Paul, Minnesota 55077

Formerly known as Cofina Financial, LLC

(d) Federal Taxpayer ID Number

20-2409352

(e) Jurisdiction of Organization

Minnesota

(f) True Legal Name

CHS Capital, LLC

(g) Organizational Identification Number

1224194-2

Annex 1, Page 2

ANNEX 2

NOTICE INFORMATION

If to an Originator, to the following, as applicable:

CHS Inc.

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Brent Dickson

Tel: 651-355-5433

Fax: 800-232-3639

Email: brent.dickson@chsinc.com

CHS Capital, LLC

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Eric Born

Tel: 651-355-5479

Fax: 651-355-4917

Email: eric.born@chsinc.com

If to the Company:

Cofina Funding, LLC

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Eric Born

Tel: 651-355-5479

Fax: 651-355-4917

Email: eric.born@chsinc.com

With a copy to Administrative Agent at its address set forth in the Receivables Purchase Agreement.

With a copy to each Purchaser Agent at its address set forth in the Receivables Purchase Agreement.

Annex 2, Page 1

ANNEX 3

DESIGNATED LOAN AGREEMENTS

Annex 3, Page 1

SCHEDULE 1

Form of Purchase Notice

[date]

Cofina Funding, LLC

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Eric Born

Tel: 651-355-5479

Fax: 651-355-4917

Email: eric.born@chsinc.com

MUFG Bank, Ltd.

1221 Avenue of the Americas

New York, New York 10020

Attention: Securitization Group

Tel: 212-782-6957

Fax: 212-782-6448

Email: securitization_reporting@us.mufg.jp

Reference is hereby made to that certain Sale and Contribution Agreement, dated as of July 22, 2016, among COFINA FUNDING, LLC, a Delaware limited liability company (“ Company ”), CHS INC. (“ CHS ”), a Minnesota corporation, as an originator, and CHS CAPITAL, LLC (“ CHS Capital ”), a Minnesota limited liability company, as an originator (as it may be amended, restated, modified or supplemented from time to time, the “ Agreement ”; capitalized terms not otherwise defined herein shall have the meanings set forth in, or by reference in, the Agreement).

Pursuant to the terms of the Agreement, [CHS] [CHS Capital] hereby provides notice to Company of the sale from such Originator to Company on [_____], 201[_] (the “ Sale Date ”) of each of the Loans listed on the exhibit attached hereto (the “ Pool Assets ”). Each of the parties hereto hereby agrees that the aggregate Purchase Price for the Pool Assets shall be $[___________].

Such Originator represents and warrants that as of the date hereof:

Each of the representations and warranties made by such Originator in the Agreement and each of the other Transaction Documents that are qualified as to materiality are true and correct, and each not so qualified are true and correct in all material respects, in each case, as of the date hereof or, in the case of any representation or warranty which speaks as to a particular date or period, as of that particular date or period.

Such Originator is in compliance in all material respects with each of its covenants and other obligations under the Agreement and each of the other Transaction Documents.

Schedule 1

[Signature Pages Follow]

Schedule 1

Upon acceptance by Company of this Purchase Notice and payment of the Purchase Price, Company hereby purchases or accepts, as applicable, and such Originator hereby sells or contributes, as applicable, all of such Originator’s right, title and interest (but none of such Originator’s underlying obligations to the applicable Account Debtor or Obligor) with respect to the Assets set forth on the attached exhibit as of the date hereof.

[CHS INC.,

as an Originator

By:______________________________________

Title:_____________________________________]

[CHS CAPITAL, LLC,

as an Originator

By:______________________________________

Title:_____________________________________]

COFINA FUNDING, LLC,

as the Company

By:______________________________________

Title:_____________________________________

Schedule 1

List of [Receivable Documentation][Loan Documents] ¹ for [Account Debtor][Obligor][____________] ²

Proposed for Sale as of ____________, 201_



Customer	Invoice Number	Invoice Amount	Due Date	Additional Days

¹ Update depending on whether related to Receivable or Loan.

² Insert applicable Account Debtor’s or Obligor’s name - use a different Exhibit for each different Account Debtor or Obligor.

Schedule 1

SCHEDULE 2

Form of Subordinated Note

SUBORDINATED NOTE

______________, 20__

Note . FOR VALUE RECEIVED, the undersigned, Cofina Funding, LLC, a Delaware limited liability company (the “ Company ”), hereby unconditionally promises to pay to the order of [ ORIGINATOR NAME ] , a(n) __________ ***[ corporation ] [ limited liability company ] *** (“ Originator ”), in lawful money of the United States of America and in immediately available funds, on or before the date following the Termination Date which is one year and one day after the date on which (i) the Unpaid Balance of all Assets sold by Originator under the “ Sale Agreement ” referred to below has been reduced to zero and (ii) Originator has paid to the Company all indemnities, adjustments and other amounts which may be owed thereunder in connection with the Purchase thereunder (the “ Collection Date ”), the aggregate unpaid principal sum outstanding of all “ Subordinated Loans ” made from time to time by Originator to the Company pursuant to and in accordance with the terms of that certain Sale and Contribution Agreement dated as of July 22, 2016 among Originator and certain of its affiliates, as originators, and the Company (as amended, restated, supplemented or otherwise modified from time to time, the “ Sale Agreement ”). Reference to Section 2.3 of the Sale Agreement is hereby made for a statement of the terms and conditions under which the loans evidenced hereby have been and will be made.

(I) Definitions, Interpretation . All terms which are capitalized and used herein and which are not otherwise specifically defined herein shall have the meanings ascribed to such terms in the Sale Agreement. In addition, as used herein, the following terms have the following meanings:

“ Junior Liabilities ” means all obligations of Company to Originator under this Subordinated Note or to any other SCA Originator, if applicable, under any other subordinated note described in Section 2.3 of the Sale Agreement.

“ SCA Originator ” means any Person designated as an “Originator” under the Sale Agreement.

“ Senior Interests ” means (a) the security interest granted to the Administrative Agent in the Assets and the Related Security for the benefit of the Purchasers pursuant to the Receivables Purchase Agreement, (b) the Asset Interest, (c) all Obligations and (d) all other obligations of Company to the Senior Interest Holders under any Transaction Document, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due on or before the Final Payout Date.

“ Senior Interest Holders ” means, collectively, each Purchaser, each Purchaser Agent, the Administrative Agent and each Indemnified Party and their permitted assigns.

“ Subordination Provisions ” is defined in Section IV hereof.

Schedule 2- 1

hereafter (“ LIBOR ”); provided , however , that if the Company shall default in the payment of any principal hereof, the Company promises to pay, on demand, interest at the rate equal to LIBOR plus 1.50 % per annum on any such unpaid amounts, from the date such payment is due to the date of actual payment. Interest shall be payable on the first Business Day of each month in arrears; provided , however , that the Company may elect on the date any interest payment is due hereunder to defer such payment and upon such election the amount of interest due but unpaid on such date shall constitute principal under this Subordinated Note. The outstanding principal of any loan made under this Subordinated Note shall be due and payable on the Collection Date and may be repaid or prepaid at any time without premium or penalty.

(III) Principal Payments . Originator is authorized and directed by the Company to enter on the grid attached hereto, or, at its option, in its books and records, the date and amount of each loan made by it which is evidenced by this Subordinated Note and the amount of each payment of principal made by the Company, and absent manifest error, such entries shall constitute prima facie evidence of the accuracy of the information so entered; provided that neither the failure of Originator to make any such entry or any error therein shall expand, limit or affect the obligations of the Company hereunder.

(IV) Subordination Provisions . Company covenants and agrees, and Originator, by its acceptance of this Subordinated Note, likewise covenants and agrees, in each case, for the benefit of the other and for the benefit of the Senior Interest Holders, that payment of all Junior Liabilities is hereby expressly subordinated in right of payment to the payment and performance of the Senior Interests, and any payment hereunder is pari passu in right of payment and performance to all other Junior Liabilities, to the extent and in the manner set forth in the following clauses of this Section IV (the “ Subordination Provisions ”):

(i) No payment or other distribution of Company’s assets of any kind or character, whether in cash, securities, or other rights or property, shall be made on account of this Subordinated Note, except to the extent such payment or other distribution is (a) permitted under the Receivables Purchase Agreement and (b) made pursuant to Sections II or III of this Subordinated Note.

(ii) (a) In the event that an Insolvency Event shall have occurred with respect to the Company, or (b) on and after the occurrence of an Event of Default (under and as defined in the Receivables Purchase Agreement), the Senior Interests (other than unasserted contingent indemnification obligations) shall first be paid in full in cash before the Originator shall be entitled to receive and to retain any payment or distribution in respect of this Subordinated Note. In order to implement the foregoing: (x) all payments and distributions of any kind or character in respect of this Subordinated Note to which Originator would be entitled except for this clause (ii) shall be made directly to Administrative Agent (for the benefit of the Senior Interest Holders), and (y) Originator hereby irrevocably agrees that Administrative Agent, acting at the direction of the Required Purchasers, in the name of Originator or otherwise, may demand, sue for, collect, receive and receipt for any and all such payments or distributions, and file, prove and vote or consent in any proceeding related to such Insolvency Event with respect to any and all claims of the Originator relating to this Subordinated Note, in each case until the Senior Interests (other than unasserted contingent indemnification obligations) shall have been paid in full and in cash.

Schedule 2- 2

until the Senior Interests (other than unasserted contingent indemnification obligations) have been paid in full and in cash. All payments and distributions received by Administrative Agent in respect of this Subordinated Note, to the extent received in or converted into cash, may be applied by Administrative Agent (for the benefit of the Senior Interest Holders) first, to the payment of any and all expenses (including, without limitation, attorneys’ fees and other legal expenses) paid or incurred by Administrative Agent or the Senior Interest Holders in enforcing these Subordination Provisions, or in endeavoring to collect or realize upon the Junior Liabilities, and second, any balance thereof shall, solely as between any SCA Originator (including Originator hereunder) and the Senior Interest Holders, be applied by Administrative Agent toward the payment of the Senior Interests in a manner determined by Administrative Agent to be in accordance with the Receivables Purchase Agreement; but as between Company and its creditors, no such payments or distributions of any kind or character shall be deemed to be payments or distributions in respect of the Senior Interests.

(iv) Upon the payment in full and in cash of all Senior Interests (other than unasserted contingent indemnification obligations), the Originator shall be subrogated to the rights of the Senior Interests Holders to receive payments or distributions from Company that are applicable to the Senior Interests.

(v) These Subordination Provisions are intended solely for the purpose of defining the relative rights of the Originator, on the one hand, and the Senior Interest Holders, on the other hand. Nothing contained in these Subordination Provisions or elsewhere in this Subordinated Note is intended to or shall impair, as between Company, its creditors (other than the Senior Interest Holders) and the Originator, Company’s obligation, which is unconditional and absolute, to pay this Subordinated Note as and when the same shall become due in accordance with the terms hereof and of the Sale Agreement or to affect the relative rights of the Originator and creditors of Company (other than the Senior Interest Holders).

(vi) Originator shall not, (a) until the Senior Interests (other than unasserted contingent indemnification obligations) have been paid in full and in cash, cancel, waive, forgive, transfer or assign, or commence legal proceedings to enforce or collect, or subordinate to any obligation of Company, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, or now or hereafter existing, or due or to become due, other than the Senior Interests, this Subordinated Note, or any rights in respect thereof, in each case, without the prior written consent of the Administrative Agent and the Required Purchasers or (b) at any time convert this Subordinated Note into an equity interest in Company.

(vii) Originator shall not commence, or join with any other Person in commencing, any proceedings related to an Insolvency Event with respect to Company until at least one year and one day shall have passed since the Senior Interests (other than unasserted contingent indemnification obligations) shall have been paid in full and in cash.

(viii) If, at any time, any payment (in whole or in part) made with respect to any Senior Interest is rescinded or must be restored or returned by a Senior Interest Holder (whether in connection with any Insolvency Event or otherwise), these Subordination Provisions shall continue to be effective or shall be reinstated, as the case may be, as though such payment had not been made.

Schedule 2- 3

any property securing any of the Senior Interests pursuant to, and to the extent set forth in, the Transaction Documents; (b) retain or obtain the primary or secondary obligations of any other obligor or obligors with respect to any of the Senior Interests; (c) extend or renew for one or more periods (whether or not longer than the original period), alter or exchange any of the Senior Interests, or release or compromise any obligation of any nature with respect to any of the Senior Interests in accordance with the Transaction Documents; (d) amend, supplement or otherwise modify any Transaction Document in accordance with the terms thereof; and (e) release its security interest in, or surrender, release or permit any substitution or exchange for all or any part of any rights or property securing any of the Senior Interests, or extend or renew for one or more periods (whether or not longer than the original period), or release, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such rights or property.

(x) Originator agrees that this Subordinated Note shall be pari passu with all other Junior Liabilities.

(xi) Originator hereby waives (a) notice of acceptance of these Subordination Provisions by any of the Senior Interest Holders, (b) notice of the existence, creation, non-payment or non-performance of all or any of the Senior Interests, and (c) all diligence in enforcement, collection or protection of, or realization upon the Senior Interests, or any thereof, or any security therefor.

(xii) These Subordination Provisions constitute a continuing offer from Company to all Persons who become the holders of, or who continue to hold, Senior Interests; and these Subordination Provisions are made for the benefit of the Senior Interest Holders, and Administrative Agent may proceed to enforce such provisions on behalf of each of such Persons.

(V) Amendments . This Subordinated Note shall not be amended or modified except in accordance with Section 8.1 of the Sale Agreement. The terms of this Subordinated Note may not be amended or otherwise modified without the prior written consent of the Administrative Agent and the Required Purchasers.

(VI) Governing Law . THIS SUBORDINATED NOTE HAS BEEN MADE AND DELIVERED AT NEW YORK, NEW YORK, AND SHALL BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE LAWS AND DECISIONS OF THE STATE OF NEW YORK. WHEREVER POSSIBLE EACH PROVISION OF THIS SUBORDINATED NOTE SHALL BE INTERPRETED IN SUCH MANNER AS TO BE EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS SUBORDINATED NOTE SHALL BE PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH PROVISION SHALL BE INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY, WITHOUT INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE REMAINING PROVISIONS OF THIS SUBORDINATED NOTE.

(VII) Waivers . All parties hereto, whether as makers, endorsers, or otherwise, severally waive presentment for payment, demand, protest and notice of dishonor. Originator additionally expressly waives all notice of the acceptance by any Senior Interest Holder of the subordination and other provisions of this Subordinated Note and expressly waives reliance by any Senior Interest Holder upon the subordination and other provisions herein provided.

(VIII) Assignment . Other than in connection with a Subordinated Note Financing (so long as each Subordinated Note Financier is then party to the No Petition Agreement), this Subordinated Note

Schedule 2- 4

may not be assigned, pledged or otherwise transferred to any party other than Originator without the prior written consent of the Administrative Agent and the Required Purchasers, and any such attempted transfer shall be void.

COFINA FUNDING, LLC

By:

Title:

Schedule 2- 5

Schedule

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL



Date	Amount of Subordinated Loan	Amount of Principal Paid	Unpaid Principal Balance	Notation made by (initials)

Schedule 2- 6

Exhibit A

[Form of] Purchase Report

Originator: [Name of Originator]

Company: Cofina Funding, LLC

For the Settlement Period beginning [date] and ending [date] (the “ Settlement Period ”)

-------

To: Company and the ADMINISTRATIVE Agent (AS Company’s ASSIGNEE)


1.	Initial Unpaid Balance of Assets sold or contributed during the Settlement Period: $


2.	Aggregate Purchase Price of Receivables sold or contributed during the Settlement Period:


3.	Aggregate Purchase Price of Assets sold or contributed during the Settlement Period that was paid in cash: $


4.	Aggregate Purchase Price of Assets sold or contributed during the Settlement Period that was paid by increasing the related Subordinated Note: $


5.	Company’s Net Worth on the last day of the Settlement Period: $


6.	Reductions in the related Subordinated Note during the Settlement Period: $


7.	Principal balance of the related Subordinated Note on the last day of the Settlement Period:

Exhibit A

Exhibit 10.36C

EXECUTION COPY

Dated as of September 4, 2018

MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.),

as Administrative Agent under the Receivables Purchase Agreement

1221 Avenue of the Americas

New York, NY 10020

Re: Letter Agreement re: Pledge of Subordinated Notes

Ladies and Gentlemen:

Please refer to (a) the Subordinated Note Financing Documents (as defined in the Receivables Purchase Agreement (defined below)), for which MUFG Bank, Ltd. (“MUFG”), as buyer and buyer agent (MUFG, as buyer agent and as buyer, together with its successors and assigns in such capacity, a “ Subordinated Note Financier ” and together the “ Subordinated Note Financiers ”) and (b) that certain Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 (as the same may be amended, restated, supplemented, replaced or otherwise modified from time to time, the “ Receivables Purchase Agreement ”) among CHS Inc., a Minnesota corporation (“ CHS ”), individually and as initial Servicer, Cofina Funding, LLC, a Delaware limited liability company (the “ Seller ”), the various Conduit Purchasers, Committed Purchasers and Purchaser Agents from time to time party thereto, and MUFG, as administrative agent (in such capacity, the “ RPA Agent ”). Capitalized terms used but not otherwise defined herein have the meanings assigned thereto in, or by reference in, the Receivables Purchase Agreement. As used herein, the following terms have the following meanings: (i) “ Debt Interests ” means each Subordinated Note issued by the Seller to an Originator, (ii) “ Securitization Assets ” means the Assets, all Related Security and Collections with respect to the Receivables and all proceeds of any of the foregoing and (iii) “ Securitization Party ” means each Purchaser, the RPA Agent and each Indemnified Party.

In consideration for the RPA Agent’s (on behalf of the Purchasers) consent to the pledge of the Debt Interests by the Originators to the Subordinated Note Financiers, each Subordinated Note Financier hereby represents, warrants and agrees that it shall not:

(a) (i) contest or challenge, or join any other Person in contesting or challenging, the transfers of Securitization Assets from any Originator to the Seller, whether on the grounds that such transfers were disguised financings, preferential transfers, fraudulent conveyances or otherwise or a transfer other than a “true sale” or a “true contribution”, (ii) without limiting the foregoing, contest or challenge, or join any other Person in contesting or challenging, the validity, enforceability, priority or perfection of the interest, or ownership, of the Seller in any of the Securitization Assets or its rights with respect thereto, or the validity, enforceability, priority or perfection of the interest of any assignee of the Seller (including any Purchaser under the Receivables Purchase Agreement or otherwise) in any of the Securitization Assets or any of their respective rights with respect thereto or (iii) (A) assert that any Person and the Seller should be substantively consolidated, treated as alter-egos or assert any similar theory or that the Seller is not or was not a limited liability company separate and distinct from any Originator, CHS or any other Person or (B) challenge the valuation of any Securitization Assets which any Purchaser, any assignee of such Purchaser or the RPA Agent may elect to liquidate as permitted under the Transaction Documents, or otherwise assert that any such liquidation was illegal, not done in a commercially reasonable manner, or otherwise invalid or improper;

(b) (i) directly or indirectly, institute against (or solicit or encourage any Person to institute against), or join any other Person in instituting against, the Seller any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other similar proceeding under any federal or state bankruptcy or similar law, until one year and one day following the Final Payout Date (such date, the “ Subject Date ”) or (ii) directly or indirectly, institute against (or solicit or encourage any Person to institute against), or join any other Person in instituting against, any Conduit Purchaser any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other similar proceeding under any federal or state bankruptcy or similar law until one year (or, if longer, any applicable preference period then in effect) plus one day following the last day on which all Commercial Paper Notes and other publicly or privately placed indebtedness for borrowed money of such Conduit Purchaser shall have been indefeasibly paid in full;

(c) assign its rights or obligations under any Subordinated Note Financing Document to any other Person unless such Person shall have agreed in writing to be bound by the terms of this letter agreement as if it were a party hereto;

(d) notwithstanding any provision of the Subordinated Note Financing Documents or any related transaction documents, prior to the Subject Date, sell, assign, pledge, create any other security interest in or otherwise transfer any of the Debt Interests or any interest therein to any other Person unless such Person shall have agreed in writing to be bound by the terms of this letter agreement as if it were a party hereto;

(e) (i) attempt to prohibit or restrict any sale, assignment, pledge, security interest or other transfer of the Securitization Assets or (ii) interfere in any manner with, or object to or contest, the transactions contemplated under the Transaction Documents, any action or exercise of rights or remedies by the RPA Agent or any Purchaser thereunder or any rights of any party to any Transaction Documents or (iii) assert any lien, security interest or ownership with respect to the Securitization Assets, in each case, prior to the Final Payout Date; and/or

(f) prior to the Subject Date, alter or cause the alteration of the independent manager provisions of the Seller’s limited liability company agreement or attempt to remove or replace any serving independent manager without the consent of the RPA Agent.

Each Subordinated Note Financier hereby acknowledges and agrees that (i) neither the RPA Agent nor any other Securitization Party has a fiduciary duty or any other duty to such Subordinated Note Financier based on the pledge of the Debt Interests and (ii) distributions under the Debt Interests are subject to the subordination provisions set forth in the Debt Interests and such Subordinated Note Financier agrees to be bound by and not otherwise challenge the enforceability of such provisions.

This letter agreement shall become effective on the date hereof provided that each of the Subordinated Note Financiers and the RPA Agent shall have received duly executed counterparts of this letter agreement, and thereafter this letter agreement shall be binding upon and inure to the benefit of the Subordinated Note Financiers and the RPA Agent and each of their respective successors and assigns.

This letter agreement shall remain in effect until the Subject Date.

No waiver, amendment or other modification, or consent with respect to, any provision of this letter agreement shall be effective unless the same shall be in writing and signed by each Subordinated Note Financier and the RPA Agent.

This letter agreement may be executed in any number of counterparts, each of which, when so executed, shall be deemed to be an original, and all of which, when taken together, shall constitute one and the same agreement.

Any provisions of this letter agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

THIS LETTER AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF).

EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:

(a) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING; AND

(continued on the following page)

Please indicate your agreement with the foregoing by signing (where indicated below).

Very truly yours,

MUFG BANK, LTD. ,

as a Subordinated Note Financier

By:

Name:

Title:

S- 1 Letter Agreement

ACCEPTED AND AGREED TO:

MUFG BANK, LTD. (f/k/a THE BANK

OF TOKYO-MITSUBISHI UFJ, LTD.) ,

as RPA Agent

By:

Name:

Title:

S- 2 Letter Agreement

EXECUTION COPY

AMENDED AND RESTATED SUBORDINATED NOTE

September 4, 2018

Note . FOR VALUE RECEIVED, the undersigned, Cofina Funding, LLC, a Delaware limited liability company (the “ Company ”), hereby unconditionally promises to pay to the order of CHS CAPITAL, LLC, a Minnesota limited liability company (“ Originator ”), in lawful money of the United States of America and in immediately available funds, on or before the date following the Termination Date which is one year and one day after the date on which (i) the Unpaid Balance of all Assets sold by Originator under the “Sale Agreement” referred to below has been reduced to zero and (ii) Originator has paid to the Company all indemnities, adjustments and other amounts which may be owed thereunder in connection with the Purchase thereunder (the “ Collection Date ”), the aggregate unpaid principal sum outstanding of all “ Subordinated Loans ” made from time to time by Originator to the Company pursuant to and in accordance with the terms of that certain Sale and Contribution Agreement dated as of July 22, 2016 among Originator and certain of its affiliates, as originators, and the Company (as amended, restated, supplemented or otherwise modified from time to time, the “ Sale Agreement ”). Reference to Section 2.3 of the Sale Agreement is hereby made for a statement of the terms and conditions under which the loans evidenced hereby have been and will be made.

“ SCA Originator ” means any Person designated as an “Originator” under the Sale Agreement.

“ Senior Interest Holders ” means, collectively, each Purchaser, each Purchaser Agent, the Administrative Agent and each Indemnified Party and their permitted assigns.

“ Subordination Provisions ” is defined in Section IV hereof.

(II) Interest . The Company further promises to pay interest on the outstanding unpaid principal amount hereof from the date hereof until payment in full hereof at a rate equal to the 1-month LIBOR rate published in The Wall Street Journal on the first Business Day of each month (or portion thereof) during the term of this Subordinated Note, computed for actual days elapsed on the basis of a year consisting of 360 days and changing on the first business day of each month hereafter (“ LIBOR ”); provided , however , that if the Company shall default in the payment of any principal hereof, the Company promises to pay, on demand, interest at the rate equal to LIBOR plus 1.50 % per annum on any such unpaid amounts, from the date such payment is due to the date of

actual payment. Interest shall be payable on the first Business Day of each month in arrears; provided , however , that the Company may elect on the date any interest payment is due hereunder to defer such payment and upon such election the amount of interest due but unpaid on such date shall constitute principal under this Subordinated Note. The outstanding principal of any loan made under this Subordinated Note shall be due and payable on the Collection Date and may be repaid or prepaid at any time without premium or penalty.

(iii) In the event that Originator receives any payment or other distribution of any kind or character from Company or from any other source whatsoever, in respect of this Subordinated Note, other than as expressly permitted by the terms of this Subordinated Note, such payment or other distribution shall be received in trust for the Senior Interest Holders and shall immediately be turned over in cash by the Originator to Administrative Agent (for the benefit of the Senior Interest Holders) until the Senior Interests (other than unasserted contingent indemnification obligations) have been paid in full and in cash. All payments and distributions received by Administrative Agent in respect of this Subordinated Note, to the extent received in or converted into cash, may be applied by Administrative Agent (for the benefit of the Senior Interest Holders) first, to the payment of any and all expenses (including, without limitation, attorneys’ fees and other legal expenses) paid or incurred by Administrative Agent or the Senior Interest Holders in enforcing these Subordination Provisions, or in endeavoring to collect or realize upon the Junior Liabilities, and second, any balance thereof shall, solely as between any SCA Originator (including Originator hereunder) and the Senior Interest

Holders, be applied by Administrative Agent toward the payment of the Senior Interests in a manner determined by Administrative Agent to be in accordance with the Receivables Purchase Agreement; but as between Company and its creditors, no such payments or distributions of any kind or character shall be deemed to be payments or distributions in respect of the Senior Interests.

(ix) Each of the Senior Interest Holders may, from time to time, at its sole discretion, without notice or demand to Originator, and without waiving any of its rights under these Subordination Provisions, take any or all of the following actions: (a) retain or obtain an interest in any property securing any of the Senior Interests pursuant to, and to the extent set forth in, the Transaction Documents; (b) retain or obtain the primary or secondary obligations of any other obligor or obligors with respect to any of the Senior Interests; (c) extend or renew for one or more periods (whether or not longer than the original period), alter or exchange any of the Senior Interests, or release or compromise any obligation of any nature with respect to any of the Senior Interests in accordance with the Transaction Documents; (d) amend, supplement or otherwise modify any Transaction Document in accordance with the terms thereof; and (e) release its security interest in, or surrender, release or permit any substitution or exchange for all or any part of any rights or property securing any of the Senior Interests, or extend or renew for one or more periods (whether or not longer than the original period), or release, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such rights or property.

(x) Originator agrees that this Subordinated Note shall be pari passu with all other Junior Liabilities.

(VIII) Assignment . Other than in connection with a Subordinated Note Financing (so long as each Subordinated Note Financier is then party to the No Petition Agreement), this Subordinated Note may not be assigned, pledged or otherwise transferred to any party other than Originator without the prior written consent of the Administrative Agent and the Required Purchasers, and any such attempted transfer shall be void.

(IX) Effect of this Note . This promissory note amends, restates and replaces in its entirety (but does not cancel or extinguish the indebtedness evidenced by) that certain note, dated as of July 22, 2016, issued by Cofina to CHS Capital, LLC.

[SIGNATURE PAGE FOLLOWS]

COFINA FUNDING, LLC

By:

Title:

[Signature Page to A&R Subordinated Note (CHS Capital)]

Schedule

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL



Date	Amount of Subordinated Loan	Amount of Principal Paid	Unpaid Principal Balance	Notation made by (initials)

EXECUTION COPY

AMENDED AND RESTATED SUBORDINATED NOTE

September 4, 2018

Note . FOR VALUE RECEIVED, the undersigned, Cofina Funding, LLC, a Delaware limited liability company (the “ Company ”), hereby unconditionally promises to pay to the order of CHS INC., a Minnesota corporation (“ Originator ”), in lawful money of the United States of America and in immediately available funds, on or before the date following the Termination Date which is one year and one day after the date on which (i) the Unpaid Balance of all Assets sold by Originator under the “Sale Agreement” referred to below has been reduced to zero and (ii) Originator has paid to the Company all indemnities, adjustments and other amounts which may be owed thereunder in connection with the Purchase thereunder (the “ Collection Date ”), the aggregate unpaid principal sum outstanding of all “ Subordinated Loans ” made from time to time by Originator to the Company pursuant to and in accordance with the terms of that certain Sale and Contribution Agreement dated as of July 22, 2016 among Originator and certain of its affiliates, as originators, and the Company (as amended, restated, supplemented or otherwise modified from time to time, the “ Sale Agreement ”). Reference to Section 2.3 of the Sale Agreement is hereby made for a statement of the terms and conditions under which the loans evidenced hereby have been and will be made.

“ SCA Originator ” means any Person designated as an “Originator” under the Sale Agreement.

“ Senior Interest Holders ” means, collectively, each Purchaser, each Purchaser Agent, the Administrative Agent and each Indemnified Party and their permitted assigns.

“ Subordination Provisions ” is defined in Section IV hereof.

however , that the Company may elect on the date any interest payment is due hereunder to defer such payment and upon such election the amount of interest due but unpaid on such date shall constitute principal under this Subordinated Note. The outstanding principal of any loan made under this Subordinated Note shall be due and payable on the Collection Date and may be repaid or prepaid at any time without premium or penalty.

determined by Administrative Agent to be in accordance with the Receivables Purchase Agreement; but as between Company and its creditors, no such payments or distributions of any kind or character shall be deemed to be payments or distributions in respect of the Senior Interests.

(x) Originator agrees that this Subordinated Note shall be pari passu with all other Junior Liabilities.

(xi) Originator hereby waives (a) notice of acceptance of these Subordination Provisions by any of the Senior Interest Holders, (b) notice of the existence, creation, non-payment or non-

performance of all or any of the Senior Interests, and (c) all diligence in enforcement, collection or protection of, or realization upon the Senior Interests, or any thereof, or any security therefor.

[SIGNATURE PAGE FOLLOWS]

COFINA FUNDING, LLC

By:

Title:

[Signature Page to A&R Subordinated Note (CHS Inc.)]

Schedule

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL



Date	Amount of Subordinated Loan	Amount of Principal Paid	Unpaid Principal Balance	Notation made by (initials)

EXECUTION COPY

Exhibit 10.39

MASTER FRAMEWORK AGREEMENT

This MASTER FRAMEWORK AGREEMENT (this “ Framework Agreement ”), is made and entered into as of September 4, 2018 (the “ Effective Date ”), by and among:

(A) MUFG Bank, Ltd., a Japanese banking corporation (“ MUFG ”) and each other financial institution from time to time party hereto, as buyers (each, a “ Buyer ” and, collectively, the “ Buyers ”);

(B) MUFG, as agent for the Buyers (in such capacity, “ Buyer Agent ”);

(B) CHS Inc., a Minnesota corporation (“ CHS ”), CHS Capital, LLC, a Minnesota limited liability company (“ CHS Capital ”), as sellers (each, a “ Seller ” and, collectively, the “ Sellers ”); and

Each of each Buyer, Buyer Agent, Seller Agent and each Seller may also be referred to herein individually as a “ Party ”, and collectively as the “ Parties ”.

RECITALS

WHEREAS, each Seller is party to a securitization facility pursuant to which such Seller sells receivables and/or loans to Cofina Funding, LLC (“ Cofina ”) and receives the purchase price therefor consisting of combination of cash and indebtedness under Seller Notes issued by Cofina to each such Seller; and

WHEREAS, the Buyers have agreed to provide Sellers with a facility under which the Buyers will enter into certain sale and repurchase agreements with each Seller with respect to their respective Seller Notes.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants, agreements and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:


1.	Interpretation .

1.1 Definitions . All capitalized terms used in this Framework Agreement (including its recitals, Exhibits and Schedules) shall, unless otherwise defined herein, have the respective meanings set forth in Schedule 1 hereto.

1.2 Construction .

(a) The headings, sub-headings and table of contents in this Framework Agreement shall not affect its interpretation. References in this Framework Agreement to Sections, Exhibits and Schedules shall, unless the context otherwise requires, be references to Sections of, and Exhibits and Schedules to, this Framework Agreement.

(b) Words denoting the singular number only shall include the plural number also and vice versa; words denoting one gender only shall include the other genders and words denoting persons shall include firms and corporations and vice versa.

(d) References in this Framework Agreement to any agreement or other document shall be deemed also to refer to such agreement or document as amended or varied or novated from time to time.

(e) References to an amendment include a supplement, novation, restatement or re-enactment, and “amend” and “amended” (or any of their derivative forms) will be construed accordingly.

(f) Reference to a time of day is a reference to New York City time.

(g) “Include”, “includes” and “including” shall be deemed to be followed by the words “without limitation”.

(h) “Hereof”, “hereto”, “herein” and “hereunder” and words of similar import when used in this Framework Agreement refer to this Framework Agreement as a whole and not to any particular provision of this Framework Agreement.

(i) References to a “writing” or “written” include any text transmitted or made available on paper or through electronic means.

(j) References to “$”, U.S. Dollars or otherwise to dollar amounts refer to the lawful currency of the United States.

(k) References to a law include any amendment or modification to such law and any rules and regulations issued thereunder, whether such amendment or modification is made, or issuance of such rules and regulations occurs, before or after the Effective Date.

2. Transaction Agreements .

2.1 Agreements to be Executed at the Closing . Concurrently with this Framework Agreement, the Parties intend to execute the following additional agreements to which they are party:

(a) the CHS Master Repurchase Agreement;

(b) the CHS Capital Master Repurchase Agreement;

(d) the Guaranty.

2.2 Definitions . When used in any Transaction Agreement, capitalized terms not otherwise defined therein will, to the extent defined herein, have the meanings set forth in this Framework Agreement (including Schedule 1).

3. Closing; Closing Deliveries .

3.1 Closing . Subject to the terms and conditions of this Framework Agreement, the transactions contemplated in this Framework Agreement to occur concurrently with the execution hereof (other than the entry into any Confirmations) will take place at a closing (the “ Closing ”) to be held on the Effective Date by the exchange of electronic documentation.

3.2 Seller Closing Deliverables . At the Closing or prior to the Closing, the Sellers and Seller Agent (as applicable) will deliver, or cause to be delivered, to each Buyer and Buyer Agent:

(a) an executed counterpart to each of the Transaction Agreements (including any Confirmations with respect to Transactions being entered into on the Effective Date) to which it is a party;

(b) a counterpart of the Guaranty executed by Guarantor;

(c) a certificate of the Secretary or an Assistant Secretary of each Seller, dated the Effective Date, certifying as to (i) the incumbency of the officers of such Seller executing the Transaction Agreements, (ii) (A) with respect to CHS, there having been no change to CHS’s articles of incorporation and bylaws delivered to Buyer Agent as Exhibit B and Exhibit C, as applicable, to the Assistant Secretary’s Certificate delivered on behalf of CHS on July 18, 2017, and (B) with respect to CHS Capital, there having been no change to CHS Capital’s articles of organization delivered to Buyer Agent as Exhibit B to the Secretary’s Certificate delivered on behalf of CHS Capital on July 18, 2017; and (iii) copies of all corporate approvals and consents of such Seller that are required by it in connection with entering into, and the exercise of its rights and the performance of its obligations under, the Transaction Agreements;

(d) a customary legal opinion or opinions of Dorsey & Whitney LLP, in form and substance satisfactory to Buyer Agent and each Buyer, with respect to each Seller and the Guarantor opining on existence,

due authorization and execution, absence of conflicts with Organizational Documents and with certain material agreements (including, for the avoidance of doubt, the Securitization Facility Documents and the Credit Facility Documents), binding nature of obligations, absence of violations of Applicable Law, absence of consents under Applicable Law and validity and perfection of security interests;

(e) a favorable bring-down opinion as to true sale and non-consolidation matters with respect to the CHS Parties and the transactions contemplated by the Securitization Facility Documents, delivered in accordance with Section 6 of the Securitization Amendment and including each Buyer and Buyer Agent, as an addressee thereof;

(f) results of a UCC lien search with respect to each Seller for the State where such Seller is organized as of a date not more than thirty (30) days prior to the Closing; and

(g) fully prepared UCC-1 financing statements reflecting the security interests granted by each Seller under the applicable Master Repurchase Agreement.

3.3 Buyers and Buyer Agent Closing Deliverables . At the Closing or prior to the Closing, each of Buyer Agent and each Buyer will deliver to Sellers (i) an executed counterpart to each of the Transaction Agreements (including any Confirmations with respect to Transactions being entered into on the Effective Date) to which it is a party and (ii) an executed copy of IRS Form W-8ECI or IRS Form W-8IMY, as applicable.

3.4 Transaction Deliverables . Unless waived by Buyer Agent in its sole discretion, no later than 12:00 p.m. on the third Business Day prior to the date of the initial Transaction hereunder, Seller Agent will deliver to Buyer and Buyer Agent (i) a duly completed Transaction Notice with respect to the initial Transactions, (ii) fully-completed forms of Confirmations for such Transactions (excluding the terms thereof pertaining to Pricing Rate, Price Differential and Repurchase Price), (iii) a copy of the pro-forma Information Package required to be delivered to the Securitization Agent and (iv) a Purchase Report with respect to the Settlement Period ending July 31, 2018. Promptly following the entry into such initial Transaction(s), the Sellers shall deliver (or caused to be delivered) to each Buyer and Buyer Agent the original executed versions of each Seller Note.

4. Transactions .

4.1 Requests for Transactions .

(a) Transaction Notices . Seller Agent may, from time to time during the Facility Term, deliver a written notice, substantially in the form attached hereto as Exhibit A (a “ Transaction Notice ”) to Buyer Agent and each Buyer requesting on behalf of the Sellers that Buyers enter into Transactions with respect to each of the Seller Notes on a Monthly Date (or, if Sellers elect to terminate outstanding Transactions pursuant to Paragraph 3(c)(ii) of the applicable Master Repurchase Agreement, on the effective date of such termination) on a pro rata basis in accordance with each Buyer’s Undivided Funding Percentage. Such notice (i) shall be delivered to Buyer Agent and each Buyer not less than three (3) Business Days prior to the date of the proposed Transaction, (ii) shall include fully-completed forms of Confirmations for such Transactions (excluding the terms thereof pertaining to Pricing Rate, Price Differential and Repurchase Price), and (iii) to the extent the proposed Purchase Date is a Monthly Date, shall be accompanied by copies of the Purchase Report and the Information Package required to be delivered pursuant to the Securitization Facility Documents in respect of the most recently completed Settlement Period prior to such proposed Purchase Date. For the avoidance of doubt, (A) no Transaction may be requested hereunder with respect to a Seller Note unless a corresponding Transaction is requested hereunder with respect to each other Seller Note, each of such proposed Transactions having the same proposed Purchase Date and same proposed Repurchase Date and (B) no outstanding Transaction with respect to a Seller Note may be terminated by a Seller pursuant to Paragraph 3(c)(ii) of the applicable Master Repurchase Agreement unless each other corresponding Transaction with respect to each other Seller Note is likewise terminated under each other Master Repurchase Agreement on the same effective date of termination.

(b) Buyers’ Option to Proceed or Decline . Following receipt of a properly completed Transaction Notice and supporting documentation in accordance with Section 4.1(a), and so long as the proposed Transactions comply with the requirements set forth in Section 4.3, each Buyer may, at its sole

discretion, severally and not jointly, elect to either (i) enter into the proposed Transactions with Sellers on the terms set forth in the Transaction Notice (with such modifications as such Buyer and Seller Agent shall have agreed) by delivering to Seller Agent finalized and executed Confirmations evidencing such Transactions and paying its applicable Funded Purchase Price in accordance with Section 4.1(c) below or (ii) decline Sellers’ request to enter into such Transactions (in which case such Buyer shall deliver written notice of such election to the Seller Agent and Buyer Agent on or before the proposed Purchase Date specified in the Transaction Notice (any Buyer who has declined to enter into a Transaction pursuant to this clause (ii), a “ Non-Consenting Buyer ”); provided that, following any Non-Consenting Buyer’s delivery of a written notice pursuant to this clause (ii) with respect to any Transaction at any time there are two or more Buyers, (x) such Non-Consenting Buyer shall have no right to enter into any other Transactions on and after such date and (y) the Undivided Funding Percentage for such Transaction shall be recalculated in accordance with the definition thereof. To the extent a Buyer wishes to proceed with the Transactions, such Buyer shall, no later than 2:00 p.m. on the Business Day immediately preceding the proposed Purchase Date, deliver to the applicable Seller a fully completed draft Confirmation with respect to the proposed Transaction. In the event the applicable Seller and a Buyer disagree with respect to any portion of the draft Confirmation or in the event a Buyer determines that any applicable Funding Conditions are not, or will not be, satisfied as of the relevant Purchase Date, such Seller or such Buyer (as applicable) shall promptly notify the other and the Buyer Agent of the same, and such Seller and such Buyer shall, subject to Section 4.1(d), cooperate expeditiously and in good faith to resolve any such matters (to the extent the same are capable of being resolved).

(c) Confirmation and Closings . In the event a Buyer elects to enter into the proposed Transactions, such Buyer shall, subject to satisfaction of the Funding Conditions, enter into such Transactions by executing and delivering to Seller Agent finalized Confirmations evidencing such Transaction in accordance with the applicable Master Repurchase Agreement at or prior to the time of closing for such Transactions. Concurrently with its delivery of such Confirmation, a Buyer shall pay its Funded Purchase Price (if any) for the Transactions in accordance Section 7.1 hereof and the terms of the applicable Master Repurchase Agreements and applicable Confirmations, whereupon Sellers will sell and assign, and Buyer will purchase, each of the Seller Notes subject to such Transactions. The closing of such Transactions and payment of any such Funded Purchase Price by a Buyer shall occur at or before 2:00 p.m. on the applicable Purchase Date (or such later time on such Purchase Date as Seller Agent and such Buyer may agree).

(d) UNCOMMITTED ARRANGEMENT . EACH SELLER AND EACH BUYER ACKNOWLEDGE THAT THIS IS AN UNCOMMITTED ARRANGEMENT, AND THAT NO SELLER HAS PAID, OR IS REQUIRED TO PAY, A COMMITMENT FEE OR COMPARABLE FEE TO ANY BUYER. PROPOSED TRANSACTIONS FOR THE SALE OF SELLER NOTES BY THE SELLERS SHALL BE REQUESTED AT SUCH SELLERS’ SOLE AND ABSOLUTE DISCRETION, AND ACCEPTANCE OF ANY SUCH REQUESTS AND ENTRY INTO ANY SUCH TRANSACTIONS BY ANY BUYER SHALL BE AT SUCH BUYER’S SOLE AND ABSOLUTE DISCRETION.

4.2 [Reserved] .

4.3 Funding Conditions .

(a) The entry by any Buyer into any Transactions on any Purchase Date shall be subject to satisfaction of the following conditions (in each case, as of such Purchase Date) (together, the “ Funding Conditions ”):

(i) each of the items required to be delivered by the Sellers pursuant to Section 3.2 shall have been delivered in accordance with the terms hereof;

(ii) solely with respect to any Transactions to be entered into on the Effective Date, each of the items required to be delivered to each Buyer and Buyer Agent pursuant to Section 3.4 shall have been duly delivered in accordance with the terms thereof;

(iii) with respect to any Transactions not referenced in clause (iii) above, the Transaction Notice for such Transactions, together with the required Information Package (to the

extent such Purchase Date is a Monthly Date) and Purchase Report, shall have been duly delivered to Buyer in accordance with Section 4.1(a);

(iv) Seller Agent, on behalf of Sellers, shall have delivered, or caused to be delivered, to such Buyer a duly executed counterpart to the Confirmation for each such Transaction;

(v) with respect to any Transactions not referenced in clause (iii) above, the Sellers shall have delivered (or the Seller Agent shall have delivered on behalf of such Seller) to Buyer Agent the original executed versions of each Seller Note (or if previously delivered, Buyer Agent shall remain in possession thereof);

(vi) with the exception of Section 5.2(a) hereof, each of the representations and warranties of Guarantor and each Seller (as applicable) set forth in the Transaction Agreements (giving effect to the entry into such Transactions) shall be true and correct in all material respects (except that any representation or warranty that is subject to any materiality qualification shall be true and correct in all respects);

(vii) the Facility Expiration Date shall not have occurred;

(viii) the payment of such Buyer’s applicable Funded Purchase Price (if any) would not cause such Buyer’s Outstanding Buyer Balance (after giving effect to such payment) to exceed such Buyer’s Maximum Buyer Balance;

(ix) the Outstanding Amount of the applicable Seller Note subject to each such Transaction shall equal or exceed the Purchase Price for such Transaction;

(x) subject to any netting arrangements permitted under the applicable Master Repurchase Agreement, Buyers shall have received the full amount of Funded Repurchase Price (if any) due and payable by the Sellers on such Purchase Date;

(xi) no Person (other than an Affiliate of MUFG) shall have replaced MUFG as Securitization Agent under the Securitization RPA;

(xii) no Seller shall have ceased to be an Originator under the Securitization SCA;

(xiii) no Event of Default, Potential Event of Default or Securitization Facility Default shall have occurred and be continuing.

4.4 Funding of Transaction Repurchase Prices .

(a) On each Repurchase Date for a Transaction on which the applicable Funded Repurchase Price is payable by the Sellers pursuant to the Transaction Agreements (including, for the avoidance of doubt, on the Facility Expiration Date), each Seller shall fund Buyer Agent the applicable Funded Repurchase Price for such Transaction by wire transfer of immediately available funds to the account of Buyer Agent specified in Schedule 2 or, upon the instruction of such Buyer, to the account of such Buyer specified in Schedule 2, no later than 11:00 a.m. on such Repurchase Date.

(b) On any Business Day when Buyer Agent receives any Funded Repurchase Price or Margin Payment from a Seller for any Transaction, Buyer Agent shall distribute to each Buyer such Buyer’s Pro Rata Share in respect of such Funded Repurchase Price or Margin Payment by wire transfer of immediately available funds to the account of such Buyer set forth on Schedule 2 (i) on the same Business Day if such Funded Repurchase Price or Margin Payment is received from Seller prior to 2:00 p.m. on such Business Day or (ii) otherwise, on the next succeeding Business Day.

5. Representations and Warranties; Certain Covenants .

5.1 Representations and Warranties of Seller . Each Seller represents to Buyer as of the Effective Date and each date thereafter until each Transaction Document is terminated in accordance with its terms that:

(a) Securitization Facility Compliance . Each Securitization Facility Document is in full force and effect. Each of the Sellers, the Securitization Guarantor and the Securitization Servicer is in compliance in all material respects with all covenants and other obligations and undertakings applicable to it under the Securitization Facility Documents, and each of the representations and warranties made by any of the Sellers, the Securitization Guarantor or the Securitization Servicer as of such Purchase Date (or if not

made as of such Purchase Date, as of the date when last made) under the Securitization Facility Documents is true and correct in all material respects as of such date (except that any such representation or warranty that is subject to any materiality qualification is true and correct in all respects).

(b) Organization and Good Standing . Such Seller has been duly organized and is validly existing as a corporation or limited liability company, as applicable, in good standing under the Applicable Laws of its jurisdiction of organization, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted.

(c) Due Qualification . Such Seller is duly qualified to do business as a foreign organization in good standing and has obtained all necessary qualifications, licenses and approvals, in all jurisdictions in which the ownership or lease of its property or the conduct of its business requires such qualifications, licenses or approvals or, if not so qualified, the failure to so qualify would not have a Material Adverse Effect with respect to such Seller.

(d) Power and Authority; Due Authorization . Such Seller (i) has all necessary power, authority and legal right to (A) execute and deliver this Framework Agreement and the other Transaction Agreements to which it is a party, (B) carry out the terms of and perform its obligations under the Transaction Agreements to which it is a party, (C) enter into Transactions and sell and convey to the Buyer Agent, on behalf of each Buyer, each applicable Seller Note on the terms and conditions provided herein and in the other Transaction Agreements, (D) repurchase and acquire from Buyer Agent, on behalf of each Buyer, the applicable Seller Note on the terms and conditions provided in the Transaction Agreements when and as provided thereunder and (ii) has duly authorized by all necessary corporate action the execution, delivery and performance of this Framework Agreement and the other Transaction Agreements to which it is a party.

(e) Binding Obligations . This Framework Agreement constitutes, and each other Transaction Agreement to be signed by such Seller (or by Seller Agent on its behalf) has been duly executed and delivered by it constitutes the legal, valid and binding obligation of it, enforceable against such Seller in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance, or other similar Applicable Laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law and implied covenants of good faith and fair dealing.

(f) No Violations . The consummation of the transactions contemplated by this Framework Agreement and the other Transaction Agreements and the fulfillment of the terms hereof and thereof by it will not, (i) conflict with, result in any breach or (with notice or lapse of time or both) a default under, (A) such Seller’s Organizational Documents, (B) the Securitization Facility Documents, (C) the Credit Facility Documents or (D) any other indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which such Seller is a party or by which it or any of its properties is bound, (ii) result in the creation or imposition of any Adverse Claim (other than Permitted Liens) upon any of its properties pursuant to the terms of any such indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which it is a party or by which it or any of its properties is bound, or (iii) violate any Applicable Law applicable to it or any of its properties.

(g) No Proceedings . There are no actions, suits, proceedings, claims, disputes, or investigations pending, or to such Seller’s knowledge threatened, before any Governmental Authority (i) asserting the invalidity of this Framework Agreement or any other Transaction Agreement to which it is a party, (ii) seeking to prevent the sale of the applicable Seller Note or the consummation of the purposes of this Framework Agreement or of any of the other Transaction Agreements to which it is a party, or (iii) seeking any determination or ruling that has had or could reasonably be expected to have a Material Adverse Effect with respect to such Seller.

(h) Governmental Approvals . No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is required for the due execution, delivery and performance by such Seller of this Framework Agreement or any other Transaction Agreement to which it is a party, except for (i) the filing of the UCC financing statements referred to in the respective Master

Repurchase Agreements, each of which, as of such Purchase Date, shall have been duly filed and shall be in full force and effect, and (ii) those that have been made or obtained and are in full force and effect.

(i) Litigation . There is no pending or, to its knowledge, threatened action, proceeding, investigation or injunction, writ or restraining order affecting such Seller, its Subsidiaries or their respective properties before any Governmental Authority which could reasonably be expected to result in a Material Adverse Effect with respect to such Seller.

(j) Accurate Reports . No Information Package, Purchase Report or any other information, exhibit, financial statement, document, book, record or report furnished or to be furnished by or on behalf of such Seller or any of its Affiliates to Buyer in connection with this Framework Agreement or any other Transaction Agreement: (i) was or will be untrue or inaccurate in any material respect as of the date it was or will be dated or as of the date so furnished; or (ii) contained or will contain when furnished any material misstatement of fact or omitted or will omit to state a material fact or any fact necessary to make the statements contained therein not misleading.

(k) Other Notes . Except for the Seller Notes, no Subordinated Note has been issued by Cofina to such Seller or any other Person.

(l) UCC Details . Such Seller has not changed its name or the location of its jurisdiction of formation during the prior five years.

(m) Tax Status . Such Seller has filed all material tax returns and reports required by Applicable Law to have been filed by it and has paid all material taxes, assessments and governmental charges, to its knowledge, owing by it, other than any such taxes, assessments or charges that are not yet delinquent or are being contested in good faith by appropriate proceedings.

(n) Compliance with Applicable Law . Such Seller has complied with, and is in compliance in all material respects with, all Applicable Laws.

(o) Financial Information . All financial statements of Guarantor and its consolidated Subsidiaries delivered in connection with this Framework Agreement or any other Transaction Agreement were prepared in accordance with GAAP in effect on the date such statements were prepared and fairly present in all material respects the consolidated financial position of Guarantor and its consolidated subsidiaries and their results of operations as of the date and for the period presented or provided (other than in the case of annual financial statements, subject to the absence of footnotes and year-end audit adjustments).

(p) No Adverse Change . Since August 31, 2017, no Material Adverse Effect or event which, individually or in the aggregate, is reasonably likely to result in a Material Adverse Effect has occurred with respect to such Seller. Since August 31, 2017, there has been no change in the business, property, operations or financial condition of Guarantor and its subsidiaries, taken as a whole, that could reasonably be expected to have a Material Adverse Effect with respect to Guarantor.

(q) Investment Company Act . Such Seller is not required to register as an investment company under the Investment Company Act.

(r) No Defaults . No Event of Default or Potential Event of Default has occurred and is continuing, or would result from the entry into the proposed Transactions on the applicable Purchase Date.

(s) Solvent . Such Seller is Solvent and no Insolvency Event (as defined in the Securitization RPA) has occurred with respect to such Seller.

(t) Policies and Procedures . Policies and procedures have been implemented and maintained by or on behalf of such Seller that are designed to achieve compliance by such Seller and its Subsidiaries, Affiliates, directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, and such Seller and its Subsidiaries, Affiliates, officers, employees, directors and agents acting in any capacity in connection with or directly benefitting from the facility established hereby, are in compliance with Anti-Corruption Laws, Anti-Terrorism Laws, and Sanctions.

(u) Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions . (i) None of such Seller or any of its Subsidiaries, Affiliates, directors, officers, employees, or agents that will act in any capacity in connection with or directly benefit from the facility established hereby is a Sanctioned Person, (ii) none of

such Seller or any of its Subsidiaries is organized or resident in a Sanctioned Country and (iii) such Seller has not violated, been found in violation of or is under investigation by any Governmental Authority for possible violation of any Anti-Corruption Laws, Anti-Terrorism Laws, or of any Sanctions.

(v) Proceeds . No proceeds received by such Seller or any of its, Subsidiaries, or Affiliates in connection with any Transaction entered into pursuant to the Transaction Agreements will be used in any manner that will violate Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.

(w) As of the Effective Date, such Seller (i) is an entity that issues a class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended, or (ii) has delivered to Buyer Agent a Beneficial Ownership Certification in relation to such Seller and the information included in such Beneficial Ownership Certification is true and correct in all respects.

5.2 Asset Representations and Warranties . Each applicable Seller represents and warrants to Buyer Agent and each Buyer as of the applicable Purchase Date with respect to each Purchased Note that:

(a) Satisfaction of Conditions . All of the applicable Funding Conditions have been satisfied or waived as of such Purchase Date.

(b) Binding Obligation . Such Purchased Note is in full force and effect and constitutes a legal, valid and binding obligation of Cofina, enforceable against Cofina in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance, or other similar Applicable Laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law and implied covenants of good faith and fair dealing. The Collection Date under such Purchased Note has not occurred, and is not scheduled to occur, during the Transaction Period commencing on such Purchase Date.

(c) Ownership . Immediately prior to the sale of such Purchased Note pursuant to the Transaction Agreements, and except to the extent such Purchased Notes are already subject to an outstanding Transaction, the applicable Seller is the sole legal and beneficial owner of such Purchased Note and is entitled to sell and assign and is selling and assigning such Purchased Note, together with the collections with respect thereto and all rights thereunder, to Buyer Agent, on behalf of each Buyer, free and clear from any Adverse Claim.

(d) Principal Balance . The Outstanding Amount of such Purchased Note as of such Purchase Date is equal to or greater than the Purchase Price of the Transaction being entered into with respect to such Purchased Note as of such Purchase Date.

(e) Records. Such Seller has maintained records relating to such Purchased Note which are true and correct in all material respects and such records are held by such Seller.

(f) Legal Proceedings. There is no Action pending or, to the knowledge of such Seller, threatened against any Seller or Cofina relating to such Purchased Note or which seeks the issuance of an order restraining, enjoining or otherwise prohibiting or making illegal the consummation of any of the transactions contemplated by such Purchased Note or by the Transaction Agreements.

5.3 Certain Covenants . Each Seller covenants with Buyer Agent and each Buyer as follows:

(a) Compliance with Applicable Laws, Etc. Such Seller shall comply in all material respects with all Applicable Laws with respect to it, the applicable Seller Note, and the Securitization Facility Documents.

(b) Performance and Compliance with Agreements . At its expense, such Seller shall timely and fully perform and comply in all material respects with all provisions, covenants and other promises required to be observed by it under the applicable Seller Note and the other Securitization Facility Documents.

(c) Preservation of Existence . Such Seller shall preserve and maintain its existence, rights, franchises and privileges in the jurisdiction of its organization, and qualify and remain qualified in good standing as a foreign organization in each jurisdiction where the failure to preserve and maintain such existence, rights, franchises, privileges and qualification could reasonably be expected to have a Material Adverse Effect with respect to such Seller.

(d) Keeping of Records and Books of Account; Delivery . Each such Seller shall maintain and implement, or cause to be maintained and implemented, administrative and operating procedures with respect to the applicable Seller Note (including an ability to recreate records evidencing the balance of its Seller Note in the event of the destruction of the originals thereof, backing up at least on a daily basis on a separate backup computer from which electronic file copies can be readily produced and distributed to third parties), and keep and maintain, or cause to be kept and maintained (or transferred to Seller Agent), all documents, books, records and other information necessary or advisable for the collection of such Seller Note. At any time during the continuation of an Event of Default, upon request of Buyer Agent or any Buyer, such Seller shall deliver (or cause to be delivered) to Buyer Agent and each Buyer or its designee, all such documents, books and records and information, together with electronic and other files applicable thereto, and other records necessary to enforce such Seller Note against Cofina.

(e) Inspections and Audits . Each Seller will, upon reasonable advance notice of not less than five (5) Business Days (or at any time following the occurrence of an Event of Default that has not been waived in accordance with this Framework Agreement), during regular business hours, permit the Buyer Agent and each Buyer and representatives thereof at such Seller’s expense, (i) to examine and make abstracts from all books, records and documents (including computer tapes and disks) in its possession or under its control relating to the Seller Notes and any Purchase Report, and (ii) to visit its offices and properties for the purpose of examining and auditing such materials described in clause (i) above, and, subject to the foregoing, to discuss matters relating to Seller Notes, any Purchase Report or its performance hereunder with any of its officers having knowledge of such matters, in each case, at such reasonable times and as often as may reasonably be desired by the Buyer Agent or any such Buyer; provided , however , that unless an Event of Default has occurred that has not been waived in accordance with this Agreement, each Seller shall be required to reimburse the Buyer Agent and the Buyers for the costs and expenses related to (x) only one such audit or visitation during any calendar year (it being understood that, at any time no Event of Default exists and a Buyer or Buyer Agent is a “Purchaser” under and as defined in the Securitization RPA, such Buyer or Buyer Agent shall be required to conduct any visitation or audit during any calendar year at the same time such Buyer or Buyer Agent, as applicable, conducts any audit or visitation during such calendar year in accordance with the Securitization RPA), (y) any audit following a material change in the systems of such Seller that occurs after any audit specified in clause (x) or (z) any follow-up audit that is required as a result of any audit specified in clauses (x) or (y) .

(f) Location of Records . Such Seller shall keep its principal place of business and chief executive office, and the offices where it keeps its books and records relating to the applicable Seller Note (and all original documents relating thereto), at the address of such Seller referred to in Schedule 3 or, such other location as such Seller may designate upon thirty (30) days’ prior written notice to Buyer Agent and each Buyer.

(g) Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions . Such Seller shall ensure that policies and procedures are maintained and enforced by or on behalf of such Seller to promote and achieve compliance by such Seller and each of its Subsidiaries, Affiliates, and their respective directors, officers, employees and agents, with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions.

(h) No Sales, Adverse Claims, Etc . Such Seller shall not, except as otherwise expressly provided herein or in the other Transaction Agreements, sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim (other than Permitted Liens) upon or with respect to any Purchased Note or any right to receive income or proceeds (other than the Purchase Price paid to such Seller hereunder) from or in respect of any of the foregoing.

(i) Extension or Amendment of Seller Note . Such Seller shall not (i) extend, amend, waive, cancel, forgive or otherwise modify the applicable Seller Note, any portion thereof, or any payment term or condition thereunder (as the case may be) or (ii) at any time during the Transaction Period for an outstanding Transaction, withdraw or permit itself to be removed as an Originator under the Securitization SCA unless, prior to or concurrently with such withdrawal or removal (x) all outstanding principal and

accrued interest owing to such Seller under the applicable Seller Note is prepaid in full, and (y) such Seller fully complies with Section 5.3(p) of this Framework Agreement in connection with such prepayment (including making any Margin Payments when and as required pursuant to Paragraph 4(c) of the applicable Master Repurchase Agreement).

(j) Mergers, Sales, Etc . Such Seller shall not, unless such Seller is the surviving or continuing entity, consolidate or merge with or into any other Person or sell, lease or transfer all or substantially all of its property and assets, or agree to do any of the foregoing, unless (i) no Event of Default or Potential Event of Default has occurred and is continuing or would result immediately after giving effect thereto, (ii) such Seller shall have given Buyer Agent and each Buyer not less than ten (10) Business Days’ prior written notice thereof, (iii) no Change of Control shall result, (iv) Guarantor reaffirms in a writing, in form and substance reasonably satisfactory to Buyer Agent and each Buyer, that its obligations under the Guaranty shall apply to the surviving entity, and (v) Buyer Agent and each Buyer receives such additional certifications, documents, instruments, agreements and opinions of counsel as it shall reasonably request, including as to the necessity and adequacy of any new UCC financing statements or amendments to existing UCC financing statements.

(k) Change in Organization, Etc . Such Seller shall not change its jurisdiction of organization or its name, identity or corporate organization structure or make any other change such that any financing statement filed or other action taken to perfect Buyer Agent’s (on behalf of each Buyer) interests under the Transaction Agreements, as applicable, would become seriously misleading or would otherwise be rendered ineffective, unless (i) no Event of Default or Potential Event of Default has occurred and is continuing or would result immediately after giving effect thereto, (ii) such Seller shall have given Buyer not less than thirty (30) days’ prior written notice of such change and shall have cured such circumstances, (iii) no Change of Control shall result, (iv) Guarantor reaffirms in a writing, in form and substance reasonably satisfactory to Buyer Agent and each Buyer, that its obligations under the Guaranty shall apply to the new entity, and (v) Buyer Agent and each Buyer has received such certificates, documents, instruments, agreements and opinions of counsel as they shall reasonably request, including as to the necessity and adequacy of any new UCC financing statements or amendments to existing UCC financing statements. Each Seller shall at all times maintain its jurisdiction of organization and its chief executive office within a jurisdiction in the United States of America in which Article 9 of the UCC is in effect.

(l) Actions Impairing Quality of Title . Such Seller shall not take any action that could cause the Seller Note or any rights to the proceeds thereof not to be owned by it free and clear of any Adverse Claim other than Permitted Liens; or take any action that could reasonably be expected to cause Buyer Agent, on behalf of each Buyer, not to have a valid ownership interest or first priority perfected security interest in such Seller Note and, to the extent such security interest can be perfected by filing a financing statement, all cash proceeds of any of the foregoing, in each case, free and clear of any Adverse Claim other than Permitted Liens; or suffer the existence of any financing statement or other instrument similar in effect covering such Seller Note or any proceeds thereof on file in any recording office except such as may be filed in favor of Buyer Agent, on behalf of each Buyer, in accordance with any Transaction Agreements.

(m) Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions . (i) Such Seller shall not use or permit its Subsidiaries, Affiliates, or its or their respective directors, officers, employees or agents to use, the proceeds of any Transaction entered into pursuant to the Transaction Agreements (A) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws or Anti-Terrorism Laws, (B) for the purpose of funding or financing any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, in each case to the extent doing so would violate any Sanctions, or (C) in any other manner that would result in liability to any Person under any applicable Sanctions or result in the violation of any Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions. (ii) Neither such Seller nor any of its Subsidiaries, Affiliates or any director, officer, employee, agent or other Person acting on behalf of such Seller or any of its Subsidiaries in any capacity in connection with or directly benefitting from the Agreement

will engage in, or will conspire to engage in, any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions

(n) Taxes . Subject to the provision by Buyer Agent and each Buyer of the IRS Form W-8ECI or IRS Form W-8IMY, as applicable, or in accordance with Section 3.3 and any other relevant tax forms and related documentation confirming its exemption from withholding Taxes (including withholding Taxes under FATCA), such Seller will pay all relevant Taxes (other than Excluded Taxes) and make all relevant returns in respect of Taxes in relation to the Seller Note and such Seller shall indemnify and hold Buyer Agent and each Buyer harmless from and against any such Taxes (for the avoidance of doubt, other than Excluded Taxes).

(o) Notice of Certain Events . Such Seller shall provide Buyer Agent and each Buyer with prompt notice upon becoming aware of (i) any Event of Default or Potential Event of Default, (ii) the occurrence or existence of any event or circumstance that could reasonably be expected to have a Material Adverse Effect with respect to any Seller, Seller Agent or Guarantor, or (iii) (x) any change that would result in a change to the status as an excluded Legal Entity Customer under and as defined in the Beneficial Ownership Regulation, and such Seller shall execute and deliver to Buyer Agent a Beneficial Ownership Certification complying with the Beneficial Ownership Regulation, in form and substance reasonably acceptable to Buyer Agent, or (y) any change in the information included in a Beneficial Ownership Certification that would result in a change to the list of beneficial owners or control party identified in such Beneficial Ownership Certification, or a change in the address of any beneficial owners or control party, and such Seller shall execute and deliver to Buyer Agent an updated Beneficial Ownership Certification.

(p) Information Required by Governmental Authorities and Know Your Customer Requirements . Each Seller shall provide Buyer Agent and each Buyer promptly, from time to time upon request, such information, documents, records or reports relating to such Seller or the applicable Seller Note as Buyer Agent (or its assigns) or any Buyer (or its assigns) may be required by a Governmental Authority to obtain (including for purposes of compliance by Buyer Agent or such Buyer with applicable “know your customer” requirements under the PATRIOT Act, the Beneficial Ownership Regulation or other applicable anti-money laundering laws).

(q) Margin Reporting; Payments . On or before any day during any Transaction Period for any outstanding Transaction on which any Seller is to receive any prepayment on account of principal owing under the applicable Purchased Note (other than the applicable Purchase Date for such Transaction), such Seller (i) shall recalculate the Outstanding Amount of such Purchased Note as of such day (after giving effect to such prepayment); (ii) based on such recalculation, shall notify Buyer Agent and each Buyer in writing promptly (but in any event prior to such Seller’s receipt of such prepayment) if such prepayment is expected to decrease the Outstanding Amount of such Purchased Note to an extent sufficient to result in a Margin Deficit exceeding the applicable threshold specified in Paragraph 4(e) of Annex I to the applicable Master Repurchase Agreement; and (iii) if such be the case, shall make the corresponding Margin Payment to the applicable Buyer on such date concurrently with (or immediately following) such Seller’s receipt of such prepayment in accordance with Paragraph 4(c) of the applicable Master Repurchase Agreement.

(r) Delivery of Financial Statements and other Documents . Each Seller shall deliver (or cause to be delivered) to Buyer Agent and each Buyer, concurrently with the delivery to Cofina as required thereunder, copies of each of the items described in Section 5.2 of the Securitization SCA.

(s) Amendments to Securitization Facility Documents . Each Seller shall deliver (or cause to be delivered) to Buyer Agent and each Buyer written notice of any actual or contemplated material amendment, supplement or other modification to the Securitization RPA, the Securitization SCA or the Securitization Guaranty, as the case may be (including a copy of such amendment, supplement or other modification) no less than five (5) Business Days (or such shorter period of time as may be consented to in writing by Buyer Agent and each Buyer) prior to such amendment, supplement or other modification becoming effective.

6. Seller Agent .

6.1 Appointment and Authorization . Each Seller hereby irrevocably designates and appoints Seller Agent as the agent of such Seller under this Framework Agreement and each of the other Transaction Agreements, and each Seller irrevocably authorizes Seller Agent, in such capacity, to take such action on its behalf under the provisions of this Framework Agreement and the other Transaction Agreements and to exercise such powers and perform such duties as are expressly delegated to Seller Agent by the terms of this Framework Agreement and the other Transaction Agreements (including the power to execute and deliver Confirmations on behalf of each Seller in accordance with Article 4 of this Framework Agreement and the applicable Master Repurchase Agreements), together with such other powers as are reasonably incidental thereto to the extent permitted by Applicable Law. Each Seller hereby further authorizes Seller Agent to consent to amendments to this Framework Agreement. Without limiting the generality of the foregoing, Seller Agent shall be responsible for maintaining and the delivering Transaction Notices, Information Packages, Purchase Reports, and for the receipt and distribution of Funded Purchase Price to each of the Sellers. Seller Agent hereby agrees that it will promptly deliver to each Seller copies of each Confirmation and any notices or written information received by Seller Agent from Buyer Agent or any Buyer in connection with any Transaction Agreement. Notwithstanding any provision to the contrary elsewhere in this Framework Agreement, Seller Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Seller, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Framework Agreement or otherwise exist against the Seller Agent.

6.2 Agent in Its Individual Capacity . Seller Agent and its Affiliates may make sales to, make purchases from and generally engage in any kind of business with any Seller, Buyer Agent, any Buyer or Guarantor as though Seller Agent were not an agent. With respect to any Transactions to which it is a party and any sales or repurchases of its applicable Seller Note made or renewed by it, Seller Agent shall have the same rights and powers under this Framework Agreement as any Seller and may exercise the same as though it were not an agent, and the terms “Seller” and “Sellers” shall include the Seller Agent in its individual capacity.

7. Buyer Agent .

7.1 Appointment and Authority .

(a) Each of the Buyers hereby irrevocably appoints MUFG to act on its behalf as Buyer Agent hereunder and under the other Transaction Agreements and authorizes Buyer Agent to take such actions on its behalf and to exercise such powers as are delegated to Buyer Agent by the terms hereof or thereof (including the power to execute and deliver Confirmations on behalf of such Buyer in accordance with Article IV of this Framework Agreement and the applicable Master Repurchase Agreements), together with such actions and powers as are reasonably incidental thereto. The provisions of this Article VII are solely for the benefit of Buyer Agent, and none of Seller Agent, any Seller or Guarantor shall have rights as a third party beneficiary of any of such provisions.

(b) Each of the Buyers hereby irrevocably appoints and authorizes Buyer Agent to act as the agent of such Buyer for purposes of acquiring, holding and enforcing any and all Liens in the Collateral granted by any Seller pursuant to the Transaction Agreements, including the filing in Buyer Agent’s name of any financing statements on behalf of Buyers, together with such powers and discretion as are reasonably incidental thereto. Each Buyer hereby authorizes Buyer Agent to exercise any rights and remedies on its behalf hereunder or under the other Transaction Agreements in respect of such Liens.

(c) Buyer Agent hereby agrees that it will promptly deliver to each Buyer copies of each Confirmation, Transaction Notices, Purchase Reports and any notices or written information received by Buyer Agent from any Seller or Guarantor in connection with any Transaction Agreement.

7.2 Rights as a Buyer . The Person serving as Buyer Agent hereunder shall have the same rights and powers in its capacity as a Buyer as any other Buyer and may exercise the same as though it were not Buyer Agent and the term “Buyer” or “Buyers” shall, unless otherwise expressly indicated or unless the

context otherwise requires, include the Person serving as Buyer Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with any CHS Party or any of their Affiliates as if such Person were not Buyer Agent hereunder and without any duty to account therefor to the Buyers.

7.3 Exculpatory Provisions .

(a) The Buyer Agent shall not have any duties or obligations except those expressly set forth herein and in the other Transaction Agreements. Without limiting the generality of the foregoing, Buyer Agent:

(i) shall not be subject to any fiduciary or other implied duties, regardless of whether an Event of Default has occurred and is continuing;

(ii) shall not have any duty to take any discretionary action or exercise any discretionary powers; and

(iii) shall not, except as expressly set forth herein or in the other Transaction Agreements, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any CHS Party or any of their Affiliates that is communicated to or obtained by the Person serving as Buyer Agent or any of its Affiliates in any capacity.

(b) Buyer Agent shall not be liable for any action taken or not taken by it in the absence of its own gross negligence or willful misconduct. Buyer Agent shall be deemed not to have knowledge of any Event of Default unless and until notice describing such Event of Default as such is given to Buyer Agent by a Seller, Guarantor or a Buyer.

(c) Buyer Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Framework Agreement or any other Transaction Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Framework Agreement, any other Transaction Agreement or any other agreement, instrument or document, (v) the value or the sufficiency of the Purchased Notes or any other Collateral or (vi) the satisfaction of any condition set forth in Article III, Section 4.3 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to Buyer Agent.

7.4 Reliance by Buyer Agent . Buyer Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Buyer Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. Buyer Agent may consult with legal counsel, independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

7.5 Delegation of Duties . Buyer Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Transaction Agreement by or through any one or more sub-agents appointed by Buyer Agent. Buyer Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Affiliate of Buyer Agent and any such sub-agent. Notwithstanding the foregoing, Buyer Agent shall remain liable (subject to the terms of this Agreement) for any act or omission of any sub-agent that it has appointed pursuant to this Section 7.5.

7.6 Resignation and Replacement of Buyer Agent . If at any time Buyer Agent or any Affiliate of Buyer Agent becomes a Non-Consenting Buyer hereunder, Buyer Agent shall give notice of its resignation to the Buyers and Seller and, if at any time Buyer Agent determines in good faith that it is no longer reasonably

capable of performing, or is prohibited under applicable Law from performing, its duties as Buyer Agent under the applicable Transaction Agreements, then Buyer Agent may give notice of its resignation to the Buyers and Sellers, in each case such resignation to be effective upon the appointment of a successor Buyer Agent. Upon receipt of any such notice of resignation, the Buyers (other than any Non-Consenting Buyer) shall have the right, in consultation with Seller Agent, to appoint a successor, which shall be (i) a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States and (ii) either a Buyer (other than a Non-Consenting Buyer) or any other Person reasonably acceptable to Seller Agent. If no such successor shall have been so appointed by the Buyers (other than any Non-Consenting Buyer) and shall have accepted such appointment within 30 days after the retiring Buyer Agent gives notice of its resignation, then the Buyer Agent may, on behalf of the Buyers, appoint a successor Buyer Agent meeting the qualifications set forth above; provided , that if the Buyer Agent notifies Seller Agent and the Buyers that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (i) the retiring Buyer Agent shall be discharged from its duties and obligations hereunder and under the other Transaction Agreements (except that in the case of any Collateral held by the Buyer Agent on behalf of the Buyers under any of the Transaction Agreements, the retiring Buyer Agent shall continue to hold such Collateral until such time as a successor Buyer Agent is appointed) and (ii) all payments, communications and determinations provided to be made by, to or through the Buyer Agent shall instead be made by or to each Buyer directly, until such time as the Buyers appoint a successor Buyer Agent as provided for above in this Section 7.6. Upon the acceptance of a successor’s appointment as Buyer Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Buyer Agent, and the retiring Buyer Agent shall be discharged from all of its duties and obligations hereunder or under the other Transaction Agreements (if not already discharged therefrom as provided above in this Section 7.6). The fees payable by the Sellers to a successor Buyer Agent shall be the same as those payable to its predecessor unless otherwise agreed between Sellers and such successor. After the retiring Buyer Agent’s resignation hereunder and under the other Transaction Agreements, the provisions of this Article VII and Section 5.3(c) shall continue in effect for the benefit of such retiring Buyer Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Buyer Agent was acting as Buyer Agent. In connection with any resignation of the Buyer Agent, Seller, the retiring Buyer Agent and the successor Buyer Agent may, and are hereby authorized by the Buyers to, effect such amendments to this Framework Agreement and the other Transaction Agreements as may be necessary or appropriate to give effect to the resignation of the retiring Buyer Agent and the succession of the successor Buyer Agent.

7.7 Non-Reliance on Agent and Other Buyers . Each Buyer acknowledges that it has, independently and without reliance upon Buyer Agent or any other Buyer or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Framework Agreement and the other Transaction Agreements. Each Buyer also acknowledges that it will, independently and without reliance upon Buyer Agent or any other Buyer or any of their Affiliates and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Framework Agreement, any other Transaction Agreement or any related agreement or any document furnished hereunder or thereunder.

7.8 Buyer Agent May File Proofs of Claim .

(a) In case of the pendency of any proceeding under any bankruptcy or insolvency Law or any other judicial proceeding relative to Seller Agent, any Seller or Guarantor, Buyer Agent shall be entitled and empowered, by intervention in such proceeding or otherwise:

(i) to file and prove a claim for the whole amount of any amounts that are owing by Seller Agent, any Seller or Guarantor under any Transaction Agreement and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Buyers and Buyer Agent (including any claim for the reasonable compensation, expenses, disbursements and advances

of the Buyers, Buyer Agent and their respective agents and counsel and all other amounts due to the Buyers and Buyer Agent under any Transaction Agreement) allowed in such judicial proceeding; and

(ii) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, curator, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Buyer to make such payments to Buyer Agent and, in the event that Buyer Agent shall consent to the making of such payments directly to the Buyers, to pay to Buyer Agent any amount due for the reasonable compensation, expenses, disbursements and advances of Buyer Agent and their respective agents and counsel, and any other amounts due to Buyer Agent hereunder or under any Transaction Agreement.

(b) Nothing contained herein shall be deemed to authorize Buyer Agent to authorize or consent to or accept or adopt on behalf of any Buyer any plan of reorganization, arrangement, adjustment or composition affecting the obligations of Seller Agent, any Seller or Guarantor under any Transaction Agreement or the rights of any Buyer or to authorize Buyer Agent to vote in respect of the claim of any Buyer in any such proceeding.

7.9 Withholding Tax To the extent required by any applicable Law, Buyer Agent may withhold from any payment to any Buyer an amount equal to any applicable withholding Tax; provided , that Buyer Agent shall ensure that the withholding does not exceed the minimum amount legally required and Agent shall pay the amount withheld to the relevant Governmental Authority in accordance with applicable law. If the IRS or any other authority of the United States or other jurisdiction asserts a claim that Buyer Agent did not properly withhold Tax from any amount paid to or for the account of any Buyer for any reason (including because the appropriate form was not delivered or was not properly executed, or because such Buyer failed to notify Buyer Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding Tax ineffective), such Buyer shall indemnify and hold harmless Buyer Agent (to the extent that Buyer Agent has not already been reimbursed by any Seller or Guarantor and without limiting or expanding the obligation of any Seller or Guarantor to do so) for all amounts paid, directly or indirectly, by Buyer Agent as Tax or otherwise, including any penalties, additions to Tax or interest thereon, together with all reasonable expenses incurred, including legal expenses and any out-of-pocket expenses, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority; provided , that no Buyer shall be required to indemnify Buyer Agent for penalties, addition to Tax or interest thereon, or any expenses incurred, to the extent the failure to withhold results from Buyer Agent’s gross negligence or willful misconduct. A certificate as to the amount of such payment or liability delivered to any Buyer by Buyer Agent shall be conclusive absent manifest error. Each Buyer hereby authorizes Buyer Agent to set off and apply any and all amounts at any time owing to such Buyer under this Framework Agreement or any other Transaction Agreement against any amount due to Buyer Agent under this Article VII . The agreements in this Article VII shall survive any assignment of rights by, or the replacement of, a Buyer, the expiration of the Facility Term and the repayment, satisfaction or discharge of all obligations under this Framework Agreement and the other Transaction Agreements. Unless required by applicable Laws, at no time shall Buyer Agent have any obligation to file for or otherwise pursue on behalf of a Buyer any refund of Taxes withheld or deducted from funds paid for the account of such Buyer.

8. Payment to Seller Agent and Buyer Agent; Certain Calculations .

8.1 Payments to Seller Agent . Notwithstanding anything to the contrary contained herein, all amounts payable in cash by a Buyer or Buyer Agent to any Seller in connection with any Transactions (including all payments of Funded Purchase Price on any applicable Purchase Dates) shall be paid to Seller Agent, and Seller Agent shall distribute such payments to the Sellers in accordance with the respective amounts of Purchase Price (or any other amounts) owing to each such Seller in connection with each applicable Transaction (after giving effect to applicable netting pursuant to Paragraph 12 of the applicable Master Repurchase Agreement). As between any Buyer or Buyer Agent and the Sellers, any payment of such amounts

to Seller Agent shall be treated as payments to the respective Sellers and shall discharge Buyer Agent’s or such Buyer’s obligations with respect to such payments regardless of whether Seller Agent distributes such payments to the Sellers, and neither Buyer Agent nor any Buyer shall have any liability for the failure of Seller Agent to comply with the preceding sentence.

8.2 Payments to Buyer Agent . Unless Seller Agent is otherwise directed in writing by a Buyer, all amounts payable to such Buyer in connection with any Transaction shall be paid to Buyer Agent, on behalf of such Buyer, and Buyer Agent shall distribute such payments to the Buyers in accordance with Section 4.4.

8.3 Several Obligations. The obligations of the Buyers hereunder are several, and no Buyer shall have any obligation or liability for the failure of any other Buyer to perform its obligations hereunder.

8.4 Certain Calculations . Buyer Agent shall calculate the Funded Purchase Prices, Funded Repurchase Prices, the Outstanding Buyer Balance and all other amounts to be calculated under the Transaction Agreements (except as set forth below), as well as any adjustments thereto, which calculations shall be conclusive absent manifest error. Upon the reasonable request of Seller Agent for any such calculations, Buyer Agent shall promptly provide such calculations to such Person. Seller Agent shall calculate and administer any redistributions of funds as between the Sellers in connection with changes in relative Purchase Prices outstanding under Transactions entered into by each respective Seller.

9. Indemnification .

9.1 Sellers’ Indemnity .

(a) General Indemnity . Without limiting any other rights which any such Person may have hereunder or under Applicable Law, each Seller, jointly and severally, hereby agrees to indemnify and hold harmless Buyer Agent, each Buyer, their respective Affiliates and all of their respective successors, transferees, participants and assigns, and all officers, members, managers, directors, shareholders, employees and agents of any of the foregoing (each an “ Indemnified Person ”), forthwith on demand, from and against any and all damages, losses, claims, liabilities and related reasonable and documented out-of-pocket costs and expenses (including all filing fees, Attorney Costs and Taxes (other than Excluded Taxes)) (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) awarded against or incurred by any of them arising out of, relating to or in connection with the Transaction Agreements, any of the transactions contemplated thereby, the ownership, maintenance or purchasing of any Purchased Note, or any actions or inactions of Seller Agent, Guarantor, any Seller or any Affiliate of any of them in connection with any of the foregoing; provided , however , notwithstanding anything to the contrary in this Article 9, no such Seller shall be responsible for Indemnified Amounts solely to the extent resulting from the gross negligence or willful misconduct on the part of such Indemnified Person, as determined by a final non-appealable judgment by a court of competent jurisdiction, as determined by a final non-appealable judgment by a court of competent jurisdiction. Without limiting the foregoing, each Seller, jointly and severally, shall indemnify, subject to the express limitations set forth in this Section 9.1, and hold harmless each Indemnified Person for any and all Indemnified Amounts arising out of, relating to or in connection with:

(i) the transfer by any Seller of any interest in any Purchased Note or any proceeds thereof, other than in connection with Transactions entered into with Buyer Agent and the Buyers pursuant to the Transaction Agreements;

(ii) any representation, warranty or statement made or deemed made by or on behalf of any Seller (or any of its officers or Affiliates) under or in connection with any Transaction Agreement, any Information Package, Purchase Report or any other information or report delivered by or on behalf of any Seller pursuant hereto, which shall have been untrue, false or incorrect when made or deemed made;

(iii) the failure of any Seller, Seller Agent, Securitization Guarantor or the Securitization Servicer to comply with the terms of any Transaction Agreement, any Seller Note, any Securitization Documents or any Applicable Law, or the nonconformity of any Seller Note with any such Applicable Law;

(iv) the lack of an enforceable ownership interest or a first priority perfected security interest in any Purchased Note transferred by any Seller, or purported to be transferred by any Seller, to Buyer Agent, on behalf of Buyers, pursuant to the Transaction Agreements against all Persons (including any bankruptcy trustee or similar Person);

(v) any attempt by any Person to void the transfers by any Seller contemplated hereby under statutory provisions or common law or equitable action;

(vi) the failure to have filed, or any delay in filing, financing statements, financing statement amendments, continuation statements or other similar instruments or documents under the UCC of any applicable jurisdiction or other Applicable Laws with respect to any Purchased Note transferred by any Seller, or purported to be transferred by any Seller, to Buyer Agent, on behalf of Buyers, pursuant to the Transaction Agreements, whether as of the applicable Purchase Date or at any time thereafter;

(vii) any dispute, claim, offset, defense, or other similar claim or defense of Cofina to the payment when due of any Purchased Note transferred, or purported to be transferred, by any Seller to Buyer Agent, on behalf of Buyers, pursuant to the Transaction Agreements (including a defense based on such Purchased Note not being a legal, valid and binding obligation of Cofina enforceable against it in accordance with its terms);

(viii) any failure of any Seller or the Securitization Servicer to perform any of its duties or obligations arising under or in connection with any Purchased Note in accordance with the provisions thereof or of any of the other Securitization Facility Documents;

(ix) any suit or claim related to any Purchased Note transferred by any Seller, or purported to be transferred by any Seller, to Buyer Agent, on behalf of Buyers, pursuant to the Transaction Agreements;

(x) any investigation, litigation or proceeding (actual or threatened) related to this Framework Agreement or any other Transaction Agreement or the use of proceeds of any purchase hereunder or in respect of any Purchased Note;

(xi) any civil penalty or fine assessed by OFAC or any other Governmental Authority administering any Anti-Terrorism Law, Anti-Corruption Law or Sanctions, and all reasonable costs and expenses (including reasonable documented legal fees and disbursements) incurred in connection with defense thereof by, any Indemnified Person in connection with the Transaction Agreements as a result of any action of Seller Agent, any Seller or any of their respective Affiliates;

(xii) any Taxes (other than Excluded Taxes) imposed upon any Indemnified Person or upon or with respect to any Purchased Note transferred by any Seller, or purported to be transferred by any Seller, to Buyer Agent, on behalf of Buyers, pursuant to the Transaction Agreements arising by reason of the purchase or ownership of such Purchased Note (or of any interest therein);

(xiii) any inability of any Seller to transfer any Purchased Note as contemplated under the Transaction Agreements; or

(xiv) the violation or breach by any Seller or Seller Agent of any confidentiality provision, or of any similar covenant of non-disclosure, with respect to any Purchased Note.

This Section 9.1 shall not be construed as a guaranty by any Seller of Cofina’s payment, performance or other obligations under any Purchased Note; provided that, for the avoidance of doubt, the Sellers shall remain liable to the Buyers, on a joint and several basis, for the payment of the Repurchase Price for any Transaction regardless of the performance by Cofina of its obligations with respect to any Purchased Note.

9.2 Contribution . If for any reason the indemnification provided above in this Article 9 is unavailable to an Indemnified Person or is insufficient to hold an Indemnified Person harmless, then each Seller shall contribute to the amount paid or payable by such Indemnified Person as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received

by such Indemnified Person on the one hand and such Seller on the other hand but also the relative fault of such Indemnified Person as well as any other relevant equitable considerations.

10. Miscellaneous .

Except as otherwise expressly set forth in a Transaction Agreement, the following will apply to all Transaction Agreements:

10.1 Further Assurances . Each Seller agrees that from time to time it will promptly execute and deliver such other documents and instruments, all instruments and documents, and take all further action that Buyer Agent or any Buyer may reasonably request, to carry out the purpose and intent of the Transaction Agreements, including in order to perfect, protect or more fully evidence Buyer Agent’s interest in the Purchased Notes and any proceeds thereof on behalf of Buyers.

10.2 Expenses . In addition to its obligations under Article 9 hereof, each Seller, jointly and severally, agrees to pay on demand:

(a) all reasonable and documented out-of-pocket costs and expenses incurred by Buyer Agent or any Buyer in connection with:

(i) the negotiation, preparation, execution and delivery of this Framework Agreement and the other Transaction Agreements and any amendment of or consent or waiver under any of the Transaction Agreements (whether or not consummated), or the enforcement of, or any actual or claimed breach of, this Framework Agreement or any of the other Transaction Agreements, including reasonable Attorney Costs and reasonable accountants’, auditors’, and consultants’ fees and expenses to any of such Persons and the fees and charges of any nationally recognized statistical rating organization or any independent accountants, auditors, consultants or other agents incurred in connection with any of the foregoing or in advising Buyer Agent or any Buyer as to its rights and remedies under any of the Transaction Agreements in connection with any of the foregoing; and

(ii) the administration of this Framework Agreement and the other Transaction Agreements and the transactions contemplated thereby, including reasonable Attorney Costs and reasonable accountants’, and consultants’ fees and expenses incurred in connection with the administration and maintenance of this Framework Agreement and the other Transaction Agreements and the transactions contemplated thereby; and

(b) all stamp and other similar Taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Framework Agreement or the other Transaction Agreements, and agrees to indemnify each Indemnified Person and their respective Affiliates for such Taxes and fees.

10.3 Entire Agreement . This Framework Agreement, together with the other Transaction Agreements, constitutes the entire agreement between the Parties and supersedes all prior oral and written negotiations, communications, discussions, and correspondence pertaining to the subject matter of the Transaction Agreements.

10.4 Order of Precedence . If there is a conflict between any Confirmation that has been executed by certain parties hereto and any other Transaction Agreement, the Confirmation will control solely with respect to such parties. Except as set forth in the immediately preceding sentence, if there is a conflict between this Framework Agreement and any Transaction Agreement, this Framework Agreement will control unless the conflicting provision of the other Transaction Agreement specifically references the provision of this Framework Agreement to be superseded.

10.5 Amendments and Waivers . No amendment, supplement, modification or waiver of any provision of this Framework Agreement or any other Transaction Agreement, and no consent to any departure by the Sellers or Guarantor therefrom, shall be effective unless in writing signed by Buyer Agent, each Buyer, Seller Agent, each Seller party to such Transaction Agreement and, in the case of the Guaranty, the Guarantor, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

10.6 Binding Effect . The Transaction Agreements will be binding upon and inure to the benefit of the Parties and their respective heirs, legal representatives, successors, and permitted assigns.

10.7 Assignment . Subject to Section 7.6, except as provided in this Framework Agreement or any other Transaction Agreement, neither this Framework Agreement nor any other Transaction Agreement, respectively, may be assigned or otherwise transferred, nor may any right or obligation hereunder or under another Transaction Agreement be assigned or transferred by any Party without the consent of each of the other Parties; provided , that, subject to the terms of the No-Petition Letter, each Buyer may transfer or assign any or all of the Transaction Agreements and its rights and obligations thereunder at any time during which an Event of Default has occurred and is continuing. Any permitted assignee shall assume all obligations of its assignor under this Framework Agreement and any other applicable Transaction Agreements. Any attempted assignment not in accordance with this Section 10.7 shall be void.

10.8 Notices . All notices, requests, demands, and other communications required or permitted to be given under any of the Transaction Agreements to any Party must be in writing delivered to the applicable Party at the following address:

If to MUFG:

MUFG Bank, Ltd.

1221 Avenue of the Americas

New York, NY 10020


Attn:	Matt Stratton


Tel:	212-782-4212

E-Mail: mstratton@us.mufg.jp

If to CHS or CHS Capital:

CHS Inc.

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Brent Dickson

Tel: 651-355-5433

Fax: 800-232-3639

Email: brent.dickson@chsinc.com

or to such other address as such Party may designate by written notice to each other Party. Each notice, request, demand, or other communication will be deemed given and effective, as follows: (i) if sent by hand delivery, upon delivery; (ii) if sent by first-class U.S. Mail, postage prepaid, upon the earlier to occur of receipt or three (3) days after deposit in the U.S. Mail; (iii) if sent by a recognized prepaid overnight courier service, one (1) Business Day after the date it is given to such service; (iv) if sent by facsimile, upon receipt of confirmation of successful transmission by the facsimile machine; and (v) if sent by e-mail, upon acknowledgement of receipt by the recipient.

10.9 GOVERNING LAW . THIS FRAMEWORK AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAW PROVISIONS THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

10.10 Jurisdiction . Each Party hereby irrevocably and unconditionally:

(a) submits for itself and its property in any legal action or proceeding relating to this Framework Agreement, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State of New York located in the Borough of Manhattan

in the City of New York, the courts of the United States of America for the Southern District of New York and appellate courts from any thereof;

(b) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the applicable party at its respective address set forth in Section 9.8 or at such other address which has been designated in accordance therewith; and

(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by Applicable Law or shall limit the right to sue in any other jurisdiction.

10.11 WAIVER OF JURY TRIAL . EACH PARTY HEREBY WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO ANY OF THE TRANSACTION AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION AGREEMENTS, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY PARTY AGAINST THE OTHER, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH PARTY HEREBY AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION WILL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE PREVIOUS SENTENCE, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM, OR OTHER PROCEEDING THAT SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF ANY PORTION OF ANY TRANSACTION AGREEMENTS. THIS WAIVER WILL APPLY TO ANY SUBSEQUENT AMENDMENT, RENEWAL, SUPPLEMENT, OR MODIFICATION TO ANY OF THE TRANSACTION AGREEMENTS.

10.12 Severability . If any provision of a Transaction Agreement is held by a court of competent jurisdiction to be invalid, unenforceable, or void, that provision will be enforced to the fullest extent permitted by applicable Law, and the remainder of the applicable Transaction Agreement will remain in full force and effect. If the time period or scope of any provision is declared by a court of competent jurisdiction to exceed the maximum time period or scope that that court deems enforceable, then that court will reduce the time period or scope to the maximum time period or scope permitted by Applicable Law.

10.13 Survival . The provisions of Article 6, Article 7, Article 8, Article 9 and this Article 10 shall survive any termination or expiration of this Framework Agreement and any of the other Transaction Agreements.

10.14 Counterparts . The Transaction Agreements and any document related to the Transaction Agreements may be executed by the Parties on any number of separate counterparts, by facsimile or email, and all of those counterparts taken together will be deemed to constitute one and the same instrument, and signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signatures are physically attached to the same document. A facsimile or portable document format (“.pdf”) signature page will constitute an original for the purposes of this Section 9.14.

10.15 USA Patriot Act . Buyer Agent and each Buyer hereby notifies Seller Agent and each Seller that pursuant to the requirements of the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “ PATRIOT Act ”), Buyer Agent and each Buyer may be required to obtain, verify and record information that identifies Seller Agent, Guarantor and each Seller, which information includes the name, address, tax identification number and other information regarding the Seller Agent, Guarantor and each Seller that will allow Buyer Agent and each Buyer to identify such Persons in accordance with the PATRIOT Act. This notice is given in accordance with the requirements of the PATRIOT Act. Each of Seller

Agent and each Seller agrees to provide Buyer Agent and each Buyer, from time to time, with all documentation and other information required by bank regulatory authorities under “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act.

10.16 Right of Setoff . If an Event of Default shall have occurred and be continuing, each of Buyer Agent and each Buyer is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Law, to set off any obligations at any time owing by Buyer Agent or such Buyer to or for the credit or the account of Seller Agent, Guarantor or any Seller against any and all of the obligations of Seller Agent, Guarantor or any Seller now or hereafter existing under this Framework Agreement or any other Transaction Agreement to Buyer Agent or such Buyer, irrespective of whether or not Buyer Agent or such Buyer shall have made any demand under this Framework Agreement or any other Transaction Agreement and although such obligations of Seller Agent, Guarantor or such Seller may be contingent or unmatured. The rights of Buyer Agent and each Buyer under this Section 10.16 are in addition to other rights and remedies (including other rights of setoff) that Buyer Agent and each Buyer may have. Each of Buyer Agent and each Buyer agrees to notify Seller Agent promptly after any such setoff and application; provided , that the failure to give such notice shall not affect the validity of such setoff and application.

10.17 Joint and Several Obligations . The obligations of the Sellers and Seller Agent hereunder and under the other applicable Transaction Agreements are joint and several. To the maximum extent permitted by Applicable Law, and notwithstanding anything in the Transaction Agreements to the contrary, Seller Agent and each Seller hereby agrees to subordinate, until such time as all obligations and liabilities of each such Person (other than unasserted contingent indemnification obligations) to Buyer Agent, each Buyer or any Indemnified Person under any of the Transaction Agreements shall have been paid and performed in full, any claim, right or remedy that it now has or hereafter acquires against any Seller or Seller Agent (as applicable) that arises hereunder including any claim, remedy or right of subrogation, reimbursement, exoneration, contribution, indemnification, or participation in any claim, right or remedy of Buyer Agent or any Buyer against Seller Agent or any Seller or any of their respective property which Buyer Agent or any Buyer now has or hereafter acquires, whether or not such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise. In addition, until such time referred to in the preceding sentence, each of Seller Agent and each Seller hereby waives any right to proceed against any other such Person, now or hereafter, for contribution, indemnity, reimbursement, and any other suretyship rights and claims, whether direct or indirect, liquidated or contingent, whether arising under express or implied contract or by operation of law, which any such Person may now have or hereafter have as against the other such Person with respect to the transactions contemplated by this Framework Agreement or the other Transaction Agreements.

10.18 Acknowledgement and Consent to Bail-In of EEA Financial Institutions . Notwithstanding anything to the contrary in any Transaction Agreement or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Transaction Agreement, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(b) the effects of any Bail-In Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Framework Agreement or any other Transaction Agreement; or

(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.

10.19 Tax Treatment . Each of Buyer Agent and each Buyer acknowledges that each Seller will treat the Transactions effected by the Transaction Agreements for U.S. federal and state tax purposes as loans by Buyer secured by the applicable Collateral. Each Buyer Agent and each Buyer agrees to prepare its U.S. federal and state tax returns, if required, in a manner consistent with the foregoing unless otherwise required by a change in law occurring after the Effective Date, a closing agreement with an applicable tax authority or a judgment of a court of competent jurisdiction.

10.20 Sharing of Recoveries . Each Buyer agrees that if it receives any recovery, through set-off, judicial action or otherwise, on any amount payable or recoverable hereunder in a greater proportion than should have been received hereunder or otherwise inconsistent with the provisions hereof, then the recipient of such recovery shall purchase for cash an interest in amounts owing to the other Buyers (as return of such Buyer’s Outstanding Buyer Balance or otherwise), without representation or warranty except for the representation and warranty that such interest is being sold by each such other Buyer free and clear of any lien created or granted by such other Buyer, in the amount necessary to create proportional participation by the Buyer in such recovery. If all or any portion of such amount is thereafter recovered from the recipient, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, the Parties have executed this Framework Agreement as of the date first written above.

Buyer Agent:

MUFG Bank, Ltd.

By:

Name:

Title:

Buyer:

MUFG Bank, Ltd.

By:

Name:

Title:

Maximum Buyer Balance: $150,000,000

[SIGNATURE PAGES CONTINUE ON FOLLOWING PAGE]

Schedule 1-1

Seller and Seller Agent:

CHS Inc.

By:

Name:

Title:

Seller:

CHS Capital, LLC

By:

Name:

Title:

[SIGNATURE PAGES CONTINUE ON FOLLOWING PAGE]

Schedule 1-2

SCHEDULE 1

DEFINITIONS

As used in the Transaction Agreements, the following terms have the following meanings unless otherwise defined in any Transaction Agreement:

“ Action ” means any suit in equity, action at law or other judicial or administrative proceeding conducted or presided over by any Governmental Authority.

“ Adverse Claim ” means any claim of ownership or any Lien; it being understood that none of (i) any such claim or Lien in favor of, or assigned to, Buyer Agent, on behalf of Buyers, under the Transaction Agreements or (ii) any such claim or Lien arising under the Subordination Provisions set forth in any applicable Seller Note (as defined therein), shall constitute an Adverse Claim.

“ Affiliate ” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“ Applicable Law ” means, with respect to any Person, (x) all provisions of law, statute, treaty, constitution, ordinance, rule, regulation, ordinance, requirement, restriction, permit, executive order, certificate, decision, directive or order of any Governmental Authority applicable to such Person or any of its property and (y) all judgments, injunctions, orders, writs, decrees and awards of all courts and arbitrators in proceedings or actions in which such Person is a party or by which any of its property is bound. For the avoidance of doubt, FATCA shall constitute an “Applicable Law” for all purposes of this Framework Agreement.

“ Attorney Costs ” means and includes all fees, reasonable and documented out-of-pocket costs, expenses and disbursements of one primary counsel, and one additional local counsel in each applicable jurisdiction, for Buyer Agent and each Buyer and the other Indemnified Persons, and, if an actual or potential conflict of interest arises, one additional counsel for each similarly situated group of Indemnified Persons for which such conflict exists.

“ Bail-In Action ” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“ Bail-In Legislation ” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the

Schedule 1- 3

implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“ Beneficial Ownership Regulation ” means 31 C.F.R. § 1010.230.

“ Business Day ” means any day (other than a Saturday or Sunday) on which banks are not authorized or required to close in New York City, New York.

“ Buyer ” has the meaning set forth in the Preamble.

“ Change of Control ” has the meaning set forth in the Securitization RPA.

“ CHS ” has the meaning set forth in the Preamble.

“ CHS Capital ” has the meaning set forth in the Preamble.

“ CHS Capital Master Repurchase Agreement ” means that certain 1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018, between CHS Capital and Buyers, including Annex I there (and as amended thereby).

“ CHS Capital Note ” means that certain Amended and Restated Subordinated Note, dated as of September 4, 2018, issued by Cofina to CHS Capital pursuant to Article II of the Securitization SCA and Section 6 of the Securitization Amendment.

“ CHS Master Repurchase Agreement ” means that certain 1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018, between CHS and Buyers, including Annex I there (and as amended thereby).

“ CHS Note ” means that certain Amended and Restated Subordinated Note, dated as of September 4, 2018, issued by Cofina to CHS pursuant to Article II of the Securitization SCA and Section 6 of the Securitization Amendment.

“ CHS Parties ” means Seller Agent, Cofina, Guarantor, the Securitization Servicer and each Seller.

“ Closing ” has the meaning set forth in Section 3.1.

“ Code ” means the Internal Revenue Code of 1986, as amended or otherwise modified from time to time.

“ Cofina ” means Cofina Funding, LLC, a Delaware limited liability Company.

“ Collateral ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Collection Date ” has the meaning set forth in each applicable Seller Note.

“ Confirmation ” has the meaning set forth in the applicable Master Repurchase Agreement.

Schedule 1- 4

“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “ Controlling ” and “ Controlled ” have meanings correlative thereto.

“ Credit Agreement ” means that certain 2015 Amended and Restated Credit Agreement, dated as of September 4, 2015, by and between CoBank ACB, as joint lead arranger, administrative agent and bid agent, Wells Fargo Bank, National Association, as syndication agent, the other joint lead arrangers and syndication parties party thereto from time to time and CHS.

“ Credit Facility Documents ” has the meaning ascribed to the term “Loan Documents” in the Credit Agreement.

“ Current Transactions ” means, as of any time of determination, each of the Transactions, if any, outstanding under the Master Repurchase Agreements at such time of determination.

“ EEA Financial Institution ” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“ EEA Member Country ” means any member state of the European Union, Iceland, Lichtenstein and Norway.

“ EEA Resolution Authority ” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“ Effective Date ” has the meaning set forth in the Preamble.

“ EU Bail-In Legislation Schedule ” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

“ Event of Bankruptcy ” means, with respect to any person, any of the following:

(a) (i) a case or other proceeding shall be commenced, without the application or consent of such Person, in any court, seeking the liquidation, examinership, reorganization, debt arrangement, dissolution, winding up, or composition or readjustment of debts of such Person, the appointment of a trustee, receiver, custodian, liquidator, examiner, assignee, sequestrator (or other similar official) for such Person or all or substantially all of its assets, or any similar action with respect to such Person under any Applicable Law relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, which proceeding shall remain unstayed or undismissed for a period of sixty (60) days; or (ii) an order for relief in respect of such Person shall be entered in an involuntary case under federal bankruptcy laws or other similar Applicable Laws now or hereafter in effect; or

(b) such Person (i) shall commence a voluntary case or other proceeding under any applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other similar law now or hereafter in effect, or (ii) shall consent to the appointment of or taking possession by a receiver, liquidator, examiner, assignee, trustee, custodian, sequestrator (or other similar official) for, such Person or for any substantial part of its property, or (iii) shall make any general assignment for the benefit of creditors, or shall

Schedule 1- 5

fail to, or admit in writing its inability to, pay its debts generally as they become due, or, if a corporation or similar entity, its board of directors (or any board or Person holding similar rights to control the activities of such Person) shall vote to implement any of the foregoing.

“ Event of Default ” means any of the following:

(a) any Seller or Guarantor shall have failed to pay any Repurchase Price (other than the portion thereof attributable to Price Differential) or Margin Payment in respect of any Transaction when and as the same shall become due and payable, and such failure shall continue unremedied for a period of one (1) or more Business Days;

(b) any Seller or Guarantor shall have failed to pay any portion of Repurchase Price attributable to Price Differential or any other amounts owing under any Transaction Agreement (other than amounts specified in clause (a) of this definition), in each case, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three (3) or more Business Days;

(c) Seller Agent or any Seller shall fail to observe or perform any covenant or agreement set forth in Section 5.3(h), Section 5.3(i), Section 5.3(l), Section 5.3(m), or Section 5.3(o), Section 5.3(q) (excluding clause (iii) thereof) or Section 5.3(s) of this Framework Agreement;

(d) Seller Agent, Guarantor or any Seller shall fail to observe or perform any covenant, condition or agreement contained in this Framework Agreement or any other Transaction Agreement (excluding any covenants, conditions or agreements specified in clauses (a), (b) or (c) of this definition) and such failure shall continue unremedied for a period of ten (10) or more Business Days;

(e) any representation or warranty made or deemed made by or on behalf of any Seller or Guarantor in or in connection with this Framework Agreement or any other Transaction Agreement shall prove to have been incorrect in any material respect when made or deemed made, and such failure to be correct shall continue unremedied for a period of ten (10) or more Business Days;

(f) Buyer Agent, on behalf of Buyers, shall cease to have a perfected security interest in any Collateral granted by any Seller pursuant to the applicable Master Repurchase Agreement, except to the extent released in accordance with, or in connection with a disposition permitted under, the Transaction Agreements;

(g) an Event of Bankruptcy shall occur with respect to Seller Agent, Guarantor or any Seller;

(h) the Guaranty shall cease to be in full force and effect, or its validity or enforceability shall be disputed by any CHS Party; or

(i) any Seller or Guarantor, or any of their respective Subsidiaries (i) fails to make payment when due (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise) in respect of any indebtedness for borrowed money aggregating in excess of $100,000,000 which was incurred, assumed or guaranteed by such Person, or (ii) fails to perform or observe any other condition or covenant, or any other event shall occur or condition shall exist, under any indenture, agreement or other instrument under which any indebtedness for borrowed money aggregating in excess of $100,000,000 was incurred, assumed or guaranteed by such Person, if the effect of such failure, event or condition is to cause, or to permit the holder or holders or beneficiary or beneficiaries of such indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, such indebtedness to be declared to be due and payable

Schedule 1- 6

prior to its stated maturity, or such guaranty to become payable, without regard to whether such holder or holders, beneficiary or beneficiaries or such other Person shall have exercised or waived their right to do so.

“ Excluded Taxes ” means any of the following Taxes imposed on or with respect to an Indemnified Person or required to be withheld or deducted from a payment to an Indemnified Person: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes and branch profits Taxes, in each case, (i) imposed as a result of such Indemnified Person being organized under the laws of, or having its principal office in the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Indemnified Person pursuant to a law in effect on the Effective Date, (c) Taxes attributable to such Indemnified Person’s failure to provide relevant IRS forms and related documentation, and (d) any Taxes imposed pursuant to FATCA.

“ Executive Order ” means Executive Order No. 13224 on Terrorist Financings: Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten To Commit, or Support Terrorism issued on September 23, 2001.

“ Facility Expiration Date ” means the Scheduled Facility Expiration Date in effect from time to time; provided , that (i) the Facility Expiration Date shall be deemed to have occurred on the first date (if any) upon which (x) the Termination Date occurs under the Securitization RPA or (y) an Event of Bankruptcy occurs with respect to Seller Agent, Guarantor or any Seller; (ii) on any Business Day (x) during which an Event of Default has occurred and is continuing or (y) on or after which any Person (other than an Affiliate of MUFG) has replaced MUFG as Securitization Agent under the Securitization RPA, the Buyers may deliver a written notice to Seller Agent and each Seller terminating the Facility Term, in which case the Facility Expiration Date shall be deemed to occur on the date of the delivery of such notice; and (iii) in the event Buyer Agent and each Buyer receives written notice pursuant to Section 5.3(r) hereof and the Repurchase Date with respect to the Current Transactions as of the time such notice is received will not otherwise occur on or prior to the date the applicable amendment, supplement or modification is to become effective, Buyers may deliver a written notice to Seller Agent and each Seller terminating the Facility Term, in which case the Facility Expiration Date shall be deemed to occur on the date such amendment, supplement or modification becomes effective.

“ Facility Term ” means the period beginning on the Effective Date and ending on the Facility Expiration Date.

“ FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Framework Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b)(1) of the Code, any intergovernmental agreements entered into in connection with the implementation of the foregoing and any fiscal or regulatory legislation, rules or official practices implemented to give effect to any such intergovernmental agreements.

“ Framework Agreement ” has the meaning set forth in the Preamble.

“ Funded Purchase Price ” means, with respect to any Transactions entered into (or proposed to be entered into) under the applicable Master Repurchase Agreements on any Purchase Date, the excess, if any, of (a) the sum of the Purchase Prices for such Transactions over (b) the sum of the Repurchase Prices under any Transactions previously entered into under such Master Repurchase Agreements whose Repurchase Dates coincide with such Purchase Date, excluding any portion of such Repurchase Prices which are not

Schedule 1- 7

permitted to be netted against Purchase Prices for subsequent Transactions entered into on such Purchase Date in accordance with Paragraph 12 of Annex I to the Master Repurchase Agreement.

“ Funded Repurchase Price ” means, with respect to any Transactions under the applicable Master Repurchase Agreements expiring on any Repurchase Date, the excess of (a) the sum of the Repurchase Prices for each such Transaction over (b) the sum of the amounts of any Purchase Prices under any subsequent Transactions entered into under such Master Repurchase Agreements whose Purchase Date coincides with such Repurchase Date which are netted against such Repurchase Prices in accordance with Paragraph 12 of the applicable Master Repurchase Agreement (any such netting being subject to Paragraph 12 of Annex I to the applicable Master Repurchase Agreement).

“ Funding Conditions ” has the meaning set forth in Section 4.3(a).

“ GAAP ” means generally accepted accounting principles in the United States of America, consistently applied.

“ Governmental Authority ” means any government or political subdivision or any agency, authority, bureau, regulatory body, court, central bank, commission, department or instrumentality of any such government or political subdivision, or any other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government or any court, tribunal, grand jury or arbitrator, or any accounting board or authority (whether or not part of a government) which is responsible for the establishment or interpretation of national or international accounting principles, in each case whether foreign or domestic (including any supra-national bodies such as the European Union or the European Central Bank).

“ Guarantor ” means CHS.

“ Guaranty ” means that certain Guaranty, dated as of the Effective Date, executed by Guarantor in favor of Buyer Agent, on behalf of Buyers.

“ Indemnified Amounts ” has the meaning set forth in Section 9.1.

“ Indemnified Person ” has the meaning set forth in Section 9.1.

“ Information Package ” has the meaning set forth in the Securitization RPA.

“ Lien ” means any mortgage, deed of trust, pledge, security interest, hypothecation, charge, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement, preferential arrangement or similar agreement or arrangement of any kind or nature whatsoever, including any conditional sale or other title retention agreement and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing).

“ Margin Deficit ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Margin Payment ” means any cash transferred by or on behalf of a Seller to Buyer as required pursuant to Paragraph 4(a) of the applicable Master Repurchase Agreement.

“ Master Repurchase Agreements ” means each of (i) the CHS Master Repurchase Agreement and (ii) the CHS Capital Master Repurchase Agreement.

Schedule 1- 8

“ Material Adverse Effect ” means, with respect to any Person (or if no Person is specified, with respect to any Seller or Seller Agent) an event or circumstance that, individually or in the aggregate, results in, or could reasonably be expected to result in, a material adverse effect on:

(a) the financial condition or results of operations of such Person and its Subsidiaries, taken as a whole;

(b) the ability of such Person to perform any of its obligations under this Framework Agreement or any other Transaction Agreement to which it is a party;

(c) the status, existence, perfection, priority, enforceability or other rights and remedies of Buyer Agent associated with its interests in the Collateral or any material portion thereof; or

(d) (i) the validity or enforceability against such Person of any Transaction Agreement or any Securitization Facility Document to which it is a party or (ii) the validity, enforceability or collectability of a material portion of the Collateral.

“ Maximum Buyer Balance ” means, with respect to any Buyer, the amount set forth below such Buyer’s signature page to this Framework Agreement.

“ Monthly Date ” means each of (i) the Effective Date and (ii) each “Settlement Date” (as defined in the Securitization RPA) during the Facility Term.

“ MUFG ” has the meaning set forth in the Preamble.

“ No-Petition Letter ” means that certain Letter Agreement, dated as of September 4, 2018, between Buyer and the Securitization Agent.

“ OFAC ” has the meaning set forth in the definition of Sanctioned Person.

“ Organizational Documents ” means a Party’s articles or certificate of incorporation and its by-laws or similar governing instruments required by the laws of its jurisdiction of formation or organization.

“ Originator ” has the meaning set forth in the Securitization SCA.

“ Other Connection Taxes ” means, with respect to any Indemnified Person, Taxes imposed as a result of a present or former connection between such Indemnified Person and the jurisdiction imposing such Tax (other than connections arising from such Indemnified Person having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Transaction Agreement, or sold or assigned an interest in any Purchased Note or Transaction Agreement).

“ Outstanding Amount ” means, with respect to any Seller Note at any given time, the outstanding principal balance of such Seller Note as of such time.

“ Outstanding Buyer Balance ” means, with respect to any Buyer, as of any time of determination, the excess, if any, of (x) the aggregate amount of Funded Purchase Price funded by such Buyer and applied to Purchase Price under any Master Repurchase Agreement over (y) the aggregate Funded Repurchase Price (or Margin Payments) paid by or on behalf of the Sellers (excluding any such amounts of Funded Repurchase Price attributable to payments of Price Differential) to such Buyer, in each case, in connection with the Current Transactions and all prior Transactions as of such time of determination.

Schedule 1- 9

“ Party ” and “ Parties ” have the meaning set forth in the Preamble.

“ PATRIOT Act ” has the meaning set forth in Section 9.15.

“ Performance Test ” shall mean each of the performance tests set forth in Section 10.1(p) and (q) of the Securitization RPA.

“ Permitted Liens ” means (a) Liens created pursuant to the Transaction Agreements and (b) inchoate Liens for Taxes, assessments or other governmental charges or levies not yet due or that are being contested in good faith and by appropriate proceedings in compliance with the Transaction Agreements and for which adequate reserves have been established in accordance with GAAP, but only so long as foreclosure with respect to such Lien has not commenced and the use and value of the property to which the Liens attach are not impaired during the pendency of such proceedings.

“ Person ” means a natural individual, partnership, sole proprietorship, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, limited liability company, any Governmental Authority or any other entity of whatever nature.

“ Potential Event of Default ” means the occurrence of any event that, with the giving of notice or lapse of time, would become an Event of Default.

“ Price Differential ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Pricing Rate ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Pro Rata Share ” means, with respect to any Buyer as of any date of determination in connection with any Transaction, a fraction (expressed as a percentage), (a) the numerator of which is the Outstanding Buyer Balance of such Buyer as of such date of determination and (b) the denominator of which is the Outstanding Buyer Balance of all Buyers as of such date of determination.

“ Purchase Date ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Purchase Price ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Purchase Report ” means a report in substantially the form of Exhibit B setting forth, among other things:

(a) for each Seller, the aggregate initial Unpaid Balance of all Assets which were sold or contributed by such Seller to Cofina during the most recently ended Settlement Period;

(b) for each Seller, the aggregate Purchase Price for all Assets which were sold or contributed by such Seller to Cofina during the most recently ended Settlement Period (such aggregate Purchase Price with respect to any Seller and Settlement Period, an “ Aggregate Seller Purchase Price ”);

(c) for each Seller, the portion, if any, of the Aggregate Seller Purchase Price for the most recently ended Settlement Period that was paid in cash during such Settlement Period;

(d) for each Seller, the portion, if any, of such Seller’s Aggregate Seller Purchase Price for the most recently ended Settlement Period that was paid in the form of an increase in the principal amount of the related Subordinated Note during such Settlement Period;

(e) Cofina’s Net Worth as of the Cut-Off Date of the most recently ended Settlement Period;

(f) for each Seller, the aggregate amount by which the principal balance of the related Seller Note was repaid during the most recently ended Settlement Period; and

Schedule 1- 10

(g) for each Seller, the aggregate principal amount of the related Seller Note as of the Cut-Off Date of the most recently ended Settlement Period.

Each term used in the definition of “Purchase Report” and not defined in this Framework Agreement shall have the meaning assigned to such term in the Securitization SCA.

“ Purchased Note ” means, as of any time with respect to any Transaction, the applicable Seller Note transferred, or purported to be transferred, to Buyer Agent, on behalf of Buyers, pursuant to such Transaction.

“ Repurchase Date ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Repurchase Price ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Sanctioned Country ” means, at any time, a country or territory which is the subject or target of any Sanctions, including as of the Effective Date, Cuba, Crimea (Ukraine), Iran, Syria and North Korea.

“ Scheduled Facility Expiration Date ” means June 27, 2019.

“ Securitization Amendment ” has the meaning set forth in the definition of Securitization RPA.

“ Securitization Facility Default ” means, except to the extent arising solely as the result of an Event of Default or similar event occurring under the Transaction Agreements, any “Event of Default” or “Unmatured Event of Default”, in each case, as defined in the Securitization RPA, without regard to any waiver granted with respect thereto under the terms of the Securitization RPA.

“ Securitization Facility Documents ” has the meaning ascribed to the term “Transaction Documents” in the Securitization RPA.

“ Securitization Guaranty ” has the meaning ascribed to the term “Performance Guaranty” in the Securitization RPA.

“ Securitization Guarantor ” means CHS.

Schedule 1- 11

“ Securitization RPA ” means the Amended and Restated Receivables Purchase Agreement, dated as of July 18, 2017 among Cofina, as seller, CHS, as initial servicer (in such capacity, the “ Securitization Servicer ”), MUFG (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.), as administrative agent (in such capacity, the “ Securitization Agent ”) and the various purchaser groups from time to time party thereto (as amended by that certain First Amendment, dated as of June 28, 2018, the Second Amendment, dated as of August 20, 2018, that certain Omnibus Amendment No. 3, dated as of September 4, 2018 (the “ Securitization Amendment ”), and as further amended, restated, supplemented or modified from time to time).

“ Securitization SCA ” means the Sale and Contribution Agreement, dated as of July 22, 2016, among each Seller, as an originator, and Cofina, as buyer (as amended by Omnibus Amendment No. 1, dated as of February 14, 2017, Omnibus Amendment No. 2, dated as of July 18, 2017, the Securitization Amendment, and as further amended, restated, supplemented or modified from time to time).

“ Seller ” has the meaning set forth in the Preamble.

“ Seller Note ” means (i) with respect to CHS, the CHS Note and (ii) with respect to CHS Capital, the CHS Capital Note (all of the foregoing, collectively, the “ Seller Notes ”).

“ Seller Agent ” has the meaning set forth in the Preamble.

“ Settlement Period ” has the meaning set forth in the Securitization RPA.

“ Solvent ” means, with respect to any Person and as of any particular date, (i) the fair value of the assets of such Person, at a fair valuation, will exceed the debts and liabilities, direct, subordinated, contingent or otherwise, of such Person; (ii) the present fair saleable value of the property of such Person will be greater than the amount that will be required to pay the probable liabilities of such Person on its debts and other liabilities, direct, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (iii) such Person will be able to pay its debts and liabilities, direct, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (iv) such Person will not have unreasonably small capital with which to conduct the businesses in which it is engaged as such businesses are currently conducted and are proposed to be conducted.

“ Subordinated Note ” has the meaning set forth in the Securitization SCA.

“ Subordination Provisions ” has the meaning set forth in the applicable Seller Note.

“ Subsidiary ” means, with respect to any Person, a corporation or other entity of which such Person owns, or its other direct or indirect Subsidiaries own, directly or indirectly, such number of outstanding shares or other ownership or control interests as have more than 50% of the ordinary voting power for the election of directors or managers, as the case may be.

“ Tax ” means all taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges payable to or imposed by any Governmental Authority, including any sales, use, excise or similar taxes and inclusive of any interest, additions to tax, penalties or fines applicable thereto.

“ Termination Date ” has the meaning given to the term “Purchase Termination Date” in the Securitization RPA.

“ Transaction ” has the meaning set forth in the applicable Master Repurchase Agreement.

Schedule 1- 12

“ Transaction Agreements ” means, collectively, (i) this Framework Agreement, (ii) each of the other agreements referred to in Section 2.1 hereof and (iii) each Confirmation entered into under any Master Repurchase Agreement during the Facility Term.

“ Transaction Notice ” has the meaning set forth in Section 4.1(a).

“ Transaction Period ” has the meaning set forth in the applicable Master Repurchase Agreement.

“ Undivided Funding Percentage ” means, with respect to any Buyer as of any date of determination in connection with any Transaction, a fraction (expressed as a percentage), (a) the numerator of which is such Buyer’s Maximum Buyer Balance and (b) the denominator of which is the sum of the Maximum Buyer Balance of each Buyer; provided that, notwithstanding the foregoing, on and after the date on which there are two or more Buyers and a Buyer becomes a Non-Consenting Buyer, such Buyer shall have an Undivided Funding Percentage and a Maximum Buyer Balance of zero for purposes of this definition.

“ Write-Down and Conversion Powers ” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which writedown and conversion powers are described in the EU Bail-In Legislation Schedule.

Schedule 1- 13

SCHEDULE 2

BANK ACCOUNTS



Buyers and Buyer Agent:
MUFG Bank Name:	MUFG BANK, LTD.
City, State:	New York, NY
SWIFT Code:	BOTKUS33
ABA/Routing #:	XXXXXXXX
Beneficiary Account Name:	MUFG BANK, LTD.
Beneficiary Account Number:	XXXXXXX
Ref:	CHS


Seller Agent:
Bank Name:	BMO Harris Bank
City, State:	Minneapolis, Minnesota
SWIFT Code:	HATRUS44
ABA/Routing #:	XXXXXXXX
Beneficiary Account Name:	CHS Capital
Beneficiary Account Number:	XXXXXXXX
Ref:	CHS Capital, LLC

Schedule 2-1

SCHEDULE 3

UCC DETAILS SCHEDULE


(1)	CHS Inc.:

(a) Chief Executive Office

5500 Cenex Drive

St. Paul Minnesota 55077

(b) Locations Where Records Are Kept

5500 Cenex Drive

St. Paul, Minnesota 55077

Not Applicable

(d) Federal Taxpayer ID Number

41-0251095

(e) Jurisdiction of Organization

Minnesota

(f) True Legal Name

CHS Inc.

(g) Organizational Identification Number

COOP-1328

Schedule 3- 1


2)	CHS Capital, LLC:

(a) Chief Executive Office

5500 Cenex Drive

St. Paul, Minnesota 55077

(b) Locations Where Records Are Kept

5500 Cenex Drive

St. Paul, Minnesota 55077

Formerly known as Cofina Financial, LLC

(d) Federal Taxpayer ID Number

20-2409352

(e) Jurisdiction of Organization

Minnesota

(f) True Legal Name

CHS Capital, LLC

(g) Organizational Identification Number

1224194-2

Schedule 3- 2

Exhibit A

Form of Transaction Notice

MUFG BANK, LTD.


RE:	Transaction under the Framework Agreement and the Master Repurchase Agreement

Ladies and Gentlemen:

This Transaction Notice is delivered to you pursuant to Section 4.1(a) of the Master Framework Agreement, dated as of September 4, 2018 (the “ Framework Agreement ”), by and among CHS Inc. and CHS Capital, LLC, as sellers (“ Sellers ”), CHS Inc., as agent for the Sellers (in such capacity, “ Seller Agent ”), MUFG Bank, Ltd., as buyer agent (“Buyer Agent”) and MUFG Bank, Ltd. and the other financial institutions from time to time party thereto, as buyers (“Buyers”), and relating to repurchase transactions to be entered into pursuant to the terms of the CHS Master Repurchase Agreement and the CHS Capital Master Repurchase Agreement. Capitalized terms used but not defined herein have the meanings set forth in the Framework Agreement.

Seller Agent hereby requests, on behalf of each applicable Seller, in accordance with the terms of the Framework Agreement:


(i)	a Transaction with CHS under the CHS Master Repurchase Agreement with a proposed Purchase Price of $__________; and


(ii)	a Transaction with CHS Capital under the CHS Capital Master Repurchase Agreement with a proposed Purchase Price of $__________;

each such Transaction to be entered into on the proposed Purchase Date of [•], and each such Transaction to have a proposed Repurchase Date of [•]. The sum of the proposed Purchase Prices for all such proposed Transactions is $__________.

[Seller Agent further requests that, pursuant to Paragraph 3(c)(ii) of each Master Repurchase Agreement set forth above (as amended by Annex I thereto), each of the current Transactions thereunder evidenced by the Confirmations dated as of [•] and originally scheduled to expire on [•] be instead terminated as of such proposed Purchase Date.] To be used in connection with an early termination of Transactions by the Sellers.

Attached hereto are forms of Confirmations for such proposed Transactions, completed in accordance with Section 4.1(a) of the Framework Agreement.

¹ To be used in connection with an early termination of Transactions by the Sellers.

Exhibit A-1

Exhibit B

Form of Purchase Report

Exhibit B-1

Dated as of September 4, 2018

MUFG Bank, Ltd. (f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd.),

as Administrative Agent under the Receivables Purchase Agreement

1221 Avenue of the Americas

New York, NY 10020

Re: Letter Agreement re: Pledge of Subordinated Notes

Ladies and Gentlemen:

This letter agreement shall remain in effect until the Subject Date.

EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:

(a) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS LETTER AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING; AND

(continued on the following page)

Please indicate your agreement with the foregoing by signing (where indicated below).

Very truly yours,

MUFG BANK, LTD. ,

as a Subordinated Note Financier

By:

Name:

Title:

S- 1 Letter Agreement

ACCEPTED AND AGREED TO:

MUFG BANK, LTD. (f/k/a THE BANK

OF TOKYO-MITSUBISHI UFJ, LTD.) ,

as RPA Agent

By:

Name:

Title:

S- 2 Letter Agreement

AMENDED AND RESTATED SUBORDINATED NOTE

September 4, 2018

“ SCA Originator ” means any Person designated as an “Originator” under the Sale Agreement.

“ Senior Interest Holders ” means, collectively, each Purchaser, each Purchaser Agent, the Administrative Agent and each Indemnified Party and their permitted assigns.

“ Subordination Provisions ” is defined in Section IV hereof.

(x) Originator agrees that this Subordinated Note shall be pari passu with all other Junior Liabilities.

[SIGNATURE PAGE FOLLOWS]

COFINA FUNDING, LLC

By:

Title:

[Signature Page to A&R Subordinated Note (CHS Capital)]

Schedule

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL



Date	Amount of Subordinated Loan	Amount of Principal Paid	Unpaid Principal Balance	Notation made by (initials)

AMENDED AND RESTATED SUBORDINATED NOTE

September 4, 2018

Note . FOR VALUE RECEIVED, the undersigned, Cofina Funding, LLC, a Delaware limited liability company (the “ Company ”), hereby unconditionally promises to pay to the order of CHS INC., a Minnesota corporation (“ Originator ”), in lawful money of the United States of America and in immediately available funds, on or before the date following the Termination Date which is one year and one day after the date on which (i) the Unpaid Balance of all Assets sold by Originator under the “Sale Agreement” referred to below has been reduced to zero and (ii) Originator has paid to the Company all indemnities, adjustments and other amounts which may be owed thereunder in connection with the Purchase thereunder (the “ Collection Date ”), the aggregate unpaid principal sum outstanding of all “ Subordinated Loans ” made from time to time by Originator to the Company pursuant to and in accordance with the terms of that certain Sale and Contribution Agreement dated as of July 22, 2016 among Originator and certain of its affiliates, as originators, and the Company (as amended, restated, supplemented or otherwise modified from time to time, the “ Sale Agreement ”). Reference to Section 2.3 of the Sale Agreement is hereby made for a statement of the terms and conditions under which the loans evidenced hereby have been and will be made.

“ SCA Originator ” means any Person designated as an “Originator” under the Sale Agreement.

“ Senior Interest Holders ” means, collectively, each Purchaser, each Purchaser Agent, the Administrative Agent and each Indemnified Party and their permitted assigns.

“ Subordination Provisions ” is defined in Section IV hereof.

(x) Originator agrees that this Subordinated Note shall be pari passu with all other Junior Liabilities.

(xi) Originator hereby waives (a) notice of acceptance of these Subordination Provisions by any of the Senior Interest Holders, (b) notice of the existence, creation, non-payment or non-

[SIGNATURE PAGE FOLLOWS]

COFINA FUNDING, LLC

By:

Title:

[Signature Page to A&R Subordinated Note (CHS Inc.)]

Schedule

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL



Date	Amount of Subordinated Loan	Amount of Principal Paid	Unpaid Principal Balance	Notation made by (initials)

Exhibit 10.40

Master Repurchase Agreement

September 1996 Version

Dated as of September 4, 2018

Between: CHS Inc.

and MUFG Bank, Ltd.


1.	Applicability

From time to time the parties hereto may enter into transactions in which one party (“Seller”) agrees to transfer to the other (“Buyer”) securities or other assets (“Securities”) against the transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such Securities at a date certain or on demand, against the transfer of funds by Seller. Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in Annex I hereto and in any other annexes identified herein or therein as applicable hereunder.


2.	Definitions

(a)

“Act of Insolvency”, with respect to any party, (i) the commencement by such party as debtor of any case or proceeding under any bankruptcy, insolvency, reorganization, liquidation, moratorium, dissolution, delinquency or similar law, or such party seeking the appointment or election of a receiver, conservator, trustee, custodian or similar official for such party or any substantial part of its property, or the convening of any meeting of creditors for purposes of commencing any such case or proceeding or seeking such an appointment or election, (ii) the commence- ment of any such case or proceeding against such party, or another seeking such an appointment or election, or the filing against a party of an application for a protective decree under the provisions of the Securities Investor Protection Act of 1970, which (A) is consented to or not timely contested by such party, (B) results in the entry of an order for relief, such an appointment or election, the issuance of such a protective decree or the entry of an order having a similar effect, or (C) is not dismissed within 15 days, (iii) the making by such party of a general assignment for the benefit of creditors, or (iv) the admission in writing by such party of such party’s inability to pay such party’s debts as they become due;


(b)	“Additional Purchased Securities”, Securities provided by Seller to Buyer pursuant to Paragraph 4(a) hereof;


(c)	“Buyer’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Buyer’s Margin Percentage to the Repurchase Price for such Transaction as of such date;


(d)	“Buyer’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Seller’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction;


(e)	“Confirmation”, the meaning specified in Paragraph 3(b) hereof;


(f)	“Income”, with respect to any Security at any time, any principal thereof and all interest, dividends or other distributions thereon;


(g)	“Margin Deficit”, the meaning specified in Paragraph 4(a) hereof;


(h)	“Margin Excess”, the meaning specified in Paragraph 4(b) hereof;


(i)	“Margin Notice Deadline”, the time agreed to by the parties in the relevant Confirmation, Annex I hereto or otherwise as the deadline for giving notice requiring same-day satisfac- tion of margin maintenance obligations as provided in Paragraph 4 hereof (or, in the absence of any such agreement, the deadline for such purposes established in accordance with market practice);

(j)

“Market Value”, with respect to any Securities as of any date, the price for such Securities on such date obtained from a generally recognized source agreed to by the parties or the most recent closing bid quotation from such a source, plus accrued Income to the extent not included therein (other than any Income credited or transferred to, or applied to the obligations of, Seller pursuant to Paragraph 5 hereof) as of such date (unless contrary to market practice for such Securities);

(k)

“Price Differential”, with respect to any Transaction as of any date, the aggregate amount obtained by daily application of the Pricing Rate for such Transaction to the Purchase Price for such Transaction on a 360 day per year basis for the actual number of days dur- ing the period commencing on (and including) the Purchase Date for such Transaction and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Buyer with respect to such Transaction);


(l)	“Pricing Rate”, the per annum percentage rate for determination of the Price Differential;


(m)	“Prime Rate”, the prime rate of U.S. commercial banks as published in The Wall Street Journal (or, if more than one such rate is published, the average of such rates);


(n)	“Purchase Date”, the date on which Purchased Securities are to be transferred by Seller to Buyer;

(o)

“Purchase Price”, (i) on the Purchase Date, the price at which Purchased Securities are transferred by Seller to Buyer, and (ii) thereafter, except where Buyer and Seller agree otherwise, such price increased by the amount of any cash transferred by Buyer to Seller pursuant to Paragraph 4(b) hereof and decreased by the amount of any cash transferred by Seller to Buyer pursuant to Paragraph 4(a)

2 ■¡ September 1996 ■¡ Master Repurchase Agreement

hereof or applied to reduce Seller’s obligations under clause (ii) of Paragraph 5 hereof;

(p)

“Purchased Securities”, the Securities transferred by Seller to Buyer in a Transaction here- under, and any Securities substituted therefor in accordance with Paragraph 9 hereof. The term “Purchased Securities” with respect to any Transaction at any time also shall include Additional Purchased Securities delivered pursuant to Paragraph 4(a) hereof and shall exclude Securities returned pursuant to Paragraph 4(b) hereof;


(q)	“Repurchase Date”, the date on which Seller is to repurchase the Purchased Securities from Buyer, including any date determined by application of the provisions of Paragraph 3(c) or 11 hereof;


(r)	“Repurchase Price”, the price at which Purchased Securities are to be transferred from Buyer to Seller upon termination of a Transaction, which will be determined in each case (including Transactions terminable upon demand) as the sum of the Purchase Price and the Price Differential as of the date of such determination;


(s)	“Seller’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Seller’s Margin Percentage to the Repurchase Price for such Transaction as of such date;


(t)	“Seller’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Buyer’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction.


3.	Initiation; Confirmation; Termination


(a)	An agreement to enter into a Transaction may be made orally or in writing at the initia- tion of either Buyer or Seller. On the Purchase Date for the Transaction, the Purchased Securities shall be transferred to Buyer or its agent against the transfer of the Purchase Price to an account of Seller.

(b)

Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or both), as shall be agreed, shall promptly deliver to the other party a written confirmation of each Transaction (a “Confirmation”). The Confirmation shall describe the Purchased Securities (including CUSIP number, if any), identify Buyer and Seller and set forth (i) the Purchase Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the Transaction is to be terminable on demand, (iv) the Pricing Rate or Repurchase Price applicable to the Transaction, and (v) any additional terms or conditions of the Transaction not inconsistent with this Agreement. The Confirmation, together with this Agreement, shall constitute conclusive evidence of the terms agreed between Buyer and Seller with respect to the Transaction to which the Confirmation relates, unless with

respect to the Confirmation specific objection is made promptly after receipt thereof. In the event of any conflict between the terms of such Confirmation and this Agreement, this Agreement shall prevail.


(c)	In the case of Transactions terminable upon demand, such demand shall be made by Buyer or Seller, no later than such time as is customary in accordance with market prac-

3 ■¡ September 1996 ■¡ Master Repurchase Agreement

tice, by telephone or otherwise on or prior to the business day on which such termination will be effective. On the date specified in such demand, or on the date fixed for termina- tion in the case of Transactions having a fixed term, termination of the Transaction will be effected by transfer to Seller or its agent of the Purchased Securities and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Paragraph 5 hereof) against the transfer of the Repurchase Price to an account of Buyer.


4.	Margin Maintenance

(a)

If at any time the aggregate Market Value of all Purchased Securities subject to all Transactions in which a particular party hereto is acting as Buyer is less than the aggre- gate Buyer’s Margin Amount for all such Transactions (a “Margin Deficit”), then Buyer may by notice to Seller require Seller in such Transactions, at Seller’s option, to transfer to Buyer cash or additional Securities reasonably acceptable to Buyer (“Additional Purchased Securities”), so that the cash and aggregate Market Value of the Purchased Securities, including any such Additional Purchased Securities, will thereupon equal or exceed such aggregate Buyer’s Margin Amount (decreased by the amount of any Margin Deficit as of such date arising from any Transactions in which such Buyer is acting as Seller).

(b)

If at any time the aggregate Market Value of all Purchased Securities subject to all Transactions in which a particular party hereto is acting as Seller exceeds the aggregate Seller’s Margin Amount for all such Transactions at such time (a “Margin Excess”), then Seller may by notice to Buyer require Buyer in such Transactions, at Buyer’s option, to transfer cash or Purchased Securities to Seller, so that the aggregate Market Value of the Purchased Securities, after deduction of any such cash or any Purchased Securities so transferred, will thereupon not exceed such aggregate Seller’s Margin Amount (increased by the amount of any Margin Excess as of such date arising from any Transactions in which such Seller is acting as Buyer).

(c)

If any notice is given by Buyer or Seller under subparagraph (a) or (b) of this Paragraph at or before the Margin Notice Deadline on any business day, the party receiving such notice shall transfer cash or Additional Purchased Securities as provided in such subpara- graph no later than the close of business in the relevant market on such day. If any such notice is given after the Margin Notice Deadline, the party receiving such notice shall transfer such cash or Securities no later than the close of business in the relevant market on the next business day following such notice.


(d)	Any cash transferred pursuant to this Paragraph shall be attributed to such Transactions as shall be agreed upon by Buyer and Seller.

(e)

Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the respective rights of Buyer or Seller (or both) under subparagraphs (a) and (b) of this Paragraph may be exercised only where a Margin Deficit or Margin Excess, as the case may be, exceeds a specified dollar amount or a specified percentage of the Repurchase Prices for such Transactions (which amount or percentage shall be agreed to by Buyer and Seller prior to entering into any such Transactions).


(f)	Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the respective rights of Buyer and Seller under subparagraphs (a) and (b) of this Paragraph to require the elimination of a Margin Deficit or a Margin Excess, as the case may be, may be exercised whenever such a Margin Deficit or Margin

4 ■¡ September 1996 ■¡ Master Repurchase Agreement

Excess exists with respect to any single Transaction hereunder (calculated without regard to any other Transaction outstanding under this Agreement).


5.	Income Payments

Seller shall be entitled to receive an amount equal to all Income paid or distributed on or in respect of the Securities that is not otherwise received by Seller, to the full extent it would be so entitled if the Securities had not been sold to Buyer. Buyer shall, as the parties may agree with respect to any Transaction (or, in the absence of any such agreement, as Buyer shall reasonably determine in its discretion), on the date such Income is paid or distributed either (i) transfer to or credit to the account of Seller such Income with respect to any Purchased Securities subject to such Transaction or (ii) with respect to Income paid in cash, apply the Income payment or payments to reduce the amount, if any, to be transferred to Buyer by Seller upon termination of such Transaction. Buyer shall not be obligated to take any action pursuant to the preceding sentence (A) to the extent that such action would result in the cre- ation of a Margin Deficit, unless prior thereto or simultaneously therewith Seller transfers to Buyer cash or Additional Purchased Securities sufficient to eliminate such Margin Deficit, or

(B) if an Event of Default with respect to Seller has occurred and is then continuing at the time such Income is paid or distributed.


6.	Security Interest

Although the parties intend that all Transactions hereunder be sales and purchases and not loans, in the event any such Transactions are deemed to be loans, Seller shall be deemed to have pledged to Buyer as security for the performance by Seller of its obligations under each such Transaction, and shall be deemed to have granted to Buyer a security interest in, all of the Purchased Securities with respect to all Transactions hereunder and all Income thereon and other proceeds thereof.


7.	Payment and Transfer

Unless otherwise mutually agreed, all transfers of funds hereunder shall be in immediately available funds. All Securities transferred by one party hereto to the other party (i) shall be in suitable form for transfer or shall be accompanied by duly executed instruments of transfer or assignment in blank and such other documentation as the party receiving possession may reasonably request, (ii) shall be transferred on the book-entry system of a Federal Reserve Bank, or (iii) shall be transferred by any other method mutually acceptable to Seller and Buyer.


8.	Segregation of Purchased Securities

To the extent required by applicable law, all Purchased Securities in the possession of Seller shall be segregated from other securities in its possession and shall be identified as subject to this Agreement. Segregation may be accomplished by appropriate identification on the books and records of the holder, including a financial or securities intermediary or a clearing corpo- ration. All of Seller’s interest in the Purchased Securities shall pass to Buyer on the Purchase Date and, unless otherwise agreed by Buyer and Seller, nothing in this Agreement shall pre- clude Buyer from engaging in repurchase transactions with the Purchased Securities or other- wise selling, transferring, pledging or hypothecating the Purchased Securities, but no such transaction shall relieve Buyer of its obligations to transfer Purchased Securities to Seller pur- suant to Paragraph 3, 4 or 11 hereof, or of Buyer’s obligation to credit or pay Income to, or

5 ■¡ September 1996 ■¡ Master Repurchase Agreement

apply Income to the obligations of, Seller pursuant to Paragraph 5 hereof.

Required Disclosure for Transactions in Which the Seller Retains Custody of the Purchased Securities

Seller is not permitted to substitute other securities for those subject to this Agreement and therefore must keep Buyer’s securities segregated at all times, unless in this Agreement Buyer grants Seller the right to substitute other securities. If Buyer grants the right to substitute, this means that Buyer’s securities will likely be commingled with Seller’s own securities during the trading day. Buyer is advised that, during any trading day that Buyer’s securities are commingled with Seller’s securities, they [will]* [may]** be subject to liens granted by Seller to [its clearing bank]* [third parties]** and may be used by Seller for deliveries on other securities transactions. Whenever the securities are commingled, Seller’s ability to resegregate substitute securities for Buyer will be subject to Seller’s ability to satisfy [the clearing]* [any]** lien or to obtain substitute securities.

* Language to be used under 17 C.F.R. ß403.4(e) if Seller is a government securities broker or dealer other than a financial institution.

** Language to be used under 17 C.F.R. ß403.5(d) if Seller is a financial institution.


9.	Substitution


(a)	Seller may, subject to agreement with and acceptance by Buyer, substitute other Securities for any Purchased Securities. Such substitution shall be made by transfer to Buyer of such other Securities and transfer to Seller of such Purchased Securities. After substitution, the substituted Securities shall be deemed to be Purchased Securities.

(b)

In Transactions in which Seller retains custody of Purchased Securities, the parties expressly agree that Buyer shall be deemed, for purposes of subparagraph (a) of this Paragraph, to have agreed to and accepted in this Agreement substitution by Seller of other Securities for Purchased Securities; provided, however, that such other Securities shall have a Market Value at least equal to the Market Value of the Purchased Securities for which they are substituted.

10. Representations

Each of Buyer and Seller represents and warrants to the other that (i) it is duly authorized to execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) it will engage in such Transactions as principal (or, if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction by the other party hereto, as agent for a disclosed principal), (iii) the person signing this Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such disclosed principal), (iv) it has obtained all authorizations of any governmental body required in connection with this Agreement and the Transactions hereunder and such autho- rizations are in full force and effect and (v) the execution, delivery and performance of this Agreement and the Transactions hereunder will not violate any law, ordinance, charter, by- law or rule applicable to it or any agreement by which it is bound or by which any of its assets are affected. On the Purchase Date for any Transaction Buyer and Seller shall each be deemed to repeat all the foregoing representations made by it.


11.	Events of Default

In the event that (i) Seller fails to transfer or Buyer fails to purchase Purchased Securities upon the applicable Purchase Date, (ii) Seller fails to repurchase or Buyer

6 ■¡ September 1996 ■¡ Master Repurchase Agreement

fails to transfer Purchased Securities upon the applicable Repurchase Date, (iii) Seller or Buyer fails to com- ply with Paragraph 4 hereof, (iv) Buyer fails, after one business day’s notice, to comply with Paragraph 5 hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi) any representation made by Seller or Buyer shall have been incorrect or untrue in any material respect when made or repeated or deemed to have been made or repeated, or (vii) Seller or Buyer shall admit to the other its inability to, or its intention not to, perform any of its oblig- ations hereunder (each an “Event of Default”):

(a)

The nondefaulting party may, at its option (which option shall be deemed to have been exercised immediately upon the occurrence of an Act of Insolvency), declare an Event of Default to have occurred hereunder and, upon the exercise or deemed exercise of such option, the Repurchase Date for each Transaction hereunder shall, if it has not already occurred, be deemed immediately to occur (except that, in the event that the Purchase Date for any Transaction has not yet occurred as of the date of such exercise or deemed exercise, such Transaction shall be deemed immediately canceled). The nondefaulting party shall (except upon the occurrence of an Act of Insolvency) give notice to the defaulting party of the exercise of such option as promptly as practicable.

(b)

In all Transactions in which the defaulting party is acting as Seller, if the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, (i) the defaulting party’s obligations in such Transactions to repurchase all Purchased Securities, at the Repurchase Price therefor on the Repurchase Date deter- mined in accordance with subparagraph (a) of this Paragraph, shall thereupon become immediately due and payable, (ii) all Income paid after such exercise or deemed exercise shall be retained by the nondefaulting party and applied to the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder, and (iii) the defaulting party shall immediately deliver to the nondefaulting party any Purchased Securities subject to such Transactions then in the defaulting party’s posses- sion or control.

(c)

In all Transactions in which the defaulting party is acting as Buyer, upon tender by the nondefaulting party of payment of the aggregate Repurchase Prices for all such Transactions, all right, title and interest in and entitlement to all Purchased Securities subject to such Transactions shall be deemed transferred to the nondefaulting party, and the defaulting party shall deliver all such Purchased Securities to the nondefaulting party.


(d)	If the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, the nondefaulting party, without prior notice to the defaulting party, may:

(i)

as to Transactions in which the defaulting party is acting as Seller, (A) immediately sell, in a recognized market (or otherwise in a commercially reasonable manner) at such price or prices as the nondefaulting party may reasonably deem satisfactory, any or all Purchased Securities subject to such Transactions and apply the proceeds thereof to the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder or (B) in its sole discretion elect, in lieu of selling all or a portion of such Purchased Securities, to give the defaulting party credit for such Purchased Securities in an amount equal to the price therefor on such date, obtained from a generally recognized source or the most recent closing bid quotation from such a source,

7 ■¡ September 1996 ■¡ Master Repurchase Agreement

against the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder; and

(ii)

as to Transactions in which the defaulting party is acting as Buyer, (A) immediately purchase, in a recognized market (or otherwise in a commercially reasonable manner) at such price or prices as the nondefaulting party may reasonably deem satisfactory, securities (“Replacement Securities”) of the same class and amount as any Purchased Securities that are not delivered by the defaulting party to the nondefaulting party as required hereunder or (B) in its sole discretion elect, in lieu of purchasing Replacement Securities, to be deemed to have purchased Replacement Securities at the price therefor on such date, obtained from a generally recognized source or the most recent closing offer quotation from such a source.

Unless otherwise provided in Annex I, the parties acknowledge and agree that (1) the Securities subject to any Transaction hereunder are instruments traded in a recognized market, (2) in the absence of a generally recognized source for prices or bid or offer quotations for any Security, the nondefaulting party may establish the source therefor in its sole discretion and (3) all prices, bids and offers shall be determined together with accrued Income (except to the extent contrary to market practice with respect to the relevant Securities).

(e)

As to Transactions in which the defaulting party is acting as Buyer, the defaulting party shall be liable to the nondefaulting party for any excess of the price paid (or deemed paid) by the nondefaulting party for Replacement Securities over the Repurchase Price for the Purchased Securities replaced thereby and for any amounts payable by the defaulting party under Paragraph 5 hereof or otherwise hereunder.


(f)	For purposes of this Paragraph 11, the Repurchase Price for each Transaction hereunder in respect of which the defaulting party is acting as Buyer shall not increase above the amount of such Repurchase Price for such Transaction determined as of the date of the exercise or deemed exercise by the nondefaulting party of the option referred to in sub- paragraph (a) of this Paragraph.

(g)

The defaulting party shall be liable to the nondefaulting party for (i) the amount of all reasonable legal or other expenses incurred by the nondefaulting party in connection with or as a result of an Event of Default, (ii) damages in an amount equal to the cost (including all fees, expenses and commissions) of entering into replacement transactions and entering into or terminating hedge transactions in connection with or as a result of an Event of Default, and (iii) any other loss, damage, cost or expense directly arising or resulting from the occurrence of an Event of Default in respect of a Transaction.

(h)

To the extent permitted by applicable law, the defaulting party shall be liable to the non- defaulting party for interest on any amounts owing by the defaulting party hereunder, from the date the defaulting party becomes liable for such amounts hereunder until such amounts are (i) paid in full by the defaulting party or (ii) satisfied in full by the exercise of the nondefaulting party’s rights hereunder. Interest on any sum payable by the defaulting party to the nondefaulting party under this Paragraph 11(h) shall be at a rate equal to the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.


(i)	The nondefaulting party shall have, in addition to its rights hereunder, any

8 ■¡ September 1996 ■¡ Master Repurchase Agreement

rights other- wise available to it under any other agreement or applicable law.


12.	Single Agreement

Buyer and Seller acknowledge that, and have entered hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and have been made in consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries and other transfers in respect of any other Transactions hereunder, and the obligations to make any such payments, deliveries and other transfers may be applied against each other and netted.


13.	Notices and Other Communications

Any and all notices, statements, demands or other communications hereunder may be given by a party to the other by mail, facsimile, telegraph, messenger or otherwise to the address specified in Annex II hereto, or so sent to such party at any other place specified in a notice of change of address hereafter received by the other. All notices, demands and requests hereunder may be made orally, to be confirmed promptly in writing, or by other communication as specified in the preceding sentence.


14.	Entire Agreement; Severability

This Agreement shall supersede any existing agreements between the parties containing gen- eral terms and conditions for repurchase transactions. Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.


15.	Non-assignability; Termination

(a)

The rights and obligations of the parties under this Agreement and under any Transaction shall not be assigned by either party without the prior written consent of the other party, and any such assignment without the prior written consent of the other party shall be null and void. Subject to the foregoing, this Agreement and any Transactions shall be binding upon and shall inure to the benefit of the parties and their respective successors and assigns. This Agreement may be terminated by either party upon giving written notice to the other, except that this Agreement shall, notwithstanding such notice, remain applicable to any Transactions then outstanding.


(b)	Subparagraph (a) of this Paragraph 15 shall not preclude a party from assigning, charg- ing or otherwise dealing with all or any part of its interest in any sum payable to it under Paragraph 11 hereof.


16.	Governing Law

This Agreement shall be governed by the laws of the State of New York without giving effect to the conflict of law principles thereof.

9 ■¡ September 1996 ■¡ Master Repurchase Agreement


17.	No Waivers, Etc.

No express or implied waiver of any Event of Default by either party shall constitute a waiver of any other Event of Default and no exercise of any remedy hereunder by any party shall constitute a waiver of its right to exercise any other remedy hereunder. No modification or waiver of any provision of this Agreement and no consent by any party to a departure here- from shall be effective unless and until such shall be in writing and duly executed by both of the parties hereto. Without limitation on any of the foregoing, the failure to give a notice pur- suant to Paragraph 4(a) or 4(b) hereof will not constitute a waiver of any right to do so at a later date.


18.	Use of Employee Plan Assets

(a)

If assets of an employee benefit plan subject to any provision of the Employee Retirement Income Security Act of 1974 (“ERISA”) are intended to be used by either party hereto (the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party prior to the Transaction. The Plan Party shall represent in writing to the other party that the Transaction does not constitute a prohibited transaction under ERISA or is otherwise exempt therefrom, and the other party may proceed in reliance thereon but shall not be required so to proceed.


(b)	Subject to the last sentence of subparagraph (a) of this Paragraph, any such Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most recent available audited statement of its financial condition and its most recent subsequent unaudited statement of its financial condition.

(c)

By entering into a Transaction pursuant to this Paragraph, Seller shall be deemed (i) to represent to Buyer that since the date of Seller’s latest such financial statements, there has been no material adverse change in Seller’s financial condition which Seller has not dis- closed to Buyer, and (ii) to agree to provide Buyer with future audited and unaudited statements of its financial condition as they are issued, so long as it is a Seller in any out- standing Transaction involving a Plan Party.

19. Intent

(a)

The parties recognize that each Transaction is a “repurchase agreement” as that term is defined in Section 101 of Title 11 of the United States Code, as amended (except insofar as the type of Securities subject to such Transaction or the term of such Transaction would render such definition inapplicable), and a “securities contract” as that term is defined in Section 741 of Title 11 of the United States Code, as amended (except insofar as the type of assets subject to such Transaction would render such definition inapplicable).


(b)	It is understood that either party’s right to liquidate Securities delivered to it in connection with Transactions hereunder or to exercise any other remedies pursuant to Paragraph 11 hereof is a contractual right to liquidate such Transaction as described in Sections 555 and 559 of Title 11 of the United States Code, as amended.


(c)	The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended (“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy

10 ■¡ September 1996 ■¡ Master Repurchase Agreement

statements thereunder (except insofar as the type of assets subject to such Transaction would render such definition inapplicable).

(d)

It is understood that this Agreement constitutes a “netting contract” as defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and payment obligation under any Transaction hereunder shall constitute a “covered contractual payment entitlement” or “covered contractual payment obligation”, respectively, as defined in and subject to FDI- CIA (except insofar as one or both of the parties is not a “financial institution” as that term is defined in FDICIA).


20.	Disclosure Relating to Certain Federal Protections

The parties acknowledge that they have been advised that:


(a)	in the case of Transactions in which one of the parties is a broker or dealer registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has

taken the position that the provisions of the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any Transaction hereunder;


(b)	in the case of Transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to the other party with respect to any Transaction hereunder; and


(c)	in the case of Transactions in which one of the parties is a financial institution, funds held by the financial institution pursuant to a Transaction hereunder are not a deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, as applicable.



	CHS Inc.		MUFG Bank, Ltd.
	[Name of Party]		[Name of Party]

By:		By:
Title:		Title:
Date:		Date:

11 ■¡ September 1996 ■¡ Master Repurchase Agreement

EXECUTION COPY

Annex I

Supplemental Terms and Conditions

This Annex I forms a part of the 1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018 (the “SIFMA Master”, and as amended by this Annex I, this or the “Agreement”) between CHS Inc. (“CHS”) and MUFG Bank, Ltd. (“MUFG”). Subject to the provisions of Paragraph 1 of this Annex I, (a) capitalized terms used but not defined in this Annex I shall have the meanings ascribed to them in the SIFMA Master, and (b) aside from this Annex I, including all exhibits and schedules attached hereto and thereto, no other Annexes or Schedules thereto shall form a part of the SIFMA Master or be applicable thereunder.

1. Applicability; Parties; Framework .

(a) Framework Agreement . This Agreement is being entered into in accordance with that certain Master Framework Agreement, dated as of September 4, 2018 (as amended, restated, supplemented or otherwise modified, the “Framework Agreement”), among CHS and CHS Capital, LLC, as sellers, CHS, as agent for the sellers (in such capacity, the “Seller Agent”), MUFG, as buyer, the other financial institutions from time to time party thereto as buyers and MUFG, as agent for the Buyers (in such capacity, “Buyer Agent”). Capitalized terms used but not defined in this Agreement or in any Confirmations shall have the meanings set forth in the Framework Agreement (including Schedule 1 thereto). In the event of any inconsistency between this Agreement and the Framework Agreement, the Framework Agreement shall govern.

(b) Seller . CHS will act as seller (in such capacity, the “ Seller ”) with respect to all Transactions entered into hereunder. Subject to the terms and conditions of the Framework Agreement, all powers of Seller hereunder, including the execution and delivery of Confirmations hereunder or any other matters involving consent or discretion, shall be exercised solely by Agent on behalf of Seller.

(c) Buyer . All references to “Buyer” in this Agreement shall refer collectively to the “Buyers” party to the Framework Agreement, each as represented for purposes of this Agreement by MUFG, as Buyer Agent. Each such Buyer shall be deemed a party to this Agreement, and upon entry into any Transaction, each such Buyer shall acquire an undivided fractional interest in the Purchased Securities for such Transaction (pro-rata in accordance with its Undivided Funding Percentage) in accordance with Section 4.2(b) of the Framework Agreement until such Purchased Securities are repurchased by Seller pursuant to this Agreement (at which point such undivided fractional interests shall be collectively reconveyed to Seller) or otherwise disposed of hereunder. Subject to the terms and conditions of the Framework Agreement, all powers of Buyers hereunder, including the execution and delivery of Confirmations hereunder or any other matters involving consent or discretion, shall be exercised solely by Agent on behalf of such Buyers. The parties agree that any remedies to be exercised against Seller, Guarantor or the Collateral shall be exercised solely through Buyer Agent and not by any Buyer individually.

(d) Securities . The only Securities for purposes of this Agreement shall consist of the CHS Note, and no asset or property other than the CHS Note shall be recognized as a Security for purposes of any Transactions hereunder. All references in this Agreement to Securities or Purchased Securities, as the case may be (whether in the SIFMA Master or elsewhere in this Annex I) shall be understood and construed as references to the CHS Note.

(e) Entire Agreement . The first sentence of Paragraph 14 of the SIFMA Master is subject to, and superseded by, Section 9.3 of the Framework Agreement.

2. Definitions .

(a) Added Definitions . For purposes of this Agreement, the following additional terms shall have the following meanings:

(i) “Breakage Amount” means, with respect to any Breakage Event pertaining to any outstanding Transaction, an amount equal to the loss, cost and expense (if any) actually incurred by Buyer and attributable to such Breakage Event but excluding loss of anticipated profits, in each case as determined in good faith by Buyer and notified to Buyer Agent and Seller Agent in writing; it being understood that any written notice from Buyer indicating such amount and setting forth in reasonable detail the calculations used by Buyer to determine such amount, shall be conclusive absent manifest error;

(ii) “Breakage Event” means, with respect to any Transaction, (A) the termination of such Transaction before the Repurchase Date specified in the Confirmation for such Transaction (1) by Seller or Buyer in accordance with Paragraph 3(c)(ii) or Paragraph 11, respectively, of the SIFMA Master, as amended by this Annex I, or (2) as the result of the Termination Date occurring under the Securitization RPA; or (B) the transfer of any cash by Seller to Buyer during the Transaction Period for such Transaction as required pursuant to Paragraph 4(a) of the SIFMA Master, as amended by this Annex I;

(iii) “Breakage Period” means, with respect to any Breakage Event, the period commencing on (and including) (x) in the case of a Breakage Event of the type described in clause (A) of the definition thereof, the effective date of Seller’s termination of the applicable Transaction or (y) in the case of a Breakage Event of the type described in clause (B) of the definition thereof, the date on which such cash is transferred by Seller to Buyer, and, in each case, ending on (but excluding) the next succeeding Monthly Date;

(iv) “Framework Agreement” has the meaning set forth in Paragraph 1(a) of this Annex I;

(v) “LIBO Rate” means for any Transaction Period, (a) the interest rate per annum designated as the LIBO Rate by Buyer Agent for a period of time comparable to such Transaction Period that appears on the Reuters Screen LIBO Page as of 11:00 a.m. (London, England time) on the second London Banking Day preceding the first day of such Transaction Period or (b) if a rate cannot be determined under either of the foregoing clauses, an annual rate equal to the average (rounded upwards if necessary to the nearest 1/100th of 1%) of the rates per annum at which deposits in USD with a duration comparable to such Transaction Period in a principal amount substantially equal to the principal amount of the Purchase Price for the applicable Transaction are offered to the principal London office of Buyer Agent by three London banks, selected by Buyer Agent in good faith, at about 11:00 a.m. London time on the second London Banking Day preceding the first day of such Transaction Period. If the calculation of the LIBO Rate results in a LIBO Rate of less than zero (0), the LIBO Rate shall be deemed to be zero (0) for all purposes of this Agreement.

(vi) “London Banking Day” means any day on which commercial banks are open for general business (including dealings in foreign exchange and foreign currency deposits) in the city of London, England;

(vii) “Original Note” means the original executed version of the CHS Note; and

(viii) “Transaction Period” means, with respect to any Transaction, the period commencing on (and including) the Purchase Date for such Transaction and expiring on (but excluding) the Repurchase Date for such Transaction.

(b) Revised Definitions . For purposes of this Agreement, and notwithstanding anything in Paragraph 2 of the SIFMA Master to the contrary, the following terms shall have the following amended and restated meanings:

(i) “Buyer’s Margin Amount” means, with respect to any Transaction as of any date, the amount obtained by application of the Buyer’s Margin Percentage to the Purchase Price for such Transaction as of such date;

(ii) “Buyer’s Margin Percentage” means, with respect to any Transaction as of any date, one hundred percent (100%);

(iii) “Price Differential” means, with respect to any Transaction as of any date, the sum of the aggregate amount obtained by daily application of the Pricing Rate for such Transaction to the Purchase Price for such Transaction on a 360 day per year basis for the actual number of days during the period commencing on (and including) the Purchase Date for such Transaction and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Buyer with respect to such Transaction); provided , that upon the occurrence of any Breakage Event with respect to such Transaction, such Price Differential shall be increased by Buyer’s applicable Breakage Amount (if any) for such Breakage Event, determined as of the date on which such Breakage Event occurs;

(iv) “Pricing Rate” means the per annum percentage rate for determination of the Price Differential, determined for each Transaction (unless otherwise specified in the Confirmation) as being equal to the sum of (A) LIBO Rate as of the applicable Purchase Date, plus (B) (i) at any time an Event of Default does not exist, 0.80% and (ii) at any time and Event of Default exists, 2.80% (it being understood that, if the Seller Agent fails to deliver the required Transaction Notice for a Transaction and the other associated documents pursuant to Section 4.1(a) of the Framework Agreement at least three (3) Business Days prior to the proposed Purchase Date and Buyer nonetheless elects to proceed with the proposed Transaction, the Buyer Agent’s Prime Rate shall be used instead of the LIBO Rate in determining the Pricing Rate for such Transaction);

(v) “Repurchase Date” means the date on which Seller is to repurchase the Purchased Securities from Buyer, which shall be the earliest of (i) the next Monthly Date immediately succeeding the applicable Purchase Date, (ii) the Facility Expiration Date and (iii) any date determined by application of the provisions of Paragraph 3(c) or 11 of this Annex I; and

(vi) “Repurchase Price” means the price at which Purchased Securities are to be transferred from Buyer to Seller upon termination of a Transaction, which will be determined in each case as the sum of (A) the Purchase Price for such Transaction plus (B) the accrued and unpaid Price Differential as of the date of such determination (it being understood that all such accrued and unpaid Price Differential shall be payable when and as set forth in Paragraph 12 of this Annex I); provided , that if an Event of Default has occurred and is continuing with respect to a Seller as of the applicable Repurchase Date for a Transaction, then the Repurchase Price for such Transaction shall include, in addition to the amounts specified in the foregoing clauses (A) and (B), all other Secured Obligations due and owing from Seller under the Transaction Agreements through the time such Repurchase Price is paid in full (other than contingent indemnification obligations in respect of which no claim therefor has been made).

3. Initiation; Confirmation; Termination . Notwithstanding anything to the contrary in Paragraph 3 of the SIFMA Master, the following shall apply:

(a) No Oral Agreements . All agreements to enter into Transactions hereunder shall be in writing in accordance with Article 4 of the Framework Agreement.

(b) Confirmations; Priority . All Confirmations with respect to Transactions hereunder shall be substantially in the form attached as Exhibit A to this Annex I. Subject to the definitions of “Price Differential”, “Repurchase Date” and “Repurchase Price” set forth in Paragraphs 2(b)(iii), 2(b)(v) and 2(b)(vi) of this Annex I, respectively, in the event of any conflict between the terms of a Confirmation and this Agreement, the Confirmation shall prevail.

“Transactions hereunder shall terminate upon the earlier of (i) the date determined pursuant to the definition of Repurchase Date (without regard to this Paragraph 3(c)) or (ii) a date specified upon demand by Seller, which demand shall be made by Seller in writing no later than 5:00 p.m. on the third London Banking Day prior to the Business Day on which such termination will be effective (it being understood that Seller may not make more than three (3) such demands described in this clause (ii) during the Facility Term). On such earlier date, termination of the Transaction will be effected by transfer to Seller or its agent of the Purchased Securities (except as otherwise provided in Paragraph 7 of Annex I) against the payment of the related Repurchase Price by Seller (which may, to the extent permitted under Paragraph 12 of Annex I hereto, be netted against the Purchase Price payable in respect of any new Transaction) in accordance with the Framework Agreement.”

(d) Outstanding Transactions; Continuity . Notwithstanding anything in this Agreement to the contrary, the Parties agree that no more than one Transaction hereunder shall be outstanding at any given time. It is the intention of the Parties that during the Facility Term, subject to Buyer’s discretion to decline to enter into any Transaction and fulfillment of the applicable conditions set forth in the Framework Agreement with respect to Buyer’s entry into any such Transaction, the expiration of each Transaction hereunder on the applicable Repurchase Date shall coincide with the entry into a subsequent Transaction with a concurrent Purchase Date in accordance with the procedures set forth in the Framework Agreement. The Parties further intend that, pursuant to Paragraph 12 of the SIFMA Master and to the extent permitted under Paragraph 12 of this Annex I, the Repurchase Price payable by Seller with respect to each such expiring Transaction shall be netted to the extent applicable against the Purchase Price payable by Buyer with respect to such subsequent Transaction; provided that in no event shall a Non-Consenting Buyer’s Pro Rata Share of the Repurchase Price of any expiring Transaction be netted against the Purchase Price payable by Buyer with respect to a subsequent Transaction.

4. Margin Maintenance . Notwithstanding anything to the contrary in Paragraph 4 of the SIFMA Master, the following shall apply:

(a) Paragraph 4(a) of the SIFMA Master is hereby amended and restated as follows:

“If, as of 12:00 noon on any Business Day during the Transaction Period for an outstanding Transaction hereunder (other than the Purchase Date), the Outstanding Amount of the Purchased Securities then subject to such Transaction is less than the Buyer’s Margin Amount for such Transaction (a “Margin Deficit”), then Buyer may, by notice to Seller, require Seller to transfer to Buyer an amount of cash such that the sum of such transferred cash together with the Outstanding Amount of the Purchased Securities will thereupon equal or exceed the Buyer’s Margin Amount.”

(b) Margin Excess Inapplicable . The provisions of Paragraph 4(b) of the SIFMA Master shall not apply to Transactions under this Agreement, and all references thereto or to “Margin Excess” in the SIFMA Master shall be disregarded.

(c) Margin Deficit Cures . Paragraph 4(c) of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

“If any notice is given (or deemed given) by Buyer under subparagraph (a) of this Paragraph, Seller shall transfer cash as provided in such subparagraph no later than the second Business Day following its receipt (or deemed receipt) of such notice; provided , that if such notice is given (or deemed given) in connection with any prepayment on account of principal owing

under the Purchased Securities, Seller shall transfer such cash to Buyer on the same day concurrently with (or immediately following) Seller’s receipt of such prepayment.”

(d) No Additional Purchased Securities . There shall be no Additional Purchased Securities in connection with any Transactions under this Agreement, and all references in the SIFMA Master thereto shall be disregarded for purposes hereof.

(e) Threshold . In accordance with Paragraph 4(e) of the SIFMA Master, the Parties agree that the rights of Buyer under Paragraph 4(a) of the SIFMA Master, as amended by this Annex I, to require the elimination of any Margin Deficit may be exercised only where such Margin Deficit exceeds $1 million.

(f) Reporting of Margin Deficits . Seller (or Seller Agent on Seller’s behalf) shall provide Buyer Agent with the notices required pursuant to Section 5.3(p) of the Framework Agreement and, upon delivery of any such notice, Buyer shall be automatically deemed to have delivered a concurrent notice to Seller exercising its rights under Paragraph 4(a) of the SIFMA Master, as amended by this Annex I, to require the elimination of such Margin Deficit.

5. Income Payments . Notwithstanding anything to the contrary in Paragraph 5 of the SIFMA Master, unless an Event of Default with respect to Seller shall have occurred and (i) such Event of Default is continuing and (ii) Buyer Agent has exercised remedies with respect to the Purchased Securities under Paragraph 11(d) of the SIFMA Master, as amended by this Annex I, Seller shall be entitled to receive and retain all Income paid or distributed on or in respect of the Purchased Securities. All references in this Agreement to Income received by Buyer prior to such an Event of Default shall be disregarded.

6. Security Interest . Paragraph 6 of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

“(a) Seller hereby grants to Buyer Agent, for the benefit of Buyers, a first priority security interest in all of Seller’s right, title, benefit and interest the Purchased Securities sold in each Transaction entered into under this Agreement and all proceeds thereof (collectively, the “Collateral”), to secure the Seller’s obligations under the Transaction Agreements (the “Secured Obligations”). This Agreement shall create a continuing security interest in the Collateral and shall remain in full force and effect (notwithstanding any repurchase by Seller of Purchased Securities under an expiring Transaction and simultaneous purchase by Buyer of such Purchased Securities under a subsequent Transaction) until all unpaid Repurchase Price with respect to outstanding Transactions under this Agreement have been indefeasibly paid in full (without application of any set off or netting). Buyer Agent (for the benefit of Buyers) shall have, with respect to all the Collateral, in addition to all other rights and remedies available to Buyer Agent under the Transaction Agreements, all the rights and remedies of a secured party under the Uniform Commercial Code as in effect in any applicable jurisdiction.

(b) Seller hereby authorizes Buyer Agent to file such financing statements (and continuation statements with respect to such financing statements when applicable) as may be necessary to perfect the security interest granted pursuant to the foregoing Paragraph 6(a) under the Uniform Commercial Code of the relevant jurisdiction.

(c) The security interest granted pursuant to the foregoing Paragraph 6(a) is released by Buyer Agent at such time when all unpaid Repurchase Price with respect to outstanding Transactions under this Agreement have been indefeasibly paid in full (without application of any set off or netting), without further action by any Person. Upon such payment and termination of this Agreement, Buyer Agent hereby agrees, at Seller’s expense, to (x) file appropriate financing statement amendments to reflect such release and (y) execute and deliver such other documents as Seller may reasonably request to further evidence such release.”

7. Payment and Transfer . Notwithstanding anything in Paragraph 7 of the SIFMA Master to the contrary, and except as otherwise provided below, all transfers of Securities by Seller to the Buyer in connection with any Transaction shall occur by delivery to the Buyer Agent, on behalf of Buyers, of the Original Note. In the event that the expiration of an outstanding Transaction coincides with the entry into a subsequent Transaction hereunder as contemplated by Paragraph 3(d) of this Annex I, the Purchased Securities under such expiring Transaction shall, in lieu of being transferred back to Seller, become Purchased Securities under such subsequent Transaction, and title to such Purchased Securities shall remain continuously vested in Buyer Agent, on behalf of Buyers,. In the event that the expiration of an outstanding Transaction on a Repurchase Date does not coincide with entry into such a subsequent Transaction, however, then upon Seller’s payment in full of the Repurchase Price with respect to the expiring Transaction (without application of any set off or netting), the Purchased Securities shall be automatically deemed to be transferred and assigned from Buyer Agent, on behalf of Buyers, to Seller without further evidence thereof and Buyer Agent shall promptly redeliver the Original Note to Seller or its agent.

8. Rehypothecation of Purchased Securities . Paragraph 8 of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

“Notwithstanding anything herein to the contrary, unless an Event of Default shall have occurred with respect to Seller, Buyer Agent and Buyers shall be prohibited from engaging in repurchase transactions with the Purchased Securities or otherwise selling, transferring, pledging or hypothecating the Purchased Securities without the consent of each other Party.”

9. Substitution . The provisions of Paragraph 9 of the SIFMA Master shall not apply to Transactions under this Agreement, and all terms and provisions thereof and references thereto shall be disregarded for purposes of this Agreement.

10. Representations . The representations and warranties set forth in Paragraph 10 of the SIFMA Master are hereby deleted in the case of Buyer and, in the case of Seller, are hereby replaced with the representations and warranties set forth in Section 5.1 of the Framework Agreement. It is acknowledged that Seller is also making the representations and warranties set forth in Section 5.2 of the Framework Agreement with respect to the Purchased Securities.

11. Events of Default .

(a) Replacement Events of Default . The Events of Default set forth in Paragraph 11 of the SIFMA Master (i) to the extent applicable to Seller, are hereby replaced with the Events of Default set forth in the definition thereof in the Framework Agreement and (ii) to the extent applicable to Buyer, are hereby deleted, subject to the provisions set forth in Paragraph 11(d) of this Annex I, below. Except for the provisions set forth in Paragraph 11(d) of this Annex I, all provisions in Paragraph 11 and elsewhere in the SIFMA Master, to the extent relating to the occurrence of any such Event of Default with respect to Buyer or any rights or remedies afforded to Seller in connection therewith, shall be disregarded for purposes of this Agreement. The introductory paragraph of Paragraph 11 of the SIFMA Master is hereby amended and restated in its entirety to read as follows: “If an Event of Default has occurred and is continuing:”.

(b) Remedies . Paragraph 11(d) of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

“If Buyer Agent, on behalf of Buyers, exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, Buyer Agent may, at the direction of Buyers, and with such notice to Seller as may be required by applicable law, immediately (i) take possession of any or all Purchased Securities subject to any outstanding Transactions, at its discretion; (ii) subject to the requirements of applicable law (including, without limitation, Article 9 of the Uniform Commercial Code), sell any or all such Purchased Securities, at such price or prices as Buyer Agent and Buyers may reasonably deem satisfactory, and apply the

proceeds thereof to amounts owing by Seller hereunder or under any of the other Transaction Agreements (it being understood, for the avoidance of doubt, that Seller shall remain liable to the Buyers for the excess of such amounts owing by Seller over any sale proceeds so applied); and (iii) generally exercise any and all rights afforded to a secured party under the Uniform Commercial Code or other applicable law.”

(c) Replacement Securities Inapplicable . The provisions of Paragraphs 11(c), 11(e), and 11(f) of the SIFMA Master shall not apply to Transactions under this Agreement, and all terms and provisions thereof and references thereto (including any references to “Replacement Securities”) shall be disregarded for purposes of this Agreement.

(d) Buyer Event of Default . The failure of Buyer Agent to promptly redeliver the Original Note to Seller or its agent when and as required pursuant to Paragraph 7 of this Annex I (it being understood, for the avoidance of doubt, that such redelivery obligation is subject to (i) Seller’s payment in full of the Repurchase Price with respect to the applicable outstanding Transaction without application of any set off or netting and (ii) Buyer Agent’s rights pursuant to Paragraph 11(d) of the SIFMA Master (as amended by this Annex I) to sell, dispose of or otherwise exercise remedies with respect to the Purchased Securities in connection with an Event of Default with respect to Seller) shall be an Event of Default with respect to Buyer. Upon the occurrence of any such Event of Default, Buyer Agent shall be liable to Seller for the amount of all reasonable legal or other expenses incurred by Seller and/or Cofina in connection with or as a result of such Event of Default and any other loss, damage, cost or expense directly arising or resulting from the occurrence of such Event of Default, including, without limitation, any costs incurred to recover the Original Note and any damages resulting from Buyer Agent, Buyers or another party acquiring the Original Note or presenting such Original Note to Cofina for payment. In the event of an Event of Default with respect to Buyer, Seller shall have, in addition to its rights hereunder, any rights otherwise available to it under any other agreement or applicable law.

12. Payment of Price Differential . With respect to any Transaction under this Agreement, and notwithstanding anything in this Agreement to the contrary, the portion of the Repurchase Price for such Transaction consisting of the Price Differential shall, in all circumstances, be paid by Seller (or by Seller Agent on Seller’s behalf) by wire transfer of immediately available funds to the account of Buyer Agent set forth in Schedule 2 to the Framework Agreement on the Repurchase Date for such Transaction (or, if such Repurchase Date is not a Monthly Date, on the earlier of (i) next succeeding Monthly Date to occur following such Repurchase Date or (ii) the Facility Expiration Date), and such payment of the Price Differential shall not be subject to any setoff, netting or other application by Seller against other amounts, whether pursuant to Paragraph 12 of the SIFMA Master or otherwise.

13. Miscellaneous .

(a) Termination of Agreement . The last sentence of Paragraph 15(a) of the SIFMA Master is hereby amended and restated to read as follows:

“This Agreement shall terminate on the Facility Expiration Date, except that this Agreement shall, notwithstanding such termination, remain applicable to any Transactions then outstanding.”

(b) Notices. The provisions of Paragraph 13 of the SIFMA Master are hereby deleted, and shall be deemed to have been replaced with the provisions of Section 9.8 of the Framework Agreement, which are hereby incorporated by reference.

(c) Other Inapplicable Provisions . Paragraphs 18 and 20 of the SIFMA Master shall not be applicable to Transactions under this Agreement, and all terms and provisions thereof and references thereto shall be disregarded for purposes of this Agreement.

EXHIBIT A

FORM OF CONFIRMATION



Dated:	[Date]
To:	CHS Inc. (“Counterparty”) [ ] [ ] [ ]
Attention:	[Documentation] Email: [ ]
From:	MUFG Bank, Ltd. (“MUFG”) Tel: [ ] E-mail: [ ]

Re:Confirmation of a Repurchase Transaction

Dear CHS Inc.:

The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the above referenced transaction entered into between Counterparty and MUFG on the Purchase Date specified below (the “Transaction”).

This Confirmation constitutes a “Confirmation” as referred to in the Master Repurchase Agreement specified below.

The definitions and provisions contained in such Master Repurchase Agreement are incorporated into this Confirmation. In the event of any inconsistency between such Master Repurchase Agreement and this Confirmation, this Confirmation will govern; provided , for the avoidance of doubt, that the applicable Repurchase Date, Price Differential and Repurchase Price will be determined in accordance with the definitions thereof as set forth in the Master Repurchase Agreement.

1. This Confirmation supplements, forms part of, and is subject to, the 1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018, including Annex I thereto and as amended thereby (as further amended and supplemented from time to time, the “Master Repurchase Agreement”), between Counterparty and MUFG. All provisions contained in the Master Repurchase Agreement govern this Confirmation except as expressly modified below.

The terms of the particular Transaction to which this Confirmation relates are as follows:

2. General Terms :



Purchase Date:	[Date]
Purchase Price:	$[ ]
Buyer:	MUFG
Buyer Agent:	MUFG
Seller:	Counterparty
Seller Agent:	CHS Inc.
Purchased Securities:	the CHS Note
Pricing Rate	[]
Repurchase Date:	[Date] ¹
Repurchase Price:	$[] ²
Price Differential:	$[]



3.	Governing law:	Unless otherwise provided in the Master Repurchase Agreement (in which case the law so specified shall govern), this Confirmation shall be governed by and construed in accordance with the laws as specified in the Master Repurchase Agreement.

[Remainder of page intentionally left blank]

¹ To be scheduled as the earlier of (i) the Facility Expiration Date or (ii) the next Monthly Date to occur following the Purchase Date.

² Stated amounts for Repurchase Price and Price Differential are indicative based on initial Purchase Price, Pricing Rate and scheduled Repurchase Date.

Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Confirmation enclosed for that purpose and returning it to us by electronic mail.

Very truly yours,

MUFG BANK, LTD.

By:

Name:

Title:

Confirmed as of the date first above written:

CHS INC.

By:

Name:

Title:

Exhibit 10.41

Master Repurchase Agreement

September 1996 Version

Dated as of September 4, 2018

Between: CHS Capital, LLC

and MUFG Bank, Ltd.


1.	Applicability


2.	Definitions

(a)

“Act of Insolvency”, with respect to any party, (i) the commencement by such party as debtor of any case or proceeding under any bankruptcy, insolvency, reorganization, liquidation, moratori- um, dissolution, delinquency or similar law, or such party seeking the appointment or election of a receiver, conservator, trustee, custodian or similar official for such party or any substantial part of its property, or the convening of any meeting of creditors for purposes of commencing any such case or proceeding or seeking such an appointment or election, (ii) the commence- ment of any such case or proceeding against such party, or another seeking such an appoint- ment or election, or the filing against a party of an application for a protective decree under the provisions of the Securities Investor Protection Act of 1970, which (A) is consented to or not timely contested by such party, (B) results in the entry of an order for relief, such an appoint- ment or election, the issuance of such a protective decree or the entry of an order having a sim- ilar effect, or (C) is not dismissed within 15 days, (iii) the making by such party of a general assignment for the benefit of creditors, or (iv) the admission in writing by such party of such party’s inability to pay such party’s debts as they become due;


(b)	“Additional Purchased Securities”, Securities provided by Seller to Buyer pursuant to Paragraph 4(a) hereof;


(c)	“Buyer’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Buyer’s Margin Percentage to the Repurchase Price for such Transaction as of such date;


(d)	“Buyer’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Seller’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction;


(e)	“Confirmation”, the meaning specified in Paragraph 3(b) hereof;


(f)	“Income”, with respect to any Security at any time, any principal thereof and all interest, dividends or other distributions thereon;


(g)	“Margin Deficit”, the meaning specified in Paragraph 4(a) hereof;


(h)	“Margin Excess”, the meaning specified in Paragraph 4(b) hereof;


(i)	“Margin Notice Deadline”, the time agreed to by the parties in the relevant Confirmation, Annex I hereto or otherwise as the deadline for giving notice requiring same-day satisfac- tion of margin maintenance obligations as provided in Paragraph 4 hereof (or, in the absence of any such agreement, the deadline for such purposes established in accordance with market practice);

(j)

(k)


(l)	“Pricing Rate”, the per annum percentage rate for determination of the Price Differential;


(m)	“Prime Rate”, the prime rate of U.S. commercial banks as published in The Wall Street Journal (or, if more than one such rate is published, the average of such rates);


(n)	“Purchase Date”, the date on which Purchased Securities are to be transferred by Seller to Buyer;

(o)

“Purchase Price”, (i) on the Purchase Date, the price at which Purchased Securities are transferred by Seller to Buyer, and (ii) thereafter, except where Buyer and Seller agree oth- erwise, such price increased by the amount of any cash transferred by Buyer to Seller pur- suant to Paragraph 4(b) hereof and decreased by the amount of any cash transferred by Seller to Buyer pursuant to Paragraph 4(a) hereof or applied to reduce Seller’s obligations under clause (ii) of

Paragraph 5 hereof;

(p)


(q)	“Repurchase Date”, the date on which Seller is to repurchase the Purchased Securities from Buyer, including any date determined by application of the provisions of Paragraph 3(c) or 11 hereof;


(r)	“Repurchase Price”, the price at which Purchased Securities are to be transferred from Buyer to Seller upon termination of a Transaction, which will be determined in each case (including Transactions terminable upon demand) as the sum of the Purchase Price and the Price Differential as of the date of such determination;


(s)	“Seller’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Seller’s Margin Percentage to the Repurchase Price for such Transaction as of such date;


(t)	“Seller’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Buyer’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction.


3.	Initiation; Confirmation; Termination


(a)	An agreement to enter into a Transaction may be made orally or in writing at the initia- tion of either Buyer or Seller. On the Purchase Date for the Transaction, the Purchased Securities shall be transferred to Buyer or its agent against the transfer of the Purchase Price to an account of Seller.

(b)


(c)	In the case of Transactions terminable upon demand, such demand shall be made by Buyer or Seller, no later than such time as is customary in accordance with market prac- tice, by telephone or otherwise on or prior to the business day on which such termination

will be effective. On the date specified in such demand, or on the date fixed for termina- tion in the case of Transactions having a fixed term, termination of the Transaction will be effected by transfer to Seller or its agent of the Purchased Securities and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Paragraph 5 hereof) against the transfer of the Repurchase Price to an account of Buyer.


4.	Margin Maintenance

(a)

(b)

(c)


(d)	Any cash transferred pursuant to this Paragraph shall be attributed to such Transactions as shall be agreed upon by Buyer and Seller.

(e)

(f)

Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the respective rights of Buyer and Seller under subparagraphs (a) and (b) of this Paragraph to require the elimination of a Margin Deficit or a Margin Excess, as the case may be, may be exercised whenever such a Margin Deficit or Margin Excess exists with respect to any single Transaction hereunder (calculated without regard to any other Transaction outstanding under this Agreement).


5.	Income Payments

Seller shall be entitled to receive an amount equal to all Income paid or distributed on or in respect of the Securities that is not otherwise received by Seller, to the full extent it would be so entitled if the Securities had not been sold to Buyer. Buyer shall, as the parties may agree with respect to any Transaction (or, in the absence of any such agreement, as Buyer shall rea- sonably determine in its discretion), on the date such Income is paid or distributed either (i) transfer to or credit to the account of Seller such Income with respect to any Purchased Securities subject to such Transaction or (ii) with respect to Income paid in cash, apply the Income payment or payments to reduce the amount, if any, to be transferred to Buyer by Seller upon termination of such Transaction. Buyer shall not be obligated to take any action pursuant to the preceding sentence (A) to the extent that such action would result in the cre- ation of a Margin Deficit, unless prior thereto or simultaneously therewith Seller transfers to Buyer cash or Additional Purchased Securities sufficient to eliminate such Margin Deficit, or (B) if an Event of Default with respect to Seller has occurred and is then continuing at the time such Income is paid or distributed.


6.	Security Interest


7.	Payment and Transfer

8. Segregation of Purchased Securities

Required Disclosure for Transactions in Which the Seller Retains Custody of the Purchased Securities

* Language to be used under 17 C.F.R. ß403.4(e) if Seller is a government securities broker or dealer other than a financial institution.

** Language to be used under 17 C.F.R. ß403.5(d) if Seller is a financial institution.

9. Substitution


(a)	Seller may, subject to agreement with and acceptance by Buyer, substitute other Securities for any Purchased Securities. Such substitution shall be made by transfer to Buyer of such other Securities and transfer to Seller of such Purchased Securities. After substitution, the substituted Securities shall be deemed to be Purchased Securities.

(b)

10. Representations

Each of Buyer and Seller represents and warrants to the other that (i) it is duly authorized to execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to perform its obligations hereunder and has taken all necessary action to authorize such exe- cution, delivery and performance, (ii) it will engage in such Transactions as principal (or, if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction by the other party hereto, as agent for a disclosed principal), (iii) the person signing this Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such disclosed principal), (iv) it has obtained all authorizations of any governmental body required in connection with this Agreement and the Transactions hereunder and such autho- rizations are in full force and effect and (v) the execution, delivery and performance of this Agreement and the Transactions hereunder will not violate any law, ordinance, charter, by- law or rule applicable to it or any agreement by which it is bound or by which any of its assets are affected. On the Purchase Date for any Transaction Buyer and Seller shall each be deemed to repeat all the foregoing representations made by it.

11. Events of Default

In the event that (i) Seller fails to transfer or Buyer fails to purchase Purchased Securities upon the applicable Purchase Date, (ii) Seller fails to repurchase or Buyer fails to transfer Purchased Securities upon the applicable Repurchase Date, (iii) Seller or Buyer fails to com- ply with Paragraph 4 hereof, (iv) Buyer fails, after one

business day’s notice, to comply with Paragraph 5 hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi) any representation made by Seller or Buyer shall have been incorrect or untrue in any material respect when made or repeated or deemed to have been made or repeated, or (vii) Seller or Buyer shall admit to the other its inability to, or its intention not to, perform any of its oblig- ations hereunder (each an “Event of Default”):

(a)

(b)

In all Transactions in which the defaulting party is acting as Seller, if the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, (i) the defaulting party’s obligations in such Transactions to repurchase all Purchased Securities, at the Repurchase Price therefor on the Repurchase Date determined in accordance with subparagraph (a) of this Paragraph, shall thereupon become immediately due and payable, (ii) all Income paid after such exercise or deemed exercise shall be retained by the nondefaulting party and applied to the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder, and (iii) the defaulting party shall immediately deliver to the nondefaulting party any Purchased Securities subject to such Transactions then in the defaulting party’s possession or control.

(c)


(d)	If the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, the nondefaulting party, without prior notice to the defaulting party, may:

(i)

(ii)

as to Transactions in which the defaulting party is acting as Buyer, (A) immediately purchase, in a recognized market (or otherwise in a commercially reasonable man- ner) at such price or prices as the nondefaulting party may reasonably deem satisfac- tory, securities (“Replacement Securities”) of the same class and amount as any Purchased Securities that are not delivered by the defaulting party to the nondefault- ing party as required hereunder or (B) in its sole discretion elect, in lieu of purchas- ing Replacement Securities, to be deemed to have purchased Replacement Securities at the price therefor on such date, obtained from a generally recognized source or the most recent closing offer quotation from such a source.

Unless otherwise provided in Annex I, the parties acknowledge and agree that (1) the Securities subject to any Transaction hereunder are instruments traded in a recognized market, (2) in the absence of a generally recognized source for prices or bid or offer quo- tations for any Security, the nondefaulting party may establish the source therefor in its sole discretion and (3) all prices, bids and offers shall be determined together with accrued Income (except to the extent contrary to market practice with respect to the rel- evant Securities).

(e)


(f)	For purposes of this Paragraph 11, the Repurchase Price for each Transaction hereunder in respect of which the defaulting party is acting as Buyer shall not increase above the

amount of such Repurchase Price for such Transaction determined as of the date of the exercise or deemed exercise by the nondefaulting party of the option referred to in sub- paragraph (a) of this Paragraph.

(g)

(h)

To the extent permitted by applicable law, the defaulting party shall be liable to the non- defaulting party for interest on any amounts owing by the defaulting party hereunder, from the date the defaulting party becomes liable for such amounts hereunder until such amounts are (i) paid in full by the defaulting party or (ii) satisfied in full by the exercise of the nondefaulting party’s rights hereunder. Interest on any sum payable by the default- ing party to the nondefaulting party under this Paragraph 11(h) shall be at a rate equal to the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.


(i)	The nondefaulting party shall have, in addition to its rights hereunder, any rights otherwise available to it under any other agreement or applicable law.

12. Single Agreement

Buyer and Seller acknowledge that, and have entered hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and have been made in consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and that a default in the perfor- mance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries and other transfers in respect of any other Transactions hereunder, and the obligations to make any such payments, deliveries and other transfers may be applied against each other and netted.

13. Notices and Other Communications

Any and all notices, statements, demands or other communications hereunder may be given by a party to the other by mail, facsimile, telegraph, messenger or otherwise to the address specified in Annex II hereto, or so sent to such party at any other place specified in a notice of change of address hereafter received by the other. All notices, demands and requests hereun- der may be made orally, to be confirmed promptly in writing, or by other communication as specified in the preceding sentence.

14. Entire Agreement; Severability

15. Non-assignability; Termination

(a)


(b)	Subparagraph (a) of this Paragraph 15 shall not preclude a party from assigning, charg- ing or otherwise dealing with all or any part of its interest in any sum payable to it under Paragraph 11 hereof.

16. Governing Law

This Agreement shall be governed by the laws of the State of New York without giving effect to the conflict of law principles thereof.

17. No Waivers, Etc.

No express or implied waiver of any Event of Default by either party shall constitute a waiver of any other Event of Default and no exercise of any remedy hereunder by any party shall constitute a waiver of its right to exercise any other remedy hereunder. No modification or waiver of any provision of this Agreement and no consent by any party to a departure here- from shall be effective unless and unt il such shall be in writing and duly executed by both of the parties hereto. Without limitation on any of the foregoing, the failure to give a notice pur- suant to Paragraph 4(a) or 4(b) hereof will not constitute a waiver of any right to do so at a later date.

18. Use of Employee Plan Assets

(a)


(b)	Subject to the last sentence of subparagraph (a) of this Paragraph, any such Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most recent available audited statement of its financial condition and its most recent subsequent unaudited statement of its financial condition.

(c)


19.	Intent

(a)


(b)	It is understood that either party’s right to liquidate Securities delivered to it in connec- tion with Transactions hereunder or to exercise any other remedies pursuant to Paragraph 11 hereof is a contractual right to liquidate such Transaction as described in Sections 555 and 559 of Title 11 of the United States Code, as amended.


(c)	The parties agree and acknowledge that if a party hereto is an “insured depository insti- tution,” as such term is defined in the Federal Deposit Insurance Act, as

amended (“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of assets subject to such Transaction would render such definition inapplica- ble).

(d)

20. Disclosure Relating to Certain Federal Protections

The parties acknowledge that they have been advised that:


(a)	in the case of Transactions in which one of the parties is a broker or dealer registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has

taken the position that the provisions of the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any Transaction hereunder;


(b)	in the case of Transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to the other party with respect to any Transaction hereunder; and


(c)	in the case of Transactions in which one of the parties is a financial institution, funds held by the financial institution pursuant to a Transaction hereunder are not a deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, as applicable.



	CHS Inc.		MUFG Bank, Ltd.
	[Name of Party]		[Name of Party]

By:		By:
Title:		Title:
Date:		Date:

Exhibit 10.41

EXECUTION COPY

Annex I

Supplemental Terms and Conditions

This Annex I forms a part of the 1996 SIFMA Master Repurchase Agreement, dated as of September 4, 2018 (the “SIFMA Master”, and as amended by this Annex I, this or the “Agreement”) between CHS Capital, LLC (“CHS Capital”) and MUFG Bank, Ltd. (“MUFG”). Subject to the provisions of Paragraph 1 of this Annex I, (a) capitalized terms used but not defined in this Annex I shall have the meanings ascribed to them in the SIFMA Master, and (b) aside from this Annex I, including all exhibits and schedules attached hereto and thereto, no other Annexes or Schedules thereto shall form a part of the SIFMA Master or be applicable thereunder.

1. Applicability; Parties; Framework .

(a) Framework Agreement . This Agreement is being entered into in accordance with that certain Master Framework Agreement, dated as of September 4, 2018 (as amended, restated, supplemented or otherwise modified, the “Framework Agreement”), among CHS Inc. and CHS Capital, as sellers, CHS Inc., as agent for the sellers (in such capacity, the “Seller Agent”), MUFG, as buyer, the other financial institutions from time to time party thereto as buyers and MUFG, as agent for the Buyers (in such capacity, “Buyer Agent”). Capitalized terms used but not defined in this Agreement or in any Confirmations shall have the meanings set forth in the Framework Agreement (including Schedule 1 thereto). In the event of any inconsistency between this Agreement and the Framework Agreement, the Framework Agreement shall govern.

(b) Seller . CHS Capital will act as seller (in such capacity, the “ Seller ”) with respect to all Transactions entered into hereunder. Subject to the terms and conditions of the Framework Agreement, all powers of Seller hereunder, including the execution and delivery of Confirmations hereunder or any other matters involving consent or discretion, shall be exercised solely by Agent on behalf of Seller.

(d) Securities . The only Securities for purposes of this Agreement shall consist of the CHS Capital Note, and no asset or property other than the CHS Capital Note shall be recognized as a Security for purposes of any Transactions hereunder. All references in this Agreement to Securities or Purchased Securities, as the case may be (whether in the SIFMA Master or elsewhere in this Annex I) shall be understood and construed as references to the CHS Capital Note.

(e) Entire Agreement . The first sentence of Paragraph 14 of the SIFMA Master is subject to, and superseded by, Section 9.3 of the Framework Agreement.

Exhibit 10.41

2. Definitions .

(a) Added Definitions . For purposes of this Agreement, the following additional terms shall have the following meanings:

(iv) “Framework Agreement” has the meaning set forth in Paragraph 1(a) of this Annex I;

(vii) “Original Note” means the original executed version of the CHS Capital Note; and

Exhibit 10.41

(ii) “Buyer’s Margin Percentage” means, with respect to any Transaction as of any date, one hundred percent (100%);

3. Initiation; Confirmation; Termination . Notwithstanding anything to the contrary in Paragraph 3 of the SIFMA Master, the following shall apply:

(a) No Oral Agreements . All agreements to enter into Transactions hereunder shall be in writing in accordance with Article 4 of the Framework Agreement.

Exhibit 10.41

4. Margin Maintenance . Notwithstanding anything to the contrary in Paragraph 4 of the SIFMA Master, the following shall apply:

(a) Paragraph 4(a) of the SIFMA Master is hereby amended and restated as follows:

(c) Margin Deficit Cures . Paragraph 4(c) of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

Exhibit 10.41

under the Purchased Securities, Seller shall transfer such cash to Buyer on the same day concurrently with (or immediately following) Seller’s receipt of such prepayment.”

6. Security Interest . Paragraph 6 of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

Exhibit 10.41

8. Rehypothecation of Purchased Securities . Paragraph 8 of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

11. Events of Default .

(b) Remedies . Paragraph 11(d) of the SIFMA Master is hereby amended and restated in its entirety to read as follows:

Exhibit 10.41

price or prices as Buyer Agent and Buyers may reasonably deem satisfactory, and apply the proceeds thereof to amounts owing by Seller hereunder or under any of the other Transaction Agreements (it being understood, for the avoidance of doubt, that Seller shall remain liable to the Buyers for the excess of such amounts owing by Seller over any sale proceeds so applied); and (iii) generally exercise any and all rights afforded to a secured party under the Uniform Commercial Code or other applicable law.”

13. Miscellaneous .

(a) Termination of Agreement . The last sentence of Paragraph 15(a) of the SIFMA Master is hereby amended and restated to read as follows:

“This Agreement shall terminate on the Facility Expiration Date, except that this Agreement shall, notwithstanding such termination, remain applicable to any Transactions then outstanding.”

Exhibit 10.41

EXHIBIT A

FORM OF CONFIRMATION



Dated:	[Date]
To:	CHS Capital, LLC (“Counterparty”) [ ] [ ] [ ]
Attention:	[Documentation] Email: [ ]
From:	MUFG Bank, Ltd. (“MUFG”) Tel: [ ] E-mail: [ ]

Re:Confirmation of a Repurchase Transaction

Dear CHS Capital, LLC:

This Confirmation constitutes a “Confirmation” as referred to in the Master Repurchase Agreement specified below.

The terms of the particular Transaction to which this Confirmation relates are as follows:

Exhibit 10.41

2. General Terms :



Purchase Date:	[Date]
Purchase Price:	$[ ]
Buyer:	MUFG
Buyer Agent:	MUFG
Seller:	Counterparty
Seller Agent:	CHS Inc.
Purchased Securities:	the CHS Capital Note
Pricing Rate	[]
Repurchase Date:	[Date] ¹
Repurchase Price:	$[] ²
Price Differential:	$[]



3.	Governing law:	Unless otherwise provided in the Master Repurchase Agreement (in which case the law so specified shall govern), this Confirmation shall be governed by and construed in accordance with the laws as specified in the Master Repurchase Agreement.

[Remainder of page intentionally left blank]

¹ To be scheduled as the earlier of (i) the Facility Expiration Date or (ii) the next Monthly Date to occur following the Purchase Date.

² Stated amounts for Repurchase Price and Price Differential are indicative based on initial Purchase Price, Pricing Rate and scheduled Repurchase Date.

Exhibit 10.41

Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Confirmation enclosed for that purpose and returning it to us by electronic mail.

Very truly yours,

MUFG BANK, LTD.

By:

Name:

Title:

Confirmed as of the date first above written:

CHS CAPITAL, LLC

By:

Name:

Title:

EXECUTION COPY

Exhibit 10.42

GUARANTY

This GUARANTY (this “ Agreement ”), dated as of September 4, 2018, is between CHS Inc. (“ CHS ”), a Minnesota corporation (the “ Guarantor ”), and MUFG BANK, LTD. (“ MUFG ”), a Japanese banking corporation, as buyer agent (“ Buyer Agent ”) for the Buyers under the Master Framework Agreement, dated as of the date hereof, among CHS, CHS Capital, LLC, a Minnesota limited liability company (together with CHS, the “ Sellers ” and each a “ Seller ”), CHS, as agent for the Sellers (in such capacity, the “ Seller Agent ”), and MUFG and the other financial institutions from time to time party thereto, as buyers (each, a “ Buyer ” and, collectively, the “ Buyers ”) (as amended, restated, supplemented or otherwise modified from time to time, the “ Framework Agreement ”). Capitalized terms used and not otherwise defined in this Agreement are used as defined in, or by reference in, the Framework Agreement. The interpretive provisions set out in Section 1.2 of the Framework Agreement shall be incorporated herein and applied in the interpretation of this Agreement.

Section 1. Undertaking . For value received by it and its Affiliates, Guarantor hereby absolutely, unconditionally and irrevocably assures and undertakes (as primary obligor and not merely as surety) for the benefit of Buyer Agent, each Buyer and each other Indemnified Person (together, the “ Beneficiaries ”) the due and punctual performance and observance by each Seller and the Seller Agent (and any of their respective successors or assigns in such capacity) of all their respective covenants, agreements, undertakings, indemnities and other obligations or liabilities (including, in each case, those related to any breach by any Seller or the Seller Agent, as applicable, of their respective representations, warranties and covenants), whether monetary or non-monetary and regardless of the capacity in which incurred (including all of any Seller’s or the Seller Agent’s payment, repurchase, indemnity or similar obligations), under any of the Transaction Agreements (collectively, the “ Guaranteed Obligations ”), irrespective of: (A) the validity, binding effect, legality, subordination, disaffirmance, enforceability or amendment, restatement, modification or supplement of, or waiver of compliance with, this Agreement, the Transaction Agreements or any documents related hereto or thereto, (B) any change in the existence, formation or ownership of, or the bankruptcy or insolvency of, any Seller, the Seller Agent or any other Person, (C) any extension, renewal, settlement, compromise, exchange, waiver or release in respect of any Guaranteed Obligation (or any collateral security therefor, including the property sold, or purportedly sold, or otherwise pledged or transferred by any Seller under the Transaction Agreements) or any party to this Agreement, the other Transaction Agreements or any other related documents, (D) the existence of any claim, set-off, counterclaim or other right that Guarantor or any other Person may have against any Seller, the Seller Agent or any other Person, (E) any impossibility or impracticability of performance, illegality, force majeure, act of war or terrorism, any act of any Governmental Authority or any other circumstance or occurrence that might otherwise constitute a legal or equitable discharge or defense available to, or provides a discharge of, any Seller, the Seller Agent or Guarantor, (F) any Applicable Law affecting any term of any of the Guaranteed Obligations or any Transaction Agreement, or rights of Buyer Agent, any Buyer or any other Beneficiary with respect thereto or otherwise, (G) the failure by Buyer Agent or any Buyer to take any steps to perfect and maintain perfected its interest in, or the impairment or release of, any Collateral or (H) any failure to obtain any authorization or approval from or other action by or to notify or file with, any Governmental Authority required in connection with the performance of the Guaranteed Obligations or otherwise.

Without limiting the generality of the foregoing, Guarantor agrees that if any Seller or the Seller Agent shall fail in any manner whatsoever to perform or observe any of its Guaranteed Obligations when the same shall be required to be performed or observed under any applicable Transaction Agreement to which it is a party, then Guarantor will itself duly and punctually perform or observe or cause to be performed or observed such Guaranteed Obligations. It shall not be a condition to the accrual of the obligation of the Guarantor hereunder to perform or to observe any Guaranteed Obligation that Buyer Agent or any Buyer or any other Person shall have first made any request of or demand upon or given any notice to the Guarantor,

any Seller, the Seller Agent or any other Person or have initiated any action or proceeding against the Guarantor, any Seller, the Seller Agent or any other Person in respect thereof. Guarantor also hereby expressly waives any defenses based on any of the provisions set forth above and all defenses it may have as a guarantor or a surety generally or otherwise based upon suretyship, impairment of collateral or otherwise in connection with the Guaranteed Obligations whether in equity or at law. Guarantor agrees that its obligations hereunder shall be irrevocable and unconditional. Guarantor hereby also expressly waives diligence, presentment, demand, protest or notice of any kind whatsoever, as well as any requirement that the Beneficiaries (or any of them) exhaust any right to take any action against any Seller, the Seller Agent or any other Person (including the filing of any claims in the event of a receivership or bankruptcy of any of the foregoing), or with respect to any collateral or collateral security at any time securing any of the Guaranteed Obligations, and hereby consents to any and all extensions of time of the due performance of any or all of the Guaranteed Obligations. Guarantor agrees that it shall not exercise or assert any right which it may acquire by way of subrogation under this Agreement unless and until all Guaranteed Obligations (other than unasserted contingent indemnification obligations) shall have been paid and performed in full.

Section 2. Confirmation . Guarantor hereby confirms that the transactions contemplated by the Transaction Agreements have been arranged among Seller, Seller Agent, Buyer Agent and each Buyer, as applicable, with Guarantor’s full knowledge and consent and any amendment, restatement, modification or supplement of, or waiver of compliance with, the Transaction Agreements in accordance with the terms thereof by any of the foregoing shall be deemed to be with Guarantor’s full knowledge and consent. Guarantor hereby confirms (i) that on the date hereof, it directly or indirectly owns 100% of the capital stock or membership interests of each Seller (other than CHS) and (ii) that it is in the best interest of Guarantor to execute this Agreement, inasmuch as Guarantor (individually) and Guarantor and its Affiliates (collectively) will derive substantial direct and indirect benefit from the transactions contemplated by the Framework Agreement and the other Transaction Agreements. Guarantor agrees to promptly notify Buyer Agent in the event that it ceases to directly or indirectly own 100% of the capital stock of any Seller (other than CHS).

Section 3. Representations and Warranties . Guarantor represents and warrants to Buyer Agent as of the date hereof and on each Purchase Date, as follows:

(i) Organization and Good Standing . It has been duly organized and is validly existing as a corporation in good standing under the Applicable Laws of its jurisdiction of organization, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted.

(ii) Due Qualification . It is duly qualified to do business as a foreign organization in good standing and has obtained all necessary qualifications, licenses and approvals, in all jurisdictions in which the ownership or lease of its property or the conduct of its business requires such qualifications, licenses or approvals or, if not so qualified, the failure to so qualify would not have a Material Adverse Effect with respect to Guarantor.

(iii) Power and Authority; Due Authorization . It (i) has all necessary power, authority and legal right to (A) execute and deliver this Agreement and the other Transaction Agreements to which it is a party and (B) carry out the terms of and perform its obligations under the Transaction Agreements to which it is a party, and (ii) has duly authorized by all necessary corporate action the execution, delivery and performance of this Agreement and the other Transaction Agreements to which it is a party.

(iv) Binding Obligations . This Agreement constitutes, and each other Transaction Agreement to be signed by Guarantor has been duly executed and delivered by it constitutes the legal, valid and binding obligation of it, enforceable against Guarantor in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent

conveyance, or other similar Applicable Laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law and implied covenants of good faith and fair dealing.

(v) No Violation . The consummation of the transactions contemplated by this Agreement and the other Transaction Agreements and the fulfillment of the terms hereof and thereof by it will not, (i) conflict with, result in any breach or (with notice or lapse of time or both) a default under, (A) Guarantor’s Organizational Documents, (B) the Securitization Facility Documents, (C) the Credit Facility Documents or (D) any other indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which Guarantor is a party or by which it or any of its properties is bound, (ii) result in the creation or imposition of any Adverse Claim (other than Permitted Liens) upon any of its properties pursuant to the terms of any such indenture, loan agreement, asset purchase agreement, mortgage, deed of trust, or other agreement or instrument to which it is a party or by which it or any of its properties is bound, or (iii) violate any Applicable Law applicable to it or any of its properties.

(vi) No Proceedings . There are no actions, suits, proceedings, claims, disputes, or investigations pending, or to Guarantor’s knowledge threatened, before any Governmental Authority (i) asserting the invalidity of this Agreement or any other Transaction Agreement to which it is a party, (ii) seeking to prevent the consummation of the purposes of this Agreement or of any of the other Transaction Agreements to which it is a party, or (iii) seeking any determination or ruling that has had or could reasonably be expected to have a Material Adverse Effect with respect to Guarantor.

(vii) Governmental Approvals . No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is required for the due execution, delivery and performance by Guarantor of this Agreement or any other Transaction Agreement to which it is a party, except for those that have been made or obtained and are in full force and effect.

(viii) Litigation . There is no pending or, to its knowledge, threatened action, proceeding, investigation or injunction, writ or restraining order affecting Guarantor, its Subsidiaries or their respective properties before any Governmental Authority which could reasonably be expected to result in a Material Adverse Effect with respect to Guarantor.

(ix) Solvency . The Guarantor is Solvent and no Insolvency Event (as defined in the Securitization RPA) has occurred with respect to the Guarantor.

(x) Taxes . Guarantor has filed all material tax returns and reports required by Applicable Law to have been filed by it and has paid all material taxes, assessments and governmental charges, to its knowledge, owing by it, other than any such taxes, assessments or charges that are not yet delinquent or are being contested in good faith by appropriate proceedings.

(xi) Investment Company Act . The Guarantor is not required to register as an investment company under the Investment Company Act.

(xii) Policies and Procedures . Policies and procedures have been implemented and maintained by or on behalf of Guarantor that are designed to achieve compliance by Guarantor and its Subsidiaries, Affiliates, directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, and Guarantor and its Subsidiaries, Affiliates, officers, employees, directors and agents acting in any capacity in connection with or directly benefitting from the facility established hereby, are in compliance with Anti-Corruption Laws, Anti-Terrorism Laws, and Sanctions.

(xiii) Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions . (i) None of the Guarantor or any of its Subsidiaries, Affiliates, directors, officers, employees, or agents that will act in any

capacity in connection with or directly benefit from the facility established hereby is a Sanctioned Person, (ii) none of the Guarantor or any of its Subsidiaries is organized or resident in a Sanctioned Country and (iii) the Guarantor has not violated, been found in violation of or is under investigation by any Governmental Authority for possible violation of any Anti-Corruption Laws, Anti-Terrorism Laws, or of any Sanctions.

Section 4. Covenants . Guarantor covenants and agrees that, from the date hereof until the later of (i) the Facility Expiration Date and (ii) such time as all Guaranteed Obligations (other than unasserted contingent indemnification obligations) shall have been paid in cash in full and performed in full, it shall observe and perform the following covenants:

(i) Compliance with Applicable Laws . It shall comply in all material respects with all Applicable Laws with respect to it and the Securitization Facility Documents.

(ii) Preservation of Corporate Existence . It shall preserve and maintain its existence, rights, franchises and privileges in the jurisdiction of its organization, and qualify and remain qualified in good standing as a foreign organization in each jurisdiction where the failure to preserve and maintain such existence, rights, franchises, privileges and qualification could reasonably be expected to have a Material Adverse Effect with respect to Guarantor.

(iii) Mergers, Sales, Etc . Unless the Guarantor is the surviving or continuing entity, it shall not (i) consolidate with or merge with any Person, (b) the surviving entity shall execute and deliver to Buyer Agent an agreement, in form and substance reasonably satisfactory to Buyer Agent, containing an assumption by the surviving entity of the due and punctual performance and observance of each obligation, covenant and condition of the Guarantor under this Agreement and each other Transaction Agreement to which it is a party, (c) no Change of Control shall result, (d) Guarantor reaffirms in a writing, in form and substance reasonably satisfactory to Buyer Agent, that its obligations under this Agreement shall apply to the surviving entity and (e) Buyer Agent receives such additional certifications, documents, instruments, agreements and opinions of counsel as it shall reasonably request, or (ii) discontinue or eliminate any business line or segment if such discontinuance or elimination could reasonably be expected to have a Material Adverse Effect.

(iv) Reporting Requirements . It shall, unless otherwise consented in writing, furnish (or cause to be furnished) to Buyer Agent all information and reports required to be furnished from time to time to Buyer Agent or any Buyer, by or on behalf of any Seller or the Seller Agent, pursuant to the terms of the Framework Agreement and each of the other Transaction Agreements.

(v) Information and Assistance . It shall, from time to time, promptly at the reasonable request of Buyer Agent (for itself or on behalf of any other Beneficiary), provide information relating to its business or affairs as Buyer Agent (for itself or on behalf of any other Beneficiary) may reasonably request in order to protect the interest of Buyer Agent or any other Beneficiary hereunder or with respect hereto or to comply with any Applicable Law or any Governmental Authority. It shall also do all such things and execute all such documents as Buyer Agent may reasonably consider necessary or desirable to give full effect to this Agreement and to perfect or preserve the rights and powers of Buyer Agent or any other Beneficiary hereunder or with respect hereto.

(vi) Impairment Actions . It shall not take any action that could either (i) cause any Purchased Note or any other Collateral, not to be owned by the applicable Seller free and clear of any Adverse Claim other than Permitted Liens; (ii) cause Buyer Agent not to have a valid and perfected ownership or first priority perfected security interest in the Collateral, on behalf of Buyers, free and clear of any Adverse Claim other than Permitted Liens; or (iii) cause this Agreement to cease being a legal, valid and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, moratorium,

reorganization, fraudulent conveyance, or other similar Applicable Laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law and implied covenants of good faith and fair dealing.

Section 5. Miscellaneous .

(a) Guarantor agrees that any payments hereunder will be applied in accordance with the Framework Agreement.

(b) Any payments hereunder shall be made in U.S. dollars to Buyer Agent or relevant Buyer, as applicable, in the United States without any set-off, deduction or counterclaim and Guarantor’s obligations hereunder shall not be satisfied by any tender or recovery of another currency except to the extent such tender or recovery results in receipt of the full amount of U.S. dollars required hereunder.

(c) No amendment or waiver of any provision of this Agreement nor consent to any departure by Guarantor therefrom shall be effective unless the same shall be in writing and signed by Buyer Agent, each Buyer and Guarantor. No failure on the part of Buyer Agent or any other Beneficiary to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right.

(d) Guarantor hereby agrees that it will not directly or indirectly, institute against (or solicit or encourage any Person to institute against), or join any other Person in instituting against, Cofina any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other similar proceeding under any federal or state bankruptcy or similar law, until one year and one day following the Final Payout Date (as defined in the Securitization RPA).

(e) This Agreement shall bind and inure to the benefit of the parties hereto, the other Beneficiaries and their respective successors and permitted assigns. Guarantor shall not assign, delegate or otherwise transfer any of its obligations or duties hereunder without the prior written consent of Buyer Agent and each Buyer. Each of the parties hereto hereby agrees that each of the Beneficiaries not a signatory hereto shall be a third-party beneficiary of this Agreement.

(f) THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5‑1401 AND 5‑1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICTS OF LAW PROVISIONS THEREOF).

(g) EACH PARTY HERETO HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY OTHER TRANSACTION AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION AGREEMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT A JURY.

(h) EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT:

(I) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING

ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OTHER TRANSACTION AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING.

(II) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.

Section 6. Termination of Guaranty . (a) This Agreement and Guarantor’s obligations hereunder shall remain operative and continue in full force and effect until the later of (i) the Facility Expiration Date, and (ii) such time as all Guaranteed Obligations (other than unasserted contingent indemnification obligations) are duly performed and paid and satisfied in full, provided , that this Agreement and Guarantor’s obligations hereunder shall continue to be effective or shall be reinstated, as the case may be, if at any time payment or other satisfaction of any of the Guaranteed Obligations is rescinded or must otherwise be restored or returned upon the bankruptcy, insolvency, or reorganization of any Seller, the Seller Agent or otherwise, as applicable, as though such payment had not been made or other satisfaction occurred, whether or not Buyer Agent or any of the Beneficiaries (or their respective assigns) are in possession of this Agreement. No invalidity, irregularity or unenforceability by reason of the bankruptcy, insolvency, reorganization or other similar Applicable Laws, or any other Applicable Law or order of any Governmental Authority thereof purporting to reduce, amend or otherwise affect the Guaranteed Obligations shall impair, affect, or be a defense to or claim against the obligations of Guarantor under this Agreement.

(b) This Agreement shall survive the insolvency of any Seller, the Seller Agent, any Beneficiary or any other Person and the commencement of any case or proceeding by or against any Seller, the Seller Agent or any other Person under any bankruptcy, insolvency, reorganization or other similar Applicable Law. No automatic stay under any bankruptcy, insolvency, reorganization or other similar Applicable Law with respect to any Seller (other than CHS), the Seller Agent or any other Person shall postpone the obligations of Guarantor under this Agreement.

Section 7. Set-off . Each Beneficiary (and its assigns) is hereby authorized by Guarantor at any time and from time to time during the continuance of an Event of Default, without notice to Guarantor (any such notice being expressly waived by Guarantor) and to the fullest extent permitted by Applicable Law, to set-off and apply any and all deposits (general or special, time or demand, provisional or final) and other sums at any time held by, and other indebtedness at any time owing to, any such Beneficiary to or for the credit to the account of Guarantor, against any and all Guaranteed Obligations of Guarantor, now or hereafter existing under this Agreement.

Section 8. Entire Agreement; Severability; No Party Deemed Drafter . This Agreement and the other Transaction Agreements constitute the entire agreement of the parties hereto with respect to the matters set forth herein. The rights and remedies herein provided are cumulative and not exclusive of any remedies provided by Applicable Law or any other agreement, and this Agreement shall be in addition to any other guaranty of or collateral security for any of the Guaranteed Obligations. Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any

such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. If the obligations of Guarantor hereunder would otherwise be held or determined to be avoidable, invalid or unenforceable in any action or proceeding on account of the amount of Guarantor’s liability under this Agreement, then, notwithstanding any other provision of this Agreement to the contrary, the amount of such liability shall, without any further action by Guarantor or any Beneficiary, be automatically limited and reduced to the highest amount that is valid and enforceable as determined in such action or proceeding. Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Each of the parties hereto hereby agrees that no party hereto shall be deemed to be the drafter of this Agreement.

Section 9. Expenses . Guarantor agrees to pay on demand:

(a) all reasonable and documented out-of-pocket costs and expenses incurred by Buyer Agent and each Buyer in connection with the negotiation, preparation, execution and delivery of this Agreement and any amendment, restatement or supplement of, or consent or waivers under, this Agreement (whether or not consummated), enforcement of, or any actual or claimed breach of, or claim under, this Agreement, including reasonable Attorney Costs and all reasonable and documented out-of-pocket fees and expenses of accountants, auditors, consultants and other agents of Buyer Agent and each Buyer incurred in connection with any of the foregoing or in advising such Persons as to their respective rights and remedies under this Agreement; and

(b) all stamp and other similar Taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement, and agrees to indemnify Buyer Agent and each of the other Beneficiaries for such Taxes and fees.

Section 10. Indemnities by Guarantor . Without limiting any other rights which any Beneficiary may have hereunder or under Applicable Law, Guarantor agrees to indemnify and hold harmless each Beneficiary and each of their respective Affiliates, and all successors, transferees, participants and assigns and all officers, members, managers, directors, shareholders, employees and agents of any of the foregoing (each an “ Indemnified Party ”) forthwith on demand, from and against any and all damages, losses, claims, liabilities and related reasonable and documented out-of-pocket costs and expenses (including all filing fees, Attorney Costs and Taxes (other than Excluded Taxes)) (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) awarded against or incurred by any of them arising out of, relating to, resulting from or in connection with: (i) any breach by Guarantor of any of its obligations or duties under this Agreement or any other Transaction Agreement to which it is a party in any capacity; (ii) the inaccuracy of any representation or warranty made by Guarantor hereunder, under any other Transaction Agreement to which it is a party in any capacity or in any certificate or statement delivered pursuant hereto or to any other Transaction Agreement to which it is a party in any capacity; (iii) the failure of any information provided to any such Indemnified Party by, or on behalf of, Guarantor, in any capacity, to be true and correct; (iv) the material misstatement of fact or the omission of a material fact or any fact necessary to make the statements contained in any information provided to any such Indemnified Party by, or on behalf of, Guarantor, in any capacity, not materially misleading; (v) any negligence or misconduct on Guarantor’s part arising out of, relating to, in connection with, or affecting any transaction contemplated by this Agreement or any other Transaction Agreement; (vi) the failure by Guarantor to comply with any Applicable Law, rule or regulation with respect to this Agreement, the transactions contemplated hereby, any other Transaction Agreement to which it is a party in any capacity, the Guaranteed Obligations or otherwise or (vii) the failure of this Agreement to constitute a legal, valid and binding obligation of the Guarantor, enforceable against it in accordance with its terms; provided , however , notwithstanding anything to the contrary in this Section 10 , Guarantor shall

not be responsible for Indemnified Amounts solely to the extent resulting from the gross negligence or willful misconduct on the part of such Indemnified Party, as determined by a final non-appealable judgment by a court of competent jurisdiction.

Section 11. Addresses for Notices . All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile and email communication) and shall be personally delivered or sent by express mail or nationally recognized overnight courier or by certified mail, first-class postage prepaid, or by facsimile, to the intended party at the address, facsimile number or email address of such party set forth in Schedule A of this Agreement or at such other address, facsimile number or email address as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective, (a) if personally delivered or sent by express mail or courier or if sent by certified mail, when received and (b) if transmitted by facsimile or email, when sent; provided that if not sent during normal business hours for the recipient, shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.

[Signatures Follow]

IN WITNESS WHEREOF, Guarantor has executed this Agreement as of the date first written above.

CHS INC.,

as Guarantor

By:

Name:

Title:

S-1

ACCEPTED AND ACKNOWLEDGED, as of the date first written above.

MUFG BANK, LTD.,

as Buyer Agent

Name:

Title:

S-2

SCHEDULE A

ADDRESSES FOR NOTICE

If to Guarantor:

CHS Inc.

5500 Cenex Drive

St. Paul, Minnesota 55077

Attention: Brent Dickson

Tel: 651-355-5433

Fax: 800-232-3639

Email: brent.dickson@chsinc.com

If to Buyers:

MUFG Bank, Ltd.

1221 Avenue of the Americas

New York, NY 10020

Attn: Matt Stratton

Tel: 212-782-4212

E-Mail: mstratton@us.mufg.jp

Schedule A

EXHIBIT 21.1

SUBSIDIARIES OF THE REGISTRANT



SUBSIDIARY		JURISDICTION OF INCORPORATION/ ORGANIZATION
ACC Feed Supplement, LLC		South Dakota

Agri Point Ltd.		Republic of Cyprus

Agro Storage d.o.o, a subsidiary of Agri Point Ltd.		Bosnia

Ag States Reinsurance Co., IC, a subsidiary of Impact Risk Funding Inc.		Washington DC

Broadbent Grain Pty. Ltd.		Australia

CENEX AG, Inc.		Delaware

CENEX Pipeline, LLC		Minnesota

CHS de Argentina, S.A.		Argentina

CHS North LLC		Minnesota

CHS AGRONEGOCIO - Industria e Comercio Ltda.		Brazil

CHS Canada Cooperative		Alberta

CHS Canada, Inc.		Manitoba

CHS Capital, LLC		Minnesota

CHS (Taiwan) Commodity Trading Co. Ltd		Taiwan

CHS Trading Company Australia Pty. Ltd.		Australia

CHS Hallock Canada, Inc		Manitoba

CHS Hallock, LLC		Minnesota

CHS Hedging, LLC		Delaware

CHS Holdings, LLC		Minnesota

CHS Inc. de Mexico		Mexico

CHS Europe S.a.r.l		Switzerland

CHSINC Iberica SL, a subsidiary of CHS Europe S.a.r.l		Spain

CHS Latin America Holdings LLC		Minnesota

CHS Luxembourg, S.a.r.l		Luxembourg

CHS Milling Luxembourg, S.a.r.l.		Luxembourg

CHS Tarim ve Gida Sanayii Limited Sirketi		Turkey

CHS Ukraine, LLC, a subsidiary of CHS Europe S.a.r.l		Ukraine

Oregana Co., Ltd., a subsidiary of CHS Europe S.a.r.l		Republic of Cyprus

CHS Agromarket, LLC, a subsidiary of Oregana Co., Ltd.		Russian Federation

CHS Agritrade Bulgaria Ltd., a subsidiary of CHS Europe S.a.r.l		Bulgaria



SUBSIDIARY		JURISDICTION OF INCORPORATION/ ORGANIZATION
CHS Agritrade Hungary Ltd., a subsidiary of CHS Europe S.a.r.l		Hungary

CHS Bermuda GP		Bermuda

RosAgroInvest LLC, a subsidiary of Oregana Co., Ltd.		Russian Federation

CHS Hong Kong Limited, a subsidiary of CHS Europe S.a.r.l		Hong Kong

CHS (Shanghai) Trading Co., Ltd., a subsidiary of CHS Hong Kong Ltd		China

CHS Italy S.r.l.		Italy

CHS Korea, LLC		South Korea

CHS McPherson Refinery, Inc.		Kansas

CHS Pacific Private Limited, a subsidiary of CHS Industries Ltd.		Republic of Singapore

CHS Serbia D.O.O. Novi Sad, a subsidiary of CHS Europe S.a.r.l		Serbia

CHS Singapore Trading Company PTE. LTD.		Republic of Singapore

CHS Uruguay SRL		Uruguay

CHS-Brule, Inc		Nebraska

CHS-CFE Co		Illinois

CHS-Farmco, Inc.		Kansas

CHS-GC, Inc.		Colorado

CHS-Holdrege, Inc.		Nebraska

CHS-M&M, Inc.		Colorado

CHS-Rochester		Minnesota

CHS-Shipman, Inc.		Illinois

CHS-Sub Sycamore, Co.		Illinois

CHS-Sub Whatcom, Inc		Washington

CHS-Valley City		North Dakota

CHS-Wallace County, Inc.		Kansas

Circle Land Management, Inc.		Minnesota

Cofina Funding, LLC, a subsidiary of CHS Capital, LLC		Delaware

CHS Capital ProFund LLC, a subsidiary of CHS Capital, LLC		Minnesota

CZL Australia & Japan Pty Ltd		Australia

CZL Ltd.		Japan

Dakota Agronomy Partners, LLC		North Dakota

Fin-Ag, Inc.		South Dakota

Front Range Pipeline, LLC		Minnesota



SUBSIDIARY		JURISDICTION OF INCORPORATION/ ORGANIZATION

GTL Resources Limited		England

GTL Resources Overseas Investments Limited		England

GTL Resources USA, Inc.		Delaware

IGH Insurance Company, IC		Washington DC

Illinois River Energy, LLC		Delaware

Jayhawk Pipeline, LLC		Kansas

Kaw Pipe Line Company		Delaware

Larsen Cooperative TVCS		Wisconsin

Lewis-Clark Terminal, Inc.		Idaho

Market Street Terminal, LLC		Illinois

Marshall Insurance Agency, Inc.		Minnesota

M Tarhaz Raktarozasi es Szolgaltato Korlatolt Felelossegu Tarsasag		Hungary

Patriot Fuels Biodiesel, LLC		Illinois

Patriot Holdings, LLC		Illinois

Patriot Land Holdings, LLC		Illinois

Patriot Renewable Fuels, LLC		Illinois

PGG/HSC Feed Company, LLC		Oregon

Rockville Propane Terminal LLC		Minnesota

Russell Consulting Group, LLC		Nebraska

CHS Agritrade Romania SRL, a subsidiary of CHS Europe S.a.r.l		Romania

S.C. Silotrans S.R.L.		Romania

S.C. Transporter S.R.L., a subsidiary of S.C. Silotrans S.R.L.		Romania

S.C. Nutron S.R.L.		Romania

Sinav Limited		England

CHS de Paraguay SRL, a subsidiary of CHS Singapore Trading Company PTE. LTD.		Paraguay

Southwest Crop Nutrients, LLC		Kansas

St. Hilaire Ag Insurance, Inc.		Minnesota

St. Paul Maritime Corporation		Minnesota

Wagner Gas & Electric, Inc.		Wisconsin

Watertown Crop Nutrients LLC		South Dakota

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-154819, 333-177326, and 333-212440) of CHS Inc. of our report dated December 3, 2018 relating to the financial statements and financial statement schedule, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Minneapolis, Minnesota

December 3, 2018

Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Jay D. Debertin, certify that:


1.	I have reviewed this Annual Report on Form 10-K for the fiscal year ended August 31, 2018 , of CHS Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c.	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d.	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 3, 2018



	/s/ Jay D. Debertin
	Jay D. Debertin
	President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, Timothy Skidmore, certify that:


1.	I have reviewed this Annual Report on Form 10-K for the fiscal year ended August 31, 2018 of CHS Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c.	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d.	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 3, 2018



	/s/ Timothy Skidmore
	Timothy Skidmore
	Executive Vice President and Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

In connection with the Annual Report on Form 10-K of CHS Inc. (the “Company”) for the fiscal year ended August 31, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jay D. Debertin, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



	/s/ Jay D. Debertin
	Jay D. Debertin
	President and Chief Executive Officer
	December 3, 2018

Exhibit 32.2

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

In connection with the Annual Report on Form 10-K of CHS Inc. (the “Company”) for the fiscal year ended August 31, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Timothy Skidmore, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



	/s/ Timothy Skidmore
	Timothy Skidmore
	Executive Vice President and Chief Financial Officer
	December 3, 2018