Exhibit 10.1

 

MLA No. RI0910

 

MASTER LOAN AGREEMENT

 

THIS MASTER LOAN AGREEMENT is entered into as of July 21, 2010, between FARM
CREDIT SERVICES OF AMERICA, FLCA (“FLCA”), FARM CREDIT SERVICES OF AMERICA, PCA
(“PCA”) and GOLDEN GRAIN ENERGY, LLC, Mason City, Iowa (the “Company”).

 

BACKGROUND

 

From time to time FLCA or PCA may make loans to the Company.  Hereinafter, the
term “Lead Lender” shall mean FLCA, PCA or both, as applicable in the context.
In order to reduce the amount of paperwork associated therewith, Lead Lender and
the Company would like to enter into a master loan agreement. For that reason,
and in consideration of Lead Lender making one or more loans to the Company,
Lead Lender and the Company agrees as follows:

 

SECTION 1.                            Supplements.  In the event the Company
desires to borrow from Lead Lender and Lead Lender is willing to lend to the
Company, or in the event Lead Lender and the Company desire to consolidate any
existing loans hereunder, the parties will enter into a Supplement to this
agreement (a “Supplement”). Each Supplement will set forth the amount of the
loan, the purpose of the loan, the interest rate or rate options applicable to
that loan, the repayment terms of the loan, and any other terms and conditions
applicable to that particular loan. Each loan will be governed by the terms and
conditions contained in this agreement and in the Supplement relating to the
loan.

 

SECTION 2.                            Sale of Participation Interests and
Appointment of Administrative Agent. The Company acknowledges that concurrent
with the execution of this Master Loan Agreement and related Supplements, Lead
Lender is selling a participation interest in this Master Loan Agreement and
Supplements executed concurrently herewith to CoBank, ACB (“CoBank”) (up to a
100% interest). Pursuant to an Administrative Agency Agreement dated July 6,
2010, (“Agency Agreement”), Lead Lender and CoBank appointed CoBank to act as
Administrative Agent (“Agent”) to act in place of Lead Lender hereunder and
under the Supplements and any security documents to be executed thereunder. All
funds to be advanced hereunder shall be made by Agent, all repayments by the
Company hereunder shall be made to Agent, and all notices to be made to Lead
Lender hereunder shall be made to Agent. Agent shall be solely responsible for
the administration of this agreement, the Supplements and the security documents
to be executed by the Company thereunder and the enforcement of all rights and
remedies of Lead Lender hereunder and thereunder. Company acknowledges the
appointment of the Agent and consents to such appointment.

 

SECTION 3.                            Availability.  Loans will be made
available on any day on which Agent and the Federal Reserve Banks are open for
business upon the telephonic or written request of the Company. Requests for
loans must be received no later than 12:00 Noon Company’s local time on the date
the loan is desired. Loans will be made available by wire transfer of
immediately available funds to such account or accounts as may be authorized by
the Company. The Company shall furnish to Agent a duly completed and executed
copy of a CoBank Delegation and Wire and Electronic Transfer Authorization Form,
and Agent shall be entitled to rely on (and shall incur no liability to the
Company in acting on) any

 

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request or direction furnished in accordance with the terms thereof.

 

SECTION 4.                                 Repayment.  The Company’s obligation
to repay each loan shall be evidenced by the promissory note set forth in the
Supplement relating to that loan or by such replacement note as Agent shall
require. Agent shall maintain a record of all loans, the interest accrued
thereon, and all payments made with respect thereto, and such record shall,
absent proof of manifest error, be conclusive evidence of the outstanding
principal and interest on the loans. All payments shall be made by wire transfer
of immediately available funds, by check, or by automated clearing house or
other similar cash handling processes as specified by separate agreement between
the Company and Agent. Wire transfers shall be made to ABA No. 307088754 for
advice to and credit of CoBank (or to such other account as Agent may direct by
notice). The Company shall give Agent telephonic notice no later than 12:00 Noon
Company’s local time of its intent to pay by wire and funds received after
3:00 p.m. Company’s local time shall be credited on the next business day.
Checks shall be mailed to CoBank, Department 167, Denver, Colorado 80291-0167
(or to such other place as Agent may direct by notice). Credit for payment by
check will not be given until the later of: (A) the day on which Agent receives
immediately available funds; or (B) the next business day after receipt of the
check.

 

SECTION 5.                                 Lender Stock.   Borrower agrees to
own or purchase if necessary, such stock in Farm Credit Services of America,
ACA, as is from time to time required by Lead Lender’s policies and bylaws.
Capitalization requirements are met by stock owned by Golden Grain Energy, LLC.
That Walt Wendland is the authorized voter on behalf of the owner(s) of voting
stock.

 

SECTION 6.                                 Security.  The Company’s obligations
under this agreement, all Supplements (whenever executed), and all instruments
and documents contemplated hereby or thereby, shall be secured by a statutory
first lien on all equity which the Company may now own or hereafter acquire in
Lead Lender. In addition, the Company agrees to grant to Lead Lender, by means
of such instruments and documents as Agent shall require, a first lien (subject
only to exceptions approved in writing by Agent) on all personal property of the
Company, and on all real property of the Company, whether now existing or
hereafter acquired. As additional security for those obligations: (A) the
Company agrees to grant to Lead Lender by means of such instruments and
documents as Agent shall reasonably require, a first priority lien on such of
its other assets, whether now existing or hereafter acquired, as Agent may from
time to time require; and (B) the Company agrees to grant to Lead Lender, by
means of such instruments and documents as Agent shall reasonably require, a
first priority lien on all realty which the Company may from time to time
acquire after the date hereof. Lead Lender may at its discretion assign
collateral to the Agent under the Agency Agreement.

 

SECTION 7.                                 Conditions Precedent.

 

(A)                               Conditions to Initial Supplement.  Lead
Lender’s obligation to extend credit under the initial Supplement hereto is
subject to the conditions precedent that Agent receive, in form and content
satisfactory to Agent, each of the following:

 

(1)                                 This Agreement, Etc.  A duly executed copy
of this agreement and all instruments and documents contemplated hereby.

 

(2)                                 Proof of Insurance.  Evidence that the
Company has obtained insurance required hereunder.

 

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(3)                                 Environmental Audit.  A written report of an
environmental audit pertaining to the Company’s real property located in Cerro
Gordo County, Iowa, produced by an independent national or regional
environmental consulting firm with full service capabilities whose selection has
been approved by Agent, and dated not more than sixty (60) days prior to the
submission thereof, which report shall show to Agent’s satisfaction that all
appropriate inquiry was made and that the past or present use or condition of
the property poses neither material health or safety hazards nor potential
financial exposure that Agent, in its sole discretion, finds unacceptable.

 

(4)                                 Security Agreement.  A security agreement
granting to Lead Lender a first lien (subject only to exceptions approved in
writing by Agent) on all personal property of the Company, whether now owned or
hereafter acquired.

 

(5)                                 Security Agreement.  A security agreement
granting to Agent a second lien (subject only to exceptions approved in writing
by Agent) on all personal property of the Company, whether now owned or
hereafter acquired.

 

(6)                                 Title Commitment/Policy.  A commitment from
a title insurance company acceptable to Agent to issue an ALTA lender’s policy
of title insurance in the face amount of $40,000,000.00 insuring the Company’s
mortgage or deed of trust to Lead Lender as a first priority lien on the
property encumbered thereby, subject only to exceptions approved in writing by
Agent. The Company agrees to pay the cost of such commitment and the related
policy, together with such endorsements as may be reasonably requested by Agent,
and also agrees that if, for any reason, a final policy is not issued by
November 1, 2010 or such later date as may be agreeable to Agent, then an “Event
of Default” shall be deemed to have occurred under this agreement.

 

(7)                                 Mortgage/Deed of Trust.  A mortgage or deed
of trust in the face amount of $70,000,000.00 granting to Lead Lender a first
lien (subject only to exceptions approved in writing by Agent) on the Company’s
property located in Cerro Gordo County, Iowa.

 

(B)                               Conditions to Each Supplement.  Lead Lender’s
obligation to extend credit under each Supplement, including the initial
Supplement, is subject to the conditions precedent that Agent receive, in form
and content satisfactory to Agent, each of the following:

 

(1)                                 Supplement.  A duly executed copy of the
Supplement and all instruments and documents contemplated thereby.

 

(2)                                 Evidence of Authority.  Such certified board
resolutions, certificates of incumbency, and other evidence that Agent may
require that the Supplement, all instruments and documents executed in
connection therewith, and, in the case of initial Supplement hereto, this
agreement and all instruments and documents executed in connection herewith,
have been duly authorized and executed.

 

(3)                                 Fees and Other Charges.  All fees and other
charges provided for herein or in the Supplement.

 

(4)                                 Evidence of Perfection, Etc.  Such evidence
as Agent may require that Lead Lender has a duly perfected first priority lien
on all security for the Company’s obligations, and that the Company is in
compliance with Section 9(D) hereof.

 

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(C)                               Conditions to Each Loan.  Lead Lender’s
obligation under each Supplement to make any loan to the Company thereunder is
subject to the condition that no “Event of Default” (as defined in Section 12
hereof) or event which with the giving of notice and/or the passage of time
would become an Event of Default hereunder (a “Potential Default”), shall have
occurred and be continuing.

 

SECTION 8. Representations and Warranties.

 

(A)                               This Agreement.  The Company represents and
warrants to Lead Lender and Agent that as of the date of this agreement:

 

(1)                                 Compliance.  The Company and, to the extent
contemplated hereunder, each “Subsidiary” (as defined below), is in compliance
with all of the terms of this agreement, and no Event of Default or Potential
Default exists hereunder.

 

(2)                                 Subsidiaries.  The Company has the following
“Subsidiary(ies)” (as defined below): Corn Oil Bio-Solutions, LLC. For purposes
hereof, a “Subsidiary” shall mean a corporation of which shares of stock having
ordinary voting power to elect a majority of the board of directors or other
managers of such corporation are owned, directly or indirectly, by the Company.

 

(B)                               Each Supplement.  The execution by the Company
of each Supplement hereto shall constitute a representation and warranty to
Agent that:

 

(1)                                 Applications.  Each representation and
warranty and all information set forth in any application or other documents
submitted in connection with, or to induce Lead Lender to enter into, such
Supplement, is correct in all material respects as of the date of the
Supplement.

 

(2)                                 Conflicting Agreements, Etc. This agreement,
the Supplements, and all security and other instruments and documents relating
hereto and thereto (collectively, at any time, the “Loan Documents”), do not
conflict with, or require the consent of any party to, any other agreement to
which the Company is a party or by which it or its property may be bound or
affected, and do not conflict with any provision of the Company’s operating
agreement, articles of organization, or other organizational documents.

 

(3)                                 Compliance. The Company and, to the extent
contemplated hereunder, each Subsidiary, is in compliance with all of the terms
of the Loan Documents (including, without limitation, Section 9(A) of this
agreement on eligibility to borrow from Lead Lender).

 

(4)                                 Binding Agreement.  The Loan Documents
create legal, valid, and binding obligations of the Company which are
enforceable in accordance with their terms, except to the extent that
enforcement may be limited by applicable bankruptcy, insolvency, or similar laws
affecting creditors’ rights generally.

 

SECTION 9.                                 Affirmative Covenants.  Unless
otherwise agreed to in writing by Agent while this agreement is in effect, the
Company agrees to and with respect to Subsections 9(B) through 9(G) hereof,
agrees to cause each Subsidiary to:

 

(A)                               Eligibility.  Maintain its status as an entity
eligible to borrow from Lead Lender.

 

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(B)                               Corporate Existence, Licenses, Etc. 
(1) Preserve and keep in full force and effect its existence and good standing
in the jurisdiction of its formation; (2) qualify and remain qualified to
transact business in all jurisdictions where such qualification is required; and
(3) obtain and maintain all licenses, certificates, permits, authorizations,
approvals, and the like which are material to the conduct of its business or
required by law, rule, regulation, ordinance, code, order, and the like
(collectively, “Laws”).

 

(C)                               Compliance with Laws.  Comply in all material
respects with all applicable Laws, including, without limitation, all Laws
relating to environmental protection. In addition, the Company agrees to cause
all persons occupying or present on any of its properties, and to cause each
Subsidiary to cause all persons occupying or present on any of its properties,
to comply in all material respects with all environmental protection Laws.

 

(D)                               Insurance.  Maintain insurance with insurance
companies or associations reasonably acceptable to Agent in such amounts and
covering such risks as are usually carried by companies engaged in the same or
similar business and similarly situated, and make such increases in the type or
amount of coverage as Agent may reasonably request. All such policies insuring
any collateral for the Company’s obligations to Lead Lender shall have mortgagee
or lender loss payable clauses or endorsements in form and content acceptable to
Agent. At Agent’s request, all policies (or such other proof of compliance with
this Subsection as may be satisfactory to Agent) shall be delivered to Agent.

 

(E)                                 Property Maintenance.  Maintain all of its
property that is necessary to or useful in the proper conduct of its business in
good working condition, ordinary wear and tear excepted.

 

(F)                                 Books and Records.  Keep adequate records
and books of account in which complete entries will be made in accordance with
generally accepted accounting principles (“GAAP”) consistently applied.

 

(G)                               Inspection.  Permit Agent or its agents, upon
reasonable notice and during normal business hours or at such other times as the
parties may agree, to examine its properties, books, and records, and to discuss
its affairs, finances, and accounts, with its respective officers, directors,
employees, and independent certified public accountants.

 

(H)                               Reports and Notices. Furnish to Agent:

 

(1)                       Annual Financial Statements.  As soon as available,
but in no event more than 90 days after the end of each fiscal year of the
Company occurring during the term hereof, annual consolidated and consolidating
financial statements of the Company and its consolidated Subsidiaries, if any,
prepared in accordance with GAAP consistently applied. Such financial statements
shall: (a) be audited by independent certified public accountants selected by
the Company and acceptable to Agent; (b) be accompanied by a report of such
accountants containing an opinion thereon acceptable to Agent; (c) be prepared
in reasonable detail and in comparative form; and (d) include a balance sheet, a
statement of income, a statement of retained earnings, a statement of cash
flows, and all notes and schedules relating thereto.

 

(2)                       Interim Financial Statements.  As soon as available,
but in no event more than 30 days after the end of each month (other than the
last month in each fiscal year of the Company), a consolidated balance sheet of
the Company and its consolidated Subsidiaries, if any, as of the end of such

 

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month, a consolidated statement of income for the Company and its consolidated
Subsidiaries, if any, for such period and for the period year to date, and such
other interim statements as Agent may reasonably request, all prepared in
reasonable detail and in comparative form in accordance with GAAP consistently
applied and, if required by written notice from Agent, certified by an
authorized officer or employee of the Company acceptable to Agent.

 

(3)                       Notice of Default.  Promptly after becoming aware
thereof, notice of the occurrence of an Event of Default or a Potential Default.

 

(4)                       Notice of Non-Environmental Litigation.  Promptly
after the commencement thereof, notice of the commencement of all actions,
suits, or proceedings before any court, arbitrator, or governmental department,
commission, board, bureau, agency, or instrumentality affecting the Company or
any Subsidiary which, if determined adversely to the Company or any such
Subsidiary, could have a material adverse effect on the financial condition,
properties, profits, or operations of the Company or any such Subsidiary.

 

(5)                       Notice of Environmental Litigation, Etc.  Promptly
after receipt thereof, notice of the receipt of all pleadings, orders,
complaints, indictments, or any other communication alleging a condition that
may require the Company or any Subsidiary to undertake or to contribute to a
cleanup or other response under environmental Laws, or which seek penalties,
damages, injunctive relief, or criminal sanctions related to alleged violations
of such Laws, or which claim personal injury or property damage to any person as
a result of environmental factors or conditions.

 

(6)                       Bylaws and Articles.  Promptly after any change in the
Company’s operating agreement or articles of organization (or like documents),
copies of all such changes, certified by the Company’s Secretary.

 

(7)                       Other Information.  Such other information regarding
the condition or operations, financial or otherwise, of the Company or any
Subsidiary as Agent may from time to time reasonably request, including but not
limited to copies of all pleadings, notices, and communications referred to in
Subsections 9(H)(4) and (5) above.

 

SECTION 10.                     Negative Covenants.  Unless otherwise agreed to
in writing by Agent, while this agreement is in effect the Company will not:

 

(A)                               Borrowings.  Create, incur, assume, or allow
to exist, directly or indirectly, any indebtedness or liability for borrowed
money (including trade or bankers’ acceptances), letters of credit, or the
deferred purchase price of property or services (including capitalized leases),
except for: (1) debt to Lead Lender; (2) accounts payable to trade creditors
incurred in the ordinary course of business; (3) current operating liabilities
(other than for borrowed money) incurred in the ordinary course of business; and
(4) debt of the Company to other lenders or finance companies in an aggregate
amount not to exceed $500,000.00.

 

(B)                               Liens.  Create, incur, assume, or allow to
exist any mortgage, deed of trust, pledge, lien (including the lien of an
attachment, judgment, or execution), security interest, or other encumbrance of
any kind upon any of its property, real or personal (collectively, “Liens”). The
forgoing restrictions shall not apply to: (1) Liens in favor of Lead Lender;
(2) Liens for taxes, assessments, or governmental charges that are not past due;
(3) Liens and deposits under workers’ compensation, unemployment

 

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insurance, and social security Laws; (4) Liens and deposits to secure the
performance of bids, tenders, contracts (other than contracts for the payment of
money), and like obligations arising in the ordinary course of business as
conducted on the date hereof; (5) Liens imposed by Law in favor of mechanics,
materialmen,  warehousemen, and like persons that secure obligations that are
not past due; (6) easements, rights-of-way, restrictions, and other similar
encumbrances which, in the aggregate, do not materially interfere with the
occupation, use, and enjoyment of the property or assets encumbered thereby in
the normal course of its business or materially impair the value of the property
subject thereto; and (7) Liens to secure indebtedness permitted hereunder with
lien position acceptable to Agent.

 

(C)                               Mergers, Acquisitions, Etc.  Merge or
consolidate with any other entity or acquire all or a material part of the
assets of any person or entity, or form or create any new Subsidiary or
affiliate, or commence operations under any other name, organization, or entity,
including any joint venture.

 

(D)                               Transfer of Assets.  Sell, transfer, lease, or
otherwise dispose of any of its assets, except in the ordinary course of
business.

 

(E)                                 Loans and Investments.  Make any loan or
advance to any person or entity, or purchase any capital stock, obligations or
other securities of, make any capital contribution to, or otherwise invest in
any person or entity, or form or create any partnerships or joint ventures
except: (1) trade credit extended in the ordinary course of business;
(2) investments by the Company in the stock or other equities of its subsidiary
Corn Oil Bio-Solutions, LLC, provided that the aggregate amount of all such
investments may not exceed $100,000.00; and (3) other investments in an
aggregate amount not to exceed $1,500,000.00 in any fiscal year of the Company.

 

(F)                                 Contingent Liabilities.  Assume, guarantee,
become liable as a surety, endorse, contingently agree to purchase, or otherwise
be or become liable, directly or indirectly (including, but not limited to, by
means of a maintenance agreement, an asset or stock purchase agreement, or any
other agreement designed to ensure any creditor against loss), for or on account
of the obligation of any person or entity, except by the endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of the Company’s business.

 

(G)                               Change in Business.  Engage in any business
activities or operations substantially different from or unrelated to the
Company’s present business activities or operations.

 

(H)                               Dividends, Etc.  Declare or pay any dividends,
or make any distribution of assets to its members/owners, or purchase, redeem,
retire or otherwise acquire for value any of its equity, or allocate or
otherwise set apart any sum for any of the foregoing, except that in any fiscal
year of the Company, the Company may pay distributions in an amount up to 60% of
its net income for the prior fiscal year, provided that no Event of Default or
Potential Default shall have occurred and be continuing or would result
therefrom.

 

(I)                                    Operating/Capital Leases.  Create, incur,
assume, or permit to exist any obligation as lessee under operating leases
(other than railroad leases) for the rental or hire of any real or personal
property or under any leases that should be capitalized in accordance with GAAP,
except for operating and capital leases that do not in the aggregate require the
Company to make scheduled payments to the lessors in any fiscal year of the
Company in excess of $100,000.00, and except for railcar leases not to exceed
250 cars and not to exceed an initial or extended term of 60 months.

 

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SECTION 11.                     Financial Covenants.  Unless otherwise agreed to
in writing, while this agreement is in effect:

 

(A)                               Working Capital.  The Company will have at the
end of each period for which financial statements are required to be furnished
pursuant to Section 9(H) hereof an excess of current assets over current
liabilities (both as determined in accordance with GAAP consistently applied) of
not less than $12,000,000.00, except that in determining current assets, any
amount available under the Revolving Term Loan Supplements (less the amount that
would be considered a current liability under GAAP if fully advanced) hereto may
be included.

 

(B)                               Net Worth.  The Company will have at the end
of each period for which financial statements are required to be furnished
pursuant to Section 9(H) hereof an excess of total assets over total liabilities
minus investments in other cooperatives and joint ventures (all as determined in
accordance with GAAP consistently applied) of not less than $62,500,000.00.

 

SECTION 12.                     Events of Default.  Each of the following shall
constitute an “Event of Default” under this agreement:

 

(A)                               Payment Default.  The Company should fail to
make any payment to, or to purchase any equity in, Lead Lender and/or Agent when
due.

 

(B)                               Representations and Warranties.  Any
representation or warranty made or deemed made by the Company herein or in any
Supplement, application, agreement, certificate, or other document related to or
furnished in connection with this agreement or any Supplement, shall prove to
have been false or misleading in any material respect on or as of the date made
or deemed made.

 

(C)                               Certain Affirmative Covenants.  The Company
or, to the extent required hereunder, any Subsidiary should fail to perform or
comply with Sections 9(A) through 9(H)(2), 9(H)(6) or any reporting covenant set
forth in any Supplement hereto, and such failure continues for 15 days after
written notice thereof shall have been delivered by Agent to the Company.

 

(D)                               Other Covenants and Agreements.  The Company
or, to the extent required hereunder, any Subsidiary should fail to perform or
comply with any other covenant or agreement contained herein or in any other
Loan Document or shall use the proceeds of any loan for an unauthorized purpose.

 

(E)                                 Cross-Default.  The Company should, after
any applicable grace period, breach or be in default under the terms of any
other agreement between the Company and Lead Lender, or between the Company and
any affiliate of Lead Lender, including without limitation Farm Credit Leasing
Services Corporation.

 

(F)                                 Other Indebtedness.  The Company or any
Subsidiary should fail to pay when due any indebtedness to any other person or
entity for borrowed money or any long-term obligation for the deferred purchase
price of property (including any capitalized lease), or any other event occurs
which, under any agreement or instrument relating to such indebtedness or
obligation, has the effect of accelerating or permitting the acceleration of
such indebtedness or obligation, whether or not such indebtedness or obligation
is actually accelerated or the right to accelerate is conditioned on the giving
of notice, the passage of time, or otherwise.

 

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(G)                               Judgments.   A judgment, decree, or order for
the payment of money shall be rendered against the Company or any Subsidiary and
either: (1) enforcement proceedings shall have been commenced; (2) a Lien
prohibited under Section 10(B) hereof shall have been obtained; or (3) such
judgment, decree, or order shall continue unsatisfied and in effect for a period
of 20 consecutive days without being vacated, discharged, satisfied, or stayed
pending appeal.

 

(H)                               Insolvency, Etc.  The Company or any
Subsidiary shall: (1) become insolvent or shall generally not, or shall be
unable to, or shall admit in writing its inability to, pay its debts as they
come due; or (2) suspend its business operations or a material part thereof or
make an assignment for the benefit of creditors; or (3) apply for, consent to,
or acquiesce in the appointment of a trustee, receiver, or other custodian for
it or any of its property or, in the absence of such application, consent, or
acquiescence, a trustee, receiver, or other custodian is so appointed; or
(4) commence or have commenced against it any proceeding under any bankruptcy,
reorganization, arrangement, readjustment of debt, dissolution, or liquidation
Law of any jurisdiction.

 

(I)                                    Material Adverse Change.  Any material
adverse change occurs, as reasonably determined by Agent, in the Company’s
financial condition, results of operation, or ability to perform its obligations
hereunder or under any instrument or document contemplated hereby.

 

(J)                                 Revocation of Guaranty.  Any guaranty,
suretyship, subordination agreement, maintenance agreement, or other agreement
furnished in connection with the Company’s obligations hereunder and under any
Supplement shall, at any time, cease to be in full force and effect, or shall be
revoked or declared null and void, or the validity or enforceability thereof
shall be contested by the guarantor, surety or other maker thereof (the
“Guarantor”), or the Guarantor shall deny any further liability or obligation
thereunder, or shall fail to perform its obligations thereunder, or any
representation or warranty set forth therein shall be breached, or the Guarantor
shall breach or be in default under the terms of any other agreement with Lead
Lender (including any loan agreement or security agreement), or a default set
forth in Subsections (F) through (H) hereof shall occur with respect to the
Guarantor.

 

SECTION 13.                     Remedies.  Upon the occurrence and during the
continuance of an Event of Default or any Potential Default, Lead Lender shall
have no obligation to continue to extend credit to the Company and may
discontinue doing so at any time without prior notice. For all purposes hereof,
the term “Potential Default” means the occurrence of any event which, with the
passage of time or the giving of notice or both would become an Event of
Default. In addition, upon the occurrence and during the continuance of any
Event of Default, Lead Lender or Agent may, upon notice to the Company,
terminate any commitment and declare the entire unpaid principal balance of the
loans, all accrued interest thereon, and all other amounts payable under this
agreement, all Supplements, and the other Loan Documents to be immediately due
and payable. Upon such a declaration, the unpaid principal balance of the loans
and all such other amounts shall become immediately due and payable, without
protest, presentment, demand, or further notice of any kind, all of which are
hereby expressly waived by the Company. In addition, upon such an acceleration:

 

(A)                               Enforcement.  Lead Lender or Agent may proceed
to protect, exercise, and enforce such rights and remedies as may be provided by
this agreement, any other Loan Document or under Law.  Each and every one of
such rights and remedies shall be cumulative and may be exercised from time to
time, and no failure on the part of Lead Lender or Agent to exercise, and no
delay in exercising, any right or remedy shall operate as a waiver thereof, and
no single or partial exercise of any right or remedy shall

 

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preclude any other or future exercise thereof, or the exercise of any other
right. Without limiting the foregoing, Agent may hold and/or set off and apply
against the Company’s obligation to Lead Lender the proceeds of any equity in
Lead Lender, any cash collateral held by Lead Lender or Agent, or any balances
held by Lead Lender or Agent for the Company’s account (whether or not such
balances are then due).

 

(B) Application of Funds. Agent may apply all payments received by it to the
Company’s obligations to Lead Lender in such order and manner as Agent may elect
in its sole discretion.

 

In addition to the rights and remedies set forth above: (1) upon the occurrence
and during the continuance of an Event of Default, then at Agent’s option in
each instance, the entire indebtedness outstanding hereunder and under all
Supplements shall bear interest from the date of such Event of Default until
such Event of Default shall have been waived or cured in a manner satisfactory
to Agent at 4.00% per annum in excess of the rate(s) of interest that would
otherwise be in effect on that loan; and (2) after the maturity of any loan
(whether as a result of acceleration or otherwise), the unpaid principal balance
of such loan (including without limitation, principal, interest, fees and
expenses) shall automatically bear interest at 4.00% per annum in excess of the
rate(s) of interest that would otherwise be in effect on that loan. All interest
provided for herein shall be payable on demand and shall be calculated on the
basis of a year consisting of 360 days.

 

SECTION 14.                     Broken Funding Surcharge.  Notwithstanding any
provision contained in any Supplement giving the Company the right to repay any
loan prior to the date it would otherwise be due and payable, the Company agrees
to provide three Business Days’ prior written notice for any prepayment of a
fixed rate balance and that in the event it repays any fixed rate balance prior
to its scheduled due date or prior to the last day of the fixed rate period
applicable thereto (whether such payment is made voluntarily, as a result of an
acceleration, or otherwise), the Company will pay to Agent a surcharge in an
amount equal to the greater of: (A) an amount which would result in Agent being
made whole (on a present value basis) for the actual or imputed funding losses
incurred by Lead Lender and Agent as a result thereof; or (B) $300.00.
Notwithstanding the foregoing, in the event any fixed rate balance is repaid as
a result of the Company refinancing the loan with another lender or by other
means, then in lieu of the foregoing, the Company shall pay to Agent a surcharge
in an amount sufficient (on a present value basis) to enable Lead Lender and
Agent to maintain the yield they would have earned during the fixed rate period
on the amount repaid. Such surcharges will be calculated in accordance with
methodology established by Agent (a copy of which will be made available to the
Company upon request).

 

SECTION 15.                     Complete Agreement, Amendments.  This agreement,
all Supplements, and all other instruments and documents contemplated hereby and
thereby, are intended by the parties to be a complete and final expression of
their agreement. No amendment, modification, or waiver of any provision hereof
or thereof, and no consent to any departure by the Company herefrom or
therefrom, shall be effective unless approved by Agent and contained in a
writing signed by or on behalf of Agent, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given. In the event this agreement is amended or restated, each such
amendment or restatement shall be applicable to all Supplements hereto.

 

SECTION 16.                     Other Types of Credit.  From time to time, Lead
Lender may issue letters of credit or extend other types of credit to or for the
account of the Company. In the event the parties desire to

 

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do so under the terms of this agreement, such extensions of credit may be set
forth in any Supplement hereto and this agreement shall be applicable thereto.

 

SECTION 17.                     Applicable Law.  Without giving effect to the
principles of conflict of laws and except to the extent governed by federal law,
the Laws of the State of Colorado, without reference to choice of law doctrine,
shall govern this agreement, each Supplement and any other Loan Documents for
which Colorado is specified as the applicable law, and all disputes and matters
between the parties to this agreement, including all disputes and matters
whatsoever arising under, in connection with or incident to the lending and/or
leasing or other business relationship between the parties, and the rights and
obligations of the parties to this agreement or any other Loan Documents by and
between the parties for which Colorado is specified as the applicable law.

 

SECTION 18.                     Notices.  All notices hereunder shall be in
writing and shall be deemed to be duly given upon delivery if personally
delivered or sent by telegram or facsimile transmission, or three days after
mailing if sent by express, certified or registered mail, to the parties at the
following addresses (or such other address for a party as shall be specified by
like notice):

 

If to Agent, as follows:

 

For general correspondence purposes:

P.O. Box 5110

Denver, Colorado 80217-5110

 

For direct delivery purposes, when desired:

5500 South Quebec Street

Greenwood Village, Colorado 80111-1914

 

Attention: Credit Information Services

Fax No.: (303) 224-6101

 

If to the Company, as follows:

 

Golden Grain Energy, LLC

1822 43rd St. SW

Mason City, Iowa 50401

 

 

 

 

 

Attention:  CEO

Fax No.:  641-421-8457

 

SECTION 19.                     Taxes and Expenses.  To the extent allowed by
law, the Company agrees to pay all reasonable out-of-pocket costs and expenses
(including the fees and expenses of counsel retained or employed by Agent,
including expenses of in-house counsel of Agent) incurred by Agent and any
participants from Lead Lender in connection with the origination,
administration, collection, and enforcement of this agreement and the other Loan
Documents, including, without limitation, all costs and expenses incurred in
perfecting, maintaining, determining the priority of, and releasing any security
for the Company’s obligations to Lead Lender, and any stamp, intangible,
transfer, or like tax payable in connection with this agreement or any other
Loan Document.

 

SECTION 20.                     Effectiveness and Severability.  This agreement
shall continue in effect until: (A) all indebtedness and obligations of the
Company under this agreement, all Supplements, and all other Loan Documents
shall have been paid or satisfied; (B) Lead Lender and Agent have no commitment
to extend credit to or for the account of the Company under any Supplement; and
(C) either party sends written notice to the other terminating this agreement.
Any provision of this agreement or any other Loan Document which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining

 

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provisions hereof or thereof.

 

SECTION 21.                     Successors and Assigns.  This agreement, each
Supplement, and the other Loan Documents shall be binding upon and inure to the
benefit of the Company and Lead Lender and their respective successors and
assigns, except that the Company may not assign or transfer its rights or
obligations under this agreement, any Supplement or any other Loan Document
without the prior written consent of Agent.

 

SECTION 22.                     Participations, Etc.  From time to time, Lead
Lender may sell to one or more banks, financial institutions, or other lenders a
participation in one or more of the loans or other extensions of credit made
pursuant to this agreement. However, no such participation shall relieve Lead
Lender of any commitment made to the Company hereunder. In connection with the
foregoing, Lead Lender may disclose information concerning the Company and its
Subsidiaries, if any, to any participant or prospective participant, provided
that such participant or prospective participant agrees to keep such information
confidential. Patronage distributions in the event of a sale of a participation
interest shall be governed by Lead Lender’s Bylaws and Capital Plan (as each may
be amended from time to time). A sale of a participation interest may include
certain voting rights of the participants regarding the loans hereunder
(including without limitation the administration, servicing, and enforcement
thereof). Lead Lender agrees to give written notification to the Company of any
sale of a participation interest.

 

SECTION 23.                     Administrative Fee. The Company agrees to pay to
Agent on October 1, 2010, and on each October 1 thereafter, for as long as the
Company has commitments from Lead Lender, an administrative fee in the amount of
$5,000.00.

 

SECTION 24.                     Counterparts. This Agreement, each Supplement
and any other Loan Document may be executed in any number of counterparts and by
the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original and shall be binding upon all parties
and their respective permitted successors and assigns, and all of which taken
together shall constitute one and the same agreement.

 

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IN WITNESS WHEREOF, the parties have caused this agreement to be executed by
their duly authorized officers as of the date shown above.

 

FARM CREDIT SERVICES OF AMERICA, FLCA

 

GOLDEN GRAIN ENERGY, LLC

 

 

 

By:

 

 

By:

/s/ Christy Marchand

 

 

 

 

 

Title:

 

 

Title:

CFO

 

 

 

FARM CREDIT SERVICES OF AMERICAN, PCA

 

 

 

 

 

By:

 

 

 

 

 

 

 

Title:

 

 

 

 

 

NT

 

7-23-10

 

 

IN WITNESS WHEREOF, the parties have caused this agreement to be executed by
their duly authorized officers as of the date shown above.

 

FARM CREDIT SERVICES OF AMERICA, FLCA

 

GOLDEN GRAIN ENERGY, LLC

 

 

 

By:

/s/ Kathryn Frahm

 

By:

 

 

 

 

 

 

Title:

VP Credit

 

Title:

 

 

 

 

 

FARM CREDIT SERVICES OF AMERICAN, PCA

 

 

 

 

 

 

By:

Kathryn Frahm

 

 

 

 

 

 

Title:

VP Credit

 

 

 

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