Document:

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York 10017
(212) 312-3000
(800) 352-0001

FINANCIAL GUARANTY INSURANCE POLICY

Issuer: Home Loan Trust 2006-HI5                         Policy Number: 06030135
                                                         Control Number: 0010001

Insured Obligations:
$247,469,000 in aggregate principal amount of Home Loan-
Backed Notes, Series 2006-HI5, Class A-1, Class A-2, Class
A-3 and Class A-4 (collectively, the "Class A Notes")

Indenture Trustee: U.S. Bank National Association

Financial Guaranty Insurance Company ("Financial Guaranty"), a New York stock
insurance company, in consideration of the right of Financial Guaranty to
receive monthly premiums as provided in the Insurance Agreement (as defined
below) and subject to the terms of this Financial Guaranty Insurance Policy
(this "Policy"), hereby unconditionally and irrevocably agrees to pay each
Insured Payment (as defined below) to the Indenture Trustee named above or its
successor, as indenture trustee for the Holders of the Class A Notes, to the
extent set forth in the Indenture (as defined below). Capitalized terms used and
not otherwise defined herein shall have the meanings assigned to such terms in
Appendix A to the Indenture as in effect and executed on the date hereof.

The following terms used herein shall have the meanings assigned to them below:

"Deficiency Amount" shall mean for any Payment Date and any class of the Class A
Notes, an amount, if any, equal to the sum of (i) the excess, if any, of (A) (1)
the aggregate amount of Accrued Note Interest on such Payment Date less (2) an
amount equal to any Prepayment Interest Shortfalls and Relief Act Shortfalls on
the Home Loans during the related Collection Period, over (B) the amount
available for interest distributions on the Class A Notes on such Payment Date
pursuant to the Indenture, (ii) any Liquidation Loss Amount with respect to the
Home Loans for such Payment Date, to the extent not distributed as part of the
Liquidation Loss Payment Amount for the Class A Notes or covered by a reduction
of the Outstanding Reserve Amount on such Payment Date and (iii) the Guaranteed
Payment Amount, if applicable.

"Final Maturity Date" shall mean for each class of the Class A Notes, the
payment date in December 2036.

"Guaranteed Payment Amount" shall mean with respect to each class of Class A
Notes, the aggregate outstanding Note Balance of such Class of Class A Notes on
the Final Maturity Date, after giving effect to all other distributions of
principal on such Class A Notes on such Payment Date from all sources other than
this Policy.

Form 9140
Page 1 of 5

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York 10017
(212) 312-3000
(800) 352-0001

FINANCIAL GUARANTY INSURANCE POLICY

"Insured Payment" shall mean (a) with respect to any Payment Date for the Class
A Notes (i) any Deficiency Amount; and (ii) any Preference Amount (as defined in
this Policy), and (b) with respect to any other date, any Preference Amount.

Financial Guaranty will pay a Deficiency Amount with respect to the Class A
Notes by 12:00 noon (New York City time) in immediately available funds to the
Indenture Trustee on the later of (i) the second Business Day following receipt
in New York, New York on a Business Day by Financial Guaranty of a Notice from
the Indenture Trustee that a Deficiency Amount is due in respect of the Class A
Notes and (ii) the Payment Date on which the related Deficiency Amount is
payable to the Holders of the Class A Notes pursuant to the Indenture, for
payment to the Holders of the Class A Notes in the same manner as other payments
with respect to the Class A Notes are required to be made. Any Notice received
by Financial Guaranty (i) after 12:00 noon (New York City time) on a given
Business Day or (ii) on any day that is not a Business Day shall be deemed to
have been received by Financial Guaranty on the next succeeding Business Day. In
addition, if any Notice received by Financial Guaranty is not in proper form or
is otherwise insufficient for the purpose of making a claim under this Policy,
it will be deemed not to have been received by Financial Guaranty, and Financial
Guaranty will promptly so advise the Indenture Trustee, and the Indenture
Trustee may submit an amended Notice.

If any portion or all of any amount that is insured hereunder that was
previously paid to a Holder of Class A Notes is recoverable and sought to be
recovered from such Holder as a voidable preference by a trustee in bankruptcy
pursuant to the U.S. Bankruptcy Code, pursuant to a final non-appealable order
of a court exercising proper jurisdiction in an insolvency proceeding (a "Final
Order") (such recovered amount, a "Preference Amount"), Financial Guaranty will
pay on the guarantee described in the first paragraph hereof, an amount equal to
each such Preference Amount by 12:00 noon (New York City time) on the second
Business Day following receipt by Financial Guaranty on a Business Day of (w) a
certified copy of the Final Order, (x) an opinion of counsel satisfactory to
Financial Guaranty that such order is final and not subject to appeal, (y) an
assignment, in form reasonably satisfactory to Financial Guaranty, irrevocably
assigning to Financial Guaranty all rights and claims of the Indenture Trustee
and/or such Holder of the Class A Notes relating to or arising under such
Preference Amount and constituting an appropriate instrument, in form reasonably
satisfactory to Financial Guaranty, appointing Financial Guaranty as the agent
of the Indenture Trustee and/or such Holder in respect of such Preference
Amount, including, without limitation, in any legal proceeding relating to the
Preference Amount, and (z) a Notice appropriately completed and executed by the
Indenture Trustee or such Holder, as the case may be. Such payment shall be made
to the receiver, conservator, debtor-in-possession or trustee in bankruptcy
named in the Final Order and not to the Indenture Trustee or Holder of the Class
A Notes directly (unless the Holder has previously paid such amount to such
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
such Final Order in which case payment shall be made to the Indenture Trustee
for payment to the Holder upon delivery of proof of such payment reasonably
satisfactory to

Form 9140
Page 2 of 5

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York 10017
(212) 312-3000
(800) 352-0001

FINANCIAL GUARANTY INSURANCE POLICY

Financial Guaranty). Notwithstanding the foregoing, in no event shall Financial
Guaranty be (i) required to make any payment under this Policy in respect of any
Preference Amount to the extent such Preference Amount is comprised of amounts
previously paid by Financial Guaranty hereunder, or (ii) obligated to make any
payment in respect of any Preference Amount, which payment represents a payment
of the principal balance of any Class A Notes, prior to the time Financial
Guaranty otherwise would have been required to make a payment in respect of such
principal, in which case Financial Guaranty shall pay the balance of the
Preference Amount when such amount otherwise would have been required to be paid
under this Policy.

Any of the documents required under clauses (w) through (z) of the preceding
paragraph that are received by Financial Guaranty after 12:00 noon (New York
City time) on a given Business Day or on any day that is not a Business Day
shall be deemed to have been received by Financial Guaranty on the next
succeeding Business Day. If a Notice or other document required under clauses
(w) through (z) of the preceding paragraph received by Financial Guaranty is not
in proper form or is otherwise insufficient for the purpose of making a claim
under this Policy, such Notice or documents will be deemed not to have been
received by Financial Guaranty, and Financial Guaranty will promptly so advise
the Indenture Trustee, and the Indenture Trustee may submit an amended Notice or
other related documents. All payments made by Financial Guaranty hereunder in
respect of Preference Amounts will be made with Financial Guaranty's own funds.

Upon payment of any Insured Payment, Financial Guaranty shall be fully
subrogated to the rights of the Holders of the Class A Notes to receive the
amount so paid. Financial Guaranty's obligations with respect to the Class A
Notes hereunder with respect to each Payment Date shall be discharged to the
extent funds consisting of the related Deficiency Amount are received by the
Indenture Trustee on behalf of the Holders of the Class A Notes for payment to
such Holders, as provided in the Indenture and herein, whether or not such funds
are properly applied by the Indenture Trustee.

This Policy is non-cancelable for any reason, including nonpayment of any
premium. The premium on this Policy is not refundable for any reason, including
the payment of any Class A Notes prior to their respective maturities. This
Policy shall expire and terminate without any action on the part of Financial
Guaranty or any other Person on the date that is the later of (i) the date that
is one year and one day following the date on which the Class A Notes shall have
been paid in full and (ii) if any insolvency proceeding referenced in the third
preceding paragraph with respect to which the Depositor is the debtor has been
commenced on or prior to the date specified in clause (i) above, the 30th day
after the entry of a final, non-appealable order in resolution or settlement of
such proceeding.

This Policy will not cover any Relief Act Shortfalls or Prepayment Interest
Shortfalls allocated to the Class A Notes, nor will it cover any shortfalls
attributable to the liability of the Trust, any Holder, any REMIC or the
Indenture Trustee for withholding taxes, if any (including interest and

Form 9140
Page 3 of 5

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York 10017
(212) 312-3000
(800) 352-0001

FINANCIAL GUARANTY INSURANCE POLICY

penalties in respect of any liability for withholding taxes), nor does this
Policy guarantee to the holders of the Class A Notes any particular rate of
principal payment. This Policy also does not cover the failure of the Indenture
Trustee to make any payment required under the Indenture to any Holder of Class
A Notes.

To the fullest extent permitted by applicable law, Financial Guaranty hereby
waives, solely for the benefit of Holders of the Class A Notes, all defenses of
any kind (including, without limitation, the defense of fraud in inducement or
fact, any defense based on any duty claimed to arise from the doctrine of
"utmost good faith" or any similar or related doctrine or any other
circumstances that would have the effect of discharging a surety, guarantor or
any other person in law or in equity) that Financial Guaranty otherwise might
have asserted as a defense to its obligation to pay in full any amounts that
have become due and payable in accordance with the terms and conditions of this
Policy. Nothing in this paragraph, however, shall be deemed to constitute a
waiver of any rights, remedies, claims or counterclaims that Financial Guaranty
may have with respect to the Issuer or Residential Funding Company, LLC, or any
of their affiliates, whether acquired by subrogation, assignment or otherwise.

A monthly Premium shall be due and payable in arrears as provided in the
Indenture and the Insurance Agreement.

This Policy is subject to and shall be governed by the laws of the State of New
York. The proper venue for any action or proceeding on this Policy shall be the
County of New York, State of New York.

THE INSURANCE PROVIDED BY THIS POLICY IS NOT COVERED BY THE NEW YORK
PROPERTY/CASUALTY INSURANCE SECURITY FUND (NEW YORK INSURANCE CODE, ARTICLE 76).

"Notice" means a written notice in the form of Exhibit A to this Policy by
registered or certified mail or telephonic or telegraphic notice, subsequently
confirmed by written notice delivered via telecopy, telex or hand delivery from
the Indenture Trustee to Financial Guaranty specifying the information set forth
therein. "Holder" means, as to a particular Class A Note, the person, other than
the Issuer, the Master Servicer, any subservicer retained by the Master Servicer
or the Depositor who, on the applicable Payment Date, is entitled under the
terms of such Class A Note to a payment thereon. "Indenture" means the Indenture
relating to the Class A Notes by and between Home Loan Trust 2006-HI5, as
Issuer, and U.S. Bank National Association as Indenture Trustee, dated as of
December 28, 2006. "Insurance Agreement" means the Insurance and Indemnity
Agreement, among Financial Guaranty, Residential Funding Mortgage Securities II,
Inc., Residential Funding Company, LLC, Home Loan Trust 2006-HI5 and the
Indenture Trustee, dated as of December 28, 2006. "Servicing Agreement" means
the Servicing Agreement relating to the Class A Notes by and among Residential
Funding Company, LLC, as

Form 9140
Page 4 of 5

Financial Guaranty Insurance Company
125 Park Avenue
New York, New York 10017
(212) 312-3000
(800) 352-0001

FINANCIAL GUARANTY INSURANCE POLICY

Master Servicer, Home Loan Trust 2006-HI5, as Issuer, and the Indenture Trustee,
dated as of December 28, 2006.

In the event that payments under any Class A Note are accelerated, nothing
herein contained shall obligate Financial Guaranty to make any payment of
principal or interest on such Class A Note on an accelerated basis, unless such
acceleration of payment by Financial Guaranty is at the sole option of Financial
Guaranty; it being understood that a payment shortfall in respect of the
redemption of any Class A Note by reason of the optional termination of the
Trust Estate pursuant to Section 8.08 of the Servicing Agreement does not
constitute acceleration for the purposes hereof.

IN WITNESS WHEREOF, Financial Guaranty has caused this Policy to be affixed with
its corporate seal and to be signed by its duly authorized officer in facsimile
to become effective and binding upon Financial Guaranty by virtue of the
countersignature of its duly authorized representative.

/s/ Howard Pfeffer                      /s/ Jeff Kert
-------------------------------------   ----------------------------------------
President                               Authorized Representative

Effective Date: December 28, 2006

Form 9140
Page 5 of 5

                                    EXHIBIT A

                       NOTICE OF NONPAYMENT AND DEMAND FOR
                                 INSURED PAYMENT

To:       Financial Guaranty Insurance Company
          125 Park Avenue
          New York, New York 10017
          (212) 312-3000
          Attention:      Structured Finance Surveillance - RFMSII 2006-HI5

          Telephone: (212) 312-3000
          Telecopier: (212) 312-3220

Re:
          $247,469,000 in aggregate principal amount of Home Loan-
          Backed Notes, Series 2006-HI5, Class A-1, Class A-2, Class
          A-3 and Class A-4 (collectively, the "Class A Notes")

          Policy No: 06030135 (the "Policy")

Payment Date/Final Maturity Date: ________________

We refer to that certain Indenture, dated as of December 28, 2006, by and
between Home Loan Trust 2006-HI5, as Issuer, and U.S. Bank National Association,
as Indenture Trustee (the "Indenture"), relating to the above referenced Class A
Notes. All capitalized terms not otherwise defined herein or in the Policy shall
have the same respective meanings assigned to such terms in Appendix A to the
Indenture.

(a)  The Indenture Trustee has determined under the Indenture that in respect of
     the Payment Date:

     (1)  The Deficiency Amount on the Class A Notes in respect of the Payment
          Date that is due to be received on the Payment Date specified above
          under the Indenture, is equal to $_____________, consisting of

          (A)  $ ___________ in respect of interest on the Class A Notes, which
               is calculated as the amount by which:

               (i)  $____________, constituting the aggregate amount of Accrued
                    Note Interest on the Payment Date less an amount equal to
                    any Prepayment Interest Shortfalls and Relief Act Shortfalls
                    on the Home Loans during the related Collection Period;
                    exceeds

               (ii) $___________, representing the amount on deposit in the
                    Payment Account available for interest payments to the Class
                    A Notes on the Payment Date; plus

                                       A-1

          (B)  $_____________ in respect of principal of the Class A Notes,
               which is calculated as the amount by which:

               (i)  the principal portion of Liquidation Loss Amounts with
                    respect to the Home Loans for the Payment Date, which total
                    $_________, exceed

               (ii) the sum of

                    (x)  $___________, representing the Liquidation Loss Payment
                         Amount for the Home Loans for the Payment Date; and

                    (y)  $____________, representing the reduction in the
                         Outstanding Reserve Amount for the Payment Date.

     (2)  [The  Guaranteed  Payment  Amount with respect to the Class A Notes is
          $_____________.]

[In addition, attached hereto is a copy of the Final Order in connection with a
Preference Amount in the amount set forth therein, together with an assignment
of rights and appointment of agent and an opinion of counsel that such order is
final and not subject to appeal. The amount of the Preference Amount is
$___________.]

     Please be advised that, accordingly, an Insured Payment exists for the
Payment Date identified above for the Class A Notes and, pursuant to the
Indenture, this statement constitutes a notice for payment of an Insured Payment
by the Insurer in the amount of $__________. This Insured Payment is payable by
the Insurer under the Policy.

(b)  No payment claimed hereunder is in excess of the amount payable under the
     Policy.

     The amount requested in this Notice should be paid to: [Payment
Instructions]

Any person who knowingly and with intent to defraud any insurance company or
other person files an application for insurance or statement of claim containing
any materially false information or conceals for the purpose of misleading,
information concerning any fact material thereto, commits a fraudulent insurance
act, which is a crime, and shall also be subject to a civil penalty not to
exceed Five Thousand Dollars ($5,000.00) and the stated value of the claim for
each such violation.

                                       A-2

     IN WITNESS WHEREOF, the Indenture Trustee has executed and delivered this
Notice of Nonpayment and Demand for Payment of Insured Payment this _____ day of
_____________________.

                                       ----------------------------------------,
                                       as Indenture Trustee

                                       By:
                                           -------------------------------------
                                       Title:
                                              ----------------------------------exv10w6

 

COMMERCIAL PAPER PLACEMENT AGREEMENT

     THIS AGREEMENT is entered into as of October 30, 2006, by and between CHS Inc.,
(hereinafter referred to as “Issuer”), a corporation with a place of business at 5500 Cenex Dr.,
Inver Grove Heights, MN 55077, and M&I Marshall & Ilsley Bank (hereinafter referred to as
“Agent”), 770 North Water Street, Milwaukee, Wisconsin 53202.

WITNESSETH:

     WHEREAS, Issuer desires to sell, from time to time, interest bearing or discounted short-term
unsecured debt obligations having maturities of no more than two hundred seventy (270) days
(hereinafter such debt obligations being referred to as “Commercial Paper”); and

     WHEREAS, Issuer desires to retain Agent to advise Issuer with respect to its issuance of
Commercial Paper, to solicit purchasers for such Commercial Paper as Issuer from time to time
advises Agent it desires to issue, and to place Commercial Paper with purchasers (hereinafter
“Purchaser” or “Purchasers”); and

     WHEREAS, Issuer desires to compensate Agent for the services Agent will be performing for
Issuer from time to time as herein described.

     NOW, THEREFORE, in consideration of the premises and the undertakings hereinafter set forth,
Issuer and Agent hereby agree as follows:

	 	 	 
	Section 1.

	 	Definitions. As used in this Agreement, including the Exhibits
attached hereto, the following terms shall have the following
meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
	 
	 	 
	 

	 	“Authorized Persons of Issuer” shall mean the individuals whose
names appear in Exhibit A attached hereto and made a part
hereof (as such Exhibit may be revised from time to time by
written notice given to Agent by Issuer).
	 
	 	 
	 

	 	“Credit Facilities” shall mean those borrowing facilities
listed on the Certificate attached hereto as Exhibit B, as such
Certificate may be amended from time to time by the Issuer as
provided herein.
	 
	 	 
	 

	 	“Issuer’s Book Entry Commercial Paper Transaction” shall mean
Issuer’s Commercial Paper which Agent has placed from time to
time with a Purchaser, with the issuance and sale of such
Commercial Paper, including the par amount, rate, discount (if
applicable) and maturity thereof, (i) being manifested on
Issuer’s books and records, and (ii) not being represented by a
promissory note instrument of Issuer.
	 
	 	 
	 

	 	“Issuer’s Commercial Paper” shall mean Issuer’s interest
bearing or discounted short-term unsecured debt obligations
placed by Agent from time to time with a Purchaser and issued
hereunder, evidenced by Issuer’s Book Entry Commercial Paper
Transactions, issued in minimum par values of $100,000.

 

 

	 	 	 
	 

	 	“Settlement Date” shall mean the date on which payment in
immediately available funds is made to Issuer for Commercial
Paper sold by Agent hereunder.
	 
	 	 
	Section 2.

	 	Limits on Issuer’s Commercial Paper. Issuer covenants and
agrees that the outstanding principal amount owing under
Issuer’s Commercial Paper shall not at any time exceed
$25,000,000.
	 
	 	 
	Section 3.

	 	Certain Relationships Created Between
Issuer and Agent; Scope of Agent’s Duties. Agent will be
acting hereunder as Issuer’s agent to assist Issuer in selling
Issuer’s Commercial Paper without recourse and solely upon the
order and for the account of Issuer. Agent will limit its
solicitation of prospective Purchasers of Issuer’s Commercial
Paper to institutional investors or other sophisticated
investors who normally purchase commercial paper. Agent will
not make any general solicitation or advertisement to the
public with respect to a particular placement of Issuer’s
Commercial Paper. Issuer’s Commercial paper shall be issued in
reliance upon the commercial paper exemption from registration
contained in Section 3(a)(3) of the Securities Act of 1933, as
amended (“Section 3(a)(3)”), and the appropriate exemption from
registration contained in applicable state securities laws.
Agent will in no event purchase or repurchase Issuer’s
Commercial Paper for Agent’s own account, nor will Agent take
any ownership interest of any kind in any of the Issuer’s
Commercial Paper placed hereunder. Issuer understands and
agrees that Agent may charge Purchasers agency fees in
connection with facilitating purchase transactions of Issuer’s
Commercial Paper for their accounts.
	 
	 	 
	Section 4.

	 	Procedures. With respect to the sale from time to time of
Issuer’s Commercial Paper, the Agent and Issuer shall follow
the procedures described in this Section:
	 
	 	 
	 

	 	(a) When Issuer desires Agent’s assistance in the sale of Issuer’s Commercial
Paper, an Authorized Person of Issuer will contact a duly authorized employee of
Agent and inform Agent of the amount of commercial paper that Issuer desires to
issue. Such Authorized Person of Issuer and authorized employee of Agent will
then mutually agree on other details respecting the proposed issuance of Issuer’s
Commercial Paper, including, without limitation, rate, discount (if applicable),
maturity date and proposed Settlement Date.
	 
	 	 
	 

	 	(b) Following such advice from Issuer referred to in subparagraph (a), Agent will
solicit Purchasers for Issuer’s Commercial Paper as described in Section 3. Upon
negotiating a sale to Purchaser, on each Settlement Date, Agent will credit
Issuer’s Account #39417796 with Agent, with credit advice to Issuer, in
immediately available funds the total net proceeds of Issuer’s Commercial Paper.
	 
	 	 
	 

	 	(c) Daily cutoff time for same day settlement shall be 12:00 Noon.

2

 

	 	 	 
	 

	 	(d) On the maturity dates specified the Agent shall charge Issuer’s Account #
39417796 with Agent, with debit advice to Issuer, for the par amount and
interest (if applicable) with respect to Issuer’s Commercial Paper maturing on
such dates, and Agent shall forthwith credit such amounts in immediately available
funds to Purchasers.
	 
	 	 
	 

	 	(e) So long as Issuer has Issuer Commercial Paper outstanding hereunder, Issuer
agrees to maintain with Agent the accounts referred to in subparagraphs (b) and
(d) above.
	 
	 	 
	 

	 	(f) Agent may establish and utilize clearing accounts as may be necessary or
appropriate to carry out the transactions contemplated by this section.
	 
	 	 
	Section 5.

	 	Substitution. If at any time requested in writing by Agent,
Issuer shall promptly issue and deliver to Agent a promissory
note in customary form, payable to bearer or to Agent (as
designated by Agent), in substitution for and in cancellation
of any Issuer Book Entry Commercial Paper Transaction. Agent
will make such substitution request of Issuer only in the event
that a Purchaser has requested Agent to obtain delivery and
possession of a promissory note to evidence Issuer’s obligation
to purchaser, in lieu of and in substitution for Issuer’s Book
Entry Commercial Paper Transaction. Upon maturity of any such
substituted promissory note, the payment procedures specified
in Section 4(d) above shall be followed, and Agent thereafter
shall promptly return to the Issuer the original promissory
note marked “paid”.
	 
	 	 
	Section 6.

	 	Termination. Either the Issuer or Agent may terminate this
Agreement at any time by written notice to the other, but such
termination shall not affect their respective rights, duties
and obligations with respect to Issuer’s Commercial Paper
transactions entered into prior to such termination.
	 
	 	 
	Section 7.

	 	Financial Reports and Credit Facility Certificates. On a
quarterly basis, Issuer will submit financial statements or
Forms 10-Q or Form 10-K to Agent showing the results of
Issuer’s operations for the preceding 3 months. In addition to
such financial statements, Issuer will provide Agent with a
certificate substantially similar to Exhibit B attached hereto,
signed by an Authorized Person of Issuer, certifying to Agent
that Issuer has confirmed Credit Facilities in place to cover
Issuer’s Commercial Paper then outstanding.
	 
	 	 
	Section 8.

	 	Agent’s Fees to Issuer. Agent will charge and collect from
Issuer, on a monthly basis, fees for Agent’s services,
determined as provided in this Section. On the
1st
day of each month, Agent will charge and collect fees from
Issuer’s Account number 39417796 for each Issuer Book Entry
Commercial Paper Transaction during the preceding month 

3

 

	 	 	 
	 

	 	(each such transaction being hereinafter referred to as
a “Unit”.) Fees for each Unit will be determined by multiplying the principal
amount of each Unit times a rate of .20% per annum for the number of days
from and including Settlement Date to the scheduled maturity date of the Unit,
calculated on the basis of a year of 360 days; provided, however, that the minimum
per Unit fee in any event shall be $10.00.
	 
	 	 
	Section 9.

	 	Issuer Covenants, Representations and Warranties. Issuer
covenants and agrees that at no time will the Issuer issue or
have outstanding commercial paper in an aggregate principal
amount in excess of the greater of (1) the sum of (a) Issuer’s
operating expenses for the most recently-completed 12-month
period, (b) Issuer’s current assets as of the last day of such
12-month period, and (c) Issuer’s investments in high quality
debt instruments (excluding those included in (b) above)
having a remaining term to maturity of one year or less, or
(2) the aggregate amount of funds applied by Issuer to
“current transactions” (as used in Section 3(a)(3)). Issuer
covenants and agrees that it will at all times, so long as
there is Issuer Commercial Paper outstanding hereunder, have
and maintain confirmed Credit Facilities in place and
available to be drawn upon in an amount at least equal to
amounts outstanding under Issuer’s Commercial Paper. Issuer
will pay all such fees and charges as may become due and owing
to keep such Credit Facilities valid, binding and in full
force and effect and, at any time during which Issuer’s
Commercial Paper is being offered or sold, will not take or
refuse to take any action, or permit any condition to arise or
occur, which constitutes, or which with the passage of time or
service of notice, or both, would constitute an event of
default or a potential event of default under any of Issuer’s
Credit Facilities. Issuer agrees to provide Agent with prompt
notice of any such event of default or potential event of
default. Issuer represents and warrants to Agent that the
execution of this Agreement and performance by Issuer
hereunder have been duly authorized by all necessary corporate
action, and Issuer shall deliver to Agent at the time of
executing this Agreement a Certificate substantially similar
to Exhibit C attached hereto, confirming such due corporate
authority and related matters. Issuer further represents and
warrants that its execution and performance hereunder will not
contravene or otherwise be in conflict with any bylaw,
agreement, understanding or order related to Issuer or as to
which Issuer is a party. Issuer’s representations and
warranties contained herein shall survive execution of this
Agreement.
	 
	 	 
	Section 10.

	 	Information Reporting. Agent shall comply with all applicable
information reporting and backup withholding requirements
imposed on Agent under the Internal Revenue Code of 1986, as
amended, arising from Agent’s role as “middleman” as defined
in IRS Reg. 1.6049-4(F)(4), with respect to interest payments
on Issuer’s Commercial Paper placed by Agent with Purchasers.

4

 

	 	 	 
	Section 11.

	 	No Legal Advice. In entering into this Agreement, Issuer
acknowledges that Agent has not rendered to Issuer, nor has
Issuer sought from Agent, legal advice of any kind of nature
respecting the subject matter contained herein or the duties
to be performed hereunder by the parties hereto, and Issuer
has relied upon advice and opinions of its counsel with
respect to this Agreement.
	 
	 	 
	Section 12.

	 	Entire Agreement. This Agreement, including the Exhibits
attached hereto, contains and constitutes the entire and only
agreement and understanding by and between Issuer and Agent
respecting the subject matter hereof, and cannot be changed,
modified, supplemented, amended or waived except as expressly
set forth in a written instrument signed by an Authorized
Person of Issuer and an authorized employee of Agent.
	 
	 	 
	Section 13.

	 	Governing Law. The terms and provisions of this Agreement and
the rights, duties and obligations of Issuer and Agent
hereunder shall be governed by and construed in accordance
with the laws of the State of Wisconsin.

5

 

     IN WITNESS WHEREOF, Issuer and Agent have caused this Agreement to be signed by duly
authorized officers, as of the day and year first above written.

	 	 	 	 	 	 	 
	 

	 	ISSUER:
	 	CHS Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Schmitz
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	AGENT:
	 	M&I MARSHALL & ILSLEY BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Senior Vice President	 	 

 

 

EXHIBIT A

AUTHORIZED PERSONS OF ISSUER

     The following persons, who hold the respective titles shown below, have been authorized by
appropriate corporate action of Issuer to sign documents and from time to time to instruct the M&I
Marshall & Ilsley Bank (“Agent”) on behalf of Issuer in connection with the Commercial Paper
Placement Agreement, dated October 30, 2006, between Issuer and Agent:

	 	 	 	 	 	 	 
	Name	 	Title	 	Signature	 	 
	John D. Johnson

	 	President and Chief
Executive Officer
	 	/s/ John D. Johnson
 

	 	 
	 
	 	 	 	 	 	 
	John Schmitz

	 	Executive Vice President
and Chief Financial Officer
	 	/s/ John Schmitz
 

	 	 

     This Authorization shall remain in full force and effect until Issuer delivers a replacement
Authorization in writing to the Agent, and until such delivery Agent may rely fully on the
authority granted by Issuer to the persons above named.

     Dated October 30, 2006.

	 	 	 	 	 	 	 
	 	 	Issuer: CHS Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Schmitz
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial Officer	 	 

2

 

EXHIBIT B

CERTIFICATION OF CREDIT FACILITIES

     Pursuant to Section 7 of the Commercial Paper Placement Agreement dated October 30, 2006
entered into by and between CHS Inc. (“Issuer”) and M&I Marshall & Ilsley Bank (“Agent”), Issuer
hereby certifies to Agent that (i) the following Lines of Credit (“Credit Facilities”) have been
granted or issued in favor of Issuer by the banks named below (individually, a “Bank” and
collectively, the “Banks”) in the amounts designated below; (ii) there is presently available for
drawing by Issuer under such Credit Facilities the amounts designated below, and such amounts are
sufficient to repay at maturity all Issuer’s Commercial Paper presently outstanding; (iii) all such
Credit Facilities are confirmed, in place and in full force and effect for the purposes intended
thereby, including, without limitation, the repayment by Issuer of amounts due upon the maturity of
Issuer’s Commercial Paper; (iv) there are no fees or charges due from the Issuer to any Bank for
any such Credit Facilities which as of this date remains unpaid; and (v) Issuer is not in default
of any term or condition included in any agreement or document establishing or renewing any such
Credit Facilities, or included in any other instrument, document or agreement related thereto:

	 	 	 	 	 	 	 
	 	 	 	 	Amount Presently	 	Date Line
	Name of	 	 	 	Available	 	Granted or
	Issuing Bank	 	Amount of Line	 	Under Line	 	Last Renewed
	CoBank
	 	$ 1,100,000,000	 	$ 950,000,000	 	05/18/2006
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 

     Issuer agrees to notify Agent promptly in writing in the event that any Bank listed above (i)
refuses to renew any Credit Facilities; (ii) changes the amount of any Credit Facilities or any
material term or condition related thereto; or (iii) has declared the Issuer (whether orally or in
writing) to be in default of any term or condition of any agreement or instrument related to any
Credit Facilities.

	 	 	 	 	 	 	 
	 	 	Issuer: CHS Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Schmitz
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	Date:
	 	October 30, 2006	 	 

 

 

EXHIBIT C

CERTIFICATE AND DESIGNATION OF AUTHORITY REGARDING

COMMERCIAL PAPER PLACEMENT AGREEMENT

     This Certificate and Designation of Authority is provided to M&I Marshall & Ilsley Bank
(“Agent”) in accordance with Section 9 of the Commercial Paper Placement Agreement dated 
October 30, 2006 (the “Agreement”) by and between Agent and CHS Inc. (“Corporation”).

     WHEREAS, by resolution dated July 7, 2006, a certified copy of which is attached hereto, the
Board of Directors of the Corporation has authorized the issuance by the Corporation of up to
$25,000,000 of discounted short-term unsecured debt obligations, with maturities of such
obligations not to exceed 270 days (hereinafter such debt obligations being referred to as
“Commercial Paper”); and

     WHEREAS, the resolution provides for the Corporation’s retention of Agent to advise
Corporation with respect to its issuance of Commercial Paper, to solicit purchasers for such
Commercial Paper, and to place Commercial Paper with purchasers, and further authorizes the
Corporation’s performance under the provisions of the Agreement; and

     WHEREAS, the resolution authorizes the President and Chief Executive Officer or the Executive
Vice President & Chief Financial Officer to undertake all actions and execute all documents and
instruments on the Corporation’s behalf as may be necessary or appropriate to appoint Agent and to
issue Commercial Paper from time to time; and

     WHEREAS, the resolution further authorizes the President and Chief Executive Officer or the
Executive Vice President & Chief Financial Officer to designate certain other officers of the
Corporation to provide instructions and authorizations to Agent regarding the Corporation’s
issuance and sale of Commercial Paper.

     NOW, THEREFORE, the undersigned Executive Vice President and Chief Financial Officer of the
Corporation hereby designates the following officers of the Corporation pursuant to the
aforementioned resolution, to give Agent instructions and authorizations from time to time
respecting any and all matters covered by the Commercial Paper Placement Agreement:

	 	 	 
	NAME	 	TITLE
	Ann Minder

	 	Treasury Manager
	Karen Wollum

	 	Cash Management Analyst

 

 

The Corporation shall furnish to Agent an Authorization consistent with the provisions contained
herein, substantially similar in form to Exhibit A to the Agreement, upon which Authorization the
Agent may rely until it receives written notice of revocation or revision of such Authorization.

     IN WITNESS WHEREOF, I have executed this Certificate and Designation of Authority the
30th day of October, 2006.

	 	 	 	 	 	 	 
	 	 	Issuer: CHS Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John Schmitz
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial Officer	 	 

 

 

EXHIBIT C-1

     I, Nanci L. Lilja, Assistant Secretary of CHS Inc. (the “Corporation”), a corporation
organized and existing under the laws of the State of Minnesota, do hereby certify that, at a
meeting of the Corporation’s Board of Directors duly held on the 7th day of July, 2006,
at which a quorum was present and acting throughout, the following resolution was adopted and is
now in full force and effect:

     WHEREAS, the Corporation desires to issue commercial paper obligations from time to time, and
further desires to retain M&I Marshall & Ilsley Bank (“M&I”) as its agent to advise it in
connection therewith.

     NOW, THEREFORE, BE IT RESOLVED, That the Corporation is authorized to issue discounted
short-term unsecured debt obligations with maturities not to exceed 270 days in the form of
book-entry transactions evidenced in the books and records of the Corporation (“Commercial Paper”),
and to sell, negotiate and/or discount the same upon such terms and conditions as the Corporation
from time to time may deem necessary and proper, but not to exceed $25,000,000 outstanding at any
one time; and

     FURTHER RESOLVED, That the President and Chief Executive Officer or the Executive Vice
President and Chief Financial Officer of the Corporation shall execute a Commercial Paper Placement
Agreement with M&I and any documents or instruments related thereto, pursuant to which M&I will act
as Corporation’s Agent and advise Corporation with respect to the issuance of Commercial Paper;
solicit purchasers for such Commercial Paper; and place Commercial Paper with purchasers; and

     FURTHER RESOLVED, That the Corporation is authorized to perform fully and to carry out the
terms, conditions and obligations incumbent upon Issuer which are included in the Commercial Paper
Placement Agreement; and

     FURTHER RESOLVED, That the President and Chief Executive Officer or the Executive Vice
President and Chief Financial Officer, or any one of them, be authorized to take all actions and
give such instructions from time to time as may be necessary for the Corporation to issue and sell
Commercial Paper, and to designate certain other officers of the Corporation who may provide
instructions and authorizations to M&I in connection with the Corporation’s issuance and sale of
Commercial Paper pursuant to the Commercial Paper Placement Agreement; and

     FURTHER RESOLVED, That this resolution shall continue in full force and effect until written
notice of its amendment or revocation shall have been received by M&I.

 

 

     IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the Corporation this the 30th
day of October, 2006.

	 	 	 	 	 	 	 
	 	 	Issuer: CHS Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Nanci L. Lilja
 

	 	 
	 
	 	 	 	 	 	 
	 

	 	Its:
	 	Assistant Secretary

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