EXHIBIT 10.34



                            COOPERATIVE REFINING, LLC


                       LIMITED LIABILITY COMPANY AGREEMENT


                                SEPTEMBER 1, 1999




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                       LIMITED LIABILITY COMPANY AGREEMENT
                                       OF
                            COOPERATIVE REFINING, LLC


                  THIS LIMITED LIABILITY COMPANY AGREEMENT made and entered into
as of this 1st day of September, 1999, by and between the persons named on
Schedule A attached hereto (hereinafter, such persons are referred to
collectively as the "Members" and individually as a "Member");

                  WITNESSETH THAT:

                  WHEREAS, the undersigned have caused the formation of
Cooperative Refining, LLC, a Delaware limited liability company (the "Company"),
of which the undersigned constitute all of the initial Members; and

                  WHEREAS, the undersigned have received and approved the
business plan of the Company;

                  NOW, THEREFORE, in consideration of the premises, the mutual
covenants and agreements hereinafter set forth, and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Members agree as follows:

                                   ARTICLE I.
                                     GENERAL

                  The parties hereto hereby agree that this Agreement
constitutes the "limited liability company agreement" of the Company within the
meaning of Section 18-101(7) of the Delaware Limited Liability Company Act, as
amended (the "Act"), and hereby adopt, approve and ratify the execution and
filing in the office of the Secretary of State of the State of Delaware of the
certificate of formation of the Company by Theodore D. Herzog, an individual
resident of the State of Minnesota, on August 6, 1999 (the "Certificate of
Formation") in the form attached hereto as Exhibit 1 and acknowledge, approve
and ratify his designation as an "authorized person" of the Company in the
Certificate of Formation as contemplated by Section 18-201(a) of the Act. The
parties agree that the Agreement shall be effective as of the date hereof and
that they shall comply with the provisions and requirements of the Act and that
the Act shall govern the rights, duties and obligations of the Members, except
as otherwise expressly stated herein.

                  SECTION 1.1. NAME. The name of the Company shall be and the
business shall be conducted under the name of "Cooperative Refining, LLC."

                  SECTION 1.2. PRINCIPAL PLACE OF BUSINESS. The location of the
principal place of business of the Company shall be 1391 Iron Horse Road, P.O.
Box 1404, McPherson,


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Kansas 67460 or such other place as the Board of Managers may from time to time
determine (the "Principal Office").

                  SECTION 1.3. NAMES AND ADDRESSES OF MEMBERS. The names and
addresses of the Members are as set forth in Schedule A.

                  SECTION 1.4. TERM OF EXISTENCE. The Company shall be formed as
of the time of the filing of the Certificate of Formation in the Office of the
Secretary of State of Delaware and its term of existence shall be perpetual,
unless earlier terminated, dissolved or liquidated in accordance with the
provisions of this Agreement or the Refinery Agreement.

                  SECTION 1.5. AGENT FOR SERVICE OF PROCESS. The name and
address of the agent for service of process is, until changed by the Board of
Managers, The Corporate Trust Company, located at Corporation Trust Center, 1209
Orange Street, Wilmington, New Castle County, Delaware 19801.

                  SECTION 1.6. DUTIES OF MEMBERS. The only duties of the Members
to the Company or to each other in respect of the Company shall be those
expressly set forth in this Agreement, and there shall be no other express or
implied duties of the Members to the Company or to each other in respect of the
Company.

                  SECTION 1.7. DUTIES OF MANAGERS. Each Manager shall owe duties
of care and loyalty to the Company and the Members equivalent to those duties
owed by a director of a Delaware corporation to the corporation and its
stockholders. A Manager shall not be personally liable to the Company or the
Members for monetary damages for breach of fiduciary duty as a Manager except
(a) for any breach of the Manager's duty of loyalty to the Company or the
Members; (b) for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law; or (c) for any transaction from which
such Manager derived an improper personal benefit. Notwithstanding the
foregoing, each Manager shall have the right to take action in a manner such
Manager believes to be in the best interest of the entity by whom such Manager
was designated in accordance with Section 6.3.

                                   ARTICLE II.
                                   DEFINITIONS

                  Unless the context otherwise specifies or requires, the terms
defined in this Article II shall, for the purposes of this Agreement, have the
meanings herein specified.

                  "Act" means the Delaware Limited Liability Company Act, as
amended from time to time.

                  "Adjusted Capital Account Deficit" means, with respect to any
Member, the deficit balance, if any, in such Member's Capital Account as of the
end of the relevant Fiscal


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Year, after giving effect to the following adjustments: (i) credit to such
Capital Account any amounts which such Member is obligated to restore pursuant
to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and
1.704-2(i)(5); and (ii) debit to such Capital Account the items describe in
Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5)
and 1.704-1(b)(2)(ii)(d)(6). The foregoing definition of Adjusted Capital
Account Deficit is intended to comply with the provisions of Section
1.704-1(b)(2)(ii)(d) of the Treasury Regulations and shall be interpreted
consistently therewith.

                  "Agreement" means this Limited Liability Company Agreement, as
it may be amended or supplemented from time to time.

                  "Approval Date" is defined in Section 5.2.

                  "Assets" shall have the meaning assigned to such term in the
Refinery Agreement.

                  "Board of Managers" means the Board of Managers of the Company
established pursuant to Article VI.

                  "Capital Account" is defined in Section 11.7 below.

                  "Capital Contribution" means the amount of money or the fair
market value of any property (as agreed by the Members as of the date of
contribution) contributed to the Company by any Member or such Member's
predecessor in interest.

                  "CHS" means Cenex Harvest States Cooperatives, a cooperative
corporation organized under the laws of Minnesota.

                  "Code" means the Internal Revenue Code of 1986, as amended,
and the Treasury Regulations promulgated thereunder. Any reference in this
Agreement to a Section of the Code or the Treasury Regulations shall be
considered also to include any subsequent amendment or replacement of that
Section.

                  "Company" means Cooperative Refining, LLC, the Delaware
limited liability company formed pursuant to the filing of the Certificate of
Formation in Delaware.

                  "Deadlock" is defined in Section 6.19.

                  "Depreciation" means, for each Fiscal Year, an amount equal to
the depreciation, amortization, or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year, except that if the Gross Asset Value
of an asset differs from its adjusted basis for federal income tax purposes at
the beginning of such Fiscal Year, Depreciation shall be an amount which bears
the same ratio to such beginning Gross Asset Value as the federal income tax
depreciation, amortization, or other cost recovery deduction for such Fiscal
Year bears to such beginning


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adjusted tax basis; PROVIDED, HOWEVER, that if the adjusted basis for federal
income tax purposes of an asset at the beginning of such Fiscal Year is zero,
Depreciation shall be determined with reference to such beginning Gross Asset
Value using any reasonable method selected by the Members.

                  "Farmland" means Farmland Industries, Inc., a cooperative
corporation organized under the laws of Kansas.

                  "Fiscal Year" means the 12-month accounting period of the
Company ending on August 31 of each year, or such other date as the Board of
Managers may determine from time to time.

                   "Gross Asset Value" means, with respect to any asset, the
asset's adjusted basis for federal income tax purposes, except as follows:

                  (i) The initial Gross Asset Value of any asset contributed by
         a Member to the Company shall be the gross fair market value of such
         asset, as determined by the contributing Member and the other Member;

                  (ii) The Gross Asset Values of all Company assets shall be
         adjusted to equal their respective gross fair market values (taking
         into account Section 7701(g) of the Code), as determined by the
         Members, as of the following times: (a) the acquisition of an
         additional interest in the Company by any new or existing Member in
         exchange for more than a de minimis Capital Contribution; (b) the
         distribution by the Company to a Member of more than a de minimis
         amount of Company property as consideration for an interest in the
         Company; and (c) the liquidation of the Company within the meaning of
         Treasury Regulations Section 1.704-1(b)(2)(ii)(g); PROVIDED HOWEVER,
         that adjustments pursuant to clauses (a) and (b) above shall be made
         only if the Board of Managers by vote of a Manager Supermajority
         determines that such adjustments are necessary or appropriate to
         reflect the relative economic interests of the Members in the Company;

                  (iii) The Gross Asset Value of any Company asset distributed
         to any Member shall be adjusted to equal the gross fair market value
         (taking into account Section 7701(g) of the Code) of such asset on the
         date of distribution as determined by the distributee and the other
         Member; and

                  (iv) The Gross Asset Values of Company assets shall be
         increased (or decreased) to reflect any adjustments to the adjusted
         basis of such assets pursuant to Code Section 734(b) or Code Section
         743(b), but only to the extent that such adjustments are taken into
         account in determining Capital Accounts pursuant to Regulations Section
         1.704-1(b)(2)(iv)(m); PROVIDED, HOWEVER, that Gross Asset Values shall
         not be adjusted pursuant to this paragraph to the extent the Members
         determine that an adjustment pursuant to




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         paragraph (ii) hereof is necessary or appropriate in connection with a
         transaction that would otherwise result in an adjustment pursuant to
         this paragraph (iv).

                  If the Gross Asset Value of an asset has been determined or
adjusted pursuant to paragraphs (i), (ii), or (iv) hereof, such Gross Asset
Value shall thereafter be adjusted by the Depreciation taken into account with
respect to such asset for purposes of computing income, gains, profits and
losses of the Company.

                  "Growmark" means Growmark, Inc., a Delaware corporation.

                  "Indemnitee" is defined in Section 8.1.

                  "Manager" is defined in Section 6.3.

                  "Manager Supermajority" means 5/6 of the total number of
Managers specified in Section 6.3; provided, however, that if any Manager is
disqualified from voting according to the terms of this Agreement, "Manager
Supermajority" shall mean a unanimous vote of all Managers not so disqualified.

                  "Membership Interest" means the entire ownership interest of a
Member in the Company at any particular time, including, without limitation, the
right of such Member to any and all benefits to which a Member may be entitled
as provided in this Agreement and under law, together with the obligations of
such Member to comply with all of the terms and provisions set forth in this
Agreement and under law.

                  "Members" means the Persons executing this Agreement and the
Persons that are hereafter admitted to the Company and designated as Members in
accordance with this Agreement until such Persons shall cease to be members of
the Company pursuant to this Agreement.

                  "MFA" means MFA Oil Company, a Missouri farm marketing
cooperative association.

                  "NCRA" means National Cooperative Refinery Association, a
cooperative marketing association organized under the laws of Kansas.

                  "Named Officer" is defined in Section 7.1.

                  "Net Cash Flow" means the gross cash proceeds from Company
operations (including sales and dispositions of property), including, dividends,
interest and royalties, if any, less the portion thereof used to pay or
establish reserves for all Company expenses, debt payments, replacements, and
contingencies, all as determined by the Board of Managers by vote of a Manager
Supermajority.


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                  "Person" means any natural person, cooperative association,
cooperative marketing association, corporation, limited liability company,
association, partnership (whether general or limited), joint venture,
proprietorship, governmental agency, trust, estate, association, custodian,
nominee or any other individual or entity, whether acting in an individual,
fiduciary, representative or other capacity.

                  "Personnel Lease Agreement" means that certain Personnel Lease
Agreement of even date herewith by and among NCRA, Farmland and the Company, as
amended or supplanted from time to time.

                  "Principal Office" is defined in Section 1.2.

                  "Profits" or "Losses" mean, for each Fiscal Year, an amount
equal to the Company's taxable income or loss for such year or period,
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the
adjustments indicated in the Tax Matters Exhibit or otherwise specifically
allocated under Article XII hereof.

                  "Refinery Agreement" means that certain Refinery Operating and
Product Output Purchase Agreement of even date herewith by and among NCRA,
Farmland and the Company, as amended or supplemented from time to time.

                  "Regulatory Allocation" is defined in Section 12.3.

                  "Reorganization" means (x) any consolidation or merger of the
Company with or into any other Person, whether or not the Company is the
surviving entity, (y) any exchange or other transaction pursuant to which
outstanding Units are converted into other securities, property or money or (z)
any sale, transfer or other disposition of all or substantially all of the
Company's assets in a single transaction or a series of related transactions. A
dissolution or liquidation of the Company pursuant to Article XIV will not
constitute a "Reorganization" within the meaning of this Agreement.

                  "Securities Act" is defined in Section 16.1.

                  "Successor" is defined in Section 6.3.

                  "Tax Matters Exhibit" means Exhibit 2 to this Agreement.

                  "Tax Matters Partner" or "TMP" shall mean NCRA.



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                  "Transfer" means the sale, assignment, transfer, withdrawal,
mortgage, pledge, hypothecation, exchange or other disposition of any part or
all of a Member's Membership Interest, whether or not for value and whether
voluntarily, by operation of law or otherwise.

                  "Transferee" is defined in Section 9.2.

                  "Treasury Regulations" or "Treas. Reg." refers to the
regulations promulgated by the United States Treasury Department under the Code.

                  "Unit" means an ownership interest of a Member or a Transferee
in the Company representing a fractional part of the ownership interests of all
Members and Transferees.

                                  ARTICLE III.
                      PURPOSE AND CHARACTER OF THE BUSINESS

                  The purpose and character of the business of the Company shall
be the management and operation of the Assets and any lawful business or
activity ancillary thereto permitted under the Act and approved by the Board of
Managers.

                                   ARTICLE IV.
                                     MEMBERS

                  The Members shall have no voting rights under this Agreement,
and instead all voting rights shall be vested in the Board of Managers. Members
shall have the power and authority, as set out in the terms of Section 11.3 of
this Agreement, to require the Members to contribute to the capital of the
Company upon the unanimous agreement of the Members.

                                   ARTICLE V.
                        NEW MEMBERS; UNITS; CERTIFICATES

                  SECTION 5.1. ADMISSION OF NEW MEMBERS; UNITS. The Managers by
vote of a Manager Supermajority may from time to time admit additional Members
to the Company upon the issuance of new Units pursuant to Section 5.2 or upon a
transfer in compliance with Section 9.2. All Members shall be required to have
an interest in the Company represented by one or more Units. Unless otherwise
authorized by vote of a Manager Supermajority in accordance with this Article V,
all Units shall be of one class and series and with equal rights and preferences
in all matters, and the Profits and Losses, and distributions of cash or other
assets, of the Company shall be allocated among the Members of the Company in
proportion to the number of Units held by the Members except as otherwise
provided herein. The Managers, by amendment to this Agreement as provided in
Article XV of this Agreement, (i) may fix the relative rights and preferences of
different classes and series of the Units and (ii) may authorize the issuance of
securities convertible into, or exchangeable for, and options, warrants and
rights to purchase Units.


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                  SECTION 5.2. ISSUANCE OF UNITS. The Company shall have the
authority to issue 100,000 Units. The Company shall initially issue a total of
100,000 Units to NCRA and Farmland according to the terms set forth in Schedule
A and in Section 11.1. The Managers by vote of a Manager Supermajority may issue
additional Units from time to time to existing or new Members. Units may be
issued for any consideration, including, without limitation, cash or other
property, tangible or intangible, received or to be received by the Company or
services rendered or to be rendered to the Company. At the time of authorization
of the issuance of additional Units, the Managers shall state, by resolution,
their determination of the fair value to the Company in monetary terms of any
consideration other than cash for which Units are to be issued.

         Unless otherwise determined by a vote of a Manager Supermajority, in
the event the Company proposes to issue and subsequently issues additional
Units, securities convertible into or exchangeable for Units or options,
warrants and rights to purchase Units, then each of the Members as of the date
on which the Board of Manager approved such issuance (the "Approval Date") shall
have the preemptive right to subscribe for and purchase at the same issue price
fixed therefor by the Board of Managers that number of Units or other securities
that bears the same proportion to the total amount of Units or other securities
proposed to be issued as the number of Units held by such Member on the Approval
Date bears to the total number of Units outstanding on the Approval Date. Upon
any proposed issuance of additional Units or other securities, the Board of
Managers shall give notice of the proposed issuance and the issue price fixed
therefor to all Members, and the Members shall have thirty (30) days from the
date of such notice to exercise the preemptive rights granted to the Members
pursuant to this Section 5.2. In the event that a portion of the Units or other
securities with respect to which the Members have preemptive rights pursuant to
this Section 5.2 remain unsubscribed after thirty (30) days, then each of the
Members that fully exercised their preemptive rights with respect to the
additional Units or other securities pursuant to this Section 5.2 shall have the
right for a period of 10 days thereafter to subscribe for and purchase at the
issue price therefor that number of additional Units or other securities that
bears the same proportion to the total amount of Units or other securities that
remained unsubscribed as the number of Units held by such Member on the Approval
Date bears to the total number of Units held on the Approval Date by Members
that fully exercised their preemptive rights with respect to the additional
Units or other securities pursuant to this Section 5.2. Any Units or other
securities remaining unsubscribed after such 10 day period may be sold by the
Company at a purchase price that is not less than the issue price fixed by the
Board of Managers.

                  SECTION 5.3. NO CERTIFICATES FOR UNITS. The Units of the
Company shall not be certificated Units unless otherwise determined by the Board
of Managers.


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                                   ARTICLE VI.
                  MANAGEMENT AND OPERATION OF COMPANY BUSINESS

                  SECTION 6.1. AUTHORITY OF THE MEMBERS. Except as otherwise
expressly provided herein, no Member shall have any authority to act for, or to
assume any obligations or responsibility on behalf of, or to bind any other
Member or the Company.

                  SECTION 6.2. BOARD OF MANAGERS. The business and affairs of
the Company shall be managed by or under the authority of the Board of Managers,
except as otherwise required by the Act or this Agreement.

                  SECTION 6.3. NUMBER, QUALIFICATION; TERM OF OFFICE; VOTE. The
number of members of the Board of Managers shall be six (each a "Manager"). The
Managers shall be designated from time to time as follows: two Managers shall be
designated by Farmland, two Managers shall be designated by CHS, one Manager
shall be designated by Growmark, and one Manager shall be designated by MFA.
Each of the Managers shall hold office until such Manager's successor has been
designated by the entity by whom such Manager was designated, or until the
earlier death, resignation, removal or disqualification of such Manager. In the
event that any of CHS, Growmark or MFA sell, assign, transfer or convey their
respective ownership interests in NCRA, the transferee of such ownership
interest (the "Successor") shall thereafter have the right to designate that
number of Managers that were previously designated by CHS, Growmark or MFA, as
applicable. Each Manager shall have one vote in all matters to come before the
Board of Managers.

                  SECTION 6.4. INITIAL BOARD. The initial Board of Managers
shall be comprised of the following individuals:

                               Robert W. Honse, as Farmland Representative;
                               Stanley A. Riemann, as Farmland Representative;
                               John Johnson, as CHS Representative;
                               Leon Westbrock, as CHS Representative;
                               Dale H. Creach, as MFA Representative; and
                               D. William Davisson, as Growmark Representative.

                  SECTION 6.5. PLACE OF MEETINGS. Meetings of the Board of
Managers shall be held at the Principal Office of the Company or at such other
place as may be agreed by the members of such Board from time to time.

                  SECTION 6.6. SPECIAL MEETINGS. A special meeting of the Board
of Managers may be called for any purpose or purposes at any time by the Chair
or by any two Managers who shall demand such special meeting by written notice
given to the Chair specifying the purposes of such meeting.


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                  SECTION 6.7. MEETINGS HELD UPON MANAGER DEMAND. Within five
(5) business days after the Chair receives a valid demand for a meeting of the
Board of Managers from two Managers, it shall be the duty of the Chair to cause
a special or regular meeting of Board of Managers, as the case may be, to be
duly called and held on notice given no later than five (5) business days after
receipt of such demand. If the Chair fails to cause such a meeting to be called
and held as required by this Section 6.7, the Managers making the demand may
call the meeting by giving notice as provided in Section 6.9 at the expense of
the Company.

                  SECTION 6.8. ADJOURNMENTS. Any meeting of the Board of
Managers may be adjourned from time to time to another date, time and place. If
any meeting of the Board of Managers is so adjourned, no notice as to such
adjourned meeting need be given if the date, time and place at which the meeting
will be reconvened are announced at the time of adjournment.

                  SECTION 6.9. NOTICE OF MEETINGS. Unless otherwise required by
law, written notice of each meeting of the Board of Managers, stating the date,
time and place and, in the case of a special meeting, the purpose or purposes,
shall be given at least five (5) days and not more than ninety (90) days prior
to the meeting to every member of the Board of Managers. A member of the Board
of Managers may waive notice of the date, time, place and purpose or purposes of
a meeting of the Board of Managers. A waiver of notice is effective whether
given before, at or after the meeting, and whether given in writing, orally or
by attendance. Attendance by a member of the Board of Managers at a meeting is a
waiver of notice of that meeting, unless the member objects at the beginning of
the meeting to the transaction of business because the meeting is not lawfully
called or convened, or objects before a vote on an item of business because the
item may not lawfully be considered at that meeting and does not participate in
the consideration of the item at that meeting.

                  SECTION 6.10. QUORUM. A majority of the members of the Board
of Managers constitutes a quorum for the transaction of business at each meeting
of the Board of Managers.

                  SECTION 6.11. ABSENT MEMBERS. A member of the Board of
Managers may give advance written consent or opposition to a proposal to be
acted on at a meeting of the Board of Managers. If such member is not present at
the meeting, such consent or opposition to a proposal does not constitute
presence for purposes of determining the existence of a quorum, but such consent
or opposition shall be counted as a vote in favor of or against the proposal and
shall be entered in the minutes or other record of action at the meeting, if the
proposal acted on at the meeting is substantially the same or has substantially
the same effect as the proposal to which the member has consented or objected.

                  SECTION 6.12. CONFERENCE COMMUNICATIONS. Any or all of the
members of the Board of Managers may participate in any meeting of the Board of
Managers by any means of communication through which such members may
simultaneously hear each other during such meeting. For the purposes of
establishing a quorum and taking any action at the meeting,



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members of the Board of Managers participating pursuant to this Section 6.12
shall be deemed present in person at the meeting; and the place of the meeting
shall be the place of origination of the conference telephone conversation or
other comparable communication technique.

                  SECTION 6.13. REMOVAL; VACANCIES. Any member of the Board of
Managers may be removed from office at any time, with or without cause, by the
entity by whom such Manager was designated in accordance with Section 6.3 by
giving notice of such removal to the Company. A vacancy among the Managers by
death, resignation, removal or otherwise shall be filled by the designation of
the entity by whom such Manager was designated in accordance with Section 6.3.

                  SECTION 6.14. ACTS OF MANAGERS. Except as otherwise provided
herein, the Board of Managers shall take action by the affirmative vote of a
majority of the total number of Managers, and any such act shall be deemed to be
the action of the Board of Managers for all purposes of this Agreement and the
Act.

                  SECTION 6.15. WRITTEN ACTION. Any action which might be taken
at a meeting of the Board of Managers may be taken without a meeting if done in
writing and signed by a number of the members of the Board of Managers, or
committee members, whose approval would be sufficient to approve the action at a
meeting at which all of the members of the Board of Managers were present.

                  SECTION 6.16. PROXIES. A member of the Board of Managers may
cast or authorize the casting of a vote by filing a written appointment of a
proxy with the Chair at or before the meeting at which the appointment is to be
effective. The member may sign or authorize the written appointment by telegram,
cablegram or other means of electronic transmission setting forth or submitted
with information sufficient to determine that the member authorized such
transmission. Any copy, facsimile, telecommunication or other reproduction of
the original of either the writing or transmission may be used in lieu of the
original, provided that it is a complete and legible reproduction of the entire
original.

                  SECTION 6.17. VOTING. Each member of the Board of Managers
entitled to vote at a meeting of the Board of Managers or entitled to express
consent in writing to action without a meeting shall have one vote. All
questions at a meeting shall be decided by a majority vote of the total number
of Managers except where otherwise required by the Act or this Agreement.

                  SECTION 6.18. CERTAIN ACTIONS. The following actions shall
require the approval or authorization of a Manager Supermajority:

                  (a) The approval of any Reorganization, any other merger,
         consolidation or sale of substantially all Company assets to which the
         Company or a Subsidiary is a party or the acquisition of another
         business by the Company;




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                  (b) The authorization or issuance of any additional Units;

                  (c) The purchase by the Company of any Unit or an agreement to
         do so; PROVIDED, HOWEVER, that the board member or members of the Board
         of Managers designated by the Member whose Units are subject to
         purchase, if such is the case, shall have no vote in such matter;

                  (d) The making of any distributions to the Members, except as
         permitted according to Section 13.1;

                  (e) The termination, assignment or material amendment of the
         Refinery Agreement;

                  (f) The approval of the transfer of Units by any Member;

                  (g) Recommendations to the Members to incur capital
         expenditures with respect to the Assets as described in Section 6 of
         the Refinery Agreement;

                  (h) The appointment or removal of the President of the
         Company;

                  (i) The commencement of any Reorganization or other
         proceedings or the filing of any petition seeking relief under Title 11
         of the United States Code, as now constituted or hereafter amended, or
         any other federal or state bankruptcy, insolvency or similar law;

                  (j) The execution by the TMP of a settlement agreement binding
         any Member without obtaining the written concurrence of the Member who
         would be bound by such agreement;

                  (k) The approval and adoption of a business plan for each
         fiscal year of the Company (other than the initial fiscal year of the
         Company) pursuant to Section 9.1 of the Refinery Agreement, and any
         material modifications to or deviations from such business plan;

                  (l) The disposition of any assets in excess of $250,000 other
         than in the ordinary course of business, except as authorized in the
         then current approved business plan;

                  (m) The entering into, or the amendment or modification of,
         any agreement between the Company and any Member, Manager or Named
         Officer (or any entity in which a Member, Manager or Named Officer has
         a financial interest); PROVIDED, HOWEVER, that any member of the Board
         Managers that is a party to, has a financial interest in a


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         party to, or was designated by a Member who is a party to, such
         agreement shall not be entitled to vote with respect to such matter;

                  (n) The determination of whether to repair or replace any
         Asset in excess of $2,000,000 in the event that such Asset is subject
         to a Casualty Occurrence (as that term is defined in Section 5.3 of the
         Refinery Agreement) as described in Section 5.3 of the Refinery
         Agreement.

                  SECTION 6.19. DISPUTES; GOVERNING LAW.

                  (a) Management Escalation. In the event that a dispute among
the Members shall arise during the term of this Agreement regarding the
interpretation of this Agreement, the Refinery Agreement or the Personnel Lease
Agreement, the Board of Managers shall first make a good faith effort to
promptly resolve such dispute. If the Board of Managers is unable to reach
agreement with respect to such dispute within thirty (30) days, then the dispute
shall be submitted to officers of Farmland, MFA, Growmark and CHS selected by
such parties, or, if applicable, of the Successor or Successors thereof, who
shall meet within thirty (30) days to attempt in good faith to resolve the
dispute. If the above mentioned officers have not resolved the dispute within
thirty (30) days of the submission of the dispute to such officers, then the
dispute shall be resolved in accordance with the provisions of Sections 6.19(b).

                  (b) Mediation and Arbitration. In the event that the Members
are unable to resolve any dispute pursuant to the provisions of Section 6.19(a)
hereof, such dispute shall be submitted to non-binding mediation administered by
the American Arbitration Association in accordance with its Commercial Mediation
Rules. If the Member initiating the mediation is NCRA, the mediation shall take
place in Kansas City, Missouri, and if the Member initiating the mediation is
Farmland, the mediation shall take place in Wichita, Kansas. The Members shall
share the expenses of the mediation on an equal basis. If such dispute is not
resolved by non-binding mediation, the dispute shall be resolved by binding
arbitration administered by the American Arbitration Association in accordance
with its Commercial Arbitration Rules (as modified hereby). If the Member
initiating the arbitration proceeding is NCRA, the arbitration shall be
conducted in Kansas City, Missouri, and if the Member initiating the arbitration
proceeding is Farmland, the arbitration shall be conducted in Wichita, Kansas.
Any award rendered in the arbitration proceeding shall be final and binding upon
the Members and a judgment thereon may be entered in any court having competent
jurisdiction. The Member initiating the arbitration shall request, and the
American Arbitration Association shall: (i) appoint as the arbitrator a single
retired trial judge in the state where the arbitration takes place who is
familiar with the business conducted by the Company; (ii) direct the arbitrator
to follow substantive rules of law and the Federal Rules of Evidence; (iii)
allow the parties to conduct discovery pursuant to the rules then in effect
under the Federal Rules of Civil Procedure (excluding confidential records of
NCRA or Farmland that are not relevant to the issues being arbitrated) for a
period not to exceed 60 days; (iv) require the testimony to be transcribed; and
(v) require the award to be accompanied by findings of fact and a statement of
reasons for the


                                       13
<PAGE>



decision. If a Member is determined to be liable in any dispute that is
determined and/or settled by arbitration pursuant to this Section 6.19(b), then
all costs and expenses, including reasonable attorney's fees and expert's fees,
of all parties incurred with respect to such dispute shall be borne by the
Member determined to be liable in respect of such dispute; PROVIDED, HOWEVER,
that if complete liability is not assessed against only one member, the Members
shall share the expenses in proportion to their respective amounts of liability
so determined. In the event that no Member is determined to be liable in a
dispute that is determined and/or settled by arbitration pursuant to this
Section 6.19(b), then the expenses of arbitration shall be shared equally by the
parties unless otherwise decided by the arbitrator(s). The Members agree to
continue performing their respective obligations under this Agreement while the
dispute is being resolved, except to the extent such obligations are clearly the
subject of the dispute. Notwithstanding any provision of this Section 6.19(b),
any Member may seek injunctive relief from any judicial or administrative
authority of competent jurisdiction to enjoin the other Member from breaching
any provision of this Agreement, the Refinery Agreement or the Personnel Lease
Agreement pending resolution of a dispute by mediation or arbitration pursuant
to this Section 6.19(b).

                  (c) This Agreement shall be governed by, and construed and
interpreted in accordance with, the law of the State of Delaware, which shall be
the proper law of this Agreement notwithstanding any rules of conflict of laws
therein contained under which any other law would be made applicable.

                  SECTION 6.20. COMPENSATION. Members of the Board of Managers
shall not be compensated by the Company for serving in such capacity. The
Company shall bear the expenses, if any, incurred by each Member's respective
representatives in attending meetings of the Board of Managers.

                                  ARTICLE VII.
                                    OFFICERS

                  SECTION 7.1. NUMBER. The officers of the Company, all of whom
shall be natural persons, shall consist of a Chair, a President, a Secretary and
a Chief Financial Officer ("Named Officers"), and any other officers and agents
as the Board of Managers by a majority vote of all Managers may designate from
time to time upon recommendation of the President.
Any person may hold two or more offices.

                  SECTION 7.2. ELECTION, TERM OF OFFICE AND QUALIFICATIONS. The
President shall be elected by a vote of a Manager Supermajority and all other
officers shall be elected by a vote of the majority of the Managers. All
officers shall serve at the pleasure of the Board of Managers and shall hold
office until their successors are elected and qualified, or until such office is
eliminated by amendment of this Agreement, in the case of the Named Officers, or
a vote of the Board of Managers, in the case of officers other than Named
Officers. An officer who is a Manager shall hold office until the election and
qualification of his or her successor even though he or she may cease to be a
Manager.


                                       14
<PAGE>




                  SECTION 7.3. REMOVAL AND VACANCIES. Any officer may be removed
from his or her office with or without cause upon a vote of the Board of
Managers, subject to the provisions of Section 6.18. Such removal shall be
without prejudice to the contract rights of the person so removed. A vacancy
among the officers by death, resignation, removal or otherwise shall be filled
for the unexpired term by the Board of Managers, unless such office is
eliminated or held vacant at the discretion of the Board of Managers.

                  SECTION 7.4. CHAIR. The Chair shall preside at all meetings of
the Managers and shall have such other duties as may be prescribed, from time to
time, by the Board of Managers. The Chair shall be a Manager and shall be
elected by the Board of Managers.

                  SECTION 7.5. PRESIDENT.

                  (a) Day-to-Day Operations. The day-to-day operations and
affairs of the Company shall be managed by a President. The Board of Managers
delegates to the President the authority to oversee and supervise the Company's
business. Except as otherwise provided in this Agreement, the President shall be
authorized to determine all questions relating to the day-to-day conduct,
operation and management of the business of the Company within the authority
granted under the business plan then in effect. The President shall be
responsible to the Board of Managers.

                  (b) General. The President shall be entitled to delegate such
part of his or her duties as he or she may deem reasonable or necessary in the
conduct of the business of the Company to one or more employees of the Company,
who shall each have such duties and authority as shall be determined from time
to time by the President or as may be set forth in any agreement between such
employee and the Company.

                  (c) Election. The President shall be elected by the Board of
Managers and shall receive such compensation as may be determined from time to
time by the Board of Managers or as shall be set forth in any written agreement
approved by the Board of Managers.

                  SECTION 7.6. SECRETARY. The Secretary shall be secretary of
and shall attend all meetings of the Members and Board of Managers and shall
record all proceedings of such meetings in the minute book of the Company. He or
she shall give proper notice of meetings of Members and the Board of Managers.
He or she shall perform such other duties as may from time to time be prescribed
by the Board of Managers.

                  SECTION 7.7. CHIEF FINANCIAL OFFICER. The Chief Financial
Officer shall keep or cause to be kept accurate accounts of all moneys of the
Company received or disbursed. He or she shall deposit or cause to be deposited
all moneys, drafts and checks in the name of and to the credit of the Company in
such banks and depositaries as the Board of Managers shall from time to time
designate. He or she shall have power to endorse or cause to be endorsed for
deposit


                                       15
<PAGE>



or collection all notes, checks and drafts received by the Company. He or she
shall disburse or cause to be disbursed the funds of the Company as ordered by
the President, making proper vouchers therefor. He or she shall render to the
Board of Managers whenever required an account of all his or her transactions as
Chief Financial Officer and of the financial condition of the Company and shall
perform such other duties as may from time to time be prescribed by the Board of
Managers.

                  SECTION 7.8. DUTIES OF OTHER OFFICERS. The duties of such
other officers and agents as the Board of Managers may designate shall be set
forth in the resolution creating such office or agency or by subsequent
resolution.

                  SECTION 7.9. COMPENSATION. The officers, agents and employees
of the Company shall receive such compensation for their services as may be
determined from time to time by the Board of Managers or as shall be set forth
in a written agreement.

                                  ARTICLE VIII.
                                 INDEMNIFICATION

                  SECTION 8.1. INDEMNIFICATION.

                  (a) To the fullest extent permitted by law, each Manager,
Named Officer, officer and employee of the Company (individually, an
"Indemnitee") shall be indemnified, held harmless and defended by the Company
from and against any and all losses, claims, damages, liabilities, whether joint
or several, expenses (including legal fees and expenses), judgments, fines and
other amounts paid in settlement, incurred or suffered by such Indemnitee, as a
party or otherwise, in connection with any threatened, pending or completed
claim, demand, action, suit or proceeding, whether civil, criminal,
administrative or investigative, and whether formal or informal, arising out of
or in connection with the business or the operation of the Company and by reason
of the Indemnitee's status as a Manager, Named Officer, officer or employee of
the Company regardless of whether the Indemnitee continues to be a Manager,
Named Officer, officer or employee of the Company at the time any such loss,
claim, damage, liability or other expense is paid or incurred if (i) the
Indemnitee acted in good faith and in a manner he or she reasonably believed to
be in the best interests of the Company and, with respect to any criminal
proceeding, had no reasonable cause to believe that his or her conduct was
unlawful, (ii) the Indemnitee's conduct did not constitute intentional
misconduct or a material breach of the terms of this Agreement and (iii) the
Indemnitee's conduct did not involve a transaction from which the Manager, Named
Officer, officer or employee of the Company derived an improper personal
benefit. The termination of any action, suit or proceeding by judgment, order,
settlement or upon a plea of NOLO CONTENDERE, or its equivalent, shall not, of
itself, create a presumption that the Indemnitee acted in a manner contrary to
the standards specified in clauses (i), (ii) or (iii) of this Section 8.1(a).



                                       16
<PAGE>



                  (b) To the fullest extent permitted by law, expenses incurred
by an Indemnitee in defending any claim, demand, action, suit or proceeding
subject to this Section 8.1 shall, from time to time, be advanced by the Company
prior to the final disposition of such claim, demand, action, suit or proceeding
upon receipt by the Company of an undertaking by or on behalf of the Indemnitee
to repay such amount unless it is determined that such Indemnitee is entitled to
be indemnified therefor pursuant to this Section 8.1.

                  (c) The indemnification provided by this Section 8.1 shall be
in addition to any other rights to which any Indemnitee may be entitled under
any other agreement, pursuant to any vote of the Managers, as a matter of law or
otherwise, and shall inure to the benefit of the heirs, legal representatives,
successors, assigns and administrators of the Indemnities.

                  (d) Any indemnification under this Section 8.1 shall be
satisfied solely out of the assets of the Company and no Indemnitee shall have
any recourse against any Member with respect to such indemnification.

                  (e) An Indemnitee shall not be denied indemnification in whole
or in part under this Section 8.1 merely because the Indemnitee had an interest
in the transaction with respect to which the indemnification applies, if the
transaction was not otherwise prohibited by the terms of this Agreement and the
conduct of the Indemnitee satisfied the conditions set forth in Section 8.1(a).

                  (f) The Company may, but shall have no obligation to, purchase
and maintain insurance covering any potential liability of the Indemnitees for
any actions or omissions for which indemnification is permitted hereunder,
including such types of insurance (including extended coverage liability and
casualty and workers' compensation) as would be customary for any person engaged
in a similar business, and may name the Indemnitees as additional insured
parties thereunder.

                  SECTION 8.2. INDEMNIFICATION PROCEDURES; SURVIVAL.

                  (a) Promptly after receipt by an Indemnitee of notice of the
commencement of any action that may result in a claim for indemnification
pursuant to Section 8.1, the Indemnitee shall notify the Company in writing
within thirty (30) days thereafter; PROVIDED, HOWEVER, that any omission so to
notify the Company will not relieve it of any liability for indemnification
hereunder as to the particular item for which indemnification may then be sought
(except to the extent that the failure to give notice shall have been materially
prejudicial to the Company) nor from any other liability that it may have to any
Indemnitee. The Company shall have the right to assume sole and exclusive
control of the defense of any claim for indemnification pursuant to Section 8.1,
including the choice and direction of any legal counsel.



                                       17
<PAGE>



                  (b) An Indemnitee shall have the right to employ separate
counsel in any action as to which indemnification may be sought under any
provision of this Agreement and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Indemnitee
unless (i) the Company has agreed in writing to pay such fees and expenses, (ii)
the Company has failed to assume the defense thereof and employ counsel within a
reasonable period of time after being given the notice required above or (iii)
the Indemnitee shall have been advised by its counsel that representation of
such Indemnitee and other parties by the same counsel would be inappropriate
under applicable standards of professional conduct (whether or not such
representation by the same counsel has been proposed) due to actual or potential
differing interests between them. It is understood, however, that to the extent
more than one Indemnitee is entitled to employ separate counsel at the Company's
expense pursuant to clause (iii) above, the Company shall, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys at any time for all such Indemnitees having actual or
potential differing interests with the Company, unless but only to the extent
the Indemnitees have actual or potential differing interests with each other.

                  (c) The Company shall not be liable for any settlement of any
such action effected without its written consent, but if settled with such
written consent, or if there is a final judgment against the Indemnitee in any
such action, the Company agrees to indemnify and hold harmless the Indemnitee to
the extent provided above from and against any loss, claim, damage, liability or
expense by reason of such settlement or judgment.

                  (d) The indemnification obligations set forth in Section 8.1
and this Section 8.2 shall survive the termination of this Agreement.

                                   ARTICLE IX.
                                    TRANSFERS

                  SECTION 9.1. REGISTRATION, TRANSFER AND EXCHANGE.

                  (a) The Company shall keep at the Principal Office a register
in which shall be entered the names and addresses of the Members, the number of
Units owned by each Member and all Transfers of outstanding Units.

                  (b) Subject to this Article IX, each Unit, whether originally
or in substitution for, or upon transfer, exchange or other issuance of any Unit
shall be registered in the register on the effective date of the Transfer,
exchange or other issuance of such Unit; PROVIDED, HOWEVER, that no registration
of any Transfer not made in compliance with this Article IX shall be made in the
register.



                                       18
<PAGE>



                  (c) Transfer of Units on the books of the Company may be
authorized only by the person or persons in whose name Units are registered on
the books of the Company named in the certificate, such person's legal
representative or such person's duly authorized attorney-in-fact.

                  SECTION 9.2. RESTRICTION ON TRANSFERS. In addition to any
restrictions imposed by the federal securities laws and any applicable state
securities or "blue-sky" laws, no Member may sell, assign, pledge, transfer,
convey or otherwise dispose of (including through any merger, share exchange or
consolidation) (collectively, "Transfer") all or any part of any Unit, whether
for consideration or not, to any Person who is not a Member at the time of such
Transfer. No recipient of such Transfer to a Person other than a Member (each
such nonMember recipient, a "Transferee") shall have any rights in the Company
or be or have any rights as a Member with respect to all or any part of any such
Unit attempted to be Transferred, and any such attempted Transfer of all or any
part of a Unit shall be entirely null and void, unless the Board of Managers by
vote of a Manager Supermajority consents to the Transfer and the admission of
such Transferee as a Member if such Transfer is to a Person, other than the
Company, who is not then a Member. The appropriate Company records and any
certificates representing the Units shall be noted to prevent any Transfers in
violation of this Section 9.2. Notwithstanding anything to the contrary
contained in this Section 9.2, in the event that the proposed merger between
Farmland and CHS is consummated, Farmland shall have the right to transfer all
or any part of its Units to the resulting merged entity, and such merged entity
shall, automatically upon such transfer, be admitted as a Member and have all
the rights of a Member with respect to such transferred Units, including, but
not limited to, rights of appointment to the Board of Managers. Further, in the
event that CHS, Growmark or MFA transfers its respective interest in NCRA to a
Person other than a corporation doing business as a cooperative or effects such
transfer without the prior written consent of Farmland, the successor to the
transferee's interest shall have no right to appoint a Manager to the Board of
Managers pursuant to Section 6.3 of this Agreement.

                  SECTION 9.3. TRANSFER BY LEGAL PROCESS. Upon any involuntary
Transfer of all or any portion of the Units of a Member pursuant to a levy of
execution, foreclosure of pledge, garnishment, attachment, divorce decree,
bankruptcy or other legal process (or by operation of law resulting from the
death, disability, liquidation, dissolution or winding-up of a Member), such
Member shall cease to be a Member, but any successor in title to the transferred
Units shall have no right to become a Member or vote in any Company matters
unless admitted as a Member by affirmative vote of a Manager Supermajority,
subject to the provisions of Section 9.4. If such successor does not become a
Member, such successor shall be merely an assignee within the meaning of Section
18-702(b) of the Act.

                  SECTION 9.4. CONDITIONS TO PERMITTED TRANSFERS. No Transfer
otherwise permitted by any provisions of this Agreement shall be valid unless
and until the following conditions are satisfied (any of which may be waived by
the Board of Managers in its discretion):



                                       19
<PAGE>



                  (a) The transferor and Transferee shall execute and deliver to
the Company such documents and instruments of conveyance as may be necessary or
appropriate in the opinion of counsel to the Company to effect such Transfer and
confirm the agreement of the Transferee to be bound by the provisions of this
Agreement; PROVIDED, HOWEVER, that in the case of a Transfer of Units at death
or involuntarily by operation of law, the Transfer shall be confirmed by
presentation to the Company of legal evidence of such Transfer, in form and
substance satisfactory to counsel of the Company.

                  (b) Except in the case of a Transfer of Units involuntarily by
operation of law in which case no opinion of counsel is required, the transferor
shall furnish to the Company an opinion of counsel, which counsel and opinion
shall be satisfactory to the Company, to the effect that:

                           (i) The Transfer will not cause the Company to
           terminate for federal income tax purposes under Section 708 of the
           Code;

                           (ii) The Transfer is either exempt from all
           applicable registration requirements and such Transfer will not
           violate any applicable federal and state laws regulating the Transfer
           of securities, or the Company Units to be transferred are duly and
           properly registered under all applicable federal and state securities
           laws; and

                           (iii) The Transfer will not cause the Company to be
           deemed to be an "investment company" under the Investment Company Act
           of 1940.

                  (c) The transferor and Transferee shall furnish the Company
with the Transferee's taxpayer identification number, sufficient information to
determine the Transferee's initial tax basis in the Units transferred and any
other information reasonably necessary to permit the Company to file all
required federal and state tax returns and other legally required information
statements or returns. The Company shall not be required to make any
distribution otherwise provided for in this Agreement with respect to any
Transferred Units until it has received such information.

                  SECTION 9.5. WITHDRAWAL. No Member shall be entitled to
withdraw from the Company prior to the dissolution and winding up of the Company
pursuant to Article XIV hereof without the unanimous consent of the other
Members of the Company.

                                   ARTICLE X.
                  BOOKS OF ACCOUNT; REPORTS AND FISCAL MATTERS

                  SECTION 10.1. BOOKS; PLACE; ACCESS. The Chief Financial
Officer shall maintain books of account on behalf of the Company at the
Principal Office or such other place as may be designated by the Board of
Managers. The Chief Financial Officer shall account for all inventories on the
books and records of the Company using the LIFO method of accounting,


                                       20
<PAGE>



as such term is understood according to generally accepted accounting
principles. All Members shall at all reasonable times have access to and the
right to inspect the books and records of the Company.

                  SECTION 10.2. FINANCIAL INFORMATION. The Chief Financial
Officer shall cause to be prepared and delivered to each of the Members summary
financial information with respect to each of the first eleven months of each
Fiscal Year. Such monthly financial information shall be provided to the Members
not later than twenty (20) days following the end of each month of the Fiscal
Year. The Chief Financial Officer also shall cause to be prepared and delivered
to each of the Members an annual financial report that shall describe in
reasonable detail the financial and business activities of the Company and
include the financial statements of the Company for the previous Fiscal Year.
Such annual financial report shall be provided to the Members not later than one
hundred twenty (120) days following each Fiscal Year-end and shall be audited by
a nationally recognized public accounting firm.

                  SECTION 10.3. TAX INFORMATION. Within one hundred twenty (120)
days after the close of each Fiscal Year, all necessary tax information shall be
transmitted to all Members.

                  SECTION 10.4. TAX ELECTIONS. All elections required or
permitted to be made by the Company under the Code, shall be made by the TMP. In
the event of a transfer of all or part of the Membership Interest of any Member,
the Company may, by vote of a Manager Supermajority, elect pursuant to Section
754 of the Code to adjust the basis of the assets of the Company.

                  SECTION 10.5. TAX MATTERS PARTNER. For as long as the TMP is a
Member, the TMP shall act as the tax matters partner, as such term is defined in
Section 6231(a)(7) of the Code, and the TMP is hereby authorized to and shall
represent the Company in connection with all examinations of the Company's
affairs by tax authorities, including resulting administrative and judicial
proceedings. The Members and the TMP shall use all reasonable efforts to comply
with the responsibilities outlined in the Tax Matters Exhibit and in Sections
6222 through 6231 of the Code (including any Treasury Regulations thereunder and
any successor or amendatory provisions thereto for which a tax matters partner
is designated).

                                   ARTICLE XI.
                                     CAPITAL

                  SECTION 11.1. INITIAL CAPITAL CONTRIBUTIONS. On the date of
the execution of this Agreement, the Members shall make the Capital
Contributions or contributions of inventory that reflect the ownership interest
indicated opposite their respective names on Schedule A.

                  SECTION 11.2. NO RIGHT TO RETURN OF CONTRIBUTION. No Member
shall have the right to the withdrawal or to the return of his, her or its
Capital Contribution, except upon the dissolution and liquidation of the Company
pursuant to Article XIV.


                                       21
<PAGE>




                  SECTION 11.3. ADDITIONAL CAPITAL CONTRIBUTIONS. In the event
that the Members unanimously determine that additional contributions to the
capital of the Company are necessary to the conduct of the Company's activities,
each of the Members shall promptly make a cash contribution to the capital of
the Company equal to his share (determined in proportion to the number of Units
held by each Member) of such additional funds, which contribution shall
constitute a Capital Contribution. If one Member fails to contribute its share
of such funds to the Company, then (i) the funds advanced by the other Members
shall be regarded as a loan in accordance with Section 11.4, and (ii) in the
event that such failure is not cured within thirty (30) days after the date upon
which such capital contribution was to be made pursuant to the determination of
the Members, each of such other Members shall have the right to cause the
dissolution of the Company upon giving thirty (30) days' notice to the other
Members. Members shall be required to contribute in proportion to the number of
Units held in the event that the Company is unable to meet any obligation
arising from environmental liabilities under the Refinery Agreement.

                  SECTION 11.4. LOANS TO THE COMPANY; NO INTEREST ON CAPITAL;
LOANS TO MEMBERS.
                  (a) The Members may, but are not obligated to, make loans to
the Company from time to time, as authorized by the Board of Managers in
accordance with Section 6.18(m). Any such loans shall not be treated as Capital
Contributions to the Company for any purpose hereunder nor entitle such Member
to any increase in its share of the Profits and Losses and cash distributions of
the Company, but the Company shall be obligated to such Member for the amount of
any such loans pursuant to the terms thereof, as the same are determined by the
Board of Managers and such Member. The outstanding amount of any loans made by a
Member to the Company shall accrue interest at the applicable semi-annual,
short-term federal interest rate on the date of such loan, which interest shall
be payable at such times as shall be determined by the Board of Managers and
such Member. All scheduled principal and interest payments with respect to any
loans from a Member to the Company pursuant to this Section 11.4 shall be repaid
prior to any distributions to any Members pursuant to Sections 13.1, 13.2 or
14.3(d). No interest shall be paid on any Capital Contribution to the Company or
on any balance in any Capital Account.

                  (b) The Company may extend loans to Members according to terms
and conditions approved by the Board of Managers in accordance with Section
6.18(m).

                  SECTION 11.5. CREDITOR'S INTEREST IN THE COMPANY. No creditor
who makes a loan to the Company shall have or acquire at any time as a result of
making the loan any direct or indirect interest in the profits, capital or
property of the Company, other than such interest as may be accorded to a
secured creditor. Notwithstanding the foregoing, this provision shall not
prohibit in any manner whatsoever a secured creditor from participating in the
profits of operation or gross or net sales of the Company or in the gain on sale
or refinancing of the Company, all as may be provided in its loan or security
agreements.


                                       22
<PAGE>



                  SECTION 11.6. LIABILITY OF MEMBERS. Except as otherwise
provided in the Act, no Member, as such, shall have any personal liability
whatsoever for the debts, liabilities, contracts or other obligations of the
Company, for any of the Company's losses or for the acts or omissions of any
other Member, Manager or employee of the Company beyond, with respect to a
Member, such Member's Capital Contribution and, solely to the extent and for the
period required by applicable law, the amount of such Member's Capital
Contribution which is returned to it. Each Unit, on issuance, shall be fully
paid and, except as set forth in Section 11.3, not subject to assessment for
additional Capital Contributions. No Member shall be required to lend any funds
to the Company as a condition to admission or continued membership of such
Member in the Company. It is the intent of the Members that (i) no distribution
to any Member (other than a distribution upon the dissolution and liquidation of
the Company) shall be deemed a withdrawal of capital, even if such distribution
represents, for Federal income tax purposes or otherwise (in full or in part), a
distribution of depreciation or any other non-cash item accounted for as a loss
or deduction from or offset to the Company's income, and (ii) no Member shall be
obligated to pay any such amount to or for the account of the Company or any
creditor of the Company. However, if any court of competent jurisdiction holds
that, notwithstanding the provisions of this Agreement, any distribution made by
the Company to a Member constitutes a withdrawal of capital, any obligation
under applicable law to return the same or any portion thereof to or for the
account of the Company or its creditors shall be the obligation of such Member.

                  SECTION 11.7. CAPITAL ACCOUNTS. A separate capital account
("Capital Account") shall be maintained by the Company for each Member as
described in the Tax Matters Exhibit.

                  SECTION 11.8. NCRA LEASE ADJUSTMENTS. NCRA shall remain
responsible for all lease, residual and other payments (excluding operating,
maintenance and repair payments) under all applicable leases thereof and incur
all expenses necessary to allow the Company the continued use of the leased
assets listed on Schedule B hereto (the "Leased Assets") during and beyond terms
of all such leases (the "Lease Expenses"). Within thirty (30) days of delivery
of proof of payment of any of the Lease Expenses (other than any residual
payments or other payments made to purchase the Leased Assets), the Company
shall reimburse NCRA for 100% of all such Lease Expenses (such reimbursement,
the "Lease Reimbursement"); PROVIDED, HOWEVER, that NCRA shall upon receipt of
any Lease Reimbursement direct a portion of such Lease Reimbursement to all
Members in proportion to the Members' respective ownership interests indicated
opposite their respective names on Schedule A. Any other assets under lease
shall be handled in like manner.



                                       23
<PAGE>



                                  ARTICLE XII.
                        ALLOCATION OF PROFITS AND LOSSES

                  SECTION 12.1. ALLOCATION OF PROFITS AND LOSSES. After giving
effect to the special allocations set forth in Sections 12.3, 12.4 and 12.5
hereof, and subject to Section 12.2 hereof, all Profits and Losses shall be
allocated to each of the Members in proportion to their respective Units.

                  SECTION 12.2. LIMITATION ON LOSS ALLOCATION. Notwithstanding
anything in Section 12.1 above, Losses allocated pursuant to Section 12.1 shall
not exceed the maximum amount of Losses that can be so allocated without causing
a Member to have an Adjusted Capital Account Deficit at the end of any Fiscal
Year. In the event one of the Members would have an Adjusted Capital Account
Deficit as a consequence of an allocation of Losses pursuant to Section 12.1,
the limitation set forth herein shall be applied on a Member by Member basis so
as to allocate the maximum permissible Losses to each Member under Section
1.704-1(b)(2)(ii)(D) of the Regulations. All Losses in excess of the foregoing
limitation shall be allocated to the Members in proportion to their Units.

                  SECTION 12.3. REGULATORY ALLOCATIONS. Notwithstanding anything
to the contrary contained in Section 12.1 or 12.2 or elsewhere in this
Agreement, it is the intention of the Members that Profits and Losses be
allocated in accordance with the "partnership minimum gain chargeback" (Treasury
Regulations Sections 1.704-2(f) and 1.704-2(g)(2)), "partner minimum gain
chargeback" (Treasury Regulations Sections 1.704-2(f)(5), 1.704-2(i)(4), 1.704-
2(i)(5) and 1.704-2(j)(2)), "qualified income offset" and "alternate test for
economic effect" (Treasury Regulations Section 1.704-1(b)(2)(ii)(d)),
"partnership nonrecourse deductions" (Treasury Regulations Section
1.704-2(b)(1)) and "partner non-recourse deductions" (Treasury Regulations
Section 1.704-2(i)(1)) provisions of Treasury Regulations Section 1.704-1(b) and
Section 1.704-2 and any successor regulations (collectively, the "Regulatory
Allocations") and, to the extent any provisions of this Agreement do not comply
therewith, the Members desire and intend that such provisions be modified or
stricken in such respects as are necessary in order to cause compliance
therewith. The Regulatory Allocations that shall govern this Agreement are set
forth in the Tax Matters Exhibit.

                  SECTION 12.4. TAX ALLOCATIONS: SECTION 704(C) OF THE CODE. In
accordance with Section 704(c) of the Code, income, gain, loss and deduction
with respect to any property contributed to the Company shall, solely for tax
purposes, be allocated among the Members so as to take account of any variation
between the adjusted basis of such property to the Company for income tax
purposes and its book value, in the same manner as such variations are treated
under Section 704(c) of the Code. Any elections or other decisions related to
such allocations shall be made by the Board of Managers in any manner that
reasonably reflects the purpose and intention of this Agreement. Allocations
pursuant to this Section 12.4 are solely for purposes of federal, state and
local taxes and shall not affect, or in any way be taken into account in
computing, any


                                       24
<PAGE>



Member's Capital Account or share of income, gain, loss or deduction pursuant to
any provision of this Agreement.

                  SECTION 12.5. SPECIAL ALLOCATIONS. The Company shall allocate
to Farmland as income or loss, as the case may be, an amount equal to 73.72% of
the amount of NCRA's share of all net income or loss of those NCRA subsidiaries
listed on Schedule C hereto. Such allocations shall not be limited to the net
income of the Company and, notwithstanding the provisions of Sections 12.2 and
12.3 hereof, may create an Adjusted Capital Account Deficit to the extent of
such allocation.

                  SECTION 12.6. OTHER ALLOCATION RULES. In the event of any
changes in Units during a Fiscal Year, all Profits and Losses from operations of
the Company during such Fiscal Year, using such methods of accounting for
depreciation and other items as the Board of Managers determines to use for
federal income tax purposes, shall be allocated to each Member based on its
varying interest in the Company during such operating year in accordance with
Section 706 of the Code. The Board of Managers shall determine in accordance
with Section 706 of the Code whether to prorate items of income and deduction
according to the portion of the Fiscal Year for which a Member held Units or
whether to close the books on an interim basis and divide such operating year
into two or more segments. All tax credits shall be allocated among the Members
in accordance with applicable law.

                                  ARTICLE XIII.
                                  DISTRIBUTIONS

                  SECTION 13.1. DISTRIBUTIONS. The Board of Managers shall,
unless otherwise prohibited by vote of a Manager Supermajority and provided the
Company has Net Cash Flow (i) distribute monthly one percent (1%) of the gross
revenue received from sales to Members of gasoline and distillate, to the
Members in proportion to such Member's ownership interest in the Company, (ii)
distribute to Farmland, to the extent of any undistributed special income
allocation under Section 12.5, an amount equal to 73.72% of the cash received by
NCRA as a result of its ownership interest in the NCRA subsidiaries listed on
Schedule C, such distribution to be made promptly following NCRA's receipt of
such cash, and (iii) distribute to NCRA, to the extent not previously
distributed under this clause (iii), an amount equal to 73.72% of the cash
invested by NCRA in such NCRA subsidiaries to cover net losses of such NCRA
subsidiaries, such distribution to be made promptly following such investment by
NCRA. After taking into account the distributions described in clauses (i)
through (iii) of this Section 13.1, the Board of Managers may distribute Net
Cash Flow to the Members at such times and in such amounts as it may determine
by vote of a Manager Supermajority. All distributions of Net Cash Flow shall be
distributed to the Members in proportion to such Members' respective ownership
interests in the Company.

                  SECTION 13.2. LIMITATIONS ON DISTRIBUTIONS. Notwithstanding
any provision to the contrary in this Article XIII:



                                       25
<PAGE>



                  (a) All distributions made in connection with the liquidation
and winding up of the Company shall be made in the manner provided in Section
14.3 hereof.

                  (b) No distribution shall be made that would result in a
violation of Section 18-607 of the Act.

                  SECTION 13.3. SETOFF. All distributions to a Member made
pursuant to Section 13.1 shall be subject to setoff by the Company for any past
due obligations of such Member (or its predecessor in interest) to the Company.

                                  ARTICLE XIV.
                           DISSOLUTION AND LIQUIDATION

                  SECTION 14.1. EVENTS CAUSING DISSOLUTION. The Company shall be
dissolved only upon the occurrence of any of the following events:

                  (a) The sale, exchange or other disposition of all or
substantially all of the assets and properties of the Company;

                  (b) The written agreement of a Manager Supermajority;

                  (c) The entry of a decree of judicial dissolution under
Section 18-802 of the Act;

                  (d) Upon notice given by a Member to the other Members
pursuant to Section 11.3 in the event of a failure of a Member to make a
required capital contribution; PROVIDED, HOWEVER, that the Company shall be
dissolved on the date specified in such notice, which date shall be at least
thirty (30) days after the date of such notice; or

                  (e) The termination or expiration of the Refinery Agreement.

                  SECTION 14.2. CONTINUATION OF BUSINESS. Upon the expulsion,
bankruptcy, retirement, resignation or dissolution of a Member or the occurrence
of any other event which terminates the continued membership of a Member in the
Company as provided in Section 18-801 of the Act, the Company shall not be
dissolved and its business shall continue.

                  SECTION 14.3. LIQUIDATION AND WINDING UP. If dissolution of
the Company should be caused by reason of the events set forth in Section 14.1,
the Company shall be liquidated and the Managers (or other person or persons
designated by a decree of court) shall wind up the affairs of the Company. The
Managers or other persons winding up the affairs of the Company shall promptly
proceed to the liquidation of the Company and, in settling the accounts of the
Company, the assets and the property of the Company shall be distributed in the
following order of priority:



                                       26
<PAGE>



                  (a) To the payment of all debts and liabilities of the Company
in the order of priority as provided by law (other than outstanding loans from a
Member);

                  (b) To the establishment of any reserves deemed necessary by
the Managers or the person winding up the affairs of the Company for any
contingent liabilities or obligations of the Company;

                  (c) To the repayment of any outstanding loans from a Member to
the Company;

                  (d) To the Members in proportion to and to the extent of their
respective Capital Account balances, after giving effect to all contributions,
distributions, and allocations for all periods; and

                  (e) The balance, if any, to the Members pro rata in accordance
with the number of Units owned by each Member.

                  SECTION 14.4. COMPLIANCE WITH TIMING REQUIREMENTS OF
REGULATIONS. In the event the Company is liquidated within the meaning of
Treasury Regulations Section 1.704-1(b)(2)(ii)(g), distributions shall be made
pursuant to this Article XIV to the Members who have positive Capital Account
balances in compliance with Treasury Regulations Section 1.704-
1(b)(2)(ii)(b)(2), and (b) if a Member has a deficit balance in its Capital
Account (after giving effect to all contributions, distributions and allocations
for all taxable years), such Member shall have no obligation to contribute to
the capital of the Company and such deficit shall not be considered a debt owed
to the Company or to any other Person for any purpose whatsoever.

                                   ARTICLE XV.
                                    AMENDMENT

                  The Certificate of Formation and this Agreement may be amended
by a unanimous vote of the Managers; PROVIDED, HOWEVER, that the Managers may
not amend this Agreement to modify the requirement that the unanimous agreement
of the Members be obtained in order to require additional contributions to the
capital of the Company.

                                  ARTICLE XVI.
                   REPRESENTATIONS, WARRANTIES OF THE MEMBERS

                  SECTION 16.1. REPRESENTATIONS AND WARRANTIES OF THE MEMBERS.
Each of the Members represents and warrants as of the date of this Agreement to
each of the other Members and the Company as follows:



                                       27
<PAGE>



                  (a) The Units being acquired by such Member are being
purchased for such Member's own account and not with a view to, or for sale in
connection with, any distribution or public offering thereof within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"). Such Member
understands that such Units have not been registered under the Securities Act or
any state securities laws by reason of their contemplated issuance in
transactions exempt from the registration and prospectus delivery requirements
thereof and that the reliance of the Company and others upon such exemptions is
predicated in part by the representations and warranties of such Member
contained herein.

                  (b) Such Member has the requisite power and authority (whether
corporate or otherwise) and legal capacity to enter into, and to carry out its
obligations under, this Agreement.

                  (c) The execution and delivery by such Member of this
Agreement and the consummation by such Member of the transactions contemplated
hereby have been duly authorized prior to the date of this Agreement by all
necessary action on the part of such Member.

                  (d) This Agreement has been duly executed and delivered by
such Member and constitutes a valid and binding obligation enforceable against
such Member in accordance with its terms.

                  (e) Such Member is not subject to, or obligated under, any
provision of (i) any agreement, arrangement or understanding, (ii) any license,
franchise or permit or (iii) any law, regulation, order, judgment or decree that
would be breached or violated, or in respect of which a right of termination or
acceleration or any encumbrance on any of such Member's assets would be created,
by such Member's execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby, except for such agreements
as to which a Member has previously obtained the consent of the other party or
parties thereto.

                  (f) No authorization, consent or approval of, waiver or
exemption by, or filing or registration with, any public body, court, third
party or authority is necessary on such Member's part, which has not previously
been obtained by such Member for the consummation of the transactions
contemplated by this Agreement.

                  (g) No person or entity has or will have, as a result of any
act or omission by such Member any right, interest or valid claim against the
Company or any other Member for any commission, fee or other compensation as a
finder or broker, or in any similar capacity, in connection with the
transactions contemplated by this Agreement.

                  (h) Such Member has, and will transfer to the Company, good
and marketable title to the assets being contributed to the Company by such
Member pursuant to the provisions of Section 11.1, free and clear of all liens,
pledges, charges, claims, leases, restrictions, obligations and encumbrances of
any nature whatsoever.


                                       28
<PAGE>




                                  ARTICLE XVII.
                            MISCELLANEOUS PROVISIONS

                  SECTION 17.1. ADDITIONAL ACTIONS AND DOCUMENTS. Each of the
Members hereby agrees to take or cause to be taken such further actions, to
execute, acknowledge, deliver and file, or cause to be executed, acknowledged,
delivered and filed such further documents and instruments, and to use all
reasonable efforts to obtain such consents, as may be necessary or as may be
reasonably requested in order to fully effectuate the purposes, terms and
conditions of this Agreement.

                  SECTION 17.2. NOTICE. Any notice or other communication to any
party in connection with this Agreement shall be in writing and shall be sent by
manual delivery, telegram, telex, facsimile transmission, overnight courier or
United States mail (postage prepaid) addressed, if to the Company, to the
Principal Office of the Company set forth in Section 1.2 hereof or to such other
address as the Company shall notify the Members in writing; and if to the
Members, to their respective addresses set forth in Schedule A hereof or to such
other address as any such Member may hereafter designate by notice in writing to
the Chair and Company. All periods of notice shall be measured from the date of
delivery thereof if manually delivered, from the date of sending thereof if sent
by telegram, telex or facsimile transmission, from the first business day after
the date of sending if sent by overnight courier, or from four days after the
date of mailing if mailed.

                  SECTION 17.3. SEVERABILITY. The invalidity of any one or more
provisions hereof or of any other agreement or instrument given pursuant to or
in connection with this Agreement shall not affect the remaining portions of
this Agreement or any such other agreement or instrument or any part thereof;
and in the event that one or more of the provisions contained herein or therein
should be invalid, or should operate to render this Agreement or any such other
agreement or instrument invalid, this Agreement and such other agreements and
instruments shall be construed as if such invalid provisions had not been
inserted.

                  SECTION 17.4. SURVIVAL. It is the express intention and
agreement of the Members that all covenants, agreements, statements,
representations, warranties and indemnities made in this Agreement shall survive
the execution and delivery of this Agreement.

                  SECTION 17.5. WAIVERS; EXERCISE OF RIGHTS. Neither the waiver
by a Member of a breach of or a default under any of the provisions of this
Agreement, nor the failure or delay on the part of a Member or the Company in
exercising any right, power or privilege hereunder and no course of dealing
between the Members or between a Member and the Company shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
expressly provided are cumulative and


                                       29
<PAGE>


not exclusive of any other rights or remedies which a Member or the Company
would otherwise have at law or in equity or otherwise.

                  SECTION 17.6. BINDING EFFECT. Subject to any provisions hereof
restricting assignment, this Agreement shall be binding upon and shall inure to
the benefit of the Members and their respective successors and permitted
assigns.

                  SECTION 17.7. LIMITATION ON BENEFITS OF THIS AGREEMENT. It is
the explicit intention of the Members that no person or entity other than the
Members and the Company is or shall be entitled to bring any action to enforce
any provision of this Agreement against any Member or the Company, and that the
covenants, undertakings and agreements set forth in this Agreement shall be
solely for the benefit of, and shall be enforceable only by, the Members (or
their respective heirs, legal representatives, successors and assigns as
permitted hereunder) and the Company; PROVIDED, HOWEVER, that the Indemnitees
shall, as intended third-party beneficiaries thereof, be entitled to the
enforcement of Sections 8.1 and 8.2 hereof, but only as insofar as the
obligations sought to be enforced thereunder are those of the Company.

                  SECTION 17.8. WAIVER OF PARTITION. The Members agree that the
assets of the Company are not and will not be suitable for partition. The
Members hereby waive any right of partition or any right to take any action that
otherwise might be available to them for the purpose of severing their
relationship with the Company or interest in assets held by the Company from the
interest of the other Members.

                  SECTION 17.9. ENTIRE AGREEMENT. This Agreement, together with
the Refinery Agreement and the Personnel Lease Agreement, contains the entire
agreement among the Members with respect to the matters contained herein, and
supersedes all prior oral or written agreements, commitments or understandings
with respect to the matters provided for herein.

                  SECTION 17.10. PRONOUNS. All pronouns shall be deemed to refer
to the masculine, feminine, neuter, singular or plural, as the identity of the
antecedent may require.

                  SECTION 17.11. HEADINGS. Article and Section headings
contained in this Agreement are inserted for convenience of reference only,
shall not be deemed to be a part of this Agreement for any purpose, and shall
not in any way define or affect the meaning, construction or scope of any of the
provisions hereof.



                                       30
<PAGE>


                  SECTION 17.12. EXECUTION IN COUNTERPARTS. To facilitate
execution, this Agreement may be executed in as many counterparts as may be
required; and it shall not be necessary that the signatures of, or on behalf of,
each party, or that the signatures of all Persons required to bind any party,
appear on each counterpart; but it shall be sufficient that the signature of, or
on behalf of, each party, or that the signatures of the Persons required to bind
any party, appear on one or more of the counterparts. All counterparts shall
collectively constitute a single agreement. It shall not be necessary in making
proof of this Agreement to produce or account for more than a number of
counterparts containing the respective signatures of, or on behalf of, all of
the parties hereto.

                  SECTION 17.13. LIMITATION OF MEMBER LIABILITIES. The aggregate
of any and all liabilities and obligations of any Member to any other Member or
Members or the Company under this Agreement, the Refinery Agreement an the
Personnel Lease Agreement shall in no event exceed $150 million per Member.



                                       31
<PAGE>



                  IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first above written.

                                FARMLAND INDUSTRIES, INC.


                                By: John W. Fuehring
                                   ---------------------------------------------
                                  Name: John W. Fuehring
                                       -----------------------------------------
                                  Title: Controller - Crop Production
                                        ----------------------------------------



                                NATIONAL COOPERATIVE REFINERY ASSOCIATION


                                By: James S. Loving
                                   ---------------------------------------------
                                  Name: James S. Loving
                                       -----------------------------------------
                                  Title: President
                                        ----------------------------------------




                                       32
<PAGE>



Exhibit 1



                            CERTIFICATE OF FORMATION
                                       OF
                            COOPERATIVE REFINING, LLC


                  This Certificate of Formation of Cooperative Refining, LLC
(the "Company") is executed and filed by the undersigned, as authorized person,
to form a limited liability company under the Delaware Limited Liability Company
Act (the "Act").

                  1. The name of the Company is Cooperative Refining, LLC.

                  2. The address of the registered office of the Company in the
State of Delaware is The Corporation Trust Company, located at Corporation Trust
Center, 1209 Orange Street, Wilmington, New Castle County, Delaware 19801.

                  3. The name and address of the registered agent for service of
process on the Company in the State of Delaware is The Corporation Trust
Company, located at Corporation Trust Center, 1209 Orange Street, Wilmington,
New Castle County, Delaware 19801.

                  IN WITNESS WHEREOF, the undersigned has executed this
Certificate of Formation this 6th day of August, 1999.


                                    /s/ Theodore D. Herzog
                                    -------------------------------------------
                                    Theodore D. Herzog

                                    Authorized Person



<PAGE>



Exhibit 2

                               TAX MATTERS EXHIBIT

                  SECTION 1. CAPITAL ACCOUNT MAINTENANCE. It is intended that
the Capital Account of each Member will be maintained in accordance with the
capital accounting rules of Treasury Regulations Section 1.704-1(b)(2)(iv) and
the provisions of this Agreement relating to the maintenance of Capital Accounts
shall be interpreted and applied in a manner consistent therewith. In the event
the Members shall determine that it is prudent to modify the manner in which the
Capital Accounts, or any debits or credits thereto, are computed in order to
comply with such Treasury Regulations, the TMP may make such modification,
provided that it is not likely to have a material effect on the amounts
distributable to any Member pursuant to Article XIII hereof. In general, the
Capital Account of each Member shall be initially credited with the amount of
such Member's initial Capital Contribution. The Capital Account of each Member
shall further be credited by the amount of any additional Capital Contribution
made by such Member from time to time, shall be debited by the amount of any
cash distributions made by the Company or the fair market value of any property
distributed in kind to such Member and shall be credited with the amount of
income and gains and debited with the amount of losses of the Company allocated
to such Member. In all instances the capital accounting rules in Treasury
Regulations Section 1.704-1(b)(2)(iv) will determine the proper debits or
credits to each Member's Capital Account. The Members may, at their option,
increase or decrease the Capital Accounts of the Members to reflect a
revaluation of Company property on the Company's books at the times when,
pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv), such adjustments may
occur. The adjustments, if made, will be made in accordance with such Treasury
Regulation, including allocating taxable items, as computed for book purposes,
to the Capital Accounts as prescribed in such Treasury Regulation, with
appropriate adjustments as contemplated by Section 12.4 of the Agreement. In the
case of the transfer of all or a part of an interest in the Company, the Capital
Account of the transferor Member attributable to the transferred interest will
carry over to the transferee Member. In the case of termination of the Company
pursuant to Section 708 of the Code, the rules of Treasury Regulations Section
1.704-1(b)(2)(iv) shall govern adjustments to the Capital Accounts. If there
are any adjustments to Company property as a result of Sections 732, 734 or 743
of the Code, the Capital Accounts of the Members shall be adjusted as provided
in Treasury Regulations Section 1.704-1(b)(2)(iv)(m).

                  SECTION 2. ADJUSTMENTS TO PROFITS AND LOSSES. In the
determination of Profits and Losses with respect to any period, the Company's
taxable income or loss for such period shall be adjusted as follows:

                  (i) Any income of the Company that is exempt from federal
         income tax and not otherwise taken into account in computing Profits
         and Losses pursuant to this paragraph shall be added to such taxable
         income or loss;

                  (ii) Any expenditures of the Company described in Code Section
         705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures
         pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not
         otherwise taken into account in computing Profits and Losses pursuant
         to this paragraph shall be subtracted from such taxable income or loss;

                                        1

<PAGE>



                  (iii) In the event the Gross Asset Value of any Company asset
         is adjusted pursuant to sub paragraphs (ii) or (iii) under the
         definition "Gross Asset Value" below, the amount of such adjustment
         shall be taken into account as gain or loss from the disposition of
         such asset for purposes of computing Profits and Losses;

                  (iv) Gain or loss resulting from any disposition of Company
         property with respect to which gain or loss is recognized for federal
         income tax purposes shall be computed by reference to the Gross Asset
         Value of the property disposed of, notwithstanding that the adjusted
         tax basis of such property differs from its Gross Asset Value;

                  (v) In lieu of the depreciation, amortization, and other cost
         recovery deductions taken into account in computing such taxable income
         or loss, there shall be taken into account Depreciation for such fiscal
         year;

                  (vi) To the extent an adjustment to the adjusted tax basis of
         any Company asset pursuant to Code Section 734(b) or Code Section
         743(b) is required pursuant to Regulations Sections
         1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4) to be taken into
         account in determining Capital Accounts as a result of a distribution
         other than in liquidation of a Member's interest in the Company, the
         amount of such adjustment shall be treated as an item of gain (if the
         adjustment increases the basis of the asset) or loss (if the adjustment
         decreases the basis of the asset) from the disposition of the asset and
         shall be taken into account for purposes of computing Profits and
         Losses;

                  (vii) Notwithstanding any other provision of this paragraph,
         any items which are specially allocated pursuant to Section 3 hereof
         shall not be taken into account in computing Profits and Losses.

The amounts of the items of Company income, gain, loss, or deduction available
to be specially allocated pursuant to Section 3 hereof shall be determined by
applying rules analogous to those set forth in subparagraphs (i) through (vi)
above.

                  SECTION 3. REGULATORY ALLOCATIONS. The following Regulatory
Allocations shall be made in the following order:

                  (a) Minimum Gain Chargeback. Except as otherwise provided in
Section 1.704-2(f) of the Treasury Regulations, notwithstanding any other
provision of these Regulatory Allocations, if there is a net decrease in Company
minimum gain during any Company Fiscal Year, each Member shall be specially
allocated items of Company income and gain for such year (and, if necessary,
subsequent years) in an amount equal to that Member's share of the net decrease
in Company minimum gain (within the meaning of Treasury Regulations Sections
1.704-2(b)(2) and 1.704-2(d)) determined in accordance with Treasury Regulations
Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made
in proportion to the respective amounts required to be allocated to each Member
pursuant thereto. The items to be so allocated shall be determined in accordance
with Treasury Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This
Paragraph (a) is intended to comply with the minimum gain chargeback


                                       2
<PAGE>



requirement in Treasury Regulations Section 1.704-2(f) and shall be interpreted
consistently therewith.

                  (b) Member Minimum Gain Chargeback. Except as otherwise
provided in Treasury Regulations Section 1.704-2(i)(4), notwithstanding any
other provision of these Regulatory Allocations, if there is a net decrease in
Member nonrecourse debt minimum gain, as defined in Treasury Regulations Section
1.704-2(i)(2) and determined pursuant to Treasury Regulations Section
1.704-2(i)(3), attributable to a Member nonrecourse debt, as defined in Treasury
Regulations Section 1.704-2(b)(4), during any Company Fiscal Year, each Member
who has a share of the Member nonrecourse debt minimum gain attributable to such
Member nonrecourse debt, determined in accordance with Treasury Regulations
Section 1.704-2(i)(5), shall be specially allocated items of Company income and
gain for such year (and if necessary, subsequent years) in an amount equal to
such Member's share of the net decrease in Member nonrecourse debt minimum gain
attributable to such Member nonrecourse debt, determined in accordance with
Treasury Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous
sentence shall be made in proportion to the respective amounts required to be
allocated to each Member pursuant thereto. The items to be so allocated shall be
determined in accordance with Treasury Regulations 1.704-2(i)(4) and
1.704-2(j)(2). This Paragraph (b) is intended to comply with the minimum gain
chargeback requirement in Treasury Regulations Section 1.704-2(i)(4) and shall
be interpreted consistently therewith.

                  (c) Qualified Income Offset. If a Member unexpectedly receives
an adjustment, allocation or distribution described in Treasury Regulations
Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6), and such unexpected adjustment,
allocation or distribution puts such Member's Capital Account into a deficit
balance or increases such deficit balance determined after such account is
credited by any amounts which the Member is obligated to restore or is deemed to
be obligated to restore pursuant to the penultimate sentence of Treasury
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5) and debited by the items
described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)
and for all other allocations tentatively made pursuant to these Regulatory
Allocations as if this Paragraph (c) were not in this Agreement, such Member
shall be allocated items of Company income and gain in an amount and manner
sufficient to eliminate such deficit or increase as quickly as possible. It is
intended that this Paragraph (c) shall meet the requirement that this Agreement
contain a "qualified income offset" as defined in Treasury Regulations Section
1.704-1(b)(2)(ii)(d) and this Section shall be interpreted and applied
consistently therewith.

                  (d) Gross Income Allocation. In the event any Member has a
deficit Capital Account at the end of any Fiscal Year which is in excess of the
sum of (i) the amount such Member is obligated to restore pursuant to any
provision of this Agreement, and (ii) the amount such Member is deemed to be
obligated to restore pursuant to the penultimate sentences of Treasury
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Member shall be
specially allocated items of Company income and gain in the amount of such
excess as quickly as possible, provided that an allocation pursuant to this
Paragraph (d) shall be made only if and to the extent that such Member would
have a deficit Capital Account in excess of such sum after all other allocations
provided for in these Regulatory Allocations have been made as if Paragraph (c)
and this Paragraph (d) were not in the Agreement.


                                       3
<PAGE>



                  (e) Nonrecourse Deductions. Nonrecourse deductions, within the
meaning of Treasury Regulations Section 1.704-2(b)(1), for any Fiscal Year or
other period shall be specially allocated to the Members in proportion to their
Units.

                  (f) Member Nonrecourse Deductions. Any Member nonrecourse
deductions, within the meaning of Treasury Regulations Sections 1.704-2(i)(1)
and 1.704-2(i)(2), for any Fiscal Year or other period shall be specially
allocated to the Member who bears the economic risk of loss with respect to the
Member nonrecourse debt to which such Member nonrecourse deductions are
attributable in accordance with Treasury Regulations Section 1.704-2(i).

                  (g) Section 754 Adjustment. To the extent an adjustment to the
adjusted tax basis of any Company asset pursuant to Code Sections 732, 734(b) or
743(b) is required, pursuant to Treasury Regulations Sections
1.704-1(b)(2)(iv)(m)(2) or (4), to be taken into account in determining Capital
Accounts, the amount of such adjustment to the Capital Accounts shall be treated
as an item of gain (if the adjustment increases the basis of the asset) or loss
(if the adjustment decreases such basis) and such gain or loss shall be
specially allocated to the Members in a manner consistent with the manner in
which their Capital Accounts are required to be adjusted pursuant to such
Sections of the Treasury Regulations.

                  The Regulatory Allocations are intended to comply with certain
requirements of the Treasury Regulations. It is the intent of the Members that
to the extent possible, all Regulatory Allocations shall be offset either with
other Regulatory Allocations or with special allocations of other items of
Company income, gain, loss, or deduction pursuant to this paragraph. Therefore,
notwithstanding any other provision of this Exhibit or Article XII (other than
the Regulatory Allocations), the Board of Managers shall make such offsetting
special allocations of Company income, gain, loss, or deduction in whatever
manner they determine appropriate so that, after such offsetting allocations are
made, each Member's Capital Account balance is, to the extent possible, equal to
the Capital Account balance such Member would have had if the Regulatory
Allocations were not part of the Agreement and all Company items were allocated
pursuant to Section 12.1 and Section 12.2. In exercising their discretion under
this paragraph, the Board of Managers shall take into account future Regulatory
Allocations under Sections Paragraphs (a) and (b) that, although not yet made,
are likely to offset other Regulatory Allocations previously made under
Paragraphs (e) and (f).

                  SECTION 4. TAX MATTERS PARTNER.

                  (a) TMP Notices. Each Member shall furnish the TMP with such
information (including information specified in Section 6230(e) of the Code) as
the TMP may reasonably request to permit the TMP to provide the Internal Revenue
Service with sufficient information to allow proper notice to the Members in
accordance with Section 6223 of the Code. The TMP shall keep each Member
informed of those administrative and judicial proceedings for the adjustment at
the Company level of Company items required by Section 6223(g) of the Code and
the Treasury Regulations thereunder, and such other matters as the TMP, in its
sole discretion, deems appropriate.



                                       4
<PAGE>



                  (b) Inconsistent Tax Treatment. Each Member shall notify the
TMP in the event its treatment of any Company item on its federal income tax
return is inconsistent with the treatment of that item on any return filed by or
in any records of the Company within thirty (30) days of the date such Member's
return is filed.

                  (c) Requests for Tax Adjustments. No Member shall file,
pursuant to Section 6227 of the Code, a request for an administrative adjustment
of limited liability company items for any Company taxable year without first
notifying each other Member. If each other Member agrees with the requested
adjustment, the TMP shall file the request for administrative adjustment on
behalf of the Company. If unanimous consent of the Members is not obtained
within thirty (30) days, or within the period required to file timely the
request for administrative adjustment, if shorter, any Member, including the TMP
(on behalf of the Company), may file a request for administrative adjustment on
its own behalf.

                  (d) Tax Proceedings. The TMP, in its sole discretion, shall
negotiate with the Internal Revenue Service on behalf of the Company during all
aspects of the tax proceeding, including without limitation the examination,
appeals and litigation process. Any Member who intends to file a petition under
Sections 6226, 6228, or other sections of the Code with respect to any Company
item, or other tax matters involving the Company, shall give reasonable notice
to each of the other Members of such intention and the nature of the
contemplated proceeding. In the case where the TMP is the Member intending to
file such petition, the TMP, in its sole discretion, shall choose the forum in
which such petition will be filed. If any Member intends to seek review of any
court decision rendered as a result of a proceeding instituted under the
preceding part of this paragraph (d) of Section 4, such Member shall notify each
of the other Members of such intended action. In accordance with its duty to act
in good faith, the TMP may choose to pursue or forego settlement, litigation or
any other proceedings.

                  (e) Tax Settlements. The TMP may bind a Member to a settlement
agreement without obtaining the written concurrence of such Member who would be
bound by such agreement only upon the approval of such settlement agreement by
vote of a Manager Supermajority. Any Member who enters into a settlement
agreement with the Secretary of the Treasury with respect to any partnership
items, as defined by Section 6231(a)(3) of the Code, shall notify the Members of
such settlement agreement and its terms within ninety (90) days from the date of
settlement.

                  (f) TMP Expenditures, Fees and Indemnification. The TMP may
engage such legal counsel, certified public accountants, or others (including,
without limitation, experts) on behalf of the Company as it may determine to be
necessary and appropriate. Any other Member may engage other legal counsel,
certified public accountants, or others on such other Member's own behalf and at
such other Member's sole cost and expense. Any reasonable item of expense,
including but not limited to fees and expenses for legal counsel, certified
public accountants, and others (including, without limitation, experts) that the
TMP incurs on behalf of the Company in connection with any audit, assessment,
litigation, or other proceeding regarding any partnership item, shall constitute
expenses of the Company. In the event that the Company does not have adequate
cash or other assets to pay such items of expense, the TMP shall not be
obligated to make capital contributions or loans to fund such expenses, and the
TMP shall be free to resign as


                                       5
<PAGE>



the tax matters partner of the Company pursuant to Section 4(g) hereof. The
Company shall indemnify the TMP pursuant to Article VIII hereof.

                  (g) Resignation of TMP. The TMP may resign as tax matters
partner at any time upon the filing of a signed statement with the Internal
Revenue Service in accordance with Temp. Treas. Reg. ss. 301.6231(a)(7)-1T(i)
(or any successor provision thereto). The successor tax matters partner shall be
determined pursuant to Temp. Treas. Reg. ss.ss. 301.6231(a)(7)-1T (or any
successor provision thereto).

                  (h) Survival of TMP Provisions. The provisions of this Section
4, including without limitation the obligation to pay fees and expenses and the
indemnification obligations described in Section 4 hereof, shall survive the
termination of the Company or the termination of any Member's interest in the
Company and shall remain binding on the Company for a period of time necessary
to resolve with the Internal Revenue Service, the Department of the Treasury or
any state taxing authority any and all matters regarding the federal or state
income taxation of the Company for the applicable tax year(s).

                  SECTION 5. DEFINITIONS.

                  "Adjusted Capital Account Deficit" means, with respect to any
Member, the deficit balance, if any, in such Member's Capital Account as of the
end of the relevant Fiscal Year, after giving effect to the following
adjustments: (i) credit to such Capital Account any amounts which such Member is
obligated to restore pursuant to the penultimate sentences of Treasury
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and (ii) debit to such
Capital Account the items describe in Treasury Regulations Sections
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6).
The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Treasury
Regulations and shall be interpreted consistently therewith.

                  "Depreciation" means, for each Fiscal Year, an amount equal to
the depreciation, amortization, or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year, except that if the Gross Asset Value
of an asset differs from its adjusted basis for federal income tax purposes at
the beginning of such Fiscal Year, Depreciation shall be an amount which bears
the same ratio to such beginning Gross Asset Value as the federal income tax
depreciation, amortization, or other cost recovery deduction for such Fiscal
Year bears to such beginning adjusted tax basis; PROVIDED, HOWEVER, that if the
adjusted basis for federal income tax purposes of an asset at the beginning of
such Fiscal Year is zero, Depreciation shall be determined with reference to
such beginning Gross Asset Value using any reasonable method selected by the
Members.

                   "Gross Asset Value" means, with respect to any asset, the
asset's adjusted basis for federal income tax purposes, except as follows:

                  (i) The initial Gross Asset Value of any asset contributed by
         a Member to the Company shall be the gross fair market value of such
         asset, as determined by the contributing Member and the other Member;


                                       6
<PAGE>



                  (ii) The Gross Asset Values of all Company assets shall be
         adjusted to equal their respective gross fair market values (taking
         into account Section 7701(g) of the Code), as determined by the
         Members, as of the following times: (a) the acquisition of an
         additional interest in the Company by any new or existing Member in
         exchange for more than a de minimis Capital Contribution; (b) the
         distribution by the Company to a Member of more than a de minimis
         amount of Company property as consideration for an interest in the
         Company; and (c) the liquidation of the Company within the meaning of
         Treasury Regulations Section 1.704-1(b)(2)(ii)(g); PROVIDED, HOWEVER,
         that adjustments pursuant to clauses (a) and (b) above shall be made
         only if the TMP reasonably determines that such adjustments are
         necessary or appropriate to reflect the relative economic interests of
         the Members in the Company;

                  (iii) The Gross Asset Value of any Company asset distributed
         to any Member shall be adjusted to equal the gross fair market value
         (taking into account Section 7701(g) of the Code) of such asset on the
         date of distribution as determined by the distributee and the other
         Member; and

                  (iv) The Gross Asset Values of Company assets shall be
         increased (or decreased) to reflect any adjustments to the adjusted
         basis of such assets pursuant to Code Section 734(b) or Code Section
         743(b), but only to the extent that such adjustments are taken into
         account in determining Capital Accounts pursuant to Regulations Section
         1.704-1(b)(2)(iv)(m); PROVIDED, HOWEVER, that Gross Asset Values shall
         not be adjusted pursuant to this paragraph to the extent the Members
         determine that an adjustment pursuant to paragraph (ii) hereof is
         necessary or appropriate in connection with a transaction that would
         otherwise result in an adjustment pursuant to this paragraph (iv).

                  If the Gross Asset Value of an asset has been determined or
adjusted pursuant to paragraphs (i), (ii), or (iv) hereof, such Gross Asset
Value shall thereafter be adjusted by the Depreciation taken into account with
respect to such asset for purposes of computing income, gains, profits and
losses of the Company.








                                        7

<PAGE>




                                   SCHEDULE A
                      MEMBERS OF COOPERATIVE REFINING, LLC


Name and Address of
Member                                                                  Units
------                                                                  -----

Farmland Industries, Inc.                                              42,435

NCRA                                                                   57,565



                                        1

<PAGE>



                                   SCHEDULE B
                                  LEASED ASSETS


As enumerated in the Operating Lease between NCRA and General Electric dated
October 12, 1983:

                           Coker Unit Revamp Equipment


As enumerated in the Operating Lease between NCRA and Beatrice dated August 1,
1984:

                            Sour Crude Unit Equipment
                          Sour Water Stripper Equipment
                           Kerley ATS Plant Equipment
                              Amine Unit Equipment
                          Diesel Hydrotreater Equipment






                                        2

<PAGE>


                                   SCHEDULE C
                                NCRA SUBSIDIARIES


Clear Creek Transportation, LLC
Jayhawk Pipeline, L.L.C.
Kaw Pipeline Company
Osage Pipeline Company


                                        3