Chs Inc 10-Q for FY2026 Q3
Chs Inc (CHSCP)
10-Q
2026-07-08
For: 2026-05-31
View Original
Added on
July 08, 2026
About this 10-Q
Chs Inc filed this 10-Q on July 8, 2026, covering the quarter ended May 31, 2026 (FY2026 Q3).
Headline figures
Quarter ended May 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $11.58B
- up 18.6% from $9.77B a year earlier
- Net income
- $267.37M
- up 15.2% from net income of $232.18M a year earlier
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | |||||||||||
| For the quarterly period ended | |||||||||||
| or | |||||||||||
Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to | |||||||||||
Commission file number: 001-36079
(Exact name of Registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |||||||||||||
(Address of principal executive offices, including zip code)
(651 ) 355-6000
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||
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.
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).
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 ☐ Accelerated filer ☐ Non-accelerated filer ☑ Smaller reporting company ☐ Emerging growth company ☐
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. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☑
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:
The issuer has no common stock outstanding.
TABLE OF CONTENTS
| Page No. | ||||||||
Unless the context otherwise requires, for purposes of this Quarterly Report on Form 10-Q, the words "CHS," "we," "us" and "our" refer to CHS Inc., a Minnesota cooperative corporation, and its subsidiaries as of May 31, 2026.
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains, and our other CHS Inc. publicly available documents contain, and our officers, directors and 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 of these 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 filings made with the U.S. Securities and Exchange Commission, including in the "Risk Factors" discussion in Item 1A of the CHS Annual Report on Form 10-K for the fiscal year ended August 31, 2025. These factors may include changes in commodity prices; political, economic, legal and other risks of doing business globally; ongoing wars and global conflicts; global and regional factors impacting the supply of or demand for our products; the impact of government policies, mandates, regulations and trade agreements, including the imposition of tariffs and retaliatory tariffs; the impact of inflation; the impact of competitive business markets; any loss of members who choose to do business with other companies instead of us; the impact of market acceptance of alternatives to refined petroleum products; consolidation among our suppliers and customers; nonperformance or nonpayment by contractual counterparties; deterioration in credit quality of third parties who owe us money; the effectiveness of our risk management strategies; actual or perceived quality, safety or health risks associated with our products; business interruptions, casualty losses and supply chain issues; the impact of epidemics, pandemics, outbreaks of disease and other adverse public health developments; the impact of workforce factors; technological improvements and sustainability initiatives that decrease demand for our products; technical, legal and opportunistic-related risks from advancements in artificial intelligence; security breaches or other disruptions in our information technology systems or assets; increased scrutiny and changing expectations with respect to environmental, social and governance practices; failures or delays in achieving strategies or expectations related to climate change or other environmental matters; our ability to complete, integrate and benefit from acquisitions, strategic alliances, joint ventures, divestitures and other nonordinary course-of-business events; changes in federal income tax laws or our tax status; the impact and costs of compliance or noncompliance with applicable laws and regulations; the costs of compliance with environmental and energy laws and regulations; the impact of environmental liabilities and litigation; the impact of seasonality; the impairment of long-lived assets; our funding needs and financing sources; financial institutions’ and other capital sources’ policies concerning energy-related businesses; limits on our ability to access equity capital due to our cooperative structure; and other factors affecting our businesses generally. Any forward-looking statements made by us in this document 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 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.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CHS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Receivables | |||||||||||
| Inventories | |||||||||||
| Other current assets | |||||||||||
Total current assets | |||||||||||
| Investments | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Other assets | |||||||||||
Total assets | $ | $ | |||||||||
| LIABILITIES AND EQUITIES | |||||||||||
| Current liabilities: | |||||||||||
| Notes payable | $ | $ | |||||||||
| Current portion of long-term debt | |||||||||||
| Accounts payable | |||||||||||
| Accrued expenses | |||||||||||
| Other current liabilities | |||||||||||
Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Other liabilities | |||||||||||
| Commitments and contingencies (Note 13) | |||||||||||
| Equities: | |||||||||||
| Preferred stock | |||||||||||
| Equity certificates | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Capital reserves | |||||||||||
Total CHS Inc. equities | |||||||||||
| Noncontrolling interests | |||||||||||
Total equities | |||||||||||
Total liabilities and equities | $ | $ | |||||||||
The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited).
2
CHS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | $ | $ | $ | |||||||||||||||||||
| Cost of goods sold | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Marketing, general and administrative expenses | |||||||||||||||||||||||
| Operating earnings (loss) | ( | ||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Other income | ( | ( | ( | ( | |||||||||||||||||||
| Equity income from investments | ( | ( | ( | ( | |||||||||||||||||||
| Income before income taxes | |||||||||||||||||||||||
| Income tax expense | |||||||||||||||||||||||
| Net income | |||||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
| Net income attributable to CHS Inc. | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited).
3
CHS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Pension and other postretirement benefits | |||||||||||||||||||||||
| Cash flow hedges | ( | ( | |||||||||||||||||||||
| Foreign currency translation adjustment | ( | ( | ( | ||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ( | |||||||||||||||||||||
| Comprehensive income | |||||||||||||||||||||||
| Comprehensive income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
| Comprehensive income attributable to CHS Inc. | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited).
4
CHS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended May 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||
| Depreciation and amortization, including amortization of deferred major maintenance | |||||||||||
| Equity income from investments, net of distributions received | ( | ( | |||||||||
| Provision for current expected credit losses | |||||||||||
| Deferred taxes | ( | ||||||||||
| Other, net | ( | ||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Receivables | ( | ( | |||||||||
| Inventories | ( | ( | |||||||||
| Accounts payable and accrued expenses | ( | ||||||||||
| Other, net | ( | ||||||||||
| Net cash provided by (used in) operating activities | ( | ||||||||||
| Cash flows from investing activities: | |||||||||||
| Acquisition of property, plant and equipment | ( | ( | |||||||||
| Proceeds from disposition of property, plant and equipment | |||||||||||
| Expenditures for major maintenance | ( | ( | |||||||||
| Purchases of short-term investments | ( | ||||||||||
| Proceeds from sale and maturity of short-term and other investments | |||||||||||
| Changes in CHS Capital notes receivable, net | ( | ( | |||||||||
| Business acquisitions, net of cash acquired | ( | ||||||||||
| Other investing activities, net | ( | ( | |||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from notes payable and long-term debt | |||||||||||
| Payments on notes payable, long-term debt and finance lease obligations | ( | ( | |||||||||
| Preferred stock dividends paid | ( | ( | |||||||||
| Redemptions of equities | ( | ( | |||||||||
| Cash patronage dividends paid | ( | ( | |||||||||
| Other financing activities, net | |||||||||||
| Net cash provided by financing activities | |||||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ||||||||||
| Increase (decrease) in cash and cash equivalents and restricted cash | ( | ||||||||||
| Cash and cash equivalents and restricted cash at beginning of period | |||||||||||
| Cash and cash equivalents and restricted cash at end of period | $ | $ | |||||||||
The accompanying notes are an integral part of the condensed consolidated financial statements (unaudited).
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CHS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 Basis of Presentation and Significant Accounting Policies
Basis of Presentation
These unaudited condensed consolidated financial statements reflect, in the opinion of management, all normal recurring adjustments necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The results of operations and cash flows for interim periods are not necessarily indicative of results for a full fiscal year because of the seasonal nature of our businesses, among other things. Our unaudited condensed consolidated financial statements and notes are presented as permitted by the requirements for Quarterly Reports on Form 10-Q and should be read in conjunction with the consolidated financial statements and notes thereto for the year ended August 31, 2025, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC").
Effective September 1, 2025, we changed our segment reporting to align with our new product-line operating model, as further described in Note 10, Segment Reporting.
Prior period amounts have been recast to conform to current period classification.
Significant Accounting Policies
No significant accounting policies were updated or changed since our Annual Report on Form 10-K for the year ended August 31, 2025.
Recent Accounting Pronouncements
In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which provides additional transparency for income tax disclosures. This ASU is effective for our annual reporting for fiscal year 2026 on a prospective basis with an option for retrospective application. While the adoption of this ASU will not impact the recognition or measurement of income taxes, it will result in expanded and enhanced income tax disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure about certain costs and expenses in the notes to financial statements. This ASU is effective for our annual reporting for fiscal year 2028 on either a prospective or retrospective basis and for interim reporting periods beginning in fiscal year 2029. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This ASU amends the criteria for recognizing and capitalizing costs related to internal-use software by replacing the previous project stage model with a principles-based framework. Under this ASU, costs are capitalized when management has authorized and committed to funding a software project and it is probable the project will be completed and the software used as intended. This ASU is effective for our annual reporting for fiscal year 2029 on either a prospective, retrospective or modified prospective transition method. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.
In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This ASU provides recognition, measurement, presentation and disclosure requirements for government grants. Under the new guidance, proceeds from government grants must be recognized in earnings during the same period the underlying costs associated with grant eligibility are incurred. However, grant income must not be recognized unless it is probable the grant will be received and the entity will comply with the conditions attached to the grant. This ASU is effective for our interim reporting beginning in fiscal year 2030. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This ASU improves clarity for interim financial reporting requirements under existing guidance within Accounting Standards Codification ("ASC") Topic 270, Interim Reporting, by creating a comprehensive list of interim disclosure requirements, clarifying scope and applicability, and adding a principle to disclose all material events that have occurred since the most
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recently filed Form 10-K. This ASU is effective for our interim reporting beginning in fiscal year 2029. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.
In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818), which provides recognition, measurement, presentation and disclosure requirements for entities that generate, purchase or receive environmental credits or have regulatory compliance obligations that may be settled with environmental credits, including renewable identification numbers (“RINs”). This ASU is effective for our interim and annual reporting periods beginning in fiscal year 2029. Early adoption is permitted. The amendments are required to be applied on a retrospective basis through a cumulative-effect adjustment to the opening balance of capital reserves as of the beginning of the annual reporting period of adoption. We are currently evaluating the impact of adopting this ASU on our consolidated financial statements.
Note 2 Revenues
| ASC Topic 606 | ASC Topic 815 | Other Guidance | Total Revenues | |||||||||||||||||||||||
| Three Months Ended May 31, 2026 | (Dollars in thousands) | |||||||||||||||||||||||||
| Energy | $ | $ | $ | $ | ||||||||||||||||||||||
| Grains | ||||||||||||||||||||||||||
| Agronomy | ||||||||||||||||||||||||||
| Corporate and Services | ||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
| Three Months Ended May 31, 2025* | ||||||||||||||||||||||||||
| Energy | $ | $ | $ | $ | ||||||||||||||||||||||
| Grains | ||||||||||||||||||||||||||
| Agronomy | ||||||||||||||||||||||||||
| Corporate and Services | ||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
| ASC Topic 606 | ASC Topic 815 | Other Guidance | Total Revenues | |||||||||||||||||||||||
| Nine Months Ended May 31, 2026 | (Dollars in thousands) | |||||||||||||||||||||||||
| Energy | $ | $ | $ | $ | ||||||||||||||||||||||
| Grains | ||||||||||||||||||||||||||
| Agronomy | ||||||||||||||||||||||||||
| Corporate and Services | ||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
| Nine Months Ended May 31, 2025* | ||||||||||||||||||||||||||
| Energy | $ | $ | $ | $ | ||||||||||||||||||||||
| Grains | ||||||||||||||||||||||||||
| Agronomy | ||||||||||||||||||||||||||
| Corporate and Services | ||||||||||||||||||||||||||
| Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
*Prior period amounts have been recast to align with our new product-line operating model.
Less than 1
Contract Assets and Contract Liabilities
Contract assets relate to unbilled amounts arising from goods that have already been transferred to customers where the right to payment is not conditional on the passage of time. This results in recognition of an asset as the amount of revenue recognized at a certain point in time exceeds the amount billed to customers. Contract assets are recorded in receivables within
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our Condensed Consolidated Balance Sheets and were $16.1 million and $11.8 million as of May 31, 2026, and August 31, 2025, respectively.
Contract liabilities relate to advance payments received from customers for goods and services that we have yet to provide. Contract liabilities of $285.5 million and $179.6 million as of May 31, 2026, and August 31, 2025, respectively, are recorded within other current liabilities on our Condensed Consolidated Balance Sheets. For the three months ended May 31, 2026 and 2025, we recognized revenues of $18.5 million and $26.3 million related to contract liabilities, respectively. For the nine months ended May 31, 2026 and 2025, we recognized revenues of $128.1 million and $192.6 million related to contract liabilities, respectively. These amounts were included in the other current liabilities balance at the beginning of the respective period.
Note 3 Receivables
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Trade accounts receivable | $ | $ | |||||||||
| CHS Capital short-term notes receivable | |||||||||||
| Other | |||||||||||
| Gross receivables | |||||||||||
| Less: allowances and reserves | |||||||||||
| Total receivables | $ | $ | |||||||||
Receivables are composed of trade accounts receivable, short-term notes receivable in our wholly-owned subsidiary, CHS Capital, LLC ("CHS Capital"), and other receivables, less an allowance for expected credit losses. The allowance for expected credit losses is based on our best estimate of expected credit losses in existing receivable balances and is determined using historical write-off experience, adjusted for various industry and regional data and current expectations of future credit losses.
Notes receivable from commercial borrowers are collateralized by various combinations of mortgages, personal property, accounts and notes receivable, inventories and assignments of certain regional cooperatives' capital stock. These loans are primarily originated in the states of Minnesota, North Dakota, Illinois and Montana. CHS Capital also has loans receivable from producer borrowers that are collateralized by various combinations of growing crops, livestock, inventories, accounts receivable, personal property and supplemental mortgages and are primarily originated in the same states as the commercial notes, as well as in South Dakota.
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 $141.7 million and $123.8 million as of May 31, 2026, and August 31, 2025, respectively. The long-term notes receivable are included in other assets on our Condensed Consolidated Balance Sheets. As of May 31, 2026, and August 31, 2025, commercial notes represented 34 % and 24 %, respectively, and producer notes represented 66 % and 76 %, respectively, of total CHS Capital notes receivable.
CHS Capital has commitments to extend credit to customers if there are no violations of contractually established conditions. As of May 31, 2026, CHS Capital customers had additional available credit of $1.2 billion. No significant troubled debt restructuring activity occurred, and no third-party customer or borrower accounted for more than 10% of the total receivables balance as of May 31, 2026, or August 31, 2025.
Note 4 Inventories
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Grain and oilseed | $ | $ | |||||||||
| Energy | |||||||||||
| Agronomy | |||||||||||
| Processed grain and oilseed | |||||||||||
| Other | |||||||||||
| Total inventories | $ | $ | |||||||||
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Note 5 Investments
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Equity method investments: | |||||||||||
| CF Industries Nitrogen, LLC | $ | $ | |||||||||
| Ventura Foods, LLC | |||||||||||
| Ardent Mills, LLC | |||||||||||
| Other equity method investments | |||||||||||
| Other investments | |||||||||||
| Total investments | $ | $ | |||||||||
Joint ventures and other investments in which we have significant ownership and influence, but not control, are accounted for in our condensed consolidated financial statements using the equity method of accounting. Our significant equity method investments during the nine months ended May 31, 2026 and 2025, consist of CF Industries Nitrogen, LLC ("CF Nitrogen") and Ventura Foods, LLC ("Ventura Foods"), which are summarized below. In addition to the recognition of our share of income from these investments, our equity method investments are evaluated for indicators of other-than-temporary impairment on an ongoing basis in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). Other investments consist primarily of investments in cooperatives without readily determinable fair values and are generally recorded at cost, unless an impairment or other observable market price change occurs that requires an adjustment. We had approximately $807.9 million in cumulative undistributed earnings from our equity method investees included in the investments balance as of May 31, 2026.
CF Nitrogen
We have a $2.6 billion investment in CF Nitrogen, a strategic venture with CF Industries Holdings, Inc. ("CF Industries"). The investment consists of an approximate 8.38 % membership interest (based on product tons) in CF Nitrogen. We account for this investment using the hypothetical liquidation at book value method, recognizing our share of the earnings and losses of CF Nitrogen as equity income from investments in our Agronomy segment based on our contractual claims on the entity's net assets pursuant to the liquidation provisions of CF Nitrogen's Limited Liability Company Agreement, adjusted for semiannual cash distributions.
The following table provides summarized unaudited financial information for our equity method investment in CF Nitrogen for the nine months ended May 31, 2026 and 2025.
| Nine Months Ended May 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Net sales | $ | $ | |||||||||
| Gross profit | |||||||||||
| Net earnings | |||||||||||
| Earnings attributable to CHS Inc. | |||||||||||
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Ventura Foods
We have a 50 % interest in Ventura Foods, a joint venture with Mitsui & Co., Ltd., that produces and distributes edible oil-based products. We account for Ventura Foods as an equity method investment, and our share of the results of this equity method investment is included in Corporate and Services.
The following table provides summarized unaudited financial information for our equity method investment in Ventura Foods for the nine months ended May 31, 2026 and 2025.
| Nine Months Ended May 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Net sales | $ | $ | |||||||||
| Gross profit | |||||||||||
| Net earnings | |||||||||||
| Earnings attributable to CHS Inc. | |||||||||||
Producer Ag
On October 10, 2025, we announced our mutual intent with Mid-Kansas Cooperative to start the process of ending our joint venture in Producer Ag. On December 31, 2025, we finalized an agreement to exit the joint venture. As part of this agreement, CHS received consideration in the form of working capital, primarily inventory and cash, in exchange for our equity interest, which represented approximately 57 % of the net assets, and amounts previously owed to CHS.
As of May 31, 2026, CHS had no remaining investment balance in Producer Ag, and the corresponding final settlement had no impact on our Consolidated Statements of Operations.
Note 6 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 all debt covenants as of May 31, 2026. Notes payable as of May 31, 2026, and August 31, 2025, consisted of the following:
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Notes payable | $ | $ | |||||||||
| CHS Capital notes payable | |||||||||||
| Total notes payable | $ | $ | |||||||||
Our primary line of credit is a five-year unsecured revolving credit facility with a syndicate of domestic and international banks. The credit facility provides a committed amount of $2.8 billion that expires on April 21, 2028. There were $190.0 million and $180.0 million in borrowings outstanding on this facility as of May 31, 2026, and August 31, 2025. We also maintain certain uncommitted bilateral facilities to support our working capital needs.
We have a receivables and loans securitization facility ("Securitization Facility") with certain unaffiliated financial institutions ("Purchasers"). Under the Securitization Facility, we and certain of our subsidiaries ("Originators") sell trade accounts and notes receivable ("Receivables") to Cofina Funding, LLC ("Cofina"), a wholly-owned, bankruptcy-remote, indirect subsidiary of CHS. Cofina in turn transfers the Receivables to the Purchasers, and this arrangement is accounted for as secured financing. 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 amount available under the Securitization Facility fluctuates over time based on the total amount of eligible Receivables generated during the normal course of business. The Securitization Facility consists of a committed portion with a maximum availability of $850.0 million and an uncommitted portion with a maximum availability of $250.0 million. As of May 31, 2026, total availability under the Securitization Facility was $1.1 billion, of which $650.0 million was utilized. As of August 31, 2025, total availability under the Securitization Facility was $802.6 million, of which $296.0 million was utilized.
We also have a repurchase facility ("Repurchase Facility"). Under the Repurchase Facility, we can obtain repurchase agreement financing up to $250.0 million for certain eligible receivables and notes receivable of the Originators. As of May 31,
10
2026, we fully utilized the amount available to us under the Repurchase Facility totaling $250.0 million. As of August 31, 2025, $159.7 million was utilized.
During the nine months ended May 31, 2026, we drew $300.0 million on our revolving term loan facility (the "Facility") for long-term capital planning purposes and utilized the proceeds to reduce short-term amounts outstanding. Our intent is to allow the balance outstanding to revert to a nonrevolving term loan that is payable on October 29, 2029. As of May 31, 2026, and August 31, 2025, there were $300.0 million and no amounts outstanding under this Facility, respectively.
The following table presents summarized long-term debt (including the current portion) as of May 31, 2026, and August 31, 2025.
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Private placement debt | $ | $ | |||||||||
| Term loan | |||||||||||
| Deferred financing costs | ( | ( | |||||||||
| Other | |||||||||||
| Total long-term debt | |||||||||||
| Less current portion | |||||||||||
| Long-term portion | $ | $ | |||||||||
Interest expense for the three months ended May 31, 2026 and 2025, was $49.7 million and $44.1 million, respectively, net of capitalized interest of $4.6 million and $8.2 million, respectively. Interest expense for the nine months ended May 31, 2026 and 2025, was $130.8 million and $97.0 million, respectively, net of capitalized interest of $19.0 million and $22.8 million, respectively.
Note 7 Income Taxes
Our effective tax rate for the three months ended May 31, 2026, was 5.2 %, compared to 10.5 % for the three months ended May 31, 2025. Our effective tax rate for the nine months ended May 31, 2026, was 2.2 %, compared to 7.3 % for the nine months ended May 31, 2025. Our income tax expense reflects the mix of full-year earnings projected across business units and current equity assumptions, along with benefits associated with certain tax credits. Income taxes and effective tax rates vary each year based on profitability, changes in tax law, income tax credits and patronage business activity.
Our uncertain tax positions are affected by the tax years that are under audit or remain subject to examination by the relevant taxing authorities. Reserves are recorded against unrecognized tax benefits when we believe certain fully supportable tax return positions are likely to be challenged, and we may not prevail. If we were to prevail on all positions taken in relation to uncertain tax positions, $105.6 million and $96.5 million of the unrecognized tax benefits would benefit our effective tax rate as of May 31, 2026, and August 31, 2025, respectively. It is reasonably possible that the total amount of unrecognized tax benefits could change significantly in the next 12 months.
11
Note 8 Equities
Changes in Equities
Changes in equities for the three months ended May 31, 2026 and 2025, are as follows:
| 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, February 28, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| Reversal of prior fiscal year patronage and redemption estimates | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
| Distribution of 2025 patronage refunds | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
Redemptions of equities | ( | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Other, net | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Estimated 2026 cash patronage refunds | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2026 equity redemptions | ( | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Balances, May 31, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| 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, February 28, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| Reversal of prior fiscal year patronage and redemption estimates | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Distribution of 2024 patronage refunds | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
Redemptions of equities | ( | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Other, net | ( | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net of tax | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2025 cash patronage refunds | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2025 equity redemptions | ( | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Balances, May 31, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Changes in equities for the nine months ended May 31, 2026 and 2025, are as follows:
| 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, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| Reversal of prior fiscal year patronage and redemption estimates | — | ( | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Distribution of 2025 patronage refunds | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
Redemptions of equities | ( | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Other, net | ( | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income, net of tax | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
| Estimated 2026 cash patronage refunds | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2026 equity redemptions | ( | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Balances, May 31, 2026 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
12
| 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, 2024 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| Reversal of prior fiscal year patronage and redemption estimates | — | ( | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Distribution of 2024 patronage refunds | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||
Redemptions of equities | ( | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Other, net | ( | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss, net of tax | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2025 cash patronage refunds | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
| Estimated 2025 equity redemptions | ( | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||
| Balances, May 31, 2025 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
Preferred Stock Dividends
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||
| Nasdaq symbol | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||
| Series of preferred stock: | (Dollars per share) | ||||||||||||||||||||||||||||
| CHSCP | $ | $ | $ | $ | |||||||||||||||||||||||||
| Class B Cumulative Redeemable, Series 1 | CHSCO | $ | $ | $ | $ | ||||||||||||||||||||||||
| Class B Reset Rate Cumulative Redeemable, Series 2 | CHSCN | $ | $ | $ | $ | ||||||||||||||||||||||||
| Class B Reset Rate Cumulative Redeemable, Series 3 | CHSCM | $ | $ | $ | $ | ||||||||||||||||||||||||
| Class B Cumulative Redeemable, Series 4 | CHSCL | $ | $ | $ | $ | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) by component for the three months ended May 31, 2026 and 2025, are as follows:
| Pension and Other Postretirement Benefits | Cash Flow Hedges | Foreign Currency Translation Adjustment | Total | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Balance as of February 28, 2026, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive income (loss), before tax: | |||||||||||||||||||||||
| Amounts before reclassifications | ( | ||||||||||||||||||||||
| Amounts reclassified | ( | ||||||||||||||||||||||
| Total other comprehensive income (loss), before tax | ( | ||||||||||||||||||||||
| Tax effect | ( | ( | ( | ( | |||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ||||||||||||||||||||||
| Balance as of May 31, 2026, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
13
| Pension and Other Postretirement Benefits | Cash Flow Hedges | Foreign Currency Translation Adjustment | Total | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Balance as of February 28, 2025, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive income (loss), before tax: | |||||||||||||||||||||||
| Amounts before reclassifications | ( | ( | ( | ||||||||||||||||||||
| Amounts reclassified | ( | ||||||||||||||||||||||
| Total other comprehensive income (loss), before tax | ( | ( | ( | ||||||||||||||||||||
| Tax effect | ( | ( | ( | ||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ( | ( | ||||||||||||||||||||
| Balance as of May 31, 2025, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Changes in accumulated other comprehensive income (loss) by component for the nine months ended May 31, 2026 and 2025, are as follows:
| Pension and Other Postretirement Benefits | Cash Flow Hedges | Foreign Currency Translation Adjustment | Total | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Balance as of August 31, 2025, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive income (loss), before tax: | |||||||||||||||||||||||
| Amounts before reclassifications | |||||||||||||||||||||||
| Amounts reclassified | ( | ||||||||||||||||||||||
| Total other comprehensive income (loss), before tax | ( | ||||||||||||||||||||||
| Tax effect | ( | ( | ( | ||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ||||||||||||||||||||||
| Balance as of May 31, 2026, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Pension and Other Postretirement Benefits | Cash Flow Hedges | Foreign Currency Translation Adjustment | Total | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Balance as of August 31, 2024, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
| Other comprehensive income (loss), before tax: | |||||||||||||||||||||||
| Amounts before reclassifications | ( | ( | ( | ||||||||||||||||||||
| Amounts reclassified | ( | ||||||||||||||||||||||
| Total other comprehensive income (loss), before tax | ( | ( | |||||||||||||||||||||
| Tax effect | ( | ( | ( | ( | |||||||||||||||||||
| Other comprehensive income (loss), net of tax | ( | ( | |||||||||||||||||||||
| Balance as of May 31, 2025, net of tax | $ | ( | $ | $ | ( | $ | ( | ||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) were related to pension and other postretirement benefits, cash flow hedges 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 9, Benefit Plans, for further information). As described in Note 11, Derivative Financial Instruments and Hedging Activities, amounts reclassified from accumulated other comprehensive income (loss) for cash flow hedges are recorded in cost of goods sold. Gains or losses on foreign currency translation reclassifications are recorded in other income.
Note 9 Benefit Plans
We have various pension and other defined benefit and defined contribution plans, in which substantially all employees may participate. We also have nonqualified supplemental executive and Board of Directors retirement plans.
14
| Three Months Ended May 31, | |||||||||||||||||||||||||||||||||||
| Qualified Pension Benefits | Nonqualified Pension Benefits | Other Benefits | |||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| Components of net periodic benefit costs: | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||
| Service cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Interest cost | |||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | |||||||||||||||||||||||||||||||||
| Prior service (credit) cost amortization | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||
| Actuarial loss (gain) amortization | ( | ( | |||||||||||||||||||||||||||||||||
| Net periodic benefit cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Nine Months Ended May 31, | |||||||||||||||||||||||||||||||||||
| Qualified Pension Benefits | Nonqualified Pension Benefits | Other Benefits | |||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| Components of net periodic benefit costs: | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||
| Service cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Interest cost | |||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | |||||||||||||||||||||||||||||||||
| Prior service (credit) cost amortization | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||
| Actuarial loss (gain) amortization | ( | ( | |||||||||||||||||||||||||||||||||
| Net periodic benefit cost | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Employer Contributions
Contributions depend primarily on market returns on the pension plan assets and minimum funding level requirements. No contributions were made to the pension plans during the nine months ended May 31, 2026, and we do not anticipate being required to make contributions to our pension plans in fiscal 2026, although we may voluntarily elect to do so.
Note 10 Segment Reporting
We are an integrated agricultural cooperative, providing grain, food, agronomy 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 grain and oilseed, processed grain and oilseed, renewable fuels and food products.
Effective September 1, 2025, we implemented a new product-line operating model, which changed the manner in which our chief operating decision maker ("CODM"), our Chief Executive Officer, evaluates performance and allocates resources in managing the business. As a result of this change, all prior period segment information has been recast to conform to the current year presentation. We define our operating segments in accordance with ASC Topic 280, Segment Reporting, and have three reportable segments: Energy, Grains and Agronomy. The primary measure of segment profit or loss used by our CODM to regularly evaluate financial performance, make key operating decisions and determine resource allocation of and among each operating segment is income before income taxes ("IBIT"). Our CODM regularly reviews discrete financial information, including IBIT, that compares actual results to the prior period, current period budget and current period forecast by each reportable segment. We have identified our significant segment expenses as cost of goods sold ("COGS") and marketing, general and administrative expenses. Total assets is not a measure by which the CODM assesses our performance or allocates resources, and asset information is therefore not included within our segment reporting disclosures.
•The Energy segment consists of our wholesale and retail activities within the refined fuels, propane and lubricants product lines. The refined fuels product line includes petroleum refining, pipelines and terminals and markets gasoline, diesel fuel and renewable fuels under the Cenex® brand to member cooperatives and other independent retailers. The lubricants product line includes the blending, sale and distribution of primarily Cenex® brand lubricants, and the propane product line markets propane and other natural gas liquids through wholesale and retail market channels. Previously, this segment included our transportation services business, which is now reported under Corporate and Services.
15
•The Grains segment comprises our global grain marketing and processing activities as part of the feed grains, oilseeds, wheat, specialty grains and animal nutrition product lines. The Grains segment connects producers to domestic and global grain markets through a broad origination and distribution network. It markets commodities such as wheat, corn, ethanol, soybeans, oilseeds and specialty grains. The segment operates grain facilities and trading offices across five continents, serving processors, food manufacturers and renewable fuel producers. Further, the Grains segment produces ethanol and is one of the nation's largest suppliers of ethanol inputs into gasoline products, while also specializing in soybean and canola processing. These results were previously included within the former Ag segment.
•The Agronomy segment consists of our wholesale and retail agronomy activities within the crop nutrients and crop protection product lines. The Agronomy segment provides crop inputs and agronomy services to farmers, member cooperatives and other retailers. It offers crop nutrients, crop protection products and seed, including both proprietary and third-party brands. The Agronomy segment also includes our Nitrogen Production business consisting of our equity method investment in CF Nitrogen. Our supply agreement with CF Nitrogen requires us to purchase a specified quantity of granular urea and urea ammonium nitrate annually from CF Nitrogen. These results were previously included within the former Ag and Nitrogen Production segments.
•Our ag retail business, which was included in our former Ag segment, is now incorporated into the Energy, Grains and Agronomy segments based on the specific products sold and their relevant product lines.
The Company's remaining operations are not reportable segments, as defined by the applicable accounting standard, and are classified within Corporate and Services. Corporate and Services primarily represents our financing and hedging businesses, which provide services to our members and consist of a financial services business and a U.S. Commodity Futures Trading Commission-regulated futures commission merchant ("FCM") for agricultural commodities hedging. Our nonconsolidated investments in Ventura Foods, LLC, and Ardent Mills, LLC ("Ardent Mills"), are also included in our Corporate and Services category. All other nonconsolidated investments are included in our Energy, Grains and Agronomy segments.
Corporate administrative expenses and interest are allocated to each reportable segment and Corporate and Services, based on direct use of services, such as information technology support and legal counsel, and other factors or considerations relevant to the costs incurred.
Many of our business activities are highly seasonal and our operating results vary throughout the year. Our revenues and IBIT generally trend lower during the second fiscal quarter and increase in the third fiscal quarter. Our retail business, which offers products and services across the Energy, Grains and Agronomy segments, primarily experiences higher volumes and revenues during the fall harvest and spring planting seasons, which generally correspond to our first and third fiscal quarters, respectively, and our global grain and processing operations within Grains are subject to fluctuations in volume and revenues based on producer harvests, world grain prices, demand and international trade relationships. Additionally, our Agronomy segment generally experiences higher volumes and revenues during the spring planting season. Our Energy segment typically experiences higher volumes and revenues in certain operating areas, such as refined fuels, in the spring, summer and early fall when gasoline and diesel fuel use by agricultural producers is highest and is subject to global supply and demand forces. Other energy products, such as propane, generally experience higher volumes and revenues during the winter heating and fall 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, grain, oilseed, crop nutrients, edible oils 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 weather; crop damage due to plant disease or insects; drought; availability and adequacy of supply; demand variability; availability of reliable rail, river, truck and ocean transportation networks; outbreaks of disease; government regulations and policies; global trade disputes; global competition; wars and civil unrest; and general political and economic conditions.
While our revenues and operating results are derived primarily from businesses and operations that are wholly owned or subsidiaries and limited liability companies in which we have a controlling interest, a portion of our business operations are conducted through companies in which we do not have a controlling interest or 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 Condensed Consolidated Statements of Operations. In our Agronomy segment, this primarily consists of our approximate 8.38 % membership interest (based on product tons) in CF Nitrogen. In Corporate and Services, 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 our equity method investments.
16
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.
Segment information for the three and nine months ended May 31, 2026 and 2025, is presented in the tables below.
| Energy | Grains | Agronomy | Total Reportable Segments | Corporate and Services | Reconciling Amounts | Total | |||||||||||||||||||||||||||||||||||||||||
| Three Months Ended May 31, 2026 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||
| Revenues, including intersegment revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Intersegment revenues | ( | ( | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||
Revenues, net of intersegment revenues | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (a) | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Marketing, general and administrative expenses | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other losses (income) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Equity income from investments | ( | ( | ( | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | $ | ( | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Capital expenditures (b) | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Energy | Grains | Agronomy | Total Reportable Segments | Corporate and Services | Reconciling Amounts | Total | |||||||||||||||||||||||||||||||||||||||||
| Three Months Ended May 31, 2025 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||
| Revenues, including intersegment revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Intersegment revenues | ( | ( | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||
Revenues, net of intersegment revenues | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (a) | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Marketing, general and administrative expenses | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other income | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
| Equity income from investments | ( | ( | ( | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| (Loss) income before income taxes | $ | ( | $ | ( | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||
| Capital expenditures (b) | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
(a) Cost of goods sold is presented net of intersegment cost of goods sold.
(b) Includes amounts related to acquisition of property, plant and equipment and expenditures for major maintenance.
17
| Energy | Grains | Agronomy | Total Reportable Segments | Corporate and Services | Reconciling Amounts | Total | |||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended May 31, 2026 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||
| Revenues, including intersegment revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Intersegment revenues | ( | ( | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||
Revenues, net of intersegment revenues | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (a) | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Marketing, general and administrative expenses | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Other losses (income) | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
| Equity income from investments | ( | ( | ( | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | $ | ( | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Capital expenditures (b) | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Energy | Grains | Agronomy | Total Reportable Segments | Corporate and Services | Reconciling Amounts | Total | |||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended May 31, 2025 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||
| Revenues, including intersegment revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
| Intersegment revenues | ( | ( | ( | ( | ( | — | |||||||||||||||||||||||||||||||||||||||||
Revenues, net of intersegment revenues | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Cost of goods sold (a) | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Marketing, general and administrative expenses | — | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest expense | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Other income | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||
| Equity income from investments | ( | ( | ( | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
| (Loss) income before income taxes | $ | ( | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| Capital expenditures (b) | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | $ | $ | $ | $ | $ | $ | — | $ | |||||||||||||||||||||||||||||||||||||||
(a) Cost of goods sold is presented net of intersegment cost of goods sold.
Note 11 Derivative Financial Instruments and Hedging Activities
We enter into various derivative instruments to manage our exposure to movements primarily associated with agricultural and energy commodity prices and, to a lesser degree, foreign currency exchange rates. Except for certain cash-settled swaps related to future crude oil purchases and refined product sales, which are accounted for as cash flow hedges, our derivative instruments represent economic hedges of price risk for which hedge accounting under ASC Topic 815 is not applied. Rather, the derivative instruments are recorded on our Condensed Consolidated Balance Sheets at fair value with changes in fair value being recorded directly to earnings, primarily within cost of goods sold in our Condensed Consolidated Statements of Operations. See Note 12, Fair Value Measurements, for additional information. The majority of our exchange-traded agricultural commodity futures are settled daily through CHS Hedging, LLC, our wholly-owned FCM.
Derivative assets and liabilities with maturities of less than 12 months are recorded in other current assets and other current liabilities, respectively, on our Condensed Consolidated Balance Sheets. The amount of current derivative assets recorded on our Condensed Consolidated Balance Sheets as of May 31, 2026, and August 31, 2025, was $315.3 million and $177.2 million, respectively. The amount of current derivative liabilities recorded on our Condensed Consolidated Balance
18
Sheets as of May 31, 2026, and August 31, 2025, was $533.3 million and $178.0 million, respectively. Derivative assets and liabilities with maturities greater than 12 months are recorded in other assets and other liabilities, respectively, on our Condensed Consolidated Balance Sheets. The amount of long-term derivative assets recorded on our Condensed Consolidated Balance Sheets as of May 31, 2026, and August 31, 2025, was $9.9 million and $2.0 million, respectively. The amount of long-term derivative liabilities recorded on our Condensed Consolidated Balance Sheets as of May 31, 2026, and August 31, 2025, was $4.9 million and $1.7 million, respectively.
Derivatives Not Designated as Hedging Instruments
The following tables present the gross fair values of derivative assets, derivative liabilities and related margin deposits (cash collateral) recorded on our Condensed Consolidated Balance Sheets, along with related amounts permitted to be offset in accordance with U.S. GAAP. 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 Condensed Consolidated Balance Sheets under ASC Topic 210-20, Balance Sheet-Offsetting.
| May 31, 2026 | |||||||||||||||||||||||
| Amounts Not Offset on Condensed Consolidated Balance Sheet but Eligible for Offsetting | |||||||||||||||||||||||
| Gross Amount Recognized | Cash Collateral | Derivative Instruments | Net Amount | ||||||||||||||||||||
| Derivative assets | (Dollars in thousands) | ||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Derivative liabilities | |||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| August 31, 2025 | |||||||||||||||||||||||
| Amounts Not Offset on Condensed Consolidated Balance Sheet but Eligible for Offsetting | |||||||||||||||||||||||
| Gross Amount Recognized | Cash Collateral | Derivative Instruments | Net Amount | ||||||||||||||||||||
| Derivative assets | (Dollars in thousands) | ||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Derivative liabilities | |||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||
| Location of Gain (Loss) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||
| Commodity derivatives | Cost of goods sold | $ | ( | $ | ( | $ | ( | $ | |||||||||||||||||||||
| Foreign exchange derivatives | Cost of goods sold | ||||||||||||||||||||||||||||
| Foreign exchange derivatives | Marketing, general and administrative expenses | ||||||||||||||||||||||||||||
| Total | $ | ( | $ | $ | ( | $ | |||||||||||||||||||||||
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Commodity Contracts
As of May 31, 2026, and August 31, 2025, 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.
| May 31, 2026 | August 31, 2025 | ||||||||||||||||||||||
| Long | Short | Long | Short | ||||||||||||||||||||
| (Units in thousands) | |||||||||||||||||||||||
| Grain and oilseed (bushels) | |||||||||||||||||||||||
| Energy products (barrels) | |||||||||||||||||||||||
| Processed grain and oilseed (tons) | |||||||||||||||||||||||
| Crop nutrients (tons) | |||||||||||||||||||||||
| Natural gas (metric million Btu) | |||||||||||||||||||||||
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 global 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 amount of our foreign exchange derivative contracts was $2.5 billion and $1.7 billion as of May 31, 2026, and August 31, 2025, respectively.
Derivatives Designated as Cash Flow Hedging Strategies
Certain pay-fixed, receive-variable, cash-settled swaps are designated as cash flow hedges of future crude oil purchases in our Energy segment. We also designate certain pay-variable, receive-fixed, cash-settled swaps as cash flow hedges of future refined energy 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. We may also elect to dedesignate certain derivative instruments previously designated as cash flow hedges as part of our risk management strategy. Amounts recorded in other comprehensive income for these dedesignated derivative instruments remain in other comprehensive income and are recognized in earnings in the period in which the underlying transactions affect earnings. The aggregate notional amounts of cash flow hedges were 3.8 million and 5.1 million barrels as of May 31, 2026, and August 31, 2025, respectively.
| Derivative Assets | Derivative Liabilities | |||||||||||||||||||||||||||||||
| Balance Sheet Location | May 31, 2026 | August 31, 2025 | Balance Sheet Location | May 31, 2026 | August 31, 2025 | |||||||||||||||||||||||||||
| (Dollars in thousands) | (Dollars in thousands) | |||||||||||||||||||||||||||||||
| Other current assets | $ | $ | Other current liabilities | $ | $ | |||||||||||||||||||||||||||
| Three Months Ended May 31, | Nine Months Ended May 31, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (Dollars in thousands) | ||||||||||||||||||||||||||
| Commodity derivatives | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||
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| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||
| Location of Gain | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||||||||
| Commodity derivatives | Cost of goods sold | $ | $ | $ | $ | ||||||||||||||||||||||||
Note 12 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 among the 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 use of observable inputs and minimize 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. Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 inputs include 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 and other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 inputs are unobservable inputs that are supported by little or no market activity for the assets or liabilities. Categorization within the valuation hierarchy is based on the lowest level of input significant to the fair value measurement.
| May 31, 2026 | |||||||||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||||||
| Assets | (Dollars in thousands) | ||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Segregated investments and marketable securities | |||||||||||||||||||||||
| Time deposits | |||||||||||||||||||||||
| Money market funds | |||||||||||||||||||||||
| Other assets | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
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| August 31, 2025 | |||||||||||||||||||||||
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||||||||||
| Assets | (Dollars in thousands) | ||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Segregated investments and marketable securities | |||||||||||||||||||||||
| Money market funds | |||||||||||||||||||||||
| Other assets | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities | |||||||||||||||||||||||
| Commodity derivatives | $ | $ | $ | $ | |||||||||||||||||||
| Foreign exchange derivatives | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
Commodity and foreign exchange 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, including location-specific adjustments, and are classified within Level 2. 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 listed or OTC markets. Changes in the fair values of these contracts are recognized in our Condensed Consolidated Statements of Operations as a component of cost of goods sold.
Segregated investments and marketable securities. Our segregated investments and marketable securities primarily include investments in U.S. Treasury securities, common stock and various government agency obligations.
Time deposits, money market funds and other assets. Our time deposits, money market funds and other assets primarily include investments in foreign time deposits with original maturities greater than 90 days, money market sweep accounts and rabbi trust assets.
U.S. Treasury securities, common stock, money market sweep accounts and rabbi trust assets are valued using quoted market prices and classified within Level 1. Investments in time deposits and various government agency obligations are valued using quoted prices for similar assets in active markets, quoted prices for identical or similar assets 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 and classified within Level 2.
Note 13 Commitments and Contingencies
Environmental
We are required to comply with various environmental laws and regulations applicable to our normal business operations. To meet our compliance requirements, we establish reserves for future costs of remediation associated with identified issues that are 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 and are included in cost of goods sold and marketing, general and administrative expenses in our Condensed Consolidated Statements of Operations. Recoveries, if any, are recorded in the period in which recovery is received. Liabilities are monitored and adjusted as new facts or changes in laws or technology occur. The resolution of any such matters may affect consolidated net income for any fiscal period; however, we currently believe any resulting liabilities, individually or in aggregate, will not have a material effect on our consolidated financial position, results of operations or cash flows for any fiscal year.
22
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 currently believe any resulting liabilities, individually or in aggregate, will not have a material effect on our consolidated financial position, results of operations or cash flows for any fiscal year.
Guarantees
We are a guarantor for lines of credit and performance obligations of related, nonconsolidated companies. Our bank covenants allow maximum guarantees of $1.1 billion, of which $124.5 million were outstanding on May 31, 2026. 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 these guarantees were current as of May 31, 2026.
Note 14 Supplemental Balance Sheet
| May 31, 2026 | August 31, 2025 | ||||||||||
| Other current assets | (Dollars in thousands) | ||||||||||
| Derivative assets (Note 11) | $ | $ | |||||||||
| Margin and related deposits | |||||||||||
| Prepaid expenses | |||||||||||
| Supplier advance payments | |||||||||||
| Restricted cash | |||||||||||
| Other | |||||||||||
| Total other current assets | $ | $ | |||||||||
| Property, plant and equipment | |||||||||||
| Property, plant and equipment | $ | $ | |||||||||
| Accumulated depreciation | ( | ( | |||||||||
| Property, plant and equipment, net | $ | $ | |||||||||
| Other current liabilities | |||||||||||
| Customer margin deposits and credit balances | $ | $ | |||||||||
| Customer advance payments | |||||||||||
| Derivative liabilities (Note 11) | |||||||||||
| Dividends and equity payable | |||||||||||
| Total other current liabilities | $ | $ | |||||||||
23
ITEM 2. 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 our management regarding 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:
•Overview
•Business Strategy
•Fiscal 2026 Third Quarter Highlights
•Fiscal 2026 Trends Update
•Operating Metrics
•Results of Operations
•Liquidity and Capital Resources
•Critical Accounting Policies
•Recent Accounting Pronouncements
Our MD&A should be read in conjunction with our Annual Report on Form 10-K for the year ended August 31, 2025 (including the information presented therein under Risk Factors), as well as the condensed consolidated financial statements and the related notes included in Item 1 of Part I of this Quarterly Report on Form 10-Q.
Overview
CHS Inc. is a diversified company that provides grain, food, agronomy 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 who own our five series of preferred stock, all of which are listed and traded on the Global Select Market of The Nasdaq Stock Market LLC ("Nasdaq").
Effective September 1, 2025, we changed the internal financial information reviewed by our chief operating decision maker ("CODM"), our Chief Executive Officer, to evaluate performance and allocate resources to our operating segments. As a result of this change, all prior period segment information has been recast to conform to the current year presentation. We have three reportable segments: Energy, Grains and Agronomy.
•The Energy segment consists of our wholesale and retail activities within the refined fuels, propane and lubricants product lines. The refined fuels product line includes petroleum refining, pipelines and terminals and markets gasoline, diesel fuel and renewable fuels under the Cenex® brand to member cooperatives and other independent retailers. The lubricants product line includes the blending, sale and distribution of primarily Cenex® brand lubricants, and the propane product line markets propane and other natural gas liquids through wholesale and retail market channels. Previously, this segment included our transportation services business, which is now reported under Corporate and Services.
•The Grains segment comprises our global grain marketing and processing activities as part of the feed grains, oilseeds, wheat, specialty grains and animal nutrition product lines. The Grains segment connects producers to domestic and global grain markets through a broad origination and distribution network. It markets commodities such as wheat, corn, ethanol, soybeans, oilseeds and specialty grains. The segment operates grain facilities and trading offices across five continents, serving processors, food manufacturers and renewable fuel producers. Further, the Grains segment produces ethanol and is one of the nation's largest suppliers of ethanol inputs into gasoline products, while also specializing in soybean and canola processing. These results were previously included within the former Ag segment.
•The Agronomy segment consists of our wholesale and retail agronomy activities within the crop nutrients and crop protection product lines. The Agronomy segment provides crop inputs and agronomy services to farmers, member cooperatives and other retailers. It offers crop nutrients, crop protection products and seed, including both proprietary and third-party brands. The Agronomy segment also includes our Nitrogen Production business consisting of our equity method investment in CF Nitrogen. Our supply agreement with CF Nitrogen requires us to purchase a specified quantity of granular urea and urea ammonium nitrate annually from CF Nitrogen. These results were previously included within the former Ag and Nitrogen Production segments.
•Our ag retail business, which was included in our former Ag segment, is now incorporated into the Energy, Grains and Agronomy segments based on the specific products sold and their relevant product lines.
24
The Company's remaining operations are not reportable segments, as defined by the applicable accounting standard, and are classified within Corporate and Services. Corporate and Services primarily represents our financing and hedging businesses, which provide services to our members and consist of a financial services business and a U.S. Commodity Futures Trading Commission-regulated futures commission merchant ("FCM") for agricultural commodities hedging. Our nonconsolidated investments in Ventura Foods, LLC ("Ventura Foods"), and Ardent Mills, LLC ("Ardent Mills"), are also included in our Corporate and Services category. All other nonconsolidated investments are included in our Energy, Grains and Agronomy segments.
Management's Focus. When evaluating our operating performance, management focuses on gross profit and income 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. Consequently, we focus on managing the margin we can earn and the resulting IBIT. We also focus on ensuring balance sheet strength through 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 IBIT generally trend lower during the second fiscal quarter and increase in the third fiscal quarter. For example, in our Grains segment, our retail business generally experiences higher volumes and revenues during the fall harvest, which generally corresponds to our first fiscal quarter, and our global grain and processing operations within Grains are subject to fluctuations in volumes and revenues based on producer harvests, world grain prices, global demand and international trade relationships. Our Agronomy segment generally experiences higher volumes and revenues during the spring planting season. Our Energy segment generally experiences higher volumes and revenues in certain operating areas, such as refined fuel products, in the spring, summer and early fall when gasoline and diesel fuel use by agricultural producers is highest and is subject to global supply and demand forces. Other energy products, such as propane, generally experience higher volumes and revenues during the winter heating and fall crop-drying seasons. The tables below demonstrate the historical trend of seasonality inherent in our businesses.
| Quarterly revenues as a percentage of annual total | Fiscal Year 2025 | Fiscal Year 2024 | Fiscal Year 2023 | 3-Year Average | |||||||||||||||||||
| Q1 | 26 | % | 29 | % | 28 | % | 28 | % | |||||||||||||||
| Q2 | 22 | % | 23 | % | 25 | % | 23 | % | |||||||||||||||
| Q3 | 28 | % | 25 | % | 26 | % | 26 | % | |||||||||||||||
| Q4 | 24 | % | 23 | % | 21 | % | 23 | % | |||||||||||||||
| Quarterly IBIT as a percentage of annual total | Fiscal Year 2025 | Fiscal Year 2024 | Fiscal Year 2023 | 3-Year Average | |||||||||||||||||||
| Q1 | 42 | % | 47 | % | 41 | % | 43 | % | |||||||||||||||
| Q2 | (14) | % | 17 | % | 16 | % | 6 | % | |||||||||||||||
| Q3 | 42 | % | 28 | % | 28 | % | 33 | % | |||||||||||||||
| Q4 | 30 | % | 8 | % | 15 | % | 18 | % | |||||||||||||||
Pricing and Volumes. Our revenues, assets and cash flows can be significantly affected by global market prices and sales volumes of commodities such as petroleum products, natural gas, grain, oilseed products and agronomy products. Changes in market prices for commodities we purchase without a corresponding change in the selling prices of those products can affect revenues and operating earnings. Similarly, increased or decreased sales volumes without a corresponding change in the purchase and selling prices of those products can affect revenues and operating earnings. Commodity prices and sales volumes are affected by a wide range of factors beyond our control, including weather; crop damage due to plant disease or insects; drought; availability/adequacy of supply of a commodity; availability of reliable rail, river, truck and ocean transportation networks; disease outbreaks; government regulations and policies; global trade disputes; global competition; wars and civil unrest; and general political and/or economic conditions.
Business Strategy
Our business strategies focus on an enterprisewide effort to create an experience that empowers customers to make CHS their first choice, expand market access to add value for our owners and transform and evolve our core businesses by capitalizing on changing market dynamics. To execute these strategies, we are focused on implementing agile, efficient and sustainable technology platforms; building robust and efficient supply chains; hiring, developing and retaining high-performing, diverse and passionate teams; achieving operational excellence and continuous improvement; and maintaining a strong balance sheet.
25
Fiscal 2026 Third Quarter Highlights
•Our Energy segment benefited from strong crack spreads driven by global market dynamics, which were mostly offset by record-high expenses for renewable energy credits.
•Grains performance was driven by continued global headwinds affecting grain margins, partially offset by strong oilseed crush margins.
•Continued strong performance by our CF Nitrogen equity method investment was partially offset by lower sales volumes of agronomy products, due to higher prices and ongoing weakness in the U.S. farm economy.
Fiscal 2026 Trends Update
Our segments operate in cyclical environments in which market conditions can change rapidly with significant positive or negative impacts on our results. We anticipate various macroeconomic factors will continue to drive uncertainty and instability in global energy and agricultural commodity markets, as well as global financial markets, which could have a significant impact on each of our segments during fiscal 2026 and beyond. These factors include, among others, the ongoing war between Russia and Ukraine and conflict in the Middle East and other regions; shifts in global trade flows for commodities, including global economic impacts from supply disruptions associated with access to the Strait of Hormuz; global competitiveness giving rise to a weak export market for U.S.-sourced agricultural products; potential changes in U.S. trade policy, including increased or fluctuating tariffs; a changing interest rate environment; and continued pricing pressures impacting costs of labor, freight and materials. These factors, or any form of them, could cause significant margin pressure and lower profitability. To mitigate these impacts, we evaluate the economic environment and adjust our operations and business strategies to help improve our position in the market. In addition to these broad macroeconomic factors, other factors could impact demand and pricing for agricultural inputs and outputs, as well as our ability to supply those inputs and outputs while remaining profitable. These include the cost of renewable energy credits, the price of which has been volatile in recent years and could positively or negatively impact our profitability. For example, the U.S. Environmental Protection Agency ("EPA") issued a renewable volume obligation ("RVO") in March 2026, which, as discussed in the MD&A Operating Metrics section, creates price uncertainty and volatility, while also significantly increasing the cost of our compliance with the program. Given the nature of our business, market dynamics and other mechanisms, it is possible the potential RVO compliance costs may be partially or wholly offset by certain other opportunities in our Energy and Grains businesses, but it is unknown if those opportunities will materialize. Additional factors that could impact demand and pricing of agricultural inputs and outputs include a weaker farm economy and regional factors, such as unpredictable weather conditions, including those due to climate change. We currently expect global economic factors impacting energy and agricultural commodities to be volatile and have the potential to be headwinds and/or tailwinds dependent on future global market conditions as they evolve throughout the remainder of fiscal 2026 and into fiscal 2027. Further, in light of uncertainty in the markets we serve, we are unable to predict how long the current environment will last or the significance of the financial and operational impacts to us; however, we currently expect the trend of volatile energy and agricultural commodities to persist throughout fiscal 2026 and into fiscal 2027. Refer to Item 1A of our Annual Report on Form 10-K for the year ended August 31, 2025, for additional considerations these and other risks may have on our business operations and financial performance.
We will continue to execute our enterprise priorities for fiscal 2026, including maximizing our segments through our integrated supply chains and capitalizing on domestic and global opportunities, as we navigate uncertain market conditions for energy and agricultural commodities.
Operating Metrics
Energy
Our Energy segment operations primarily include our refineries in Laurel, Montana, and McPherson, Kansas, which process crude oil to produce refined products, including gasoline, distillates and other products. To ensure the reliability of our refineries, we perform major maintenance activities every two to five years, which require a temporary shutdown of operations. These planned shutdowns allow us to extend the life, increase the capacity and improve the safety and efficiency of our refinery processing assets. They also minimize unplanned business interruptions and are essential to the long-term reliability and profitability of our Energy segment.
During periods of maintenance, utilization rates, throughput volumes and refined fuel yields are lower, and we may purchase refined petroleum products from third parties to meet the needs of our customers. These third-party purchases may result in lower margins than for products produced by our refineries, which reduces our profitability.
26
The following table provides information about our consolidated refinery operations.
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Refinery throughput volumes* | (Barrels per day) | ||||||||||||||||||||||||||||||||||
| Heavy, high-sulfur crude oil | 92,204 | 82,160 | 105,357 | 99,637 | |||||||||||||||||||||||||||||||
| All other crude oil | 72,752 | 30,767 | 72,008 | 55,682 | |||||||||||||||||||||||||||||||
| Other feedstocks and blendstocks | 13,186 | 3,560 | 16,852 | 12,002 | |||||||||||||||||||||||||||||||
| Total refinery throughput volumes | 178,142 | 116,487 | 194,217 | 167,321 | |||||||||||||||||||||||||||||||
| Refined fuel yields* | |||||||||||||||||||||||||||||||||||
| Gasolines | 79,915 | 50,506 | 89,705 | 77,114 | |||||||||||||||||||||||||||||||
| Distillates | 80,851 | 50,226 | 86,287 | 73,146 | |||||||||||||||||||||||||||||||
*Lower refinery throughput and refined fuels yields experienced during 2025 and 2026 are primarily due to planned major maintenance at our McPherson, Kansas, and Laurel, Montana, refineries, respectively.
We are subject to the Renewable Fuel Standard that requires refiners to blend renewable fuels (e.g., ethanol and biodiesel) into their finished transportation 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. In March 2026, the EPA issued a final RVO for calendar years 2026 and 2027 that increased the renewable fuel percentage standards compared with the previous RVO. The new RVO represents the highest blending obligation ever issued by the EPA.
We generate RINs through our blending activities, but we cannot generate enough RINs to meet the needs of our refining capacity; therefore, RINs must be purchased on the open market. The price of RINs can be volatile, with prices for D6 ethanol RINs and D4 biodiesel RINs increasing by 95% and 85%, respectively, during the three months ended May 31, 2026, compared to the same period during the prior fiscal year. The final RVO has impacted the demand for RINs, and we expect continued price volatility along with elevated and potentially increasing RINs prices for the remainder of fiscal 2026 and into fiscal 2027. Estimates of our RINs expense are calculated using an average of RINs prices each month.
In addition to our internal operational reliability, the profitability of our Energy segment is largely driven by crack spreads (i.e., the price differential between refined products and crude oil inputs) and Western Canadian Select ("WCS") crude oil discounts (i.e., the price discount for WCS crude oil relative to West Texas Intermediate ("WTI") crude oil), which are driven by supply and demand of refined products. Supply and demand dynamics in the global and North American refined product markets resulted in increased crack spreads during both the three and nine months ended May 31, 2026, compared to the same periods of the prior year. The table below provides information about average market reference prices and differentials that impacted our Energy segment.
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||||
| Market indicators | |||||||||||||||||||||||||||||||||||
| WTI crude oil (dollars per barrel) | $ | 96.03 | $ | 63.99 | $ | 72.63 | $ | 68.71 | |||||||||||||||||||||||||||
| WTI - WCS crude oil discount (dollars per barrel) | $ | 14.36 | $ | 11.69 | $ | 12.87 | $ | 12.28 | |||||||||||||||||||||||||||
| Group 3 2:1:1 crack spread (dollars per barrel)* | $ | 39.03 | $ | 23.88 | $ | 27.56 | $ | 18.35 | |||||||||||||||||||||||||||
| Group 3 5:3:2 crack spread (dollars per barrel)* | $ | 36.19 | $ | 23.40 | $ | 25.26 | $ | 17.66 | |||||||||||||||||||||||||||
| D6 ethanol RIN (dollars per RIN) | $ | 1.7985 | $ | 0.9242 | $ | 1.3349 | $ | 0.7633 | |||||||||||||||||||||||||||
| D4 biodiesel RIN (dollars per RIN) | $ | 1.8339 | $ | 0.9899 | $ | 1.3688 | $ | 0.7935 | |||||||||||||||||||||||||||
*Group 3 refers to the oil refining and distribution system serving Midwest markets from the Gulf Coast through the Plains states.
Grains
Our Grains segment is primarily composed of our global grain marketing, processing and retail grains activities for our feed grains, oilseeds, wheat, specialty grains and animal nutrition product lines. The Grains segment connects producers to domestic and global grain markets through a broad origination and distribution network and markets commodities such as wheat, corn, soybeans, oilseeds and specialty grains. We operate grain facilities and trading offices across five continents, serving processors, food manufacturers and renewable fuel producers. Profitability in our Grains segment is largely driven by throughput and production volumes, as well as commodity price spreads; however, revenues and cost of goods sold ("COGS") are largely affected by market-driven commodity prices and weather-related conditions outside our control.
27
The table below provides information about average market prices for agricultural commodities, as well as sales and throughput volumes that impacted our Grains segment.
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||||||||||||
| Market Source* | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||
| Commodity prices | |||||||||||||||||||||||||||||||||||||||||
| Corn (dollars per bushel) | Chicago Board of Trade | $ | 4.56 | $ | 4.56 | $ | 4.40 | $ | 4.47 | ||||||||||||||||||||||||||||||||
| Soybeans (dollars per bushel) | Chicago Board of Trade | $ | 11.80 | $ | 10.30 | $ | 11.15 | $ | 10.19 | ||||||||||||||||||||||||||||||||
| Wheat (dollars per bushel) | Chicago Board of Trade | $ | 6.17 | $ | 5.28 | $ | 5.62 | $ | 5.47 | ||||||||||||||||||||||||||||||||
| Ethanol (dollars per gallon) | Chicago Platts | $ | 1.99 | $ | 1.73 | $ | 1.84 | $ | 1.68 | ||||||||||||||||||||||||||||||||
| Volumes | |||||||||||||||||||||||||||||||||||||||||
| Grain and oilseed (thousands of bushels) | 654,971 | 604,009 | 1,961,042 | 1,805,800 | |||||||||||||||||||||||||||||||||||||
| North American grain and oilseed port throughput (thousands of bushels) | 252,136 | 190,979 | 771,562 | 576,610 | |||||||||||||||||||||||||||||||||||||
| Ethanol (thousands of gallons) | 153,826 | 138,254 | 478,556 | 418,266 | |||||||||||||||||||||||||||||||||||||
*Market source information represents the average week-end or month-end price during the period.
Agronomy
Our Agronomy segment is primarily composed of our wholesale and retail agronomy activities within our crop nutrients and crop protection product lines. This segment provides innovative agriculture solutions to farmers, cooperatives and other retailers. Dedicated to supporting farmer success with effective agronomy practices, we offer crop nutrients, crop protection products and seed, including both proprietary and third-party brands. Our Agronomy segment includes our Nitrogen Production business consisting of our equity method investment in CF Nitrogen. Products in the Agronomy segment are supported by wholesale and retail channels from investment in domestic manufacturing and strategic relationships with suppliers around the world. Profitability in our Agronomy segment is largely driven by the relationship between global and regional supply and demand for the underlying products and raw materials, costs of inputs used in the fertilizer manufacturing process and strength of the agricultural industry throughout the trade territories in which we operate. The table below provides information about average market prices for agricultural commodities, as well as sales and throughput volumes for our Agronomy segment.
| Three Months Ended May 31, | Nine Months Ended May 31, | ||||||||||||||||||||||||||||||||||||||||
| Market Source* | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||
| Commodity prices | |||||||||||||||||||||||||||||||||||||||||
| Urea (dollars per ton) | Green Markets NOLA | $ | 598.92 | $ | 397.00 | $ | 463.71 | $ | 355.93 | ||||||||||||||||||||||||||||||||
| Urea ammonium nitrate (dollars per ton) | Green Markets NOLA | $ | 465.60 | $ | 326.95 | $ | 369.92 | $ | 267.40 | ||||||||||||||||||||||||||||||||
| Volumes | |||||||||||||||||||||||||||||||||||||||||
| Wholesale crop nutrients (thousands of tons) | 2,177 | 2,316 | 5,372 | 5,802 | |||||||||||||||||||||||||||||||||||||
*Market source information represents the average week-end or month-end price during the period.
28
Results of Operations
Three Months Ended May 31, 2026 and 2025
| Three Months Ended May 31, | |||||||||||||||||||||||
| 2026 | % of Revenues* | 2025 | % of Revenues* | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 11,582,089 | 100.0 | % | $ | 9,766,421 | 100.0 | % | |||||||||||||||
| Cost of goods sold | 11,171,469 | 96.5 | 9,436,610 | 96.6 | |||||||||||||||||||
| Gross profit | 410,620 | 3.5 | 329,811 | 3.4 | |||||||||||||||||||
| Marketing, general and administrative expenses | 302,283 | 2.6 | 258,850 | 2.7 | |||||||||||||||||||
| Operating earnings | 108,337 | 0.9 | 70,961 | 0.7 | |||||||||||||||||||
| Interest expense | 49,725 | 0.4 | 44,109 | 0.5 | |||||||||||||||||||
| Other income | (21,775) | (0.2) | (27,398) | (0.3) | |||||||||||||||||||
| Equity income from investments | (201,826) | (1.7) | (204,605) | (2.1) | |||||||||||||||||||
| Income before income taxes | 282,213 | 2.4 | 258,855 | 2.7 | |||||||||||||||||||
| Income tax expense | 14,717 | 0.1 | 27,175 | 0.3 | |||||||||||||||||||
| Net income | 267,496 | 2.3 | 231,680 | 2.4 | |||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests | 130 | — | (504) | — | |||||||||||||||||||
| Net income attributable to CHS Inc. | $ | 267,366 | 2.3 | % | $ | 232,184 | 2.4 | % | |||||||||||||||
*Amounts less than 0.1% are shown as zero percent. Percentage totals may differ due to rounding.
The table below details revenues, net of intersegment revenues, and IBIT by segment for the three months ended May 31, 2026.
| Energy | Grains | Agronomy | Corporate and Services | Total | |||||||||||||||||||||||||||||||
| Three Months Ended May 31, 2026 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||
| Revenues | $ | 3,307,979 | $ | 5,660,619 | $ | 2,566,264 | $ | 47,227 | $ | 11,582,089 | |||||||||||||||||||||||||
| Income (loss) before income taxes | $ | 10,099 | $ | (33,564) | $ | 275,044 | $ | 30,634 | $ | 282,213 | |||||||||||||||||||||||||
29
Operating Segments
Energy
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 3,307,979 | $ | 1,915,096 | $ | 1,392,883 | 72.7 | % | |||||||||||||||
| Income (loss) before income taxes | $ | 10,099 | $ | (56,515) | $ | 66,614 | 117.9 | % | |||||||||||||||
The following commentary presents the changes in our Energy segment for the three months ended May 31, 2026, compared to the three months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the three months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | 597,018 | $ | 1,147 | |||||||
| Price impact on revenues and margin impact on IBIT | 795,865 | 77,542 | |||||||||
| Other IBIT | — | (12,075) | |||||||||
| Total change | $ | 1,392,883 | $ | 66,614 | |||||||
Total Energy segment revenues increased $1,392.9 million, or 72.7%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily due to the following:
•Higher market prices for refined fuels products, due to geopolitical events in the current quarter, improved Energy segment revenues.
•Strong bulk refined fuels and propane sales volumes also drove revenues growth.
Energy segment IBIT increased $66.6 million, or 117.9%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily due to the following:
•Improved sales mix of higher-margin refined fuels products, higher crack spreads and favorable WCS discounts contributed to an increase in IBIT.
•These benefits were largely offset by significantly higher RINs expense and unrealized hedging losses.
Grains
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 5,660,619 | $ | 5,292,301 | $ | 368,318 | 7.0 | % | |||||||||||||||
| Loss before income taxes | $ | (33,564) | $ | (32,856) | $ | (708) | (2.2 | %) | |||||||||||||||
The following commentary presents the changes in our Grains segment for the three months ended May 31, 2026, compared to the three months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the three months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | 455,110 | $ | (2,170) | |||||||
| Price impact on revenues and margin impact on IBIT | (86,792) | (3,629) | |||||||||
| Other IBIT | — | 5,091 | |||||||||
| Total change | $ | 368,318 | $ | (708) | |||||||
Total Grains segment revenues increased $368.3 million, or 7.0%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily as a result of the following:
•Strong volumes from feed grains exports and oilseed processing demand increased Grains segment revenues but were partially offset by weaker wheat sales.
•Lower selling prices for feed grains and oilseed commodities contributed to a decrease in Grains segment prices.
30
Grains segment IBIT decreased $0.7 million, or 2.2%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily as a result of the following:
•Lower margins associated with wheat, feed grains and specialty products decreased IBIT.
•These impacts were mostly offset by strong oilseed crush margins driven by RVO-related processing demand, higher interest income and improved performance by our equity method investments.
Agronomy
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 2,566,264 | $ | 2,514,021 | $ | 52,243 | 2.1 | % | |||||||||||||||
| Income before income taxes | $ | 275,044 | $ | 247,395 | $ | 27,649 | 11.2 | % | |||||||||||||||
The following commentary presents the changes in our Agronomy segment for the three months ended May 31, 2026, compared to the three months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the three months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | (220,087) | $ | (21,302) | |||||||
| Price impact on revenues and margin impact on IBIT | 272,330 | 24,634 | |||||||||
| Other IBIT | — | 24,317 | |||||||||
| Total change | $ | 52,243 | $ | 27,649 | |||||||
Total Agronomy segment revenues increased $52.2 million, or 2.1%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily due to the following:
•Higher wholesale and retail crop nutrients prices, due to tight market supply, increased Agronomy segment revenues.
•This was partially offset by lower sales volumes, driven primarily by deferred demand and a weaker U.S. farm economy, which decreased revenues.
Total Agronomy segment IBIT increased $27.6 million, or 11.2%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily due to the following:
•Continued strong performance from our investment in CF Nitrogen, driven by higher urea and UAN prices, and improved margins across crop nutrients and crop protection products increased IBIT.
•These benefits were partially offset by volume declines, due largely to higher product costs, which led to deferred demand.
Other Business Activities
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Corporate and Services revenues | $ | 47,227 | $ | 45,003 | $ | 2,224 | 4.9 | % | |||||||||||||||
| Corporate and Services IBIT | $ | 30,634 | $ | 100,831 | $ | (70,197) | (69.6 | %) | |||||||||||||||
During the three months ended May 31, 2026, compared to the same period in the prior fiscal year, performance by CHS Capital positively impacted Corporate and Services revenues, while IBIT decreased due to the gain from the sale of a business by our equity investment, Ventura Foods, during the prior fiscal year that did not reoccur in the current year.
31
Cost of Goods Sold
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Cost of goods sold | $ | 11,171,469 | $ | 9,436,610 | $ | 1,734,859 | 18.4 | % | |||||||||||||||
Consolidated cost of goods sold increased $1,734.9 million, or 18.4%, during the three months ended May 31, 2026, compared to the three months ended May 31, 2025, primarily due to the following:
•Increased bulk sales volumes of refined fuels and propane products, increased RINs expense, higher commodity prices and unrealized hedging losses increased COGS in our Energy segment.
•Higher sales volumes of feed grains and oilseed products, along with increased wheat prices, contributed to increased COGS in our Grains segment.
•Higher crop nutrients prices increased COGS in our Agronomy segment.
Marketing, General and Administrative Expenses
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Marketing, general and administrative expenses | $ | 302,283 | $ | 258,850 | $ | 43,433 | 16.8 | % | |||||||||||||||
Marketing, general and administrative expenses increased during the three months ended May 31, 2026, driven primarily by incentive compensation and benefit expenses.
Interest Expense
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Interest expense | $ | 49,725 | $ | 44,109 | $ | 5,616 | 12.7 | % | |||||||||||||||
Interest expense increased during the three months ended May 31, 2026, as a result of higher long-term debt balances compared to the same period in the prior fiscal year.
32
Other Income
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Other income | $ | 21,775 | $ | 27,398 | $ | (5,623) | (20.5 | %) | |||||||||||||||
Other income decreased during the three months ended May 31, 2026, primarily due to lower gains on investments, partially offset by increased interest income as a result of a larger cash balance compared to the same period in the prior fiscal year.
Equity Income from Investments
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Equity income from investments* | $ | 201,826 | $ | 204,605 | $ | (2,779) | (1.4 | %) | |||||||||||||||
*For additional information, see Note 5, Investments, of the notes to the condensed consolidated financial statements that are included in this Quarterly Report on Form 10-Q.
Equity income from investments decreased during the three months ended May 31, 2026, as compared to the same period during the prior fiscal year, primarily due to the non-recurring gain on the sale of a business by our equity investment, Ventura Foods, during the prior fiscal year, largely offset by strong performance from our investment in CF Nitrogen.
Income Tax Expense
| Three Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Income tax expense | $ | 14,717 | $ | 27,175 | $ | (12,458) | (45.8 | %) | |||||||||||||||
Decreased income tax expense during the three months ended May 31, 2026, reflects the mix of full-year earnings projected across business units relative to the prior year and current equity assumptions, along with benefits associated with certain tax credits. Effective tax rates for the three months ended May 31, 2026 and 2025, were 5.2% and 10.5%, respectively. Federal and state statutory rates of 24.2% and 24.5% were applied to nonpatronage business activity for the three months ended May 31, 2026 and 2025, respectively. Income tax expense and effective tax rates vary each year based on profitability, changes in tax law, income tax credits and patronage business activity.
33
Results of Operations
Nine Months Ended May 31, 2026 and 2025
| Nine Months Ended May 31, | |||||||||||||||||||||||
| 2026 | % of Revenues* | 2025 | % of Revenues* | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 28,799,984 | 100.0 | % | $ | 26,856,724 | 100.0 | % | |||||||||||||||
| Cost of goods sold | 27,974,194 | 97.1 | 26,049,922 | 97.0 | |||||||||||||||||||
| Gross profit | 825,790 | 2.9 | 806,802 | 3.0 | |||||||||||||||||||
| Marketing, general and administrative expenses | 838,012 | 2.9 | 769,968 | 2.9 | |||||||||||||||||||
| Operating earnings | (12,222) | — | 36,834 | 0.1 | |||||||||||||||||||
| Interest expense | 130,833 | 0.5 | 96,962 | 0.4 | |||||||||||||||||||
| Other income | (91,588) | (0.3) | (74,138) | (0.3) | |||||||||||||||||||
| Equity income from investments | (440,891) | (1.5) | (418,970) | (1.6) | |||||||||||||||||||
| Income before income taxes | 389,424 | 1.4 | 432,980 | 1.6 | |||||||||||||||||||
| Income tax expense | 8,661 | — | 31,710 | 0.1 | |||||||||||||||||||
| Net income | 380,763 | 1.3 | 401,270 | 1.5 | |||||||||||||||||||
| Net (loss) income attributable to noncontrolling interests | (34) | — | 50 | — | |||||||||||||||||||
| Net income attributable to CHS Inc. | $ | 380,797 | 1.3 | % | $ | 401,220 | 1.5 | % | |||||||||||||||
*Amounts less than 0.1% are shown as zero percent. Percentage totals may differ due to rounding.
The table below details revenues, net of intersegment revenues, and IBIT by segment for the nine months ended May 31, 2026.
| Energy | Grains | Agronomy | Corporate and Services | Total | |||||||||||||||||||||||||||||||
| Nine Months Ended May 31, 2026 | (Dollars in thousands) | ||||||||||||||||||||||||||||||||||
| Revenues | $ | 7,764,425 | $ | 16,053,061 | $ | 4,836,342 | $ | 146,156 | $ | 28,799,984 | |||||||||||||||||||||||||
| Income (loss) before income taxes | $ | 28,804 | $ | (15,258) | $ | 300,356 | $ | 75,522 | $ | 389,424 | |||||||||||||||||||||||||
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Operating Segments
Energy
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 7,764,425 | $ | 6,026,408 | $ | 1,738,017 | 28.8 | % | |||||||||||||||
| Income (loss) before income taxes | $ | 28,804 | $ | (120,257) | $ | 149,061 | 124.0 | % | |||||||||||||||
The following commentary presents the changes in our Energy segment for the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the nine months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | 1,109,301 | $ | (1,471) | |||||||
| Price impact on revenues and margin impact on IBIT | 628,716 | 176,895 | |||||||||
| Other IBIT | — | (26,363) | |||||||||
| Total change | $ | 1,738,017 | $ | 149,061 | |||||||
Total Energy segment revenues increased $1,738.0 million, or 28.8%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily due to the following:
•Strong sales volumes of refined fuels and propane products, driven by heavy fall harvest activity and higher bulk sales volumes, increased Energy segment revenues.
•Higher market prices for refined fuels products, due to geopolitical events in the current year, also drove revenues growth, but were partially offset by lower propane prices.
Energy segment IBIT increased $149.1 million, or 124.0%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily due to the following:
•Higher crack spreads, improved sales mix of higher-margin refined fuels products and favorable WCS discounts contributed to an increase in IBIT.
•These benefits were partially offset by significantly higher RINs expense and unrealized hedging losses.
Grains
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 16,053,061 | $ | 15,947,458 | $ | 105,603 | 0.7 | % | |||||||||||||||
| (Loss) income before income taxes | $ | (15,258) | $ | 125,751 | $ | (141,009) | (112.1 | %) | |||||||||||||||
The following commentary presents the changes in our Grains segment for the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the nine months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | 672,728 | $ | 947 | |||||||
| Price impact on revenues and margin impact on IBIT | (567,125) | (150,116) | |||||||||
| Other IBIT | — | 8,160 | |||||||||
| Total change | $ | 105,603 | $ | (141,009) | |||||||
Total Grains segment revenues increased $105.6 million, or 0.7%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily as a result of the following:
•Higher volumes increased Grains segment revenues, driven by strong feed grains exports.
•These benefits were partially offset by lower selling prices for feed grains and oilseed commodities, as well as lower oilseed volumes in the first half of the current fiscal year.
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Grains segment IBIT decreased $141.0 million, or 112.1%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily as a result of the following:
•Lower oilseed export volumes, soft crush margins during the first half of our fiscal year, weaker retail and wholesale wheat margins and timing of mark-to-market adjustments associated with commodity derivatives decreased IBIT.
Agronomy
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Revenues | $ | 4,836,342 | $ | 4,723,164 | $ | 113,178 | 2.4 | % | |||||||||||||||
| Income before income taxes | $ | 300,356 | $ | 264,144 | $ | 36,212 | 13.7 | % | |||||||||||||||
The following commentary presents the changes in our Agronomy segment for the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025.
| Revenues | IBIT | ||||||||||
| For the nine months ended May 31, 2026: | (Dollars in thousands) | ||||||||||
| Volume | $ | (359,025) | $ | (24,210) | |||||||
| Price impact on revenues and margin impact on IBIT | 472,203 | 7,592 | |||||||||
| Other IBIT | — | 52,830 | |||||||||
| Total change | $ | 113,178 | $ | 36,212 | |||||||
Total Agronomy segment revenues increased $113.2 million, or 2.4%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily due to the following:
•Crop nutrients, driven primarily by higher crop nutrients prices, increased Agronomy segment revenues.
•This increase was partially offset by lower sales volumes, reflecting a weaker U.S. farm economy.
Total Agronomy segment IBIT increased $36.2 million, or 13.7%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily due to the following:
•Strong performance from our investment in CF Nitrogen, driven by higher urea and UAN prices, increased IBIT.
•This increase was partially offset by volume declines of crop nutrients products, due largely to higher product costs, which contributed to deferred demand.
Other Business Activities
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Corporate and Services revenues | $ | 146,156 | $ | 159,694 | $ | (13,538) | (8.5 | %) | |||||||||||||||
| Corporate and Services IBIT | $ | 75,522 | $ | 163,342 | $ | (87,820) | (53.8 | %) | |||||||||||||||
During the nine months ended May 31, 2026, as compared to same period in the prior fiscal year, lower transportation volumes negatively impacted Corporate and Services revenues, while IBIT decreased due to performance from our equity method investments and the gain on the sale of a business by our equity investment, Ventura Foods, during the prior fiscal year which did not reoccur in the current year.
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Cost of Goods Sold
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Cost of goods sold | $ | 27,974,194 | $ | 26,049,922 | $ | 1,924,272 | 7.4 | % | |||||||||||||||
Consolidated cost of goods sold increased $1,924.3 million, or 7.4%, during the nine months ended May 31, 2026, compared to the nine months ended May 31, 2025, primarily due to the following:
•Increased bulk sales volumes of refined fuels and propane products, increased RINs expense, higher commodity prices and unrealized hedging losses increased COGS in our Energy segment.
•Increased feed grains and wheat sales volumes increased COGS in our Grains segment but were partially offset by oilseed price and volume impacts.
•Higher crop nutrients per-ton prices increased COGS in our Agronomy segment.
Marketing, General and Administrative Expenses
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Marketing, general and administrative expenses | $ | 838,012 | $ | 769,968 | $ | 68,044 | 8.8 | % | |||||||||||||||
Marketing, general and administrative expenses increased during the nine months ended May 31, 2026, driven primarily by incentive compensation and benefit expenses and amortization related to our enterprise resource planning system.
Interest Expense
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Interest expense | $ | 130,833 | $ | 96,962 | $ | 33,871 | 34.9 | % | |||||||||||||||
Interest expense increased during the nine months ended May 31, 2026, as a result of higher long-term debt balances compared to the same period in the prior fiscal year.
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Other Income
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Other income | $ | 91,588 | $ | 74,138 | $ | 17,450 | 23.5 | % | |||||||||||||||
Other income increased during the nine months ended May 31, 2026, primarily due to increased interest income as a result of a larger cash balance compared to the same period in the prior fiscal year.
Equity Income from Investments
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Equity income from investments* | $ | 440,891 | $ | 418,970 | $ | 21,921 | 5.2 | % | |||||||||||||||
*For additional information, see Note 5, Investments, of the notes to the condensed consolidated financial statements that are included in this Quarterly Report on Form 10-Q.
Equity income from investments increased during the nine months ended May 31, 2026, as compared to the same period during the prior fiscal year, primarily due to higher equity income from our investment in CF Nitrogen as a result of higher urea and UAN prices, partially offset by natural gas costs. This was also partially offset by the gain on the sale of a business by our equity investment, Ventura Foods, during the prior fiscal year that did not recur in the current year.
Income Tax Expense
| Nine Months Ended May 31, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Dollars | Percent | ||||||||||||||||||||
| (Dollars in thousands) | |||||||||||||||||||||||
| Income tax expense | $ | 8,661 | $ | 31,710 | $ | (23,049) | (72.7 | %) | |||||||||||||||
Decreased income tax expense during the nine months ended May 31, 2026, reflects the mix of full-year earnings projected across business units relative to the prior year and current equity assumptions, along with benefits associated with certain tax credits. Effective tax rates for the nine months ended May 31, 2026 and 2025, were 2.2% and 7.3%, respectively. Federal and state statutory rates of 24.2% and 24.5% were applied to nonpatronage business activity for the nine months ended May 31, 2026 and 2025, respectively. Income tax expense and effective tax rates vary each year based on profitability, changes in tax law, income tax credits and patronage business activity.
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Liquidity and Capital Resources
In assessing our financial condition, we consider factors such as working capital, internal benchmarking related to our applicable covenants and other financial information. The following financial information is used when assessing our liquidity and capital resources to meet our capital allocation priorities, which include maintaining the safety and compliance of our operations, meeting debt maturity obligations, paying interest on debt and preferred stock dividends, returning cash to our member-owners in the form of cash patronage and equity redemptions and taking advantage of strategic opportunities that benefit our member-owners.
| May 31, 2026 | August 31, 2025 | ||||||||||
| (Dollars in thousands) | |||||||||||
| Cash and cash equivalents | $ | 497,614 | $ | 327,826 | |||||||
| Notes payable | 1,589,756 | 1,152,457 | |||||||||
| Long-term debt including current maturities | 2,133,582 | 1,835,833 | |||||||||
| Total equities | 11,205,581 | 11,080,174 | |||||||||
| Working capital | 3,171,972 | 2,803,865 | |||||||||
| Current ratio* | 1.5 | 1.5 | |||||||||
*Current ratio is defined as current assets divided by current liabilities.
Summary of Our Major Sources of Cash and Cash Equivalents
We fund our current operations primarily through our cash flows from operations and with short-term borrowings through our committed and uncommitted revolving credit facilities, including our securitization facility with certain unaffiliated financial institutions and our repurchase facility. We fund certain of our long-term capital needs, primarily those related to acquisitions of property, plant and equipment, with cash flows from operations and by issuing long-term debt. See Note 6, Notes Payable and Long-Term Debt, of the notes to the unaudited condensed consolidated financial statements that are included in this Quarterly Report on Form 10-Q for additional information on our short-term borrowings and long-term debt. We will continue to consider opportunities to further diversify and enhance our sources and amounts of liquidity.
Summary of Our Major Uses of Cash and Cash Equivalents
The following is a summary of our primary cash requirements for fiscal 2026:
•Capital expenditures. We expect total capital expenditures for fiscal 2026 to be approximately $494.5 million, compared to capital expenditures of $728.6 million in fiscal 2025, as we continue to invest in capital expenditures for projects to meet the evolving needs of our owners and customers and enhance value for the cooperative system during fiscal 2026. During the nine months ended May 31, 2026, we acquired $344.3 million of property, plant and equipment.
•Major maintenance. We expect total major maintenance for fiscal 2026 to be approximately $73.4 million, compared to major maintenance of $271.4 million in fiscal 2025. Decreased major maintenance for fiscal 2026 is due to significantly reduced turnaround activities at our refineries compared to the turnaround at our McPherson refinery during fiscal 2025. During the nine months ended May 31, 2026, we had $56.3 million in major maintenance largely due to the planned partial turnaround at our Laurel refinery.
•Debt and interest. We expect to repay approximately $91.8 million of long-term debt and finance lease obligations and incur interest payments related to long-term debt of approximately $102.5 million during fiscal 2026. During the nine months ended May 31, 2026, we repaid $9.3 million of scheduled long-term debt maturities and finance lease obligations.
•Preferred stock dividends. We had approximately $2.3 billion of preferred stock outstanding as of May 31, 2026. We expect to pay dividends on our preferred stock of approximately $168.7 million during fiscal 2026. Dividends paid on our preferred stock during the nine months ended May 31, 2026, were $126.5 million.
•Patronage. Our Board of Directors authorized approximately $30.0 million of our fiscal 2025 patronage-sourced earnings to be paid to our member-owners during fiscal 2026. During the nine months ended May 31, 2026, we distributed $30.0 million of cash patronage related to the year ended August 31, 2025.
•Equity redemptions. Our Board of Directors authorized approximately $90.0 million of equity redemptions to be distributed in fiscal 2026 in the form of redemptions of qualified and nonqualified equity owned by individual producer-members and association members. During the nine months ended May 31, 2026, we redeemed $80.6 million of member equity.
39
We believe cash generated by operating and investing activities, along with available borrowing capacity under our credit facilities, will be sufficient to support our short-term (the next 12 months) and long-term (beyond 12 months) operations. 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 all debt covenants and restrictions as of May 31, 2026. Based on our current fiscal 2026 projections, we expect continued covenant compliance.
Working Capital
We measure working capital as current assets less current liabilities as each amount appears on our condensed consolidated balance sheets. We believe this information is meaningful to investors as a measure of operational efficiency and short-term financial health. Working capital is not defined under U.S. generally accepted accounting principles and may not be computed the same as similarly titled measures used by other companies. Working capital as of May 31, 2026, and August 31, 2025, was as follows:
| May 31, 2026 | August 31, 2025 | Change | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||||
| Current assets | $ | 9,943,293 | $ | 8,086,351 | $ | 1,856,942 | |||||||||||
| Less current liabilities | 6,771,321 | 5,282,486 | 1,488,835 | ||||||||||||||
| Working capital | $ | 3,171,972 | $ | 2,803,865 | $ | 368,107 | |||||||||||
As of May 31, 2026, working capital increased by $368.1 million compared to August 31, 2025. Changes in current asset balances increased working capital by $1.9 billion, primarily due to increases in receivables, other current assets and inventories, which were driven by seasonality in our business. Current liability balance changes decreased working capital by $1.5 billion, primarily due to increases in other current liabilities, notes payable and accounts payable, which were also driven by seasonality in our business.
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 available capacity on our committed and uncommitted lines of credit will provide adequate liquidity to meet our working capital needs.
Contractual Obligations
For information regarding our estimated contractual obligations, see the MD&A discussion included in Item 7 of Part II of our Annual Report on Form 10-K for the year ended August 31, 2025. No material changes occurred during the nine months ended May 31, 2026.
Cash Flows
The following table presents summarized cash flow data for the nine months ended May 31, 2026 and 2025:
| Nine Months Ended May 31, | |||||||||||||||||
| 2026 | 2025 | Change | |||||||||||||||
| (Dollars in thousands) | |||||||||||||||||
| Net cash provided by (used in) operating activities | $ | 201,214 | $ | (635,272) | $ | 836,486 | |||||||||||
| Net cash used in investing activities | (503,649) | (552,160) | 48,511 | ||||||||||||||
| Net cash provided by financing activities | 511,065 | 724,692 | (213,627) | ||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | 2,961 | (6,973) | 9,934 | ||||||||||||||
| Increase (decrease) in cash and cash equivalents and restricted cash | $ | 211,591 | $ | (469,713) | $ | 681,304 | |||||||||||
Cash flows from operating activities can fluctuate significantly from period to period as a result of various factors, including seasonality and timing differences associated with purchases, sales, taxes and other business decisions. The $836.5 million year-over-year increase in cash provided by operating activities primarily reflects increased accounts payable and accrued expenses, which was partially offset by changes in accounts receivable, during the first nine months of fiscal 2026 as compared to the same period during fiscal 2025.
40
The $48.5 million decrease in cash used in investing activities primarily reflects decreased expenditures for major maintenance, business acquisitions and acquisitions of property, plant and equipment, mostly offset by decreased proceeds from the sale and maturity of short-term and other investments, increased purchases of short-term investments and increases in CHS Capital notes receivable during the first nine months of fiscal 2026 compared to the same period during fiscal 2025.
The $213.6 million decrease in cash provided by financing activities primarily reflects decreased net cash inflows associated with our notes payable and short-term funding needs for working capital, partially offset by decreased cash patronage dividends paid and redemptions of equities during the first nine months of fiscal 2026 compared to the same period during fiscal 2025.
Preferred Stock
The following is a summary of our outstanding preferred stock as of May 31, 2026, 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 patron equities redeemed with preferred stock.
(b) Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 2 accumulated dividends at a rate of 7.10% per year until March 31, 2024, and subsequently fixed at a rate of 7.10% based on the terms of the contract and application of the Adjustable Rate (LIBOR) Act.
(c) Class B Reset Rate Cumulative Redeemable Preferred Stock, Series 3 accumulated dividends at a rate of 6.75% per year until September 30, 2024, and subsequently fixed at a rate of 6.75% based on the terms of the contract and application of the Adjustable Rate (LIBOR) Act.
(d) All series of preferred stock are 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 2002 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.
Critical Accounting Policies
Our critical accounting policies as presented in the MD&A in our Annual Report on Form 10-K for the year ended August 31, 2025, have not materially changed during the nine months ended May 31, 2026.
Recent Accounting Pronouncements
Refer to Note 1, Basis of Presentation and Significant Accounting Policies, included in Item 1 of Part I of this Quarterly Report on Form 10-Q for a discussion of applicable standards issued and not yet adopted.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We did not experience material changes in market risk exposures for the period ended May 31, 2026, that would affect the quantitative and qualitative disclosures presented in our Annual Report on Form 10-K for the year ended August 31, 2025.
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ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of May 31, 2026. Based on that evaluation, our chief executive officer and chief financial officer concluded that, as of that date, our disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting
There have been no changes in internal control over financial reporting during the quarter ended May 31, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
For a description of our material pending legal proceedings, please see Note 13, Commitments and Contingencies, of the notes to the unaudited condensed consolidated financial statements that are included in this Quarterly Report on Form 10-Q.
ITEM 1A. RISK FACTORS
There have been no material changes from the risk factors disclosed in Item 1A of our Annual Report on Form 10-K for the year ended August 31, 2025.
ITEM 5. OTHER INFORMATION
During the three months ended May 31, 2026, no director or officer of the company adopted terminated
ITEM 6. EXHIBITS
| Exhibit | Description | ||||
| CHS Inc. Annual Variable Pay Plan Document | |||||
| CHS Inc. Executive Long-Term Incentive Plan Document | |||||
| CHS Inc. Deferred Compensation Plan Document (2026 Restatement) | |||||
| Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||
| Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||
| Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||
| Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||
| 101.INS | XBRL Instance Document (The Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). | ||||
| 101.SCH | XBRL Taxonomy Extension Schema Document. | ||||
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | ||||
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | ||||
| 101.LAB | XBRL Taxonomy Extension Labels Linkbase Document. | ||||
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. | ||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | ||||
42
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CHS Inc.
(Registrant)
| Date: | July 8, 2026 | By: | /s/ Olivia Nelligan | ||||||||||||||
| Olivia Nelligan | |||||||||||||||||
| Executive Vice President, Chief Financial Officer and Chief Strategy Officer | |||||||||||||||||
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Exhibit 10.1
Purpose
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 financial and individual performance goals that are aligned with organizational priorities and CHS Capabilities. The Plan is intended to:
•Drive strong company performance by providing Participants line of sight into their contributions to the achievement of financial goals
•Emphasize shared ownership of enterprise and business initiatives, and reward Participants for the achievement of collective results through collaborative work efforts
•Provide incentives that are competitive with compensation in the external market and aligned with organizational and market best practices
Performance Period
Each Performance Period for the Plan (“Performance Period”) is measured in one (1) fiscal-year segment, currently September 1 through August 31. A new Performance Period begins each fiscal year.
For purposes of the Plan, “Award” is defined as the amount awarded to a Participant for a Performance Period upon the CHS Board of Directors approving the Performance Period financial results and authorizing distribution of payouts under the Plan following the end of the Performance Period.
Eligibility
•Employees must meet all the following criteria to be eligible:
In an eligible non-union job pay grade 16 or higher on or before June 1 of the Performance Period
Have full-time or part-time regularly scheduled status on or before June 1 of the Performance Period
Remain active in non-union job at the end of the Performance Period (August 31)
Work a minimum of 30 days in an eligible role during the Performance Period
Are not eligible for variable compensation through any other bonus, commission, or incentive plan
•Generally, employees meeting any of the following criteria are not eligible:
In pay grade 15 or below job
In a union job
Layoff, Intern or Temp/Seasonal status
Hire date or effective date in eligible job after June 1 of the Performance Period
Separated status at the end of the Performance Period (August 31), unless separation type is eligible for proration (reference Award Proration for details)
Worked less than 30 days during Performance Period
Eligible for variable compensation through any other bonus, commission, or incentive plan
•Employee eligibility may change during the Performance Period due to employee changes including status change, transfer, or job change. An eligibility change may result in the employee becoming ineligible for the Plan or being eligible for proration of the Award (reference Award Proration for details).
CHS Annual Variable Pay Plan Document
•Employees that are not eligible for the Plan include but are not limited to: Employees in pay grades 15 and below; Drivers; Applicators; sales incentive eligible employees; Interns; employees coded to the following org units: Ag Partners, LLC; Battlecreek; Dakota Ag Partners; Midwest Ag Supplements; TEMCO KALAMA TERMINAL; TEMCO MERCHANDISING; TEMCO TACOMA TERMINAL. Eligibility can be changed at the sole discretion of the Plan Administrators.
Forfeiture and Modification for Performance or Behavior
A Participant may forfeit eligibility under the Plan for any Performance Period or have their opportunity for an Award, if provided under the Plan, modified at the discretion of the Plan Administrators, if it has been determined that the Participant has 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 or modification of a Participant’s opportunity for an Award under the Plan must be approved by the Plan Administrators.
Performance Goals
Performance Goals are established for each Performance Period at the beginning of the Performance Period. Financial Performance goals are defined in the Plan Appendix for each Performance Period. Plan Performance Goals include:
•Return on Invested Capital (ROIC)
•Return on Assets (ROA)
•Individual Performance Goals
All Plan Performance Goals for each Performance Period are measured over the applicable Performance Period.
•The President and Chief Executive Officer (CEO) and the Chief Financial Officer (CFO) establish, and the CHS Board of Directors approves, the ROIC Performance Goals at the enterprise level for each Performance Period pursuant to the Plan.
•The CEO and CFO establish, in collaboration with senior finance and business leaders, all ROA Performance Goals for each Performance Period pursuant to the Plan.
•Individual Performance Goals are established by the Participant and the Participant’s manager at the beginning of the Performance Period.
For any Award made under the Plan, the payout range for each Performance Goal is calculated as a percent of target Performance Goal (the expected level of performance), based on actual results for that Performance Goal for the Performance Period.
The payout range is calculated independently for each Performance Goal and mathematically interpolated when results are attained between the Performance Goal levels. The following table illustrates the Performance Goal levels and associated payout range.
Performance Goal Level | Level Definition | Payout Range | ||||||
Maximum | Highest level of Performance | 200% | ||||||
Target | Expected level of Performance | 100% | ||||||
Threshold | Lowest level of Performance | 50% | ||||||
CHS Annual Variable Pay Plan Document
Performance Goal Weightings
The Performance Goal Weightings indicate the relative value of each Performance Goal in the Award calculation. Performance Goals are weighted based on the appropriate Participant Group in accordance with the weightings in the following table.
Participant Group | Group Definition | Performance Goal Weighting | ||||||||||||
ROIC | ROA | Individual | ||||||||||||
Corporate Function* | Enterprise Support | 70% | 30% | |||||||||||
Business | Defined Market Segment | 35% | 35% | 30% | ||||||||||
*Corporate function includes all enterprise leadership team Participants.
Performance Goal Trigger
Performance Goal levels and “Triggers” are established at the beginning of each Performance Period. The Trigger defines the level of required performance to trigger any Award.
The Trigger or Triggers are based on whether Participants are in a Corporate Function or a Business Participant group, as follows:
•Corporate Function Participant:
oThreshold ROIC Performance Goal must be met for any Award to be issued under the Plan.
oIf the threshold ROIC Performance Goal is not met, no Award will be issued under the Plan.
•Business Participant:
oThreshold ROIC or target ROA Performance Goals must be met for any Award to be issued under the Plan.
oIf the threshold ROIC Performance Goal is not met, and the target ROA Performance Goal is met, any Award may be issued for the ROA Performance Goal only. If both the threshold ROIC and target ROA Performance Goals are not met, no Award will be issued under the Plan.
The following table illustrates the impact of the Trigger for each Performance Goal.
Participant Group | Trigger | Performance Goal Weighting Compensation Earned | |||||||||||||||
Performance Goal | Performance Goal Level Required | ROIC | ROA | Individual | |||||||||||||
Corporate Function | ROIC | Threshold | Yes | Yes | |||||||||||||
Business | ROIC | Threshold | Yes | Yes | Yes | ||||||||||||
IF THRESHOLD ROIC TRIGGER IS NOT MET | |||||||||||||||||
Corporate Function | ROIC | Threshold | No | No | |||||||||||||
Business | ROIC | Threshold | No | Varies Based on Business ROA Results (see below) | No | ||||||||||||
Business | ROA | Target | No | Yes | No | ||||||||||||
CHS Annual Variable Pay Plan Document
Individual Performance Goals
As noted in the Performance Goal Weighting table above, Individual Performance Goals are weighted as 30% for both Corporate Function and Business Participant groups. The Participant’s manager determines the payout for the Individual Performance Goal component based on the Participant’s performance rating for the Performance Period and the individual payout guidelines.
Pay Basis & Incentive Target Percentage
Pay Basis and Target Percentage are factors used in the calculation of any Award under the Plan.
Pay Basis for any Performance Period is determined based on whether a Participant is salaried (exempt) or hourly (non-exempt) at the end of the Performance Period (August 31), or at the time the Participant exits the Plan.
•Salaried (exempt) Participant: Base pay at the end of the Performance Period (August 31), or at the time the Participant exits the plan, prorated by the number of days worked in an eligible status.
•Hourly (non-exempt) Participant: Actual eligible earnings during Plan eligibility, including base pay and overtime, during the Performance Period (September 1 through August 31).
oFor any eligible week in which a participant is on leave of absence, the pay basis will be the Participant’s hourly rate multiplied by standard weekly hours, unless actual eligible earnings for the week are greater.
Target Percentage is based on the employee’s pay grade at the end of the Performance Period (August 31), or at the time the Participant exits the plan. Target Percentages are not prorated based on movement between roles/pay grades during the Performance Period.
Award Proration
Any Award under the Plan will be prorated based on the following changes during the Performance Period:
•Movement between Participant Groups (i.e. Corporate Function, Business) on or before June 1 of the Performance Period.
•Movement into the Plan on or before June 1 of the Performance Period.
•Eligible status changes that occur during the Performance Period.
•The following table outlines status changes and how any Award under the Plan will be prorated when a change in status occurs during the Performance Period (reference Eligibility section for more information).
CHS Annual Variable Pay Plan Document
| Status Change* | Proration Rule – Days Included | ||||
| Full-time Leave of Absence | Days worked in an eligible status; and up to a total of 90 leave days within each Performance Period | ||||
| Intermittent Leave of Absence | Days worked in an eligible status; and duration of leave | ||||
| Temp/Seasonal to Eligible Status | Days worked in an eligible status; unless status is Temp/Seasonal at the end of the Performance Period | ||||
| Union to Eligible Status | Days worked in an eligible status, unless status is Union at the end of the Performance Period | ||||
| Layoff | Days worked in an eligible status; unless status is Layoff at the end of the Performance Period | ||||
| Deceased | Days worked in an eligible status | ||||
| Termination due to reduction in workforce (including location closures, position elimination and redundancy) | Days worked in an eligible status | ||||
| Retirement: Age 55 with 10 years of vesting service (defined as calendar year in which Participant worked at least 1000 hours), or age 65 with no tenure requirements | Days worked in an eligible status | ||||
| Separation and Return to Eligible Status | Days worked in an eligible status since rehire date | ||||
*Not all eligible status changes are included in the table above.
Award Payment
Any Award under the Plan, including for Participants who are no longer employed by the company after the end of the Performance Period and/or due to an eligible status change during the Performance Period, are determined, approved and issued as soon as administratively feasible following the Performance Period. No Award shall be deemed approved under the Plan until after Performance Period financial results are approved by the CHS Board of Directors.
A Participant’s potential for an Award under the Plan can be modified or terminated without Participant consent for any reason up until the CHS Board of Directors approve the Performance Period financial results. Once approved, any Award cannot be modified or terminated, except as is expressly provided in the Plan.
In all cases, any Award issued under the Plan shall be paid no later than December 31 following the applicable Performance Period. Any Award under the Plan is paid through the same process as the Participant’s paycheck. All payments are subject to appropriate withholdings.
Administration
The CEO, CFO and Chief Human Resource Officer (CHRO) administer the Plan (collectively the Plan Administrators). The Plan Administrators are authorized to jointly make all decisions as required in the administration of the Plan and may, in their sole discretion, define, interpret, construe, administer and apply Plan provisions, and make all eligibility determinations. Further, the Plan Administrators may jointly approve amendments to the Plan, provided however, that any such amendments are not a material modification or material amendment to the Plan. For the avoidance of doubt, any material modification or material amendment to the Plan, including with respect to the corporate level performance metrics or performance goals established for any current Performance Period, must be approved by the CHS Board of Directors. The CEO and CFO must approve any modification of the business level performance metrics or performance goals.
CHS Annual Variable Pay Plan Document
General Provisions
CHS reserves the right to change or cancel the Plan at any time. This Plan document does not intend to, nor does it operate to, create an employment contract or provide a guarantee of continued employment. 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 rights not expressly stated in the Plan.
Non-Recurring Events: Non-recurring business events that have a substantial impact on CHS financial results during the Performance Period, may be excluded (or included as appropriate) from the calculations for determining any Awards. Such events could include but are not limited to, major gains or losses from acquisitions (including planned short-term gains or losses), divestitures, lawsuits, significant business write-offs, business reorganizations, casualty losses or sale of assets. Any such exclusion must be approved by the CHS Board of Directors.
Recovery: Any Awards issued under the Plan shall be subject to recovery and any penalties pursuant to the Company’s Incentive Recovery Policy, Prohibiting Detrimental Conduct Policy and any other applicable company policy or successor policy, law, rule, 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), as each of the foregoing may be amended from time to time.
This Plan document applies to eligible U.S. and Canadian Participants. A separate plan document is customized for eligible international employees.
Approvals
Chief Human Resource Officer: _______________________________________
Chief Financial Officer: _______________________________________
Chief Executive Officer: _______________________________________
CHS Annual Variable Pay Plan Document
Exhibit 10.2
Purpose
Our purpose at CHS is to create connections to empower agriculture. The CHS Executive Long-Term Incentive Plan (the “Plan”), referred to as the CHS Long-Term Incentive Plan prior to September 1, 2021, is provided to eligible executives as defined herein (each a “Participant”) who can have influence on long-term business success.
The objectives of this Plan are to:
•Link a component of the Participants’ total compensation with long-term business performance
•Encourage Participants to generate competitive returns on our invested capital over the long term
•Maintain an overall competitive compensation structure for Participants
•Retain key executives
Performance Period
Each performance period for the Plan (“Performance Period”) is measured in three (3) fiscal year (currently September 1 through August 31) segments. A new three-year Performance Period begins each fiscal year on September 1. Therefore, three concurrent Performance Periods are in operation at any one time, as illustrated below.
Year One | Year Two | Year Three | Year Four | Year Five | ||||||||||
| Performance Period A | ||||||||||||||
| Performance Period B | ||||||||||||||
| Performance Period C | ||||||||||||||
The first fiscal year of each Performance Period is the “Grant Year”. The Participant’s Award Opportunity is determined at the end of the Grant Year for each Performance Period.
For purposes of this Plan, “Award” is defined as the amount that is awarded to a Participant for a Performance Period upon the CHS Board of Directors approving the Performance Period financial results and authorizing distribution of Awards to Participants following the end of a Performance Period.
Eligibility
Unless and to the extent the Plan Administrators determine otherwise, employees in the positions of Vice President, Senior Vice President, Executive Vice President, President, and Chief Executive Officer are eligible for the Plan.
Participants may forfeit their eligibility under the Plan or have their opportunity for any Award modified at the discretion of the Plan Administrators for one or more Performance Periods if the Plan Administrators determine in their sole discretion that the Participant is no longer eligible to be a Participant or as otherwise provided herein. With respect to any three-year Performance Period that has not yet been completed, a Participant has no right to continued eligibility under the Plan.
To be eligible for an Award for any Performance Period, Participants must be eligible pursuant to the terms of the Plan (i) on or before August 31 of the Grant Year (last day of year one of the three-year Performance Period), and (ii) on the date the Performance Period ends (as of August 31 of year three).
CHS Executive Long-Term Incentive Plan U.S. Plan Document 9/26
If a Participant’s employment ends prior to the last day of a Performance Period, the Participant will no longer be eligible for, and will not receive any Award under the Plan for the Performance Period, unless employment ends after the Grant Year due to retirement, death or permanent disability.
•New Participants
oA Participant must be an active and eligible Participant as of August 31 of the Grant Year (last day of year one of the three-year Performance Period) to be eligible for an Award under the Plan for that Performance Period.
oAny Award Opportunity for eligible new Participants is granted in full (not pro-rated) regardless of when the Participant becomes eligible during the Grant Year.
oA Participant who is promoted to an eligible position while participating in the CHS Long-Term Incentive Plan is considered a New Participant of this Plan.
oRetirement, Death, or Permanent Disability
oAfter the Grant Year is completed, a Participant is eligible for a full Award (not pro-rated) for that Performance Period in the event that, during the second or third year of the Performance Period, the Participant:
retires, which for purposes of this Plan is defined as separation from service for any reason other than a leave of absence, death, or permanent disability on or after the earlier of the attainment of (i) age sixty-five (65) or (ii) age fifty-five (55) with ten (10) years of vesting service (defined as calendar year in which Participant worked at least 1000 hours),
becomes deceased, or
is permanently disabled, which is defined as (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident or health plan covering employees of CHS.
oA Participant must be an active and eligible Participant at the end of the Grant Year to be eligible for any Award under the Plan for that Performance Period.
oAwards are determined and processed in the same manner and at the same time as for other Participants.
oFor the avoidance of doubt, if employment ends for any reason (including but not limited to retirement, death, or permanent disability) during the Grant Year of a given Performance Period, the Participant will not be eligible for and will not receive an Award for that Performance Period.
oLeave of Absence
oA Participant on paid and/or unpaid leave status for any reason for the entire Grant Year is not eligible for an Award for that Performance Period, except to the extent eligibility may be required by applicable law.
oAward eligibility is not generally impacted by other leave of absence so long as eligibility requirements under this Plan are otherwise met.
oParticipant transitioning to a role not eligible for ELTI
CHS Executive Long-Term Incentive Plan U.S. Plan Document 9/26
oA Participant is eligible to continue participating in any previously granted Award provided the Participant remains employed through the date the applicable Performance Period ends.
Forfeiture and Modification for Performance or Behavior
A Participant may forfeit eligibility under the Plan for any Performance Period or have their opportunity for an Award under the Plan modified at the discretion of the Plan Administrators, if it has been determined that the Participant has failed to meet job performance criteria and standards, which includes but is not limited to documented performance issues, or acts of misconduct, dishonesty or violation of CHS policies and procedures. Forfeiture of eligibility or modification of a Participant’s opportunity for an Award under the Plan must be approved by the Plan Administrators.
Performance Goals
The Plan has predetermined financial performance goals based on Return on Invested Capital (“ROIC”), which are defined in the Plan Appendix for each Performance Period.
The President and Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”) recommend to the CHS Board of Directors for approval, the Threshold, Target, Maximum and Superior performance goals for each three-year Performance Period pursuant to this Plan. The ROIC performance goals for each Performance Period are cumulative goals that are measured over the entire Performance Period.
The Target Performance Goal is the expected level of performance. Each of the other Performance Goal levels is associated with a multiplier, which is a percent of the Target Performance Goal level. When results fall between Performance Goal levels, the percent of Target to be used in the calculation is mathematically interpolated. The following table provides an example of Performance Goal Levels and the associated multipliers as a percent of Target.
Performance Goal Level | Level Definition | Percent of Target | ||||||
Superior | Highest level of Performance | 400% | ||||||
Maximum | Above Expected level of Performance | 200% | ||||||
Target | Expected level of Performance | 100% | ||||||
Threshold | Lowest level of Performance – Plan Trigger | 50% | ||||||
Performance Goal Trigger
As noted in the table above, Threshold Performance, as defined in the Plan Appendix, must be met to trigger any potential Award under the Plan for any Performance Period.
Award Opportunity
The calculation of each Participant’s Award Opportunity (“Award Opportunity”) for any Performance Period is determined at the end of the Grant Year based on:
oParticipant’s base salary as of August 31 of the Grant Year, also referred to as “Pay Basis.”
oTarget level award percentage, which varies by grade level, title and/or job. The Company can vary a Participant’s Target level award percentage at the sole discretion of the Plan Administrators.
oEach Participant’s Award Opportunity for any Performance Period is determined by multiplying Pay Basis by the Participant’s Target level award percentage as of August 31 of the Grant Year.
Award Payment
CHS Executive Long-Term Incentive Plan U.S. Plan Document 9/26
A Participant will receive an Award only pursuant to the terms of this Plan and only if the CHS Board of Directors approves providing Awards to Participants for any Performance Period that has ended.
Awards under the Plan, including for Participants who are no longer employed by the Company after the end of the Performance Period due to retirement, death, or permanent disability, are determined, approved, communicated, and paid as soon as administratively feasible following the Performance Period. No Award shall be deemed approved under the Plan until after Performance Period financial results are approved by the CHS Board of Directors.
Participant’s potential for an Award under the Plan can be modified or terminated without Participant consent for any reason up until the CHS Board of Directors approve the Performance Period financial results. Once approved, Awards cannot be modified or terminated, except as expressly provided in the Plan.
Participants may elect to defer all or a portion of an Award pursuant to the terms of the CHS Deferred Compensation Plan. Any Award under the ELTI Plan shall be issued no later than December 31 following the applicable Performance Period. Award payments are made through the same process as the Participant’s paycheck, and all payments are subject to appropriate withholdings. Participants may want to obtain personal tax advice related to any payment under the ELTI Plan.
Administration
The CEO, CFO and Chief Human Resource Officer (CHRO) administer the Plan (collectively the Plan Administrators). The Plan Administrators are authorized to jointly make all decisions as required in the administration of the Plan and may, in their sole discretion, define, interpret, construe, administer and apply Plan provisions, and make all eligibility determinations as previously described in the Plan. Further, the Plan Administrators may jointly approve amendments to the Plan, provided however, that any such amendments are not a material modification or material amendment to the Plan. For the avoidance of doubt, any material modification or material amendment to the Plan, including with respect to the performance metrics or performance goals established for any current Performance Period, must be approved by the CHS Board of Directors.
General Provisions
During any three-year Performance Period, CHS reserves the right to change or cancel the Plan at any time. This Plan document does not intend to, nor does it operate to, create an employment contract or provide a guarantee of continued employment. The CHS Executive Long-Term Incentive Plan – U.S. Plan Document does not give rise to any rights not expressly stated in the Plan.
Non-Recurring Events: Non-recurring business events that have a substantial impact on CHS financial results during the Performance Period, may be excluded (or included as appropriate) from the calculations for determining any Awards. Such events could include but are not limited to, major gains or losses from acquisitions (including planned short-term gains or losses), divestitures, lawsuits, significant business write-offs, business reorganizations, casualty losses or sale of assets. Any such exclusion must be approved by the CHS Board of Directors.
Recovery: Any Awards issued under the plan shall be subject to recovery and any penalties pursuant to the Company’s Incentive Recovery Policy , Prohibiting Detrimental Conduct Policy and any other applicable company policy or successor policy, law, rule, 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), as each of the foregoing may be amended from time to time.
This Plan document applies to eligible U.S. Participants. A separate plan document is customized for eligible international employees.
This document, effective September 1, 2026 supersedes the CHS Executive Long-Term Incentive Plan document effective September 1, 2024 and is only applicable to Performance Periods that begin on or after
CHS Executive Long-Term Incentive Plan U.S. Plan Document 9/26
September 1, 2026. Performance Periods that began prior to September 1, 2026 are administered according to the documents in effect as of those respective Performance Periods.
Approvals
Chief Human Resource Officer: _______________________________________
Chief Financial Officer: _______________________________________
Chief Executive Officer: _______________________________________
CHS Executive Long-Term Incentive Plan U.S. Plan Document 9/26
CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
Exhibit 10.3
CHS Inc.
Deferred Compensation Plan
Master Plan Document
(2026 Restatement)
Deferred Compensation Plan
Master Plan Document
(2026 Restatement)
First Adopted Effective December 30, 2004
As Amended and Restated Effective September 1, 2026
CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
TABLE OF CONTENTS
Page
ARTICLE 2 Enrollment and Eligibility 7
2.1 Eligibility
2.2 Enrollment and Additional Eligibility Requirements; Commencement of Participation
2.3 Termination of a Participant’s Eligibility
ARTICLE 3 Deferral Commitments/Company Contribution Amounts/Company Restoration Amounts/Vesting/Crediting/Taxes 8
3.1 Minimum Deferrals
3.2 Maximum Deferral
3.3 Election to Defer; Effect of Election Form
3.4 Withholding and Crediting of Annual Deferral Amounts
3.5 Company Contribution Amount
3.6 Company Restoration Amount
3.7 Director Retirement Plan Amount
3.8 Crediting of Amounts after Benefit Distribution
3.9 Vesting
3.10 Crediting/Debiting of Earnings/Losses
3.11 FICA and Other Taxes
ARTICLE 4 Scheduled Distribution; Unforeseeable Financial Emergencies; 14
4.1 Scheduled Distribution
4.2 Changing Scheduled Distributions
4.3 Certain Benefits Take Precedence Over Scheduled Distributions
4.4 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies
ARTICLE 5 Change In Control Benefit 16
5.1 Change in Control Benefit
5.2 Payment of Change in Control Benefit
ARTICLE 6 Retirement Benefit 17
6.1 Retirement Benefit
6.2 Payment of Retirement Benefit
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
ARTICLE 7 Termination Benefit 17
7.1 Termination Benefit
7.2 Payment of Termination Benefit
ARTICLE 8 Disability Benefit 18
8.1 Disability Benefit
8.2 Payment of Disability Benefit
ARTICLE 9 Death Benefit 18
9.1 Death Benefit
9.2 Payment of Death Benefit
ARTICLE 10 Director Retirement Plan Benefit 19
10.1 Director Retirement Plan Benefit
10.2 Payment of Director Retirement Plan Benefit
10.3 Benefit Distribution Date
10.4 Effect of Change in Control
ARTICLE 11 Beneficiary Designation 19
11.1 Beneficiary
11.2 Beneficiary Designation; Change; Spousal Consent
11.3 Acknowledgement
11.4 No Beneficiary Designation
11.5 Doubt as to Beneficiary
11.6 Discharge of Obligations
ARTICLE 12 Leave of Absence 20
12.1 Paid Leave of Absence
12.2 Unpaid Leave of Absence
ARTICLE 13 Termination of Plan, Amendment or Modification 21
13.1 Termination of Plan
13.2 Amendment
13.3 Effect of Payment
ARTICLE 14 Administration 22
14.1 Committee Duties
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
14.2 Administration Upon Change In Control
14.3 Binding Effect of Decisions
14.4 Indemnity of Committee
14.5 Employer Information
ARTICLE 15 Other Benefits and Agreements 23
15.1 Coordination with Other Benefits
15.2 Clawback or Recoupment
ARTICLE 16 Claims Procedures 23
16.1 Presentation of Claim
16.2 Notification of Decision
16.3 Review of a Denied Claim
16.4 Decision on Review
16.5 Legal Action
16.6 Determinations
ARTICLE 17 Trust 25
17.1 Establishment of the Trust
17.2 Interrelationship of the Plan and the Trust
17.3 Distributions From the Trust
ARTICLE 18 Miscellaneous 26
18.1 Status of Plan
18.2 Unsecured General Creditor
18.3 Employer’s Liability
18.4 Nonassignability
18.5 Not a Contract of Employment
18.6 Furnishing Information
18.7 Terms
18.8 Captions
18.9 Governing Law
18.10 Notice
18.11 Successors
18.12 Spouse’s Interest
18.13 Validity
18.14 Incompetent
18.15 Insurance
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
APPENDIX A — Share Option Plan Accounts A-1
APPENDIX B — Supplemental Savings Plan Accounts B-1
APPENDIX C — Supplemental Executive Retirement Plan Savings Accounts C-1
APPENDIX D — Agriliance LLC Deferred Compensation Plan Accounts D-1
APPENDIX E — Cofina Deferred Compensation Plan Accounts E-1
APPENDIX F — CMS McPherson Refinery Inc. (formerly National Cooperative
Refinery Association) Deferred Compensation Plan Accounts F-1
Refinery Association) Deferred Compensation Plan Accounts F-1
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
Adopted Effective December 30, 2004
Purpose
The purpose of this Plan is to provide specified benefits to Directors and a select group of management or highly compensated Employees who contribute materially to the continued growth, development and future business success of CHS Inc., a Minnesota corporation, and its subsidiaries, if any, that sponsor this Plan. This Plan shall be unfunded for tax purposes and for purposes of Title I of ERISA.
ARTICLE 1
Definitions
Definitions
For the purposes of this Plan, unless otherwise clearly apparent from the context, the following phrases or terms shall have the following indicated meanings:
1.1“Account Balance” shall mean, with respect to a Participant, an entry on the records of the Employer equal to the sum of (i) the Deferral Account balance, (ii) the Company Contribution Account balance, (iii) the Company Restoration Account balance, and (iv) the SOP Account balance, if any, transferred to this Plan in accordance with Appendix A. For purposes of this Section 1.1 and Article 10 only, the term “Account Balance” also includes the Director Retirement Plan Account balance of any Company Director. The Account Balance shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or his or her designated Beneficiary, pursuant to this Plan.
1.2“Annual Deferral Amount” shall mean that portion of a Participant’s Base Salary, Bonus and Director Compensation that a Participant defers in accordance with Article 3 for any one Plan Year, without regard to whether such amounts are withheld and credited during such Plan Year. In the event of a Participant’s Retirement, Disability, death or Separation from Service prior to the end of a Plan Year, such year’s Annual Deferral Amount shall be the actual amount withheld prior to such event.
1.3“Annual Director Retirement Plan Amount” shall mean the amount credited to the Director Retirement Plan Account of a non-employee Company Director for performance periods beginning prior to September 1, 2024, in accordance with Section 3.7.
1.4“Annual Installment Method” shall be an annual installment payment over the number of years selected by the Participant in accordance with this Plan, calculated as follows: (i) for the first annual installment, the Participant’s vested Account Balance shall be calculated as of the close of business on or around the Participant’s Benefit Distribution Date, as determined by the Committee in its sole discretion, and (ii) for remaining annual installments, the Participant’s vested Account Balance shall be calculated on every anniversary of such calculation date, as
-1-
CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
applicable. Each annual installment shall be calculated by multiplying this balance by a fraction, the numerator of which is one and the denominator of which is the remaining number of annual payments due the Participant. By way of example, if the Participant elects a ten (10) year Annual Installment Method for the Retirement Benefit, the first payment shall be 1/10 of the vested Account Balance, calculated as described in this definition. The following year, the payment shall be 1/9 of the vested Account Balance, calculated as described in this definition.
1.5“Base Salary” shall mean the annual cash compensation relating to services performed during any calendar year, excluding distributions from nonqualified deferred compensation plans, bonuses, commissions, overtime, fringe benefits, profit sharing contributions, stock options, relocation expenses, incentive payments, non-monetary awards, director fees and other fees, and automobile and other allowances paid to a Participant for employment services rendered (whether or not such allowances are included in the Employee’s gross income). Base Salary shall be calculated before reduction for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or nonqualified plans of any Employer and shall be calculated to include amounts not otherwise included in the Participant’s gross income under Code Section 125, 402(e)(3), 402(h), or 403(b) pursuant to plans established by any Employer; provided, however, that all such amounts will be included in compensation only to the extent that had there been no such plan, the amount would have been payable in cash to the Employee. In no event shall Base Salary include any amounts payable to the Participant prior to the commencement of his or her participation in this Plan.
1.6“Beneficiary” shall mean one or more persons, trusts, estates or other entities, designated in accordance with Article 10, that are entitled to receive benefits under this Plan upon the death of a Participant.
1.7“Beneficiary Designation Form” shall mean the form (which is anticipated to be in electronic format) established from time to time by the Committee (or its delegate) that a Participant completes (via any applicable on-line portal established by the Plan’s third-party administrator) to designate one or more Beneficiaries.
1.8“Benefit Distribution Date” shall mean the date that triggers distribution of a Participant’s vested Account Balance. A Participant’s Benefit Distribution Date shall be determined upon the occurrence of any one of the following:
(a)If the Participant Retires, his or her Benefit Distribution Date shall be the first business day of the calendar month that immediately follows the six-month anniversary of the date on which the Participant Retires; provided, however, in the event the Participant changes his or her Retirement Benefit election in accordance with Section 6.2(a), his or her Benefit Distribution Date shall be postponed in accordance with such Section 6.2(a); or
(b)If the Participant experiences a Separation from Service, his or her Benefit Distribution Date shall be the first business day of the calendar month that immediately follows the six-month anniversary of the date on which the Participant experiences a Separation from Service; or
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(c)The date on which the Committee is provided with proof that is satisfactory to the Committee of the Participant’s death, if the Participant dies prior to the complete distribution of his or her vested Account Balance; or
(d)The date on which the Committee determines the Participant is Disabled; or
(e)The date on which the Affected Corporation (as defined in Section 1.11) experiences a Change in Control, as determined by the Committee in its sole discretion, if (i) the Participant has elected to receive a Change in Control Benefit, as set forth in Section 1.12 below, and (ii) if a Change in Control occurs prior to the Participant’s Separation from Service, Retirement, death or Disability.
1.9“Board” shall mean the board of directors of the Company.
1.10“Bonus” shall mean any compensation, in addition to Base Salary, earned by a Participant for services rendered during a Plan Year as further specified on an Election Form approved by the Committee in its sole discretion, under any Employer’s annual bonus and cash incentive plans (and long term incentive plans). As of the approval of this restated Plan document (and until the Committee determines otherwise), Bonus compensation consists of compensation payable under the Company’s Annual Variable Pay (AVP) and Executive Long-Term Incentive (ELTI) Plans. For avoidance of doubt, performance-based compensation payable to Directors is included in Director Compensation rather than the definition of Bonus compensation.
1.11“Change in Control” shall mean the occurrence of a “change in the ownership,” “change in effective control,” and/or a “change in the ownership of a substantial portion of the assets,” as defined under Treasury Regulation § 1.409A-3(i)(5), of the Affected Corporation. For this purpose, the Affected Corporation is the Participant’s Employer, or any corporation (including the Company) in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending with the Participant’s Employer. A “majority shareholder” is a shareholder owning more than 50 percent of the total fair market value and total voting power of such corporation.
1.12“Change in Control Benefit” shall have the meaning set forth in Article 5.
1.13“Charter” shall mean the CHS Inc. Retirement Plan Committee Charter.
1.14“Claimant” shall have the meaning set forth in Section 16.1.
1.15“Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time.
1.16“Committee” shall mean the CHS Inc. Retirement Plan Committee.
1.17“Company” shall mean CHS Inc., a Minnesota corporation, and any successor to all or substantially all of the Company’s assets or business.
1.18“Company Contribution Account” shall mean (i) the sum of the Participant’s Company Contribution Amounts, plus (ii) amounts credited or debited to the Participant’s Company Contribution Account in accordance with this Plan, less (iii) all distributions made to the
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Participant or his or her Beneficiary pursuant to this Plan that relate to the Participant’s Company Contribution Account.
1.19“Company Contribution Amount” shall mean, for any one Plan Year, the amount determined in accordance with Section 3.5.
1.20“Company Restoration Account” shall mean (i) the sum of all of a Participant’s Company Restoration Amounts, plus (ii) amounts credited or debited to the Participant’s Company Restoration Account in accordance with this Plan, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participant’s Company Restoration Account.
1.21“Company Restoration Amount” shall mean, for any one Plan Year, the amount determined in accordance with Section 3.6.
1.22“Death Benefit” shall mean the benefit set forth in Article 9.
1.23“Deferral Account” shall mean (i) the sum of all of a Participant’s Annual Deferral Amounts, plus (ii) amounts credited or debited to the Participant’s Deferral Account in accordance with this Plan, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account.
1.24“Director” shall mean any non-employee member of the board of directors of any Employer.
1.25“Director Compensation” shall mean the annual compensation earned by a Director from any Employer for serving on the board of directors, including retainer fees, meetings fees and any performance-based compensation.
1.26“Director Retirement Plan” shall mean the deferred compensation plan covering non-employee Directors of the Company, to which Annual Director Retirement Plan Amounts were credited for performance periods beginning prior to September 1, 2024, as described in Section 3.7. The Director Retirement Plan Accounts shall be paid in the manner described in Article 10. For avoidance of doubt, a Director’s voluntary deferrals of Director Compensation are not part of the Director Retirement Plan.
1.27“Director Retirement Plan Account” shall mean (i) the sum of a Participant’s Annual Director Retirement Plan Amounts, plus (ii) amounts credited or debited to the Participant’s Director Retirement Plan Account in accordance with this Plan, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to his or her Director Retirement Plan Account.
1.28“Director Retirement Plan Benefit” shall mean the benefit set forth in Article 10.
1.29“Disability” or “Disabled” shall mean that a Participant is (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not
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less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident or health plan covering employees of the Participant’s Employer.
1.30“Disability Benefit” shall mean the benefit set forth in Article 8.
1.31“Election Form” shall mean the form (which is anticipated to be in electronic format) established from time to time by the Committee (or its delegate) that a Participant completes (via any applicable on-line portal established by the Plan’s third-party administrator) to make an election under the Plan.
1.32“Employee” shall mean a person who is an employee of any Employer.
1.33“Employer(s)” shall mean the Company and/or any of its subsidiaries (now in existence or hereafter formed or acquired) that have been selected by the Committee to participate in the Plan and have adopted the Plan as a sponsor.
1.34“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to time.
1.35“401(k) Plan” shall mean, with respect to an Employer, a plan qualified under Code Section 401(a) that contains a cash or deferral arrangement described in Code Section 401(k), adopted by the Employer, as it may be amended from time to time, or any successor thereto.
1.36“Participant” shall mean any Director or any Employee with a grade of Vice President (“VP”), Senior Vice President (“SVP”), Executive Vice President (“EVP”) or Chief Executive Officer (“CEO”), as well as any employee selected for participation by the Chief Executive Officer, who submits an executed Election Form and Beneficiary Designation Form, which are accepted by the Committee.
1.37“Plan” shall mean the CHS Inc. Deferred Compensation Plan, which shall be evidenced by this instrument, as may be amended from time to time.
1.38“Plan Year” shall mean a period beginning on January 1 of each calendar year and continuing through December 31 of such calendar year. The first Plan Year for which the Plan shall be in effect shall commence on January 1, 2005.
1.39“Retirement”, “Retire(s)” or “Retired” shall mean, with respect to an Employee, Separation from Service from all Employers for any reason other than a leave of absence, death or Disability on or after the earlier of the attainment of (a) age sixty-five (65) or (b) age fifty-five (55) with ten (10) Years of Service; and shall mean with respect to a Director who is not an Employee, Separation from Service as a Director with all Employers on or after the attainment of age sixty (60).
1.40“Retirement Benefit” shall mean the benefit set forth in Article 6.
1.41“Scheduled Distribution” shall mean the distribution set forth in Section 4.1.
1.42“Terminate the Plan”, “Termination of the Plan” shall mean a determination by an Employer’s board of directors that (i) all of its Participants shall no longer be eligible to participate in the
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Plan, (ii) all deferral elections for such Participants shall terminate, and (iii) such Participants shall no longer be eligible to receive company contributions under this Plan.
1.43“Termination Benefit” shall mean the benefit set forth in Article 7.
1.44“Separation from Service” shall mean the separation from service (within the meaning of Treas. Regs. § 1.409A-1(h)) with the Company Controlled Group, voluntarily or involuntarily, for any reason other than Retirement, Disability or death. Whether a separation from service has occurred is determined under Code Section 409A and Treasury Regulation 1.409A-1(h) (i.e., whether the facts and circumstances indicate that the Employer and the employee reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the employee would perform after such date (whether as an employee or independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding thirty-six (36) month period (or the full period of services to the employer if the employee has been providing services to the employer less than thirty-six (36) months)). Separation from service shall not be deemed to occur while the employee is on military leave, sick leave or other bona fide leave of absence if the period does not exceed six (6) months or, if longer, so long as the employee retains a right to reemployment with any member of the Company Controlled Group under an applicable statute or by contract. For this purpose, a leave is bona fide only if, and so long as, there is a reasonable expectation that the employee will return to perform services for any member of the Company Controlled Group. Notwithstanding the foregoing, a twenty-nine (29) month period of absence will be substituted for such six (6) month period if the leave is due to any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of no less than six (6) months and that causes the employee to be unable to perform the duties of his or her position of employment. For this purpose, the “Company Controlled Group” is the Participant’s Employer and all persons with whom the Employer would be considered a single employer under Code sections 414(b) and 414(c); provided that, in applying Code sections 1563(a)(1), (2) and (3) for purposes of determining a controlled group of corporations under Code section 414(b), the language “at least 50 percent” shall be used instead of “at least 80 percent” each place it appears therein, and in applying Treas. Regs. § 1.414(c)-2 for purposes of determining trades or businesses that are under common control for purposes of Code section 414(c), “at least 50 percent” shall be used instead of “at least 80 percent” each place it appears therein. For purposes of this Plan, a “Separation from Service” shall mean a complete severance of a Director’s relationship as a director of the Employer and all affiliates within the Company Controlled Group, if any, and as an independent contractor of the Employer and all affiliates within the Company Controlled Group, if any, for any reason (including death). A Director may have a Separation from Service upon resignation as a director even if the Director then becomes an officer or employee.
1.45“Trust” shall mean one or more trusts established by the Company in accordance with Article 16.
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1.46“Unforeseeable Financial Emergency” shall mean an unanticipated emergency that is caused by an event beyond the control of the Participant that would result in severe financial hardship to the Participant resulting from (i) a sudden and unexpected illness or accident of the Participant, the Participant’s spouse, or a dependent of the Participant, (ii) a loss of the Participant’s property due to casualty, or (iii) such other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, all as determined in the sole discretion of the Committee.
1.47“Years of Service” shall mean an Employee’s period of service with CHS Inc., a participating Employer or a related employer measured in full years. A Participant shall receive credit for one full year of “Service” for each Plan Year in which the Participant had at least 1,000 hours of service for CHS Inc., a participating Employer or related employer. For purposes of this section, a “related employer” means the member services department of Land O’Lakes, Inc. and any trade or business that is part of a parent-subsidiary controlled group with CHS Inc. as determined under Code Sections 1563(a)(1) and 414(c), except that “at least 25 percent” voting control and ownership shall be used instead of “at least 80 percent” for purposes of establishing a controlled group.
ARTICLE 2
Eligibility and Enrollment
Eligibility and Enrollment
2.1Eligibility. Participation in the Plan shall be limited to Directors and a select group of management or highly compensated Employees. Employees with a grade of VP, SVP, EVP, or CEO are eligible to participate in this Plan, as is any employee selected for participation by the Chief Executive Officer, so long as such employee is still part of a select group of highly compensated or management employees (“Eligible Employee”).
2.2Enrollment and Additional Eligibility Requirements; Commencement of Participation.
(a)As a condition to participation, each Director or Eligible Employee who is eligible to participate in the Plan effective as of the first day of a Plan Year shall complete, execute and return to the Committee an Election Form and a Beneficiary Designation Form, prior to the first day of such Plan Year, or such other earlier deadline as may be established by the Committee in its sole discretion. In addition, the Committee shall establish from time to time such other enrollment requirements as it determines, in its sole discretion, are necessary.
(b)If the Committee so allows, a Director or Eligible Employee who first becomes eligible to participate in this Plan (and all other deferred compensation plans required to be aggregated with the Plan under Code Section 409A) after the first day of a Plan Year may be permitted to complete these requirements within thirty (30) days after he or she first becomes eligible to participate in the Plan, or within such other earlier deadline as may be established by the Committee, in its sole discretion, in order to participate for that Plan Year. In such event, such person’s participation in this Plan shall not commence earlier
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than the date determined by the Committee pursuant to Section 2.2(c) and such person shall not be permitted to defer under this Plan any portion of his or her Base Salary, Bonus and/or Director Compensation that are paid with respect to services performed prior to his or her participation commencement date, except as permitted by Section 3.3(c). Notwithstanding the foregoing, the Committee may, in its sole discretion, prohibit a deferral or specify an automatic time and form of payment if it determines that, based on the timing of a Participant’s entry into the Plan during a given deferral period, a voluntary deferral election of that Bonus would be administratively burdensome or impractical.
(c)Each Director or Eligible Employee who is eligible to participate in the Plan shall commence participation in the Plan on the date that the Committee determines, in its sole discretion, that the Director or Employee has met all enrollment requirements set forth in this Plan and required by the Committee, including returning all required documents to the Committee within the specified time period. However, unless and until the Committee determines otherwise, no Director or Eligible Employee shall become eligible to participate in this Plan after the first day of a Plan Year.
(d)If a Director or an Employee fails to meet all requirements contained in this Section 2.2 within the period required, that Director or Employee shall not be eligible to participate in the Plan during such Plan Year.
2.3Termination of a Participant’s Eligibility. The Committee shall have the right, in its sole discretion, to (i) terminate any deferral election the Participant has made for the remainder of the Plan Year in which the Committee makes such determination, (ii) prevent the Participant from making future deferral elections, and/or (iii) take further action that the Committee deems appropriate to the extent permitted under Code Section 409A. Notwithstanding the foregoing, in the event of a Termination of the Plan in accordance with Section 1.42, the termination of the affected Participants’ eligibility for participation in the Plan shall not be governed by this Section 2.3, but rather shall be governed by Section 1.42 and Section 13.1. In the event that a Participant is no longer eligible to defer compensation under this Plan, the Participant’s Account Balance shall continue to be governed by the terms of this Plan until such time as the Participant’s Account Balance is paid in accordance with the terms of this Plan.
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ARTICLE 3
Deferral Commitments/Company Contribution Amounts/
Deferral Commitments/Company Contribution Amounts/
Company Restoration Amounts/Vesting/Crediting/Taxes
3.1Minimum Deferrals.
(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual Deferral Amount, Base Salary, Bonus and/or Director Compensation in the following minimum amounts for each deferral elected:
Deferral | Minimum Amount | ||||
Base Salary and/or Bonus | $0 | ||||
Director Compensation | $0 | ||||
3.2Maximum Deferral.
(a)Annual Deferral Amount. For each Plan Year, a Participant may elect to defer, as his or her Annual Deferral Amount, Base Salary, Bonus and/or Director Compensation up to the following maximum percentages for each deferral elected:
Deferral | Maximum Percentage | ||||
Base Salary | 80% | ||||
Bonus | 80% | ||||
Director Compensation | 100% | ||||
(b)Short Plan Year. Notwithstanding the foregoing, if a Participant first becomes a Participant after the first day of a Plan Year, the maximum Annual Deferral Amount shall be limited to the amount of compensation not yet earned by the Participant as of the date the Participant submits an Election Form to the Committee for acceptance.
3.3Election to Defer; Effect of Election Form.
(a)First Plan Year. In connection with a Participant’s commencement of participation in the Plan, the Participant shall make an irrevocable deferral election for the Plan Year in which the Participant commences participation in the Plan, along with such other elections as the Committee deems necessary or desirable under the Plan. For these elections to be valid, the Election Form must be completed and signed by the Participant, timely delivered to the Committee (in accordance with Section 2.2 above) and accepted by the Committee.
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(b)Subsequent Plan Years. For each succeeding Plan Year, an irrevocable deferral election for that Plan Year, and such other elections as the Committee deems necessary or desirable under the Plan, shall be made by timely delivering a new Election Form to the Committee, in accordance with its rules and procedures, before the end of the Plan Year preceding the Plan Year for which the election is made. If no such Election Form is timely delivered for a Plan Year, the Annual Deferral Amount shall be zero for that Plan Year.
(c)Performance-Based Compensation. Notwithstanding the foregoing, the Committee may, in its sole discretion, determine that an irrevocable deferral election pertaining to Director Compensation or Bonuses that qualify as performance-based compensation may be made by timely delivering a new Election Form to the Committee, in accordance with its rules and procedures, no later than six (6) months before the end of the performance service period, provided such compensation is not yet readily ascertainable. “Performance based compensation” shall be compensation based on services performed over a period of at least twelve (12) months, in accordance with Code Section 409A and related guidance.
(d)Mandatory Deferrals. In accordance with Section 3.5 below, eligible compensation shall be automatically credited to a Company Contribution Account under this Plan to the extent required by the Committee or a governing bonus plan, long-term incentive plan or other agreement under which the compensation was earned or awarded. With respect to any amounts that are automatically credited to this Plan, the Committee may specify an automatic time and form of payment in lieu of permitting a voluntary election as to time and form of payment.
(e)Rehired Participants. An Employee who previously participated in the Plan, ceased to be eligible to defer amounts under the Plan and was paid all deferred amounts under the Plan before again becoming eligible to participate shall be treated as a newly eligible Employee under (a) above. An Employee who previously participated in the Plan, ceased to be eligible to defer amounts under the Plan for twenty-four (24) months or longer before again becoming eligible to participate shall be treated as a newly eligible Employee under (a) above, regardless of whether all amounts deferred under the Plan have been paid to the Employee. A rehired Employee who is treated as a newly eligible Employee shall complete such forms as required under Section 2.2 with respect to future deferrals made after re enrollment. With respect to any unpaid amounts deferred prior to re enrollment, the Employee’s prior elections shall continue to apply, and any payments scheduled to be made following the Employee’s Separation from Service that occurred before re hire shall be made as scheduled.
3.4Withholding and Crediting of Annual Deferral Amounts. For each Plan Year, the Base Salary portion of the Annual Deferral Amount shall be withheld from each regularly scheduled Base Salary payroll in equal amounts, as adjusted from time to time for increases and decreases in Base Salary. The Bonus and/or Director Compensation portion of the Annual Deferral
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Amount shall be withheld at the time the Bonus or Director Compensation is or otherwise would be paid to the Participant, whether or not this occurs during the Plan Year itself. Annual Deferral Amounts shall be credited to a Participant’s Deferral Account as soon as reasonably practicable following the time such amounts would otherwise have been paid to the Participant. For example, an Annual Deferral Amount consisting of ELTI (a type of Bonus) shall be credited to the Plan at the time the ELTI would have been paid (generally, in the November following the ELTI performance period that ended on the immediately preceding August 31). Mandatory deferral amounts shall be credited at such times as determined by the Committee or the governing bonus plan, long-term incentive plan or other agreement under which the mandatory deferral is made.
3.5Company Contribution Amount.
(a)For each Plan Year, an Employer may be required to credit amounts to a Participant’s Company Contribution Account in accordance with other plans, employment agreements or other agreements entered into between the Participant and the Employer. Such amounts shall be credited on the date or dates prescribed by such plans or agreements. For avoidance of doubt, a Participant’s voluntary deferrals are not part of the Company Contribution Accounts. By way of illustration, if the Company’s Executive Long-Term Incentive Plan (ELTI) provides for mandatory deferrals of all or a portion of an ELTI award into this Plan, such mandatory deferral would be credited to a Company Contribution Account, but any voluntary deferrals of ELTI would credited to a Deferral Account.
(b)For each Plan Year, an Employer, in its sole discretion, may, but is not required to, credit any amount it desires to any Participant’s Company Contribution Account under this Plan, which amount shall be for that Participant the Company Contribution Amount for that Plan Year and shall include any amounts credited in accordance with Section 3.5(a) above. The amount so credited to a Participant may be smaller or larger than the amount credited to any other Participant, and the amount credited to any Participant for a Plan Year may be zero, even though one or more other Participants receive a Company Contribution Amount for that Plan Year. The Company Contribution Amount described in this Section 3.5(b), if any, shall be credited on a date or dates to be determined by the Committee, in its sole discretion.
(c)Notwithstanding any provision in this Plan to the contrary, Company Contribution Amounts may, as applicable, be distributed at the time or times determined under the relevant terms of the Company’s plan, agreement or other arrangement under which such amounts were contributed to this Plan.
3.6Company Restoration Amount. A Participant’s Company Restoration Amount for any Plan Year shall be an amount determined by the Committee, in its sole discretion, to make up for certain limits applicable to the 401(k) Plan or other qualified plan for such Plan Year, as identified by the Committee, or for such other purposes as determined by the Committee in its
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sole discretion. The amount so credited to a Participant under this Plan for any Plan Year (i) may be smaller or larger than the amount credited to any other Participant, and (ii) may differ from the amount credited to such Participant in the preceding Plan Year. The Participant’s Company Restoration Amount, if any, shall be credited on a date or dates to be determined by the Committee, in its sole discretion.
3.7Director Retirement Plan Amount. Effective for performance periods beginning on or after September 1, 2024, no Annual Director Retirement Plan Amounts will be credited to the Director Retirement Plan. Annual Director Retirement Plan Amounts credited prior to such time shall be administered in accordance in accordance with Article 10.
3.8Crediting of Amounts after Benefit Distribution. Notwithstanding any provision in this Plan to the contrary, should the commencement of a Participant’s vested Account Balance occur prior to the date on which any portion of (i) the Annual Deferral Amount that a Participant has elected to defer in accordance with Section 3.3, (ii) the Company Contribution Amount, or (iii) the Company Restoration Amount, would otherwise be credited to the Participant’s Account Balance, such amounts shall be credited to the Participant’s Account Balance in accordance with the deferral election and shall be paid to the Participant in accordance with the terms of the Plan (and the Participant’s payment election, as applicable). Notwithstanding the foregoing, should the complete distribution of a Participant’s vested Deferral Account, Company Contribution Account or Company Restoration Account, as the case may be, occur prior to when the aforementioned amounts would otherwise be credited to the corresponding account, such amounts shall be paid to the Participant in cash.
3.9Vesting.
(a)A Participant shall at all times be 100% vested in his or her Deferral Account. A Company Director Participant shall at all times be 100% vested in his or her Director Retirement Plan Account.
(b)A Participant shall be vested in his or her Company Contribution Account in accordance with the vesting schedule(s) set forth in the corresponding plan or agreement, as applicable, or as declared by the Committee in its sole discretion. If not addressed in such plans or agreements or declared by the Committee, the Company Contribution Amount, plus amounts credited and debited on such amount, shall be 100% vested.
(c)A Participant shall be vested in his or her Company Restoration Account only to the extent that the Participant would be vested in such amounts under the provisions of the 401(k) Plan, as determined by the Committee in its sole discretion.
(d)Notwithstanding anything to the contrary contained in this Section 3.9, in the event that, while a Participant is employed by an Employer or in the service of the Company as a Director, a Change in Control occurs (whether or not Article 5 has been implemented) or the Participant Retires, dies or becomes Disabled, the Participant’s Company
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Contribution Account and Company Restoration Account shall immediately become 100% vested (if it is not already vested in accordance with the above vesting schedules).
(e)Notwithstanding subsection 3.9(d) above, the vesting schedule for a Participant’s Company Contribution Account and Company Restoration Account shall not be accelerated upon a Change in Control to the extent that the Committee determines that such acceleration would cause the deduction limitations of Section 280G of the Code to become effective. In the event that all of a Participant’s Company Contribution Account and/or Company Restoration Account is not vested pursuant to such a determination, the Participant may request independent verification of the Committee’s calculations with respect to the application of Section 280G. In such case, the Committee must provide to the Participant within ninety (90) days of such a request an opinion from a nationally recognized accounting firm selected by the Participant (the “Accounting Firm”). The opinion shall state the Accounting Firm’s opinion that any limitation in the vested percentage hereunder is necessary to avoid the limits of Section 280G and contain supporting calculations. The cost of such opinion shall be paid for by the Company.
(f)Section 3.9(e) shall not prevent the acceleration of the vesting schedule applicable to a Participant’s Company Contribution Account and/or Company Restoration Account if such Participant is entitled to a “gross-up” payment, to eliminate the effect of the Code section 4999 excise tax, pursuant to his or her employment agreement or other agreement entered into between such Participant and the Employer.
3.10Crediting/Debiting of Earnings/Losses. In accordance with, and subject to, the rules and procedures that are established from time to time by the Committee, in its sole discretion, amounts shall be credited or debited to a Participant’s Account Balance in accordance with the following rules. For purposes of this Section 3.10, the term “Account Balance” includes the Director Retirement Plan Account balance of any Company Director.
(a)Measurement Funds. The Participant may elect one or more of the measurement funds selected by the Committee, in its sole discretion, which are based on investment options including, but not limited to, fixed interest credits, notional mutual fund(s) or an investment index (the “Measurement Funds”), for the purpose of crediting or debiting additional amounts to his or her Account Balance. As necessary, the Committee may, in its sole discretion, discontinue, substitute or add a Measurement Fund and such changes will take effect as soon as practicable.
(b)Election of Measurement Funds. A Participant, in connection with his or her initial deferral election in accordance with Section 3.3(a) above (or as a result of a Company Director’s automatic participation in accordance with Section 3.7 above), shall elect, on the Election Form, one or more Measurement Fund(s) (as described in Section 3.10(a) above) to be used to determine the amounts to be credited or debited to his or her Account Balance. If a Participant does not elect any of the Measurement Funds as described in the previous sentence, the Participant’s Account Balance shall automatically
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be allocated into such default Measurement Fund as determined by the Committee from time to time, in its sole discretion. The Participant may (but is not required to) elect, by submitting an Election Form to the Committee that is accepted by the Committee, to add or delete one or more Measurement Fund(s) to be used to determine the amounts to be credited or debited to his or her Account Balance, or to change the portion of his or her Account Balance allocated to each previously or newly elected Measurement Fund. If an election is made in accordance with the previous sentence, it shall apply as of the first business day deemed reasonably practicable by the Committee, in its sole discretion, and shall continue thereafter for each subsequent day in which the Participant participates in the Plan, unless changed in accordance with the previous sentence.
(c)Proportionate Allocation. In making any election described in Section 3.10(a) above, the Participant shall specify on the Election Form, in increments of one percent (1%), the percentage of his or her Account Balance or Measurement Fund, as applicable, to be allocated/reallocated.
(d)Crediting or Debiting Method. The performance of each Measurement Fund (either positive or negative) will be determined on a daily basis based on the manner in which such Participant’s Account Balance has been hypothetically allocated among the Measurement Funds by the Participant.
(e)No Actual Investment. Notwithstanding any other provision of this Plan that may be interpreted to the contrary, the Measurement Funds are to be used for measurement purposes only, and a Participant’s election of any such Measurement Fund, the allocation of his or her Account Balance thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balance shall not be considered or construed in any manner as an actual investment of his or her Account Balance in any such Measurement Fund. In the event that the Company or the Trustee (as that term is defined in the Trust), in its own discretion, decides to invest funds in any or all of the investments on which the Measurement Funds are based, no Participant shall have any rights in or to such investments themselves. Without limiting the foregoing, a Participant’s Account Balance shall at all times be a bookkeeping entry only and shall not represent any investment made on his or her behalf by the Company or the Trust; the Participant shall at all times remain an unsecured creditor of the Company.
3.11FICA and Other Taxes.
(a)Annual Deferral Amounts. For each Plan Year in which an Annual Deferral Amount is being withheld from a Participant, the Participant’s Employer(s) shall withhold from that portion of the Participant’s Base Salary and/or Bonus that is not being deferred, in a manner determined by the Employer(s), the Participant’s share of FICA and other employment taxes on such Annual Deferral Amount. If necessary, the Committee may reduce the Annual Deferral Amount in order to comply with this Section 3.11.
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(b)Company Restoration Account and Company Contribution Account. When a Participant becomes vested in a portion of his or her Company Restoration Account and/or Company Contribution Account, the Participant’s Employer(s) shall withhold from that portion of the Participant’s Base Salary and/or Bonus that is not deferred, in a manner determined by the Employer(s), the Participant’s share of FICA and other employment taxes on such Company Restoration Amount and/or Company Contribution Amount. If necessary, the Committee may reduce the vested portion of the Participant’s Company Restoration Account or Company Contribution Account, as applicable, in order to comply with this Section 3.11.
(c)Distributions. The Participant’s Employer(s), or the trustee of the Trust, shall withhold from any payments made to a Participant under this Plan all federal, state and local income, employment and other taxes required to be withheld by the Employer(s), or the trustee of the Trust, in connection with such payments, in amounts and in a manner to be determined in the sole discretion of the Employer(s) and the trustee of the Trust.
ARTICLE 4
Scheduled Distribution; Unforeseeable Financial Emergencies
Scheduled Distribution; Unforeseeable Financial Emergencies
4.1Scheduled Distribution. In connection with each election to defer an Annual Deferral Amount, a Participant may irrevocably elect to receive a Scheduled Distribution with respect to all or a portion of the Annual Deferral Amount, in the form of a lump sum payment or pursuant to an Annual Installment Method of up to ten (10) years. The Annual Deferral Amount (or portion thereof) subject to the election shall be credited or debited for earnings, gains or losses in the manner provided in Section 3.10 above. Subject to the other terms and conditions of this Plan, each Scheduled Distribution elected shall be paid out (or commenced in the case of installments) during a sixty (60) day period commencing immediately after the first day of any Plan Year designated by the Participant (the “Scheduled Distribution Date”). The Plan Year designated by the Participant must be at least two (2) Plan Years after the end of the Plan Year to which the Participant’s deferral election described in Section 3.3 relates. By way of example, if a Scheduled Distribution is elected for Annual Deferral Amounts that are earned in the Plan Year commencing January 1, 2014, the Scheduled Distribution would become payable during a sixty (60) day period commencing January 1, 2017.
4.2Changing Scheduled Distributions. A Participant may elect to postpone or change the form of a Scheduled Distribution election described in Section 4.1 above. In order to make this election, the Participant must submit a new Scheduled Distribution Election Form to the Committee in accordance with the following criteria:
(a)Such Scheduled Distribution Election Form must be submitted to and accepted by the Committee in its sole discretion at least twelve (12) months prior to the Participant’s previously designated Scheduled Distribution Date;
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(b)The new Scheduled Distribution Date selected by the Participant must be the first day of a Plan Year, and must be at least five years after the previously designated Scheduled Distribution Date (even if the Participant is seeking merely to modify the form of payment);
(c)The election to modify the Scheduled Distribution shall have no effect until at least twelve (12) months after the date on which the election is made.
4.3Certain Benefits Take Precedence Over Scheduled Distributions. Should a Benefit Distribution Date occur that triggers a benefit under Article 5, 7, 8, or 9, any Annual Deferral Amount that is subject to a Scheduled Distribution election under Section 4.1 shall not be paid in accordance with Section 4.1, but shall be paid in accordance with the other applicable Article. The occurrence of a Benefit Distribution Date that triggers a Retirement Benefit under Article 6 shall not take precedence over any Annual Deferral Amount that is subject to a Scheduled Distribution election; such amount(s) shall be paid in accordance with the applicable Scheduled Distribution election. Notwithstanding the foregoing, the Committee shall interpret this Section 4.1 in a manner that is consistent with Code Section 409A and other applicable tax law, including but not limited to guidance issued after the effective date of this Plan.
4.4 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.
(a)If the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee to suspend deferrals of Base Salary, Bonus and Director Compensation to the extent deemed necessary by the Committee to satisfy the Unforeseeable Financial Emergency. If suspension of deferrals is not sufficient to satisfy the Participant’s Unforeseeable Financial Emergency, or if suspension of deferrals is not required under Code Section 409A and other applicable tax law, the Participant may further petition the Committee to receive a partial or full payout from the Plan. The Participant shall only receive a payout from the Plan to the extent such payout is deemed necessary by the Committee to satisfy the Participant’s Unforeseeable Financial Emergency, plus amounts reasonably necessary to pay taxes reasonably anticipated as a result of the distribution.
(b)The payout shall not exceed the lesser of (i) the Participant’s vested Account Balance, calculated as of the close of business on or around the date on which the amount becomes payable, as determined by the Committee in its sole discretion, or (ii) the amount necessary to satisfy the Unforeseeable Financial Emergency, plus amounts reasonably necessary to pay taxes reasonably anticipated as a result of the distribution. Notwithstanding the foregoing, a Participant may not receive a payout from the Plan to the extent that the Unforeseeable Financial Emergency is or may be relieved (A) through reimbursement or compensation by insurance or otherwise, (B) by liquidation of the Participant’s assets, to the extent the liquidation of such assets would not itself cause severe financial hardship or (C) by suspension of deferrals under this Plan, if the
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Committee, in its sole discretion, determines that suspension is required by Code Section 409A and other applicable tax law.
(c)If the Committee, in its sole discretion, approves a Participant’s petition for suspension, the Participant’s deferrals under this Plan shall be suspended as of the date of such approval. If the Committee, in its sole discretion, approves a Participant’s petition for suspension and payout, the Participant’s deferrals under this Plan shall be suspended as of the date of such approval and the Participant shall receive a payout from the Plan within sixty (60) days of the date of such approval.
(d)Notwithstanding the foregoing, the Committee shall interpret all provisions relating to suspension and/or payout under this Section 4.4 in a manner that is consistent with Code Section 409A and other applicable tax law, including but not limited to guidance issued after the effective date of this Plan.
ARTICLE 5
Change in Control Benefit
Change in Control Benefit
5.1Change in Control Benefit. The provisions of this Change in Control Benefit Article shall be subject to such conditions and limitations as the Committee may prescribe from time to time for administrative convenience and to comply with the provisions of Code Section 409A. Each Participant, in connection the implementation of this provision (or for any future Participant, in connection with his or her commencement of participation in the Plan), shall irrevocably elect on an Election Form whether to (i) receive a Change in Control Benefit upon the occurrence of a Change in Control, which shall be equal to the Participant’s vested Account Balance, calculated as of the close of business on or around the Participant’s Benefit Distribution Date, as determined by the Committee in its sole discretion, or (ii) to have his or her Account Balance remain in the Plan upon the occurrence of a Change in Control and to have his or her Account Balance remain subject to the terms and conditions of the Plan. If a Participant does not make any election with respect to the payment of the Change in Control Benefit, then: (i) for Participants who first entered the Plan prior to June 1, 2012, such Participant’s Account Balance shall remain in the Plan upon a Change in Control and shall be subject to the terms and conditions of the Plan; and (ii) for Participants who first enter the Plan on or after June 1, 2012, such Participant’s Account Balance shall receive a Change in Control Benefit upon the occurrence of a Change in Control.
5.2Payment of Change in Control Benefit. The Change in Control Benefit, if any, shall be paid to the Participant in a lump sum no later than sixty (60) days after the Participant’s Benefit Distribution Date. Notwithstanding the foregoing, the Committee shall interpret all provisions in this Plan relating to a Change in Control Benefit in a manner that is consistent with Code Section 409A and other applicable tax law, including but not limited to guidance issued after the effective date of this Plan.
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ARTICLE 6
Retirement Benefit
Retirement Benefit
6.1Retirement Benefit. A Participant who Retires shall receive, as a Retirement Benefit, his or her vested Account Balance, calculated as of the close of business on or around the Participant’s Benefit Distribution Date, as determined by the Committee in its sole discretion.
6.2Payment of Retirement Benefit.
(a) A Participant, in connection with his or her commencement of participation in the Plan, shall elect on an Election Form to receive the Retirement Benefit in a lump sum or pursuant to an Annual Installment Method of up to ten (10) years. The Participant may postpone or change the form of the Retirement Benefit by submitting an Election Form to the Committee in accordance with the following criteria:
(i) Such Election Form must be submitted to and accepted by the Committee in its sole discretion at least twelve (12) months prior to the Participant’s previously scheduled Benefit Distribution Date described in Section 1.8(a); and
(ii) The first Retirement Benefit payment is delayed at least five (5) years from the Participant’s previously scheduled Benefit Distribution Date described in Section 1.8(a); and
(iii) The election to modify the Retirement Benefit shall have no effect until at least twelve (12) months after the date on which the election is made.
The Election Form most recently accepted by the Committee shall govern the payout of the Retirement Benefit. If a Participant does not make any election with respect to the payment of the Retirement Benefit in connection with his or her commencement of participation in the Plan, then such Participant shall be deemed to have elected to receive the Retirement Benefit in a lump sum.
(b)The lump sum payment shall be made, or installment payments shall commence, no later than sixty (60) days after the Participant’s Benefit Distribution Date. Remaining installments, if any, shall be paid no later than sixty (60) days after each anniversary of the Participant’s Benefit Distribution Date.
ARTICLE 7
Termination Benefit
Termination Benefit
7.1Termination Benefit. A Participant who experiences a Separation from Service shall receive, as a Termination Benefit, his or her vested Account Balance, calculated as of the close of business
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on or around the Participant’s Benefit Distribution Date, as determined by the Committee in its sole discretion.
7.2Payment of Termination Benefit. The Termination Benefit shall be paid to the Participant in a lump sum payment no later than sixty (60) days after the Participant’s Benefit Distribution Date.
ARTICLE 8
Disability Benefit
Disability Benefit
8.1Disability Benefit. Upon a Participant’s Disability, the Participant shall receive a Disability Benefit, which shall be equal to the Participant’s vested Account Balance, calculated as of the close of business on or around the Participant’s Benefit Distribution Date, as selected by the Committee in its sole discretion.
8.2Payment of Disability Benefit.
(a)A Participant, in connection with his or her commencement of participation in the Plan, shall elect on an Election Form to receive the Disability Benefit in a lump sum or pursuant to an Annual Installment Method of up to ten (10) years. The Participant may change this election by submitting an Election Form to the Committee, provided that any such Election Form is submitted to and accepted by the Committee in its sole discretion at least twelve (12) months prior to the Participant’s Disability.
Notwithstanding the foregoing, the Committee shall interpret all provisions relating to changing the Disability Benefit election under this Section 8.2 in a manner that is consistent with Code Section 409A and other applicable tax law, including but not limited to guidance issued after the effective date of this Plan.
The Election Form most recently accepted by the Committee shall govern the payout of the Disability Benefit. If a Participant does not make any election with respect to the payment of the Disability Benefit, then such benefit shall be payable in a lump sum.
(b)The lump sum payment shall be made, or installment payments shall commence, no later than sixty (60) days after the Participant’s Benefit Distribution Date. Remaining installments, if any, shall be paid no later than sixty (60) days after each anniversary of the Participant’s Benefit Distribution Date.
ARTICLE 9
Death Benefit
Death Benefit
9.1Death Benefit. The Participant’s Beneficiary(ies) shall receive a Death Benefit upon the Participant’s death which will be equal to the Participant’s vested Account Balance, calculated as of the close of business on or around the Participant’s Benefit Distribution Date, as selected by the Committee in its sole discretion.
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9.2Payment of Death Benefit. The Death Benefit shall be paid to the Participant’s Beneficiary(ies) in a lump sum payment no later than sixty (60) days after the Participant’s Benefit Distribution Date.
ARTICLE 10
Director Retirement Plan Benefit
Director Retirement Plan Benefit
10.1Director Retirement Plan Benefit. A Director of the Company who experiences a Separation from Service, death or Disability shall receive, as a Director Retirement Plan Benefit, his or her Director Retirement Plan Account balance, if any, calculated as of the close of business on or around the Director’s Benefit Distribution Date, as determined by the Committee in its sole discretion.
10.2Payment of Director Retirement Plan Benefit. Prior to the discontinuance of Director Retirement Plan Benefits being credited to the Director Retirement Plan, Directors were permitted to choose a lump sum or annual installment payments over two (2) to ten (10) years in accordance with the Annual Installment Method. In the absence of a timely submitted Election Form, a Director Retirement Plan Benefit shall be paid in annual installment payments over four (4) years, determined in accordance with the Annual Installment Method. Payment shall be made (or commence, in the case of installments) to the Director no later than sixty (60) days after the Participant’s Benefit Distribution Date. Remaining installments shall be paid no later than sixty (60) days after each anniversary of the Participant’s Benefit Distribution Date.
10.3Benefit Distribution Date. For purposes of this Article 10, “Benefit Distribution Date” shall mean the date that triggers distribution of a Director Retirement Plan Account balance. A Director’s Benefit Distribution Date shall be determined upon the occurrence of any one of the following: (a) if the Participant experiences a Separation from Service, his or her Benefit Distribution Date shall be the first business day of the calendar month that immediately follows the six-month anniversary of the date on which the Participant experiences a Separation from Service; or (b) the date on which the Committee is provided with proof that is satisfactory to the Committee of the Participant’s death; or (c) the date on which the Committee determines the Participant is Disabled; or
10.4Effect of Change in Control. Notwithstanding the foregoing provisions of this Article 10, if the Company experiences a Change in Control either before, on or after the Participant’s Separation from Service, death or Disability, the Director shall be entitled to a lump sum payment (no later than sixty (60) days following the date the Company experiences the Change in Control) which shall be equal to the Participant’s remaining vested Director Retirement Plan Account balance, calculated as of the date on which the Company experiences a Change in Control.
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ARTICLE 11
Beneficiary Designation
Beneficiary Designation
11.1Beneficiary. Each Participant shall have the right, at any time, to designate his or her Beneficiary(ies) (both primary as well as contingent) to receive any benefits payable under the Plan to a beneficiary upon the death of a Participant. The Beneficiary designated under this Plan may be the same as or different from the Beneficiary designation under any other plan of an Employer in which the Participant participates.
11.2Beneficiary Designation; Change; Spousal Consent. A Participant shall designate his or her Beneficiary by completing and signing the Beneficiary Designation Form, and returning it to the Committee or its designated agent. A Participant shall have the right to change a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the Committee’s rules and procedures, as in effect from time to time. If the Participant names someone other than his or her spouse as a Beneficiary, the Committee may, in its sole discretion, determine that spousal consent is required to be provided in a form designated by the Committee, executed by such Participant’s spouse and returned to the Committee. Upon the acceptance by the Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be canceled. The Committee shall be entitled to rely on the last Beneficiary Designation Form filed by the Participant and accepted by the Committee prior to his or her death.
11.3Acknowledgment. No designation or change in designation of a Beneficiary shall be effective until received and acknowledged in writing by the Committee or its designated agent.
11.4No Beneficiary Designation. If a Participant fails to designate a Beneficiary as provided in Sections 12.1, 11.2 and 11.3 above or, if all designated Beneficiaries predecease the Participant or die prior to complete distribution of the Participant’s benefits, then the Participant’s designated Beneficiary shall be deemed to be his or her surviving spouse. If the Participant has no surviving spouse, the benefits remaining under the Plan to be paid to a Beneficiary shall be payable to the executor or personal representative of the Participant’s estate.
11.5Doubt as to Beneficiary. If the Committee has any doubt as to the proper Beneficiary to receive payments pursuant to this Plan, the Committee shall have the right, exercisable in its discretion, to cause the Participant’s Employer to withhold such payments until this matter is resolved to the Committee’s satisfaction.
11.6Discharge of Obligations. The payment of benefits under the Plan to a Beneficiary shall fully and completely discharge all Employers and the Committee from all further obligations under this Plan with respect to the Participant.
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ARTICLE 12
Leave of Absence
Leave of Absence
12.1Paid Leave of Absence. If a Participant is authorized by the Participant’s Employer to take a paid leave of absence from the employment of the Employer, (i) the Participant shall continue to be considered eligible for the benefits provided in Article 4, 5, 6, 7, 8, or 9 in accordance with the provisions of those Articles, and (ii) the Annual Deferral Amount shall continue to be withheld during such paid leave of absence in accordance with Section 3.3.
12.2Unpaid Leave of Absence. If a Participant is authorized by the Participant’s Employer to take an unpaid leave of absence from the employment of the Employer for any reason, such Participant shall continue to be eligible for the benefits provided in Article 4, 5, 6, 7, 8, or 9 in accordance with the provisions of those Articles. However, the Participant shall be excused from fulfilling his or her Annual Deferral Amount commitment that would otherwise have been withheld during the remainder of the Plan Year in which the unpaid leave of absence is taken. During the unpaid leave of absence, the Participant shall not be allowed to make any additional deferral elections. However, if the Participant returns to employment, the Participant may elect to defer an Annual Deferral Amount for the Plan Year following his or her return to employment and for every Plan Year thereafter while a Participant in the Plan, provided such deferral elections are otherwise allowed and an Election Form is delivered to and accepted by the Committee for each such election in accordance with Section 3.3 above.
ARTICLE 13
Termination of Plan, Amendment or Modification
Termination of Plan, Amendment or Modification
13.1Termination of Plan. Although each Employer anticipates that it will continue the Plan for an indefinite period of time, there is no guarantee that any Employer will continue the Plan or will not terminate the Plan at any time in the future. Accordingly, the board of directors of any Employer reserves the right to Terminate the Plan (as defined in Section 1.42) as to that Employer, and the Board of Directors of the Company reserves the right to Terminate the Plan in its entirety as to the Company and all Employers. In the event of a Termination of the Plan, the Measurement Funds available to Participants following the Termination of the Plan shall be comparable in number and type to those Measurement Funds available to Participants in the Plan Year preceding the Plan Year in which the Termination of the Plan is effective. Following a Termination of the Plan, Participant Account Balances shall remain in the Plan until the Participant becomes eligible for the benefits provided in Article 4, 5, 6, 7, 8 or 9 in accordance with the provisions of those Articles. The Termination of the Plan shall not adversely affect any Participant or Beneficiary who has become entitled to the payment of any benefits under the Plan as of the date of termination. Provided, however, to the extent permissible under Code Section 409A and related Treasury Regulations and guidance, including but not limited to such guidance and Regulations as may be issued after the effective date of this Plan, if there is a
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Termination of the Plan with respect to all Participants, the Company may, in its discretion, amend the Plan to accelerate the time and form of payments.
13.2Amendment.
(a)The Board may, at any time, amend or modify the Plan in whole or in part. In addition, the Committee may amend or modify the Plan to the extent permitted under the Charter. Notwithstanding the foregoing, (i) no amendment shall be effective to decrease the value of a Participant’s vested Account Balance in existence at the time the amendment is made, and (ii) no amendment or modification of this Section 13.2 or Section 14.2 of the Plan shall be effective. In no event shall the Company or any Employer be responsible for any decline in a Participant’s Account Balance as a result of the selection, discontinuation, addition, substitution, crediting or debiting of the Measurement Funds pursuant to Section 3.10.
(b)Notwithstanding any provision of the Plan to the contrary, in the event that the Committee determines that any provision of the Plan may cause amounts deferred under the Plan to become immediately taxable to any Participant under Code Section 409A, and related guidance, the Committee may (i) adopt such amendments to the Plan and appropriate policies and procedures, including amendments and policies with retroactive effect, that the Committee determines necessary or appropriate to preserve the intended tax treatment of the Plan benefits provided by the Plan and/or (ii) take such other actions as the Committee determines necessary or appropriate to comply with the requirements of Code Section 409A, and related guidance.
13.3Effect of Payment. The full payment of the Participant’s vested Account Balance under Article 4, 5, 6, 7, 8, or 9 of the Plan shall completely discharge all obligations to a Participant and his or her designated Beneficiaries under this Plan, and the Participant’s Plan Agreement shall terminate.
ARTICLE 14
Administration
Administration
14.1Committee Duties. Except as otherwise provided in this Article 14, this Plan shall be administered by the Committee,. The Committee’s composition, duties, authority and responsibilities shall be determined in accordance with the Charter, as amended from time to time. Any individual serving on the Committee who is a Participant shall not vote or act on any matter relating solely to himself or herself. When making a determination or calculation, the Committee shall be entitled to rely on information furnished by a Participant or the Company.
14.2Administration Upon Change In Control. The provisions of this Section 14.2 shall not apply unless and until Article 5 has been implemented and a Trustee has been appointed. For purposes of this Plan, the Committee shall be the “Administrator” at all times prior to the occurrence of a Change in Control. Within one hundred and twenty (120) days following a Change in Control, an independent third-party “Administrator” may be selected by the individual who, immediately
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prior to the Change in Control, was the Company’s Chief Executive Officer or, if not so identified, the Company’s highest ranking officer (the “Ex-CEO”), and approved by the Trustee. The Committee, as constituted prior to the Change in Control, shall continue to be the Administrator until the earlier of (i) the date on which such independent third party is selected and approved, or (ii) the expiration of the one hundred and twenty (120) day period following the Change in Control. If an independent third party is not selected within one hundred and twenty (120) days of such Change in Control, the Committee, as described in Section 14.1 above, shall be the Administrator. The Administrator shall have the discretionary power to determine all questions arising in connection with the administration of the Plan and the interpretation of the Plan and Trust including, but not limited to benefit entitlement determinations; provided, however, upon and after the occurrence of a Change in Control, the Administrator shall have no power to direct the investment of Plan or Trust assets or select any investment manager or custodial firm for the Plan or Trust. Upon and after the occurrence of a Change in Control, the Company must: (1) pay all reasonable administrative expenses and fees of the Administrator; (2) indemnify the Administrator against any costs, expenses and liabilities including, without limitation, attorney’s fees and expenses arising in connection with the performance of the Administrator hereunder, except with respect to matters resulting from the gross negligence or willful misconduct of the Administrator or its employees or agents; and (3) supply full and timely information to the Administrator on all matters relating to the Plan, the Trust, the Participants and their Beneficiaries, the Account Balances of the Participants, the date and circumstances of the Retirement, Disability, death or Separation from Service of the Participants, and such other pertinent information as the Administrator may reasonably require. Upon and after a Change in Control, the Administrator may be terminated (and a replacement appointed) by the Trustee only with the approval of the Ex-CEO. Upon and after a Change in Control, the Administrator may not be terminated by the Company.
14.3Binding Effect of Decisions. The decision or action of the Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in the Plan.
14.4Indemnity of Committee. All Employers shall indemnify and hold harmless the members of the Committee, any Employee to whom the duties of the Committee may be delegated, and the Administrator against any and all claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Plan, except in the case of willful misconduct by the Committee, any of its members, any such Employee or the Administrator.
14.5Employer Information. To enable the Committee and/or Administrator to perform its functions, the Company and each Employer shall supply full and timely information to the Committee and/or Administrator, as the case may be, on all matters relating to the compensation of its Participants, the date and circumstances of the Retirement, Disability, death or Separation from Service of its Participants, and such other pertinent information as the Committee or Administrator may reasonably require.
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ARTICLE 15
Other Benefits and Agreements
Other Benefits and Agreements
15.1Coordination with Other Benefits. The benefits provided for a Participant and Participant’s Beneficiary under the Plan are in addition to any other benefits available to such Participant under any other plan or program for employees of the Participant’s Employer. The Plan shall supplement and shall not supersede, modify or amend any other such plan or program except as may otherwise be expressly provided.
15.2Clawback or Recoupment. All benefits under this Plan shall be subject to recovery or other penalties pursuant to (i) any Company clawback policy, as may be adopted or amended from time to time, or (ii) 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.
ARTICLE 16
Claims Procedures
Claims Procedures
16.1Presentation of Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to the amounts distributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by the Claimant, the claim must be made within sixty (60) days after such notice was received by the Claimant. All other claims must be made within 180 days of the date on which the event that caused the claim to arise occurred. The claim must state with particularity the determination desired by the Claimant.
16.2Notification of Decision. The Committee shall consider a Claimant’s claim within a reasonable time, but no later than ninety (90) days after receiving the claim. If the Committee determines that special circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial ninety (90) day period. In no event shall such extension exceed a period of ninety (90) days from the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the benefit determination. The Committee shall notify the Claimant in writing:
(a)that the Claimant’s requested determination has been made, and that the claim has been allowed in full; or
(b)that the Committee has reached a conclusion contrary, in whole or in part, to the Claimant’s requested determination, and such notice must set forth in a manner calculated to be understood by the Claimant:
(i)the specific reason(s) for the denial of the claim, or any part of it;
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(ii)specific reference(s) to pertinent provisions of the Plan upon which such denial was based;
(iii)a description of any additional material or information necessary for the Claimant to perfect the claim, and an explanation of why such material or information is necessary;
(iv)an explanation of the claim review procedure set forth in Section 16.3 below; and
(v)a statement of the Claimant’s right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.
16.3Review of a Denied Claim. On or before sixty (60) days after receiving a notice from the Committee that a claim has been denied, in whole or in part, a Claimant (or the Claimant’s duly authorized representative) may file with the Committee a written request for a review of the denial of the claim. The Claimant (or the Claimant’s duly authorized representative):
(a)may, upon request and free of charge, have reasonable access to, and copies of, all documents, records and other information relevant to the claim for benefits;
(b)may submit written comments or other documents; and/or
(c)may request a hearing, which the Committee, in its sole discretion, may grant.
16.4Decision on Review. The Committee shall render its decision on review promptly, and no later than sixty (60) days after the Committee receives the Claimant’s written request for a review of the denial of the claim. If the Committee determines that special circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial sixty (60) day period. In no event shall such extension exceed a period of sixty (60) days from the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the benefit determination. In rendering its decision, the Committee shall take into account all comments, documents, records and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. The decision must be written in a manner calculated to be understood by the Claimant, and it must contain:
(a)specific reasons for the decision;
(b)specific reference(s) to the pertinent Plan provisions upon which the decision was based;
(c)a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the Claimant’s claim for benefits; and
(d)a statement of the Claimant’s right to bring a civil action under ERISA Section 502(a).
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
16.5Legal Action. A Claimant’s compliance with the foregoing provisions of this Article 16 is a mandatory prerequisite to a Claimant’s right to commence any legal action with respect to any claim for benefits under this Plan.
16.6Determinations. Benefits under the Plan will be paid only if the Committee decides in its discretion that the applicant is entitled to them. The Committee has discretionary authority to grant or deny benefits under the Plan. The Committee shall have the sole discretion, authority and responsibility to interpret and construe this Plan Statement and all relevant documents and information, and to determine all factual and legal questions under the Plan, including but not limited to the entitlement of all persons to benefits and the amounts of their benefits. The Committee shall make such determinations as may be required from time to time in the administration of the Plan. The discretionary authority shall include all matters arising under the Plan.
ARTICLE 17
Trust
Trust
17.1Establishment of the Trust. In order to provide assets from which to fulfill the obligations of the Participants and their beneficiaries under the Plan, the Company may establish a trust by a trust agreement with a third party, the trustee, to which each Employer may, in its discretion, contribute cash or other property, including securities issued by the Company, to provide for the benefit payments under the Plan, (the “Trust”).
17.2Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receive distributions pursuant to the Plan. The provisions of the Trust shall govern the rights of the Employers, Participants and the creditors of the Employers to the assets transferred to the Trust. Each Employer shall at all times remain liable to carry out its obligations under the Plan.
17.3Distributions From the Trust. Each Employer’s obligations under the Plan may be satisfied with Trust assets distributed pursuant to the terms of the Trust, and any such distribution shall reduce the Employer’s obligations under this Plan.
ARTICLE 18
Miscellaneous
Miscellaneous
18.1Status of Plan. The Plan is intended to be a plan that is not qualified within the meaning of Code Section 401(a) and that “is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1). The Plan shall be administered and interpreted (i) to the extent possible in a manner consistent with that intent, and (ii) in accordance with Code Section 409A and other applicable tax law, including but not limited to Treasury Regulations promulgated pursuant to Code Section 409A.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
18.2Unsecured General Creditor. Participants and their Beneficiaries, heirs, successors and assigns shall have no legal or equitable rights, interests or claims in any property or assets of an Employer. For purposes of the payment of benefits under this Plan, any and all of an Employer’s assets shall be, and remain, the general, unpledged unrestricted assets of the Employer. An Employer’s obligation under the Plan shall be merely that of an unfunded and unsecured promise to pay money in the future.
18.3Employer’s Liability. An Employer’s liability for the payment of benefits shall be defined only by the Plan. An Employer shall have no obligation to a Participant under the Plan except as expressly provided in the Plan.
18.4Nonassignability. Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in advance of actual receipt, the amounts, if any, payable hereunder, or any part thereof, which are, and all rights to which are expressly declared to be, unassignable and non-transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure, attachment, garnishment or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any other person, be transferable by operation of law in the event of a Participant’s or any other person’s bankruptcy or insolvency or be transferable to a spouse as a result of a property settlement or otherwise (including without limitation any domestic relations order, whether or not a “qualified domestic relations order” under section 414(p) of the Code and section 206(d) of ERISA) before the Account Balance is distributed to the Participant or Beneficiary.
18.5Not a Contract of Employment. The terms and conditions of this Plan shall not be deemed to constitute a contract of employment between any Employer and the Participant. Such employment is hereby acknowledged to be an “at will” employment relationship that can be terminated at any time for any reason, or no reason, with or without cause, and with or without notice, unless expressly provided in a written employment agreement. Nothing in this Plan shall be deemed to give a Participant the right to be retained in the service of any Employer, either as an Employee or a Director, or to interfere with the right of any Employer to discipline or discharge the Participant at any time.
18.6Furnishing Information. A Participant or his or her Beneficiary will cooperate with the Committee by furnishing any and all information requested by the Committee and take such other actions as may be requested in order to facilitate the administration of the Plan and the payments of benefits hereunder, including but not limited to taking such physical examinations as the Committee may deem necessary.
18.7Terms. Whenever any words are used herein in the masculine, they shall be construed as though they were in the feminine in all cases where they would so apply; and whenever any words are used herein in the singular or in the plural, they shall be construed as though they were used in the plural or the singular, as the case may be, in all cases where they would so apply.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
18.8Captions. The captions of the articles, sections and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions.
18.9Governing Law. Subject to ERISA, the provisions of this Plan shall be construed and interpreted according to the internal laws of the State of Minnesota without regard to its conflicts of laws principles.
18.10Notice. Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below:
CHS Inc. | ||
Attn: Senior Director, Benefits - MS 480 | ||
5500 Cenex Drive | ||
Inver Grove Heights, Minnesota 55077 | ||
Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.
Any notice or filing required or permitted to be given to a Participant under this Plan shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Participant.
18.11Successors. The provisions of this Plan shall bind and inure to the benefit of the Participant’s Employer and its successors and assigns and the Participant and the Participant’s designated Beneficiaries.
18.12Spouse’s Interest. The interest in the benefits hereunder of a spouse of a Participant who has predeceased the Participant shall automatically pass to the Participant and shall not be transferable by such spouse in any manner, including but not limited to such spouse’s will, nor shall such interest pass under the laws of intestate succession.
18.13Validity. In case any provision of this Plan shall be illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Plan shall be construed and enforced as if such illegal or invalid provision had never been inserted herein.
18.14Incompetent. If the Committee determines in its discretion that a benefit under this Plan is to be paid to a minor, a person declared incompetent or to a person incapable of handling the disposition of that person’s property, the Committee may direct payment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetent or incapable person. The Committee may require proof of minority, incompetence, incapacity or guardianship, as it may deem appropriate prior to distribution of the benefit. Any payment of a benefit shall be a payment for the account of the Participant and the Participant’s Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Plan for such payment amount.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
18.15Insurance. The Employers, on their own behalf or on behalf of the trustee of the Trust, and, in their sole discretion, may apply for and procure insurance on the life of the Participant, in such amounts and in such forms as the Trust may choose. The Employers or the trustee of the Trust, as the case may be, shall be the sole owner and beneficiary of any such insurance. The Participant shall have no interest whatsoever in any such policy or policies, and at the request of the Employers shall submit to medical examinations and supply such information and execute such documents as may be required by the insurance company or companies to whom the Employers have applied for insurance.
Executed this ________ day of _____________________ , 2026.
CHS INC.
By: ____________________________________
Title: VP Total Rewards
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX A
Share Option Plan Accounts
Share Option Plan Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1History. Since January 1, 1998, the Company has sponsored the CHS Inc. Share Option Plan (the “SOP”) for the purpose of providing stock options to certain key individuals. The options granted under the SOP are in shares of a private investment company established by the Company as well as shares of certain regulated investment companies. The Company has determined to discontinue the grant of additional options under the SOP effective December 9, 2005 and to amend the terms of all outstanding options as of December 31, 2005 to comply with Section 409A of the Code.
1.2Right to Exercise in 2005. On or before December 9, 2005, each Participant in the SOP shall have the right to exercise all or any portion of such Participant’s vested options.
1.3Conversion of Options. Effective December 10, 2005, options which are not exercised on or prior to December 9, 2005 shall be converted into an account balance (the “SOP Account”) which shall become part of the Participant’s Account Balance under the CHS Inc. Deferred Compensation Plan (the “Plan”). The initial SOP Account shall consist of two parts: (i) the difference of the value of the securities underlying the option less the exercise price (the “Option Spread”); and (ii) the exercise price of the option (the “Exercise Price Credit”). The Participant shall not be entitled to payment of the Exercise Price Credit; provided, however, that the Participant shall have a right to deemed earnings, if any, which accrue on the portion of the SOP Account representing the Exercise Price Credit.
1.4Vesting. A Participant shall continue to vest in all options converted into an SOP Account (excluding the portion of the SOP Account representing the Exercise Price Credit) in accordance with the vesting schedule applicable to such options under the SOP.
1.5Crediting/Debiting of SOP Account. Following the conversion, the Participant’s Option Spread shall no longer be tied to the value of the securities underlying the option immediately prior to conversion, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan. The Participant’s Exercise Price Credit shall no longer be tied to the value of the securities underlying the option immediately prior to the conversion, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds selected by the
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
Committee. With respect to a Participant who receives an installment or other partial distribution of the SOP Account in accordance with a Scheduled Distribution elected pursuant to Section 1.6 below, the portion of the SOP Account representing the Exercise Price Credit shall be reduced by a pro rata amount. Upon a complete distribution of the SOP Account, the Exercise Price Credit shall be reduced to zero (0).
1.6Scheduled Distributions. A Participant who does not exercise all of such Participant’s options pursuant to Section 1.2 of this Appendix A shall, on or before December 31, 2005, irrevocably elect on an Election Form to receive one or more (not to exceed five (5)) Scheduled Distributions with respect to the Participant’s SOP Account (minus the Exercise Price Credit). For purposes of this Section 1.6, the following special rules shall apply:
(a) Subject to the limitations described this paragraph (a), the Participant may elect to receive or commence a Scheduled Distribution as of any fixed date selected by the Participant (e.g., January 1, 2007). No more than one (1) Scheduled Distribution as of a fixed date may be made or commenced in any Plan Year, and the Plan Year designated by the Participant for the first Scheduled Distribution must be at least one (1) Plan Year after the end of the Plan Year ending December 31, 2005.
(b) The Participant may elect on an Election Form to receive each Scheduled Distribution in a lump sum or pursuant to an Annual Installment Method of up to ten (10) years. If a Participant does not make any election with respect to the form of payment, then such Participant’s Scheduled Distribution shall be distributed in a single lump sum.
(c) Effective on and after December 31, 2025, no changes to a Scheduled Distribution of the SOP Account shall be permitted.
(d) Notwithstanding the foregoing, if the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee for a payout in accordance with Section 4.4 of the Plan.
(e) With respect to a Participant who is not actively employed with the Company as of December 9, 2005, if the Participant fails to make a Scheduled Distribution election with respect to any portion of the SOP Account, that portion of the SOP Account shall be paid (minus the Exercise Price Credit) as a Scheduled Distribution during the sixty (60) day period commencing immediately after the Plan Year ending December 31, 2006. With respect to a Participant who is actively employed with the Company as of December 9, 2005, if the Participant fails to make a Scheduled Distribution election with respect to any portion of the SOP Account, that portion of the SOP Account shall be paid (minus the Exercise Price Credit) upon the occurrence of a Benefit Distribution Date on account of the Participant’s Separation from Service, Retirement or Disability, in accordance with the terms of the Plan.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
1.7Elections for Retirement or Disability Benefit. With respect to each Participant who is actively employed by the Company as of December 9, 2005 and who does not exercise all of such Participant’s options pursuant to Section 1.2 of this Appendix A, such Participant must complete a Retirement Benefit election in accordance with Article 6 and a Disability Benefit election in accordance with Article 8.
1.8Certain Benefits Take Precedence Over Scheduled Distributions.
(a) Change in Control. On or before December 31, 2005, a Participant may irrevocably elect to receive a single lump sum Change in Control Benefit upon the occurrence of a Change in Control in accordance with Article 5 of the Plan. If the Participant elects to receive a Change in Control Benefit, the Change in Control shall trigger payment of the entire SOP Account (minus the Exercise Price Credit) notwithstanding any other election to receive one or more Scheduled Distributions. If a Participant does not make any election with respect to the payment of the Change in Control Benefit, then such Participant’s SOP Account shall remain in the Plan upon a Change in Control and shall be subject to the terms one or more Scheduled Distributions.
(b) Termination, Retirement or Disability Benefit. In accordance with Section 4.3 of the Plan, the occurrence of a Benefit Distribution Date on account of the Participant’s Separation from Service or Disability that triggers a Termination or Disability Benefit shall take precedence over one or more Scheduled Distribution elections with respect to the SOP Account; provided, however, that the provisions of this Section 1.8 shall not be applicable to any Participant who was not actively employed with the Company at the time such Participant elects a Scheduled Distribution in accordance with Section 1.6 above. The occurrence of a Benefit Distribution Date that triggers a Retirement Benefit under Article 6 shall not take precedence over any SOP Account that is subject to a Scheduled Distribution election; the SOP Account shall be paid in accordance with the applicable Scheduled Distribution election.
(c) Death Benefit. The occurrence of the Participant’s death that triggers an automatic Death Benefit under Section 9 of the Plan shall take precedence over one or more Scheduled Distribution elections with respect to the SOP Account; the SOP Account (minus the Exercise Price Credit) shall be paid in a single lump sum in accordance with Article 9 of the Plan.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX B
Supplemental Savings Plan Accounts
Supplemental Savings Plan Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1 History. Since January 1, 1999, the Company has sponsored the CHS Inc. Supplemental Savings Plan (the “SSP”) for the purpose of allowing a select group of management and highly compensated employees to voluntarily defer compensation. The Company has determined to discontinue voluntary deferrals under the SSP effective July 1, 2006.
1.2 Conversion of Account Balances. Effective July 1, 2006, voluntary deferrals previously deferred pursuant to the terms of the SSP shall become part of the Participant’s Deferral Account balance under this Plan. Following the conversion, the Participant’s SSP Account shall no longer be credited with interest income under the terms of the SSP, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan. Notwithstanding the foregoing, the following special rules shall apply:
(a) Amounts deferred under the SSP pursuant to an election providing one or more scheduled payments, all of which are to be paid in full no later than December 31, 2008, shall not become part of the Plan, but shall instead continue to be governed by the terms of the SSP until such amounts, and any earnings thereon, are paid in full.
(b) Amounts deferred under the SSP which are in pay status as of July 1, 2006 but which are not scheduled to be paid in full on or before December 31, 2008, shall become part of the Plan but shall be paid in accordance with the schedule elected under the SSP. Unpaid amounts shall be credited or debited with earnings, gains or losses in accordance with Section 3.9 of the Plan.
(b) Amounts deferred under the SSP by any SSP Participant who is an employee of Cofina Financial, LLC as of July 1, 2006 shall not become part of this Plan, but rather, shall become part of the Participant’s Deferral Account balance under the Cofina Financial, LLC Deferred Compensation Plan.
1.3 Payment Elections. With respect to each Participant in the SSP who first becomes a Participant in this Plan when his or her SSP Account becomes part of the Deferral Account balance under this Plan, on or prior to July 1, 2006, such Participant must complete a Retirement Benefit election in accordance with Article 6 and a Disability Benefit election in accordance with
B-1
CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
Article 8 (other than with respect to benefits in pay status under Section 1.2(b) above). Such Participant may also (but need not) irrevocably elect to receive a single lump sum Change in Control Benefit upon the occurrence of a Change in Control in accordance with Article 5 of the Plan. With respect to each Participant in the SSP who is a Participant in this Plan when his or her SSP benefits become part of the Deferral Account balance under this Plan, such Participant’s prior payment elections with respect to the Participant’s Deferral Account shall apply to the SSP benefits.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX C
Supplemental Executive Retirement Plan Savings Accounts
Supplemental Executive Retirement Plan Savings Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1 History. Since January 1, 1999, the Company has sponsored the CHS Inc. Supplemental Executive Retirement Plan (the “SERP”) for the purpose of providing deferred compensation to a select group of management and highly compensated employees. The Company has determined, effective July 1, 2006, to discontinue making restorative matching and non-elective credits to the Savings Plan Accounts of Participants under Section 4.3 of the SERP.
1.2 Conversion of Account Balances. Effective July 1, 2006, a Participant’s Savings Plan Account under the SERP, if any, shall become part of the Participant’s Company Contribution Account balance under this Plan. Following the conversion, the Participant’s SERP Savings Plan Account shall no longer be credited with interest income under the terms of the SERP, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan.
1.3 Payment Elections. With respect to each Participant in the SERP who first becomes a Participant in this Plan when his or her SERP Savings Plan Account becomes part of the Company Contribution Account balance under this Plan, on or prior to July 1, 2006, such Participant must complete a Retirement Benefit election in accordance with Article 6, a Disability Benefit election in accordance with Article 8. Such Participant may also (but need not) irrevocably elect to receive a single lump sum Change in Control Benefit upon the occurrence of a Change in Control in accordance with Article 5 of the Plan. With respect to each Participant in the SERP who is a Participant in this Plan when his or her SERP Savings Plan Account becomes part of the Company Contribution Account balance under this Plan, such Participant’s prior payment elections with respect to the Participant’s Company Contribution Account shall apply to the SERP Savings Plan Accounts.
1.4 Company Contribution Amount. In addition to such Company Contribution Amounts as may be made under Section 3.5 of the Plan, for each Plan Year, the Company Contribution Account of each Participant who qualifies as an Active Participant under the SERP shall be credited with a Company Contribution Amount determined under this Section 1.4. Such Company Contribution Amount for any Plan Year shall be the difference, if any, between:
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
(a) the amount of the Active Participant’s “discretionary contribution” which would have been credited under the CHS Inc. Savings Plan for the Plan Year if: (i) the limitations on benefits imposed by Sections 401(a)(17) and 415 of the Code were disregarded; and (ii) compensation deferred upon the election of the Participant under this Plan were taken into account as includible compensation under the Savings Plan (except that amounts deferred or paid under any mandatory deferral portion of any long-term incentive compensation program maintained by the Company or any Employer shall be disregarded for this purpose); and
(b) the actual amount of discretionary contribution that is allocated on behalf of such Participant under the provisions of the Savings Plan for such Plan Year
1.5 Company Restoration Amounts. In addition to such Company Restoration Amounts as may be made under Section 3.6 of the Plan, for each Plan Year, the Company Restoration Account of each Participant who qualifies as an Active Participant under the SERP shall be credited with a Company Restoration Amount as determined under this Section 1.5. Such Company Restoration Amount for any Plan Year shall be the difference, if any, between:
(a) the amount of the Active Participant’s “matching contribution” which would have been credited under the CHS Inc. Savings Plan for the Plan Year if: (i) the limitations on benefits imposed by Sections 401(a)(17), 402(g) and 415 of the Code were disregarded; (ii) compensation deferred upon the election of the Participant under this Plan were taken into account as includible compensation under the Savings Plan (except that amounts deferred or paid under any mandatory deferral portion of any long-term incentive compensation program maintained by the Company or any Employer shall be disregarded for this purpose); and (iii) for such Plan Year, the Participant made a “before tax contribution” (as defined in the Savings Plan) of the lesser of: (A) six percent (6%) of the Participant’s includible compensation as revised under (i) and (ii) above, or (B) the maximum before-tax contribution, stated as a percentage of such compensation, which is permitted under the Savings Plan to be made by such Participant for that Plan Year, and
(b) the actual amount of matching contribution that is allocated on behalf of such Participant under the provisions of the Savings Plan for such Plan Year (not in excess of the maximum dollar limit in effect for such Plan Year under Section 402(g) of the Code).
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX D
Agriliance LLC Deferred Compensation Plan Accounts
Agriliance LLC Deferred Compensation Plan Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1 History. In connection with the Company’s purchase of certain assets of Agriliance LLC (“Agriliance”), the Company assumed deferred compensation obligations under the Agriliance LLC Deferred Compensation Plan (“Agriliance Plan”) for those Participants who transferred employment to the Company as part of the asset purchase.
1.2 Transfer of Account Balances. For those Participants who transferred employment to the Company as part of the asset purchase, all voluntary deferrals previously deferred pursuant to the terms of the Agriliance Plan shall become part of the Participant’s Deferral Account balance under this Plan. Following the conversion, the Participant’s Agriliance Plan account shall no longer be credited with earnings, gains or losses under the terms of the Agriliance Plan, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan.
1.3 Payment Elections. With respect to each Participant in the Agriliance Plan who becomes a Participant in this Plan, such Participant must upon commencement of participation complete a Beneficiary Designation Form, a Retirement Benefit election in accordance with Article 6 and a Disability Benefit election in accordance with Article 8. Such elections and Beneficiary designations shall apply both to deferrals previously made under the Agriliance Plan and to new deferrals, if any, made under this Plan. Such Participant may also (but need not) irrevocably elect to receive a single lump sum Change in Control Benefit upon the occurrence of a Change in Control in accordance with Article 5 of the Plan. All of the foregoing elections must be made on or before December 31, 2008 and must comply in all other respects with special transition rules issued by the IRS and the U.S. Department of Treasury in connection with the implementation of Section 409A of the Code.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX E
Cofina Deferred Compensation Plan Accounts
Cofina Deferred Compensation Plan Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1 History. In connection with the Company’s acquisition of one hundred percent (100%) of Cofina Financial, LLC, a Minnesota limited liability company (“Cofina”), the Company assumed all deferred compensation obligations under the Cofina Financial, LLC Deferred Compensation Plan (“Cofina Plan”).
1.2 Transfer of Account Balances. All deferrals previously deferred pursuant to the terms of the Cofina Plan shall become part of the Participant’s Deferral Account balance under this Plan. Following the conversion, the Participant’s Cofina Plan account shall no longer be credited with earnings, gains or losses under the terms of the Cofina Plan, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan.
1.3 Payment Elections. The Cofina Plan is maintained under a document entitled “Cofina Financial, LLC Deferred Compensation Plan, Master Plan Document”, as amended by two amendments. The terms of the Cofina Plan are, in all material respects, identical to this Plan. Accordingly, with respect to each Participant in the Cofina Plan, such Participant’s Beneficiary Designation Form, Retirement Benefit election, Disability Benefit election and Change in Control benefit election (if any) made in accordance with Articles 5, 6 and 8 of the Cofina Plan shall continue in effect, both with respect to deferrals previously made under the Cofina Plan and new deferrals, if any, made under this Plan. In addition, if the Participant has a Scheduled Distribution election in effect with respect to any Annual Deferral Amount under the Cofina Plan, such election shall remain in effect following transfer to this Plan.
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CHS Inc.
Deferred Compensation Plan
| Master Plan Document | ||
CHS INC.
DEFERRED COMPENSATION PLAN
DEFERRED COMPENSATION PLAN
APPENDIX F
CHS McPherson Refinery Inc. (formerly National Cooperative Refinery Association)
CHS McPherson Refinery Inc. (formerly National Cooperative Refinery Association)
Deferred Compensation Plan Accounts
Except where expressly defined in this Appendix, the capitalized terms used herein shall have the same meanings as the same terms in the Plan document.
1.1 History. In connection with the Company’s acquisition of one hundred percent (100%) of CHS McPherson Refinery Inc., formerly National Cooperative Refinery Association, a Kansas corporation, the Company assumed all deferred compensation obligations under the I.R.C. § 409A National Cooperative Refinery Association Deferred Compensation and Supplemental Retirement Plan (“NCRA Plan”). The NCRA Plan is maintained under a document entitled “I.R.C. § 409A National Cooperative Refinery Association Deferred Compensation and Supplemental Retirement Plan, As Restated Effective January 1, 2008”, as amended by one amendment.
1.2 Transfer of Account Balances. Each Deferred Compensation Account under the NCRA Plan, shall be transferred to a Deferral Account balance under this Plan shall become part of this Plan effective December 31, 2015. Following the transfer, each Deferred Compensation Account under the NCRA Plan shall no longer be credited with earnings, gains or losses under the terms of the NCRA Plan, but shall instead be credited or debited with earnings, gains or losses under one or more Measurement Funds elected by the Participant, in accordance with Section 3.9 of the Plan
1.3 Payment Elections. With respect to each Participant in the NCRA Plan who becomes an active Participant in this Plan, such Participant must upon commencement of participation complete a Beneficiary Designation Form, a Change in Control Benefit election in accordance with Article 5, a Retirement Benefit election in accordance with Article 6 and a Disability Benefit election in accordance with Article 8. The Participant may also make a Schedule Distribution election in accordance with Article 4. Such elections and Beneficiary designations shall apply only to deferrals made under this Plan, and not to deferrals previously made under the NCRA Plan. Such Participant’s prior elections with respect to the Participant’s Deferred Compensation Account shall continue to apply to the Deferred Compensation Account.
F-1
4938-7029-3682\3
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 Quarterly Report on Form 10-Q for the quarterly period ended May 31, 2026, 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(s) 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(s) 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: July 8, 2026
| /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, Olivia Nelligan, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended May 31, 2026, 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(s) 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(s) 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: July 8, 2026
| /s/ Olivia Nelligan | |||||
| Olivia Nelligan | |||||
| Executive Vice President, Chief Financial Officer and Chief Strategy 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 Quarterly Report on Form 10-Q of CHS Inc. (the “Company”) for the quarterly period ended May 31, 2026, 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 | |||||
| July 8, 2026 | |||||
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 Quarterly Report on Form 10-Q of CHS Inc. (the “Company”) for the quarterly period ended May 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Olivia Nelligan, 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/ Olivia Nelligan | |||||
| Olivia Nelligan | |||||
| Executive Vice President, Chief Financial Officer and Chief Strategy Officer | |||||
| July 8, 2026 | |||||