Item 1.01 Entry into a Material Definitive Agreement.
On August 31, 2021, CHS Inc. (the "Company") entered into Omnibus Amendment No.
10 (the "Omnibus Amendment"), by and among Cofina Funding, LLC ("Cofina
Funding"), an indirect subsidiary of the Company, as seller, the Company, as
servicer and as an originator, CHS Capital, LLC ("CHS Capital"), a direct
subsidiary of the Company, as an originator, each of the conduit purchasers,
committed purchasers and purchaser agents set forth on the signature pages
thereto and MUFG Bank, Ltd. f/k/a The Bank of Tokyo-Mitsubishi UFJ, Ltd., New
York Branch ("MUFG"), as administrative agent, to (i) that certain Amended and
Restated Receivables Purchase Agreement, dated as of July 18, 2017, by and among
Cofina Funding, the Company, the purchasers and the purchaser agents party
thereto and MUFG, as previously amended (the "Receivables Purchase Agreement"),
and (ii) that certain Sale and Contribution Agreement, dated as of July 22,
2016, by and among the Company, CHS Capital and Cofina Funding, as previously
amended (the "Sale Agreement"). On August 31, 2021, the Company also entered
into Amendment No. 5 (the "Framework Agreement Amendment" and the Omnibus
Amendment and the Framework Agreement Amendment, collectively, the "Amendments")
to that certain Master Framework Agreement, dated as of September 4, 2018, by
and among the Company, as a seller and as agent for the sellers, CHS Capital, as
a seller, and MUFG, as a buyer (the "MFA Buyer") and as agent for the buyer, as
previously amended (the "Framework Agreement").
Pursuant to the Sale Agreement, the Company and CHS Capital, from time to time,
assign, sell and contribute their rights to certain trade accounts and notes
receivable (collectively, the "Assets") to Cofina Funding. Pursuant to the
Receivables Purchase Agreement, Cofina Funding sells and assigns the Assets to
the purchasers and purchaser agents under the Receivables Purchase Agreement
(the "RPA Purchasers"). Cofina Funding finances its purchases of the Assets with
cash available, including cash received upon the resale of the Assets to the RPA
Purchasers, and by issuing subordinated promissory notes (the "Notes") to the
Company and CHS Capital for the amount of the purchase price of the Assets not
paid in cash.
Under the Framework Agreement, that certain 1996 SIFMA Master Repurchase
Agreement, dated as of September 4, 2018, between the Company, as seller, and
MUFG, as MFA Buyer, as amended (the "Company MRA"), and that certain 1996 SIFMA
Master Repurchase Agreement, dated as of September 4, 2018, between CHS Capital,
as seller, the Company, as guarantor, and MUFG, as MFA Buyer, as amended (the
"CHS Capital MRA" and the Framework Agreement, the Company MRA and the CHS
Capital MRA, collectively, the "Repurchase Facility"), CHS and CHS Capital may
each request that the MFA Buyer transfer funds to them in exchange for a
transfer of Notes, with a simultaneous agreement by CHS or CHS Capital, as
applicable, to transfer funds to the MFA Buyer at a date certain or on the MFA
Buyer's demand in exchange for the return of such Notes (collectively, the
"Transactions"), with an aggregate amount of funds agreed to be transferred to
the MFA Buyer in exchange for the return of Notes not to exceed $150 million at
any time outstanding. The Framework Agreement provides that the MFA Buyer has
the option to elect to either enter into the proposed Transaction with CHS or
CHS Capital, as applicable, or to decline such request to enter into such
Transaction.
The Amendments, among other things, amend the Receivables Purchase Agreement,
the Sale Agreement and the Repurchase Facility to extend their respective
termination dates to August 30, 2022. The Omnibus Amendment also, among other
things, amends the Receivables Purchase Agreement to (i) increase the amount of
Assets that the RPA Purchasers have committed to purchase to $700 million, (ii)
provide that Cofina Funding may sell and assign up to an additional $250 million
of Assets to the RPA Purchasers on an uncommitted basis, (iii) revise the Assets
that may be sold and assigned by Cofina Funding to, among other things, include
certain trade accounts arising out of the Company's crop protection business,
and (iv) add mechanics relating to the transition from the use of LIBOR to the
Secured Overnight Financing Rate, or SOFR, upon the discontinuance or
unavailability of LIBOR.
MUFG and certain RPA Purchasers, including Coöperatieve Rabobank U.A. and
Coöperatieve Rabobank U.A., New York Branch ("Rabobank New York"), PNC Bank,
National Association, and Santander Bank, National Association, are parties to
one or more of the Company's outstanding credit facilities, including the 2019
Amended and Restated Credit Agreement (5-Year Revolving Loan), dated as of July
16, 2019, by and between the Company, CoBank, ACB, for its own benefit as a
syndication party and as the administrative agent for the benefit of the present
and future syndication parties, Rabobank New York and Sumitomo Mitsui Banking
Corporation, for their own benefit as syndication parties and as syndication
agents, and the other syndication parties party thereto. In addition, certain
parties to the Amendments and/or their affiliates have from time to time
engaged, and in the future may engage, in various financial advisory and
investment banking transactions with, and provide services to, the Company and
its subsidiaries in the ordinary course of business for which they received or
will receive customary fees and expenses.
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Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
Reference is made to the information set forth in Item 1.01 of this Current
Report on Form 8-K, which is incorporated herein by reference.
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