Exhibit 10.30

 

Assn.

 

B.O.No.

 

CIF No.

 

Loan No.

 

Product Code

 

Coll. Code

 

Customer Name

 

CommitmentAmount

72

 

65

 

1895500

 

1192413700

 

1011

 

1

 

GREAT PLAINS ETHANOL

 

$15,000,000.00

 

PROMISSORY NOTE/LOAN AGREEMENT

LENDER:  AGCOUNTRY FARM CREDIT SERVICES, PCA
                                                                                                                      
                Date: February 20, 2008

 

 

1900 44TH ST S PO BOX 6020

 

 

FARGO

NORTH DAKOTA

58108-6020

LOAN AMOUNT: $15,000,000.00

MATURITY DATE: April 1, 2009

TYPE OF LOAN: Revolving Line of Credit (RLOC)

STATED INTEREST RATE: 7.37%

TYPE OF INTEREST RATE: ADJUSTABLE RATE LIBOR BASED:

 

On the first day of each month the Interest Rate shall be adjusted by adding a
margin of 3.00 percentage points to the index.  This margin shall remain in
effect until February 1, 2009, at which time Lender may change the margin at its
discretion, and Lender may continue to change the margin at successive intervals
of 1 year(s) each thereafter.

 

 

 

LOAN PAYMENTS:

Interest payments are due Quarterly beginning on April 1, 2008. The remaining
unpaid balance of the loan is payable in its entirety on the Maturity Date.

 

 

 

DRAFT PROGRAM:

Not applicable.

 

COLLATERAL: Payment of the loan is secured by:

All existing and future security agreements from all or any of the Borrowers
(and from third parties if so intended) to the Lender.  All of the covenants and
agreements contained in said security instruments are made a pert of this note.

 

 

 

DEFAULT ADD-ON RATE:   2.00% will be added to the interest rate that would
otherwise be in effect for this loan, if Borrowers default as explained in the
Additional Provisions.

VOTING STOCKHOLDER: Any one Stockholder is authorized by the Borrowers to
exercise any voting rights on behalf of members, subject to applicable bylaws,
and to receive effective interest rate disclosures unless otherwise agreed in
writing between the parties.

                Borrowers further agree that a security interest is granted to
Lender in all such stock or participation certificates now owned and hereafter
acquired, however designated or classified, and all equity reserve and allocated
surplus in the Lender or Lender’s parent association, as  applicable, to secure
the Loans.

                FOR VALUE RECEIVED the undersigned Borrowers jointly and
severally promise to pay to the order of the Lender at its office shown above on
or before the Maturity Date the principal sum equal to the Loan Amount together
with interest thereon from dates of disbursement until paid pursuant to the
Lender’s Individual Loan Pricing Program (the “Program”), as provided in the
Additional Provisions.  Borrowers grant to the Lender, as security for the
payment or this loan and, if applicable, the other Obligations as defined in the
Additional Provisions, a present security interest or lien in the property
described above and, if applicable, the other Collateral, as defined In the
Additional Provisions.

                The Borrowers acknowledge receipt of: a) pertaining to the
Lender or the Lender’s parent association, as applicable, the most recent annual
report and most recent quarterly report, if more recent than the annual report a
copy of the notice to Borrowers concerning investment, which includes a
description of the terms and conditions under which equity is issued;
capitalization bylaws and b,) an Effective Interest Rate Disclosure Statement or
a Truth-in-Lending Disclosure Statement, as applicable.

 

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THIS AGREEMENT INCLUDES THE PROVISIONS IN THE “PROMISSORY NOTE/LOAN AGREEMENT —
ADDITIONAL PROVISIONS.”

 

AND THE PROVISIONS IN THE “ADDENDUM TO NOTE/LOAN AGREEMENT.”

 

GREAT PLAINS ETHANOL LLC

dba Poet Biorefining - Chancellor

a South Dakota LLC

 

By:

/s/ Darrin Ihnen

 

DARIN IHNEN, Chairman

 

--------------------------------------------------------------------------------

 

Assn.

 

B.O.No.

 

CIF No.

 

Loan No.

 

Product Code

 

Coll. Code

 

Customer Name

 

Commitment Amount

72

 

65

 

1895500

 

1192413700

 

1011

 

1

 

GREAT PLAINS ETHANOL

 

$15,000,000.00

 

ADDENDUM TO NOTE/LOAN AGREEMENT

February 20, 2008

 

                This Addendum is a part of, and contains additional terms and
conditions for, a Promissory Note/Loan Agreement (‘Note”) dated February 20,
2008, in the principal sum of $15,000,000.00, evidencing a loan extended by
AgCountry Farm Credit Services, PCA  (“Lender”) to the Borrowers.  Unless waived
in writing by the Lender, until all liabilities of the Borrowers under this loan
have been paid and satisfied in full, the Borrowers covenant and agree as
follows:

 

1.                                       COVENANTS: The following covenants and
agreements amend and supplement the Note and the Security Agreement. To the
extent of any inconsistency between the provisions of the Note or the Security
Agreement and this Addendum, this Addendum governs.

 

2.                                       BORROWING BASE: Borrower agrees to
limit credit available under this line of credit to the lesser of the Commitment
Amount or the FCS Borrowing Base Formula. This formula is to be calculated
quarterly using the most recent inventory, aging accounts receivable, and
hedging account reports. Credit available under the Borrowing Base Formula,
based on current market values, is to be calculated as follows:

 

 

 

a.

Inventory - unsettled payables X 75%

$ a

 

 

b.

Gain/Loss on market contracts X 75%

$ b

 

 

c.

Accounts receivable < 90 days X 75%

$ c

 

 

 

 

 

 

 

Total Credit Available

$ (a+b+c)

 

3.                                       FINANCIAL - MINIMUM OWNER EQUITY:
Borrower(s) shall maintain minimum owner equity percentage of 45% by 12-31-07
and thereafter. Calculation of such owner equity percentage is made by dividing
the difference between total assets and total liabilities by total assets and
expressing the result as a percentage.

 

4.                               FINANCIAL, - WORKING CAPITAL: Borrower will
maintain working capital of at least $5,000,000 by 12-31-07. For purposes of
determining the amount of Borrower’s working capital, Borrower may include as
working capital all amounts available for borrowing under the Revolving Term
Commitment less the current portion due.

 

5.                                       FINANCIAL: Borrower agrees to maintain
a fixed charge coverage ratio of 1.00:1.00 by 12-31-08. Fixed charge coverage
ratio is defined as: (earnings before interest, taxes, depreciation and
amortization) divided by the sum of; a) interest; b) mandatory debt retirement;
c) cash taxes; d) maintenance capital expenditures; and e) cash patronage
dividends and cash equity retirements to be measured at fiscal year end.

 

6.                                       Borrower to insure business with.
adequate property casualty insurance and adequate liability insurance. Agcountry
to be named loss payee and additional insured.

 

7.                                       FINANCIAL REPORTING - - CERTIFIED
AUDIT: Within 120 days after the Borrowers fiscal year and annually thereafter,
Borrower shall provide Lender with a written balance sheet of borrower as of the
close of such fiscal year and a written statement of profit and loss of Borrower
for such year, prepared in accordance with generally accepted principles of
accounting and certified by a firm of independent accountants selected by
Borrower but satisfactory to Lender. Such reports shall be set forth in a format
comparing the results of the most recent fiscal year to those in the prior
fiscal year certified report and in all reasonable details.

 

--------------------------------------------------------------------------------

 

Assn.

 

B.O.No.

 

CIF No.

 

Loan No.

 

Product Code

 

Coll. Code

 

Customer Name

 

CommitmentAmount

72

 

65

 

1895500

 

1192413700

 

1011

 

1

 

GREAT PLAINS ETHANOL

 

$15,000,000.00

 

ADDENDUM TO NOTE/LOAN AGREEMENT

February 20, 2008

 

                This Addendum is a part of, and contains additional terms and
conditions for, a Promissory Note/Loan Agreement (‘Note”) dated February 20,
2008, in the principal sum of $15,000,000.00, evidencing a loan extended by
AgCountry Farm Credit Services, PCA  (“Lender”) to the Borrowers.  Unless waived
in writing by the Lender, until all liabilities of the Borrowers under this loan
have been paid and satisfied in full, the Borrowers covenant agree as follows:

 

8.                                       QUARTERLY FINANCIAL REPORTING: Within
30 days of the previous quarter-end, Borrower(s) shall provide lender with the
previous quarter-end reports consisting of a balance sheet, profit and loss
statements and other reports requested to monitor performance.

 

9.                                       ACCOUNTING METHODS — Borrower shall not
adopt any accounting methods, which are inconsistent with generally accepted
accounting principles (GAAP). To the extent any change in GAAP affects any
computation or determination required to be made pursuant to this Addendum, such
computation or determination shall be made as it such change in GAAP had not
occurred unless the Borrower and Lender agree in writing to an adjustment to
such computation or determination to account for such change in GAAP.
Furthermore, Borrower will not change any accounting methods, allow any
restatement of its earnings, change in depreciation or inventory methods, or
reclassification of balance sheet accounts, including but not limited to, the
sale and leaseback of any asset, without full and immediate disclosure to
Lender. Lender shall have the right to accept or reject any and all changes that
Lender, in its sole discretion, determines are material. Lender shall also have
the right to review and adjust any and all loan covenants, interest rates and
other contract agreements upon determining a material change has occurred.

 

10.                                 OTHER INDEBTEDNESS - If Borrower should fail
to pay any indebtedness to any other person or entity for borrowed money or any
long-term obligation when due, or any other event occurs which, under any
agreement or instrument relating to indebtedness or obligation, has the effect
of accelerating or permitting the acceleration of such indebtedness or
obligation; then all Lender obligations become due.

 

11.                                 DEFAULT EVENT - Borrower shall be in default
if borrower fails to pay any principal

or interest or fees when due and such failure shall continue un-remedied for a
period of 10 days.

 

12.                                 DEFAULT EVENT - Borrower shall be in default
if borrower fails to observe or perform any covenant or agreement contained in
this agreement or other loan documents and such failure shall remain un-remedied
for 30 days after the earlier of: 1) any officer of Borrower becomes aware of
such failure or 2) Lender notifies borrower of such failure.

 

13.                                 LIENS AND ENCUMBRANCES — Lender acknowledges
all liens and encumbrances granted by the Borrower to the Lender under the
Credit Agreement dated August 10, 2007 and all subsequent amendments between
Borrower and Agcountry Farm Credit Services, FLCA.

 

14.                                 TAXES - Borrower to pay all taxes before
they become delinquent.

 

Great Plains Ethanol, LLC

dba Poet Biorefining — Chancellor

a South Dakota LLC

 

By:

/s/ Darin Ihnen

 

(print name) Darrin Ihnen

Title:

President

 

 

--------------------------------------------------------------------------------

 

PROMISSORY NOTE/LOAN AGREEMENT

ADDITIONAL PROVISIONS

 

INDIVIDUAL LOAN PRICING PROGRAM:   The Program provides for charging
differential interest rates according to loan classes determined by criteria
adopted by the Lander from time to time, such as type of loan, purpose, amount
quality, funding costs, operating costs, servicing costs, and competitive
interest rates. There are separate types of loans and interest rates under the
Program, each having a different rate of interest, and the loans within each
class are assigned to an interest rate category, it is possible that the
particular rate for each class of loan may differ among such geographical areas
as may be designated from time to time. In the event that Borrowers default
under the terms or conditions of any promissory note, membership agreement,
mortgage or other security document, or any amendatory agreement to any of
these, the Lender at its option may adjust this loan to any less favorable
interest rate category then offered or maintained by Lender for loans of this
type.  The higher interest rate shall become effective immediately upon
placement of this loan into the less favorable interest rate category by Lender,
and the loan may, at the option of Lender, remain in the less favorable interest
rate category for the remaining term of the loan, regardless of whether
Borrowers later cure the default. Lender shall not place the loan into a less
favorable interest rate category unless Lender has first given Borrowers written
notice of the default, and Borrowers fail to cure the default within 60 days
after Lender has given the notice. Notice shall be deemed to have been given
when Lender places such notice in the mail for first-class mailing to the last
address of Borrowers known by Lender. In addition to adjusting the loan to a
less favorable interest rate category, Lender may also charge the higher default
interest rate described below.

INTEREST RATE: If this is a:

   (a) Variable Rate loan, the initial annual rate of interest is equal to the
Stated Interest Rate.  The interest rate is subject to change at any time and by
any amount during the term of the loan and will vary from time to time at the
option of the Lender.

   (b) Fixed Rate loan, the annual rate of interest is equal to the Stated
Interest Rate.  The interest rate is not subject to change during the term of
the loan and will not be increased or decreased except in the event of default.

   (c) Adjustable Rate Operating loan, the initial annual rate of interest is
equal to the Stated Interest Rate. The interest rate is subject to change at any
time and by any amount during the term of the loan, but only on and after the
first adjustment date, and the rate will not be increased or decreased prior to
that date except in the event of default.

   (d) Adjustable Rate loan or an Adjustable Rate IT loan or an Adjustable Rate
Capital RLOC, the initial annual rate of interest is equal to the Stated
Interest Rate. The interest rate is subject to change by any amount during the
term of the loan, but only on the first adjustment date and on dates occurring
at the end of the successive adjustment intervals thereafter, and the rate will
not be increased or decreased during any one such interval except in the event
of default.

   (e) Adjustable Rate Prima Rate Based loan, the initial annual rate of
interest is equal to the Stated Interest Rate. The Index for adjustments is the
prime rate reported on the tenth day of the month preceding the interest rate
change date by the Wall Street Journal in its daily listing of money rates,
defined therein as “the base rate on corporate leans posted by at least 78
percent of the nation’s 30 largest banks.”  If a prime rate is not reported on
the tenth day of a month, the prime rate reported on the first business day
preceding the tenth day of the month will be used. If this index is no longer
available Lender will select a new index which is based upon comparable
information.

   (f) Capped Non-indexed Variable Rate loan, the initial annual rate of
interest is equal to the Stated Interest Rate.  The Interest rate is subject to
change at any time and will vary from time to time at the option of the Lender.
The interest rate is not based on an Index. Except during periods of default
when the additional percentage points specified herein shall be added to
increase the interest rate, tile interest rate may not increase or decrease by
more than 6.00 percentage points above or below the initial annual rate of
interest on any single change date or during the term of the Loan.

   (g) Fixed Then indexed Adjustable Rate loan, the initial annual rate of
interest is equal to the Stated interest Rate. Once the interest rate changes to
an adjustable interest rate at the end of the fixed interest rate period, the
index for adjustments is the estimated weekly average available for the one-year
bonds funding cost index as reported by the Federal Farm Credit Banks Funding
Corporation at its Web site, found in the Farm Credit System, Funding Cost
Index, Archive section at http://www.farmcredit-ffcb corn, for that week which
contains the date that is 45 days before the data that the adjustable interest
rate is to be initially determined or subsequently adjusted. if the date that is
45 days before either the expiration date of the fixed interest rate period or
an Adjustment interval is not a business day, the Lander shall use that
estimated weekly average for the one-year bonds funding cost index for that week
which immediately precedes the 45-day date.

If this index is no longer available, the Lender will select a new index which
is based on comparable information. The Lender will give the Borrowers notice of
this choice.

   (h) Indexed Adjustable Rate loan, the initial annual rate of interest is
equal to the Stated Interest Rate. The index for adjustments is the estimated
weekly average available for the one-year bonds funding cost index as reported
by the Federal Pant Credit Banks Funding Corporation at its Web site, found in
the Farm Credit System, Funding Cost index, Archive section at
http://farmcredit-ffcb.com, for that week which contains the data that is 45
days before the date the interest rate is to be adjusted. If the date that is 45
days before the date the interest rate is to be adjusted is not a business day,
the Lender shall use that estimated weekly average for the one-year bonds
funding cost index for that week which immediately precedes the 45 day date. If
this index is no longer available, the Lender will select a new index which is
based on comparable information. The Lender will give the Borrowers notice of
this choice.

   (i) Adjustable Rate LIBOR Based loan, the initial annual rate of interest is
equal to the Stated Interest Rate. The Index for adjustments is the One Month
London interbank Offered Rate (“One Month LIBOR”) reported on the tenth day of
the month preceding the interest rate change date by the Wall Street Journal in
its daily listing of money rates, defined therein as “the average of interbank
offered rates for dollar deposits in the London market based on quotations five
major banks.” If a One Month LIBOR rate is not reported on the tenth day of a
month, the One Month LIBOR rate reported on the first business day preceding the
tenth day of the month will be used.  If this index is no longer available,
Lender will select a new index which is based upon comparable information.

   Interest may be based upon a 360- or 365-day year as the Lender may
determine.

DEFAULT RATE OF INTEREST: Prior to maturity, if Borrowers default under this
document the entire unpaid principal balance of the loan, including all
advancements, shall bear interest from the date of default until the default is
cured or maturity of the loan is accelerated by reason of default at a rate
equal to the interest rate for this loan that would otherwise be in effect
during the period of default plus the Default Add-On Rate per annum (the
“default rate”), and the amount of such interest in excess of interest otherwise
accruing in the absence of default shall be immediately due and payable. At
maturity or upon acceleration of maturity by reason of default, the entire
indebtedness including all principal, interest and advancements shall bear
interest until paid at the default rate in effect at the time of maturity or
acceleration of maturity, as the case may be.

 

--------------------------------------------------------------------------------

 

DISBURSEMENTS OF PRINCIPAL: Disbursements of principal may be made at various
times at Borrowers’ request, subject to the provisions of this paragraph.
Repayments of principal under a Revolving Line of Credit reinstate the loan
commitment, subject to the terms of this document, but the total of the unpaid
balance of future advances together with the existing indebtedness hereunder, in
the aggregate at any one time outstanding, shall not exceed the Loan Amount;
otherwise, repayments of principal do not reinstate the loan commitment, and
total disbursements, in the aggregate, shall not exceed the Loan Amount. The
Lender may withhold further disbursements if it determines that: (a) the value
of the Collateral is insufficient; (b) loan proceeds have been used for purposes
not approved by the Lender; (c) loan payments have not been made in accordance
with the repayment plan contained in the loan application; or (d) an event has
occurred which entities the Lender to accelerate maturity of the loan.

DRAFT PROGRAM AGREEMENT: If the Draft Program is applicable to this loan, the
Borrowers may draw loan funds using the draft forms furnished by the tender,
subject to the following terms and conditions:

   (a) The Borrowers authorize and direct the Lender and its duly authorized
agents to accept drafts made or drawn by any one of the Borrowers and to
disburse loan funds accordingly, as specified in this document; however,
Borrowers agree not to use drafts as payments on this or other Obligations of
the Borrowers. The Borrowers may be charged a reasonable fee for this program
and the cost of printing drafts.

   (b) The Borrowers jointly and severally accept responsibility for all
disbursements made pursuant to this authorization and direction. The Lender
shall not be obligated to inquire as to whether the Borrowers have issued
specific directions for any particular draft or to determine whether the
Borrowers have received the benefit of the proceeds of any particular draft
before honoring such draft. Drafts may be deposited directly into the bank
account at any one of the Borrowers.

   (c) The minimum amount for which each draft may be written is the Minimum
Draft amount. In the event that Borrowers write any draft for an amount below
this minimum, the Lender may charge Borrowers a reasonable fee for each draft
that is not in compliance.

   (d) Drafts may not be written in excess of the undisbursed loan commitment.
The Lender reserves the right to revoke all future draft privileges without
notice to the Borrowers in the event of an overdraft and the right to reject
drafts that are not written for purposes specified in the loan documents or
pursuant to these terms and conditions. In the event that Lander chooses to
honor a draft which exceeds the available loan commitment, Borrowers are liable
for full repayment of the funds thus borrowed, plus interest and Lender may
charge Borrowers a reasonable overdraft fee.

   (e) The Borrowers agree to immediately notify the Lender in the event one or
more drafts are lost, stolen, destroyed or otherwise misused and to indemnify
the Lender and hold the Lender harmless from any loss or claim if any draft is
lost, stolen, forged, altered or otherwise misused if the Lender did not have
notice of the same at least 24 hours prior to honoring such draft.

   (f) The Borrowers may stop payment on a draft by request to the Lender.  The
Borrowers wilt be charged a reasonable fee for each stop-payment order and agree
to reimburse the Lender for all damages, costs and expenses as a result of the
Lender’s refusal to honor such draft. The Lender shall not be liable in the
event the draft is honored following a stop-payment order if such order is not
received in sufficient time to permit dishonor.

   (g) This authorization and direction shall be effective as to this and, with
the Lender’s approval, other existing and future loans to the Borrowers and
shall continue in force and effect until the Lender receives written notice of
revocation signed by the Borrowers, provided the privilege of using drafts may
be withdrawn by the Lender and unused drafts must be surrendered to the Lender
on demand.

FUNDS HELD PROGRAM: Lender may offer a Funds Held Program (“Program”) that
allows Borrowers to make advance conditional payments on designated loans.
Lender reserves the right, in its discretion, to amend or terminate the Program.
The following terms and conditions apply to at Program accounts in connection
with loans from Lender.

   (a) Subject to Lender’s rights to direct the application of payments, an
advance payment made to be applied to future maturities on a loan will be placed
in a Program account (“Account”) as of the date received. If a special
prepayment of principal is desired, Borrowers must so specify when an advance
payment is made.

   (b) Interest will accrue on funds in the Account at such times and at such
rates as per Lender’s Program. Lender may change the interest rate or accrual
period from time to time without notice. The Program may provide for different
interest rates for different categories of loans.

   (c) When a loan installment or other related charge becomes due, funds in the
Account for that loan wilt be automatically applied on the due date toward
payment be the installment or related charge. Any accrued interest in the
Account will be applied first. If the funds in the  Account are not adequate to
pay the entire Installment or related charge, Borrowers must pay the difference
by the installment due date.

   (d) Funds received after a loan installment or related charge has been billed
will be applied to the installment or related charge due. Funds received in
excess of the billed installment amount or related charge will be placed in the
Account.

Even though no installment or related charge is due, Lender may, at its option,
apply funds from the Account without notice to Borrowers as follows:

      — Protective Advances.  If Borrowers fail to pay when due other items
Borrowers are required to pay pursuant to any loan document, Lender may apply
funds in the Account to pay them.

      — Account Ceiling. If the Account balance exceeds the unpaid balance on
the loan, Lender may apply the funds in the Account to pay off the loan and will
return any excess funds.

      — Transfer of Security. If Borrowers sell, assign, or transfer any
interest in any collateral for the loan, Lender may apply the funds in the
Account to the remaining loan balance.

      — Deceased Borrowers. If all Borrowers are deceased, Lender may apply the
funds in the Account to the remaining loan balance.

      — Termination of Program. If Lender decides to terminate the Program, it
may apply all funds in the Account to the remaining loan balance effective on
the termination date.

   (e) Lender may, in its discretion, permit Borrowers to withdraw funds from
the Account in accordance with Lender’s Program.

   (f) Neither the advance payments nor the accrued interest in an Account are
insured by a governmental agency or instrumentality. If Lender is placed in
liquidation, Borrowers shall be sent by the receiver such notices as required by
FCA regulations then in effect. Such regulations currently provide for advance
notice from the receiver that funds in the Account will be applied to the loan
and that funds in the Account will not earn interest after the receiver is
appointed.

LOAN PAYMENTS:  If the loan is payable in installments and the period from the
day interest begins to the due date of the first installment is more than the
interval between installments, there may be an interest only payment due one
installment interval prior to the due date of the first installment, or the
interest may be included in the first installment at the option of the Lender,
but if each period is less than the interval between installments and principal
and interest are payable in equal installments, then the first installment will
be decreased by the amount of interest not yet accrued for that installment. The
final installment may be more or less than preceding installments, if any, and
any periodic adjustments to the interest rate will result in corresponding
changes in the amount of installments, if the lean is payable in installments,
or the amount due at maturity. The Borrowers may make advance payments in any
amount and at any time without penalty.

 

--------------------------------------------------------------------------------

 

Prepayments shall, at the option of the Lender, (a) be held by the Lender and
then applied to installments of principal and interest next scheduled to mature
in the order of maturity (b) be immediately applied to payment of principal then
outstanding, resulting in a reamortization of the remaining balance of the loan
over the remaining term under the existing payment plan and in a corresponding
reduction in the amount of future installments of principal end interest, or
(c)  be immediately applied to payment of principal then outstanding, with, if
en amortized loan, a corresponding reduction in the number of future
installments of principal and interest in the inverse order of maturity, thus
discharging the loan at an earlier date; provided, in any event, the Lender may,
at its option, first apply any such prepayments to the payment of interest
accrued to the date of prepayment.

PERSONAL PROPERTY AND FIXTURES: The following subsections (1) and (2) including
the definitions apply, in addition, only if the collateral described on
Promissory Note/Loan Agreement, and each addendum thereto, is personal property
or fixtures:

(1)  Obligations and Collateral. The Borrowers grant to the Lender as security
for the payment and performance of this loan and the other Obligations a
security interest in all of the Borrowers’ rights, title, and interest in the
Collateral, including all rights to transfer an interest in the Collateral.
“Obligations” means this loan and all other loans and advances by the Lender
except any loan to which a Basic Membership and Lending Relationship Agreement
(Rural Residence /Country Living Loans) applies including: (a) existing and
future indebtedness, liabilities, and other obligations of the Borrowers to the
Lender of any kind, absolute or contingent, due or to become due, arising out of
existing or future credit granted by the Lender to the Borrowers, or any one or
more of them, and all extensions and renewals thereof from time to time: and
(b) all costs incurred by the Lender in enforcing its rights under this document
with interest, including attorneys fees end legal costs.  “Collateral” means
(a) the property described on Promissory Note/Loan Agreement and each addendum
thereto; (b) all additions, accessions, replacements, and substitutions of the
Collateral and property of similar type or kind now owned or hereafter acquired
by the Borrowers; and (a) to the extent not included in (a) or (b) as original
Collateral, all products and proceeds of the Collateral. If the Collateral
includes crops now growing or to be grown in North Dakota, the following
provision is part of this document:

This security agreement covers crops now growing. This security agreement also
covers future crops to be grown in the current year or any year hereafter.

   The Borrowers agree to deliver upon the request of the Lender such additional
or corrected documents, drafts or instruments as the Lender may deem necessary
at any time.

   (2) Warranties end Agreements: The Borrowers warrant and agree that:

      (a) The Borrowers are the absolute owners of the Collateral free from any
encumbrances, liens, security interests, or equity interests, except for the
security interest granted herein and except as disclosed by the Borrowers to the
Lender in writing.

      (b) The Borrowers shall: (1) care for the Collateral and not permit its
value to be impaired; (2) keep the Collateral free from all encumbrances, liens,
and security interests, other than those created or expressly permitted herein;
(3) defend the Collateral against all claims and legal proceedings by persons
other than the Lender; (4) pay and discharge when due all taxes, license fees,
levies, end other charges upon the Collateral; and (5) immediately inform the
Lender in writing of any change in Borrowers’ address or the location of the
Collateral, Loss of or damage to the Collateral shall not release the Borrowers
from any of the Obligations. Upon demand, the Borrowers will provide additional
collateral acceptable to the Lender.

      (c) At the Lender’s request, the Borrowers shall keep all Collateral and
the Lenders interest in it insured under policies naming the Lender as loss
payee, with provisions, coverages, amounts, end by insurers satisfactory to the
Lender, and the Borrowers shall furnish Lender satisfactory evidence of such
insurance.

      (d) The Borrowers shall pay all expenses which are permitted to be
recovered from the Borrowers by applicable law and, upon request, take any
action reasonably deemed advisable by the Lender to preserve the Collateral or
to establish, determine the priority of, perfect, continue as perfected,
preserve, enforce or terminate the Lender’s rights and interest in the
Collateral.

      (e) The Lender is authorized to examine the Collateral at reasonable
times.

      (f) The Borrowers shall not dispose of any of the Collateral without the
authorization of the Lender and, except as otherwise agreed to in writing by the
Lender, shall apply the proceeds of all dispositions of the Collateral to
payment of this loan.

   (g) The Borrowers understand that the unauthorized disposition of Collateral
with intent to defraud the Lender constitutes a federal criminal offense.

   (h) The Borrowers hereby authorize the Lender to file all financing
statements describing the Collateral, and all amendments thereto, in any offices
as the Lender, in its sole discretion, may determine. The Borrowers hereby also
authorize the Lender to file all effective financing statements describing the
Collateral pursuant to 7 U.S.C. Section 1631, and all amendments hereto, in any
offices as the Lenders, in its sole discretion, may determine.

    (i) If the Collateral includes federal or state government program
entitlements or payments, the Borrowers shall execute and deliver to the Lender
all assignments, transfers, and other documents required by the Lender to
transfer, convey, and assign to the Lender all such federal and slate government
program entitlements, payments, rights to payment whether or not earned by
performance, accounts, general intangibles, and benefits.

   (j) All terms in this Agreement that are defined in the Uniform Commercial
Code, as enacted in the stats in which Lender’s office originating this Loan is
located and as amended from time to time (“UCC”), shall have the meanings set
forth in the UCC. The meaning of a term hereunder shall automatically change on
the affective date of each amendment to the definition of such term in the UCC.

   (k) For each Borrower that is not an individual, the legal name of each such
Borrower is as set forth in the Note or an addendum thereto. None of the
Borrowers have used any trade name, assumed name, or other name except those sat
forth in the Note or an addendum thereto, The Borrowers shall give the Lender
written notice at least 30 days before the date of (1) any change in any
Borrowers name or (2) any use by any Borrower of another name.

   (l) If any of the Borrowers is a Registered Organization, as that term is
defined in the UCC, all information provided by the Borrowers to the Lender
concerning the state(s) of organization for the Borrowers is true, accurate, and
complete. None of the Borrowers shall change its state of organization without
the prior written consent of the Lender. Borrowers shall provide the Lender with
written notice at least 30 days before the date any Borrower date any action to
change its state of organization.

   (m) If any of the Borrowers is an individual or an entity that is not a
Registered Organization, all information provided by the Borrowers to the Lender
concerning the address of an individual Borrower’s residence or the address of
the chief executive office of an entity that is not a Registered Organization is
true, accurate, and complete. None of the individual Borrowers shall change that
address of residence without providing written notice to the Lender at least 30
days before the effective date of such address change. None of the Borrowers
that are entities that are not Registered Organizations shall change that
address of the chief executive office without providing written notice to the
Lender at least 30 days before the effective date of such address change.

   (n) To the extent that the Borrowers use proceeds of the Loan extended by the
Lender to purchase Collateral, Borrowers’ repayment of the Loan shall apply on a
“first-in-first-out” basis so

 

--------------------------------------------------------------------------------

 

that the portion of the Loan used to purchase a particular item of the
Collateral shall be paid in the chronological order the Borrowers purchased the
Collateral.

FINANCIAL RECORDS: The Borrowers agree to maintain complete and accurate
financial books and records for Borrowers’ business, permit access by the Lender
and to provide periodic financial information as requested by Lender in a form
acceptable to Lender.

PAYMENTS BY LENDER: The Lender is authorized but not obligated to pay the
following items and charge them to the loan with internet at the rate(s) then
applicable to this loan: (a) amounts required to pay prior liens on the
Collateral; (b) the cost of insurance carried by the Borrowers in connection
with this loan or any financially related service offered by or through the
Lender; (c) appraisal and title evidence costs, recording and filing fees, and
similar items; (d) amounts required for the Borrowers to acquire and maintain
stock or participation certificates in the Lender or the Lenders parent
association, as applicable; and (a) any accrued interest hereunder that is not
paid when due.

EVENTS OF DEFAULT:  Each of the following constitutes a default by Borrowers
under this document (a) the failure to perform any warranty or agreement
contained in this document or in any instrument securing payment of this loan or
related to this loan; (b) default under any other promissory note executed by
the Borrowers, or any one or more of them, and payable to the Lender except any
note to which a Basic Membership and Lending Relationship Agreement (Rural
Residence/Country Living Loans) applies; (c) default under any lease executed by
the Borrowers, or any one or more of them, under which the Lender is the Lessor,
and, it shall also be an event of default under this document if an event of
default occurs on any other loan or lease that any of the Borrowers have with
either the Lenders parent association or any subsidiaries of the Lender’s parent
association; (d) any statement or report furnished by the Borrowers to the
Lender is false in any material respect; (e) any Collateral is lost, stolen,
substantially damaged destroyed, or, without the Lender’s consent, sold or
encumbered; (f) any of the Borrowers dies, is dissolved, declares insolvency, is
declared insolvent, or is the subject of any proceeding under any bankruptcy or
insolvency law; or (g) the Lender, in good faith, deems itself insecure or
determines that the prospect of payment of this loan or the prospect of
performance of this or any other instrument securing this loan or relating to it
is impaired.

LENDER’S REMEDIES: Lender, in addition to other rights provided in this document
or by law or agreement, may do any one or more of the following if Borrowers
default under this document; (a) declare this loan and any or all other loans to
Borrowers or any one or more of them (except any loan to which a Basic
Membership and Landing Relationship Agreement (Rural Residence/Country Living)
applies) immediately due end payable; (b) as to Collateral which is personal
property or fixtures, exercise all the remedies of a secured party under the
Uniform Commercial Code including without limitation: (1) without notice to the
Borrowers or judicial process peaceably enter upon any premises where the
Collateral is located, take possession of it and remove it from the premises;
(2) require the Borrowers to assemble the Collateral and make it available to
the Lender at a place designated by Lender which is reasonably convenient to
both parties; end (3) use and occupy the Borrowers’ premises to care for
livestock collateral. Crops are perishable and may decline speedily in value and
the Lender at Borrowers’ expense may care for and harvest the crops and dispose
of them at private sale; (4) require Borrowers to reimburse the Lender for
expenses incurred by the Lender in protecting or enforcing us rights under this
document, including without limitation reasonable attorney’s fees and legal
expenses when permitted by law, (5) After deduction of expenses, the Lender may
apply the proceeds of disposition to the Obligations in the order and amounts it
elects.

ASSIGNMENT OP LOAN: The Lender may not assign or otherwise transfer this loan to
any party other than Agribank, FCB and its successors (the “Bank”), whether
absolutely or as collateral security and whether in the ordinary course of
business or otherwise, without the express written consent of the Bank. If this
loan is assigned or otherwise transferred to the Bank or another institution
chartered pursuant to the provisions of the Farm Credit Act of 1971, as amended,
(“Act”) the interest rate hereunder may be established by such institution in
accordance with the provisions of this document. If this loan is assigned or
transferred to a party not chartered under the Act, notwithstanding any contrary
provision in this document, in the absence of maturity or acceleration, the
following apply:

   (a) If this is a Variable Rate loan or an Adjustable Rate Operating RLOC,
adjustments in the interest rate will be made only on the dates occurring at
successive intervals of one year each after the first day of the month and year
of such assignment based upon an index and margin. The index will be the weekly
average yield on United Stales Treasury securities, as made available by the
Federal Reserve Board, adjusted to a constant maturity of one year.

   (b) If this is an Adjustable Rate Capital RLCC or Adjustable Rate it loan,
the interest rate will continue to be adjusted on the dates and intervals
described therein based upon an index and margin. The index will be the same as
for a Variable Rate Loan, except it will be adjusted to a constant maturity of a
length equal to the length of the interval between adjustments specified above
(if U.S. Treasury yield figures are not available for this length, the U.S.
Treasury yield figures which are available for the closest length of time which
is shorter than the interval between adjustments will be used).

   (c) For interest rate adjustments under (a) and (b), the margin will be the
amount by which the interest rate in effect for this loan at the time of the
assignment, in the absence of default, exceeds the index that would have been
effective for the date that this interest rate was established for this loan
(the last previous repricing date). The new interest rate will be calculated by
adding the margin to the applicable current index and rounding the total to the
nearest one-eighth of one percent, subject however, to the provision herein for
a higher default rate. The current index will be the most recent index available
as of 45 days before the date the Interest rate is to be adjusted, if the
applicable index is not available, the Lender will select a new index which is
based upon comparable information. The interest rate shall never exceed the rate
permitted by applicable law.

   (d) If this is an Adjustable Rate Prime Rate Based loan, the margin that is
used for interest rate adjustments shall remain fixed for the remaining term, of
the loan at the margin amount that is in effect at the time of the assignment.

WAIVER: The Borrowers and other parties to this transaction (except the Lender),
and each of them, whether principal, surety, guarantor, endorser, or other
party, agree to be jointly and severally bound and, further, waive demand,
protest, and notice of demand, protest, or nonpayment, and agree that the
liability of each shall be unconditional without regard to the liability of any
other party and shall not be affected by any indulgence, extension or extensions
of time, renewal, waiver, release of any party or of any Collateral, or other
modifications granted or consented to by the Lender. The rights and powers
granted to the Lender hereunder shall not, nor shall any provision hereof be
waived except in writing signed by the Lender, and the provisions hereof shall
not be modified, limited, or waived by any prior or subsequent course of dealing
between the parties or between the Borrowers and third parties or by any usage
of trade. To the extent the Bank gives or has given value to the Lender in
reliance hereon, either by way of loan or discount, the Borrowers hereby waive
any and all other defenses or right of offset which the Borrowers or any of then
may or might have against the Lender when this document is held by the Bank, its
collateral custodian, or the successors or assigns of either.

APPOINTMENT OF AGENT: Each of the Borrowers hereby appoints each of the other
Borrowers as agent for the purposes of

 

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this loan and, if applicable, the Obligations and agrees that loan funds,
dividends, stock retirement proceeds, and other distributions may be disbursed
to or by order of any one or more of them. This appointment shall continue until
written notice of termination is received by the Lender.

ASSOCIATION MEMBERSHIP: The Borrowers agree to purchase and maintain stock or
participation certificates in the Lender or the Lender’s parent association, as
applicable, in amounts as may be required from time to time under the Capital
Plan adopted by the Board of Directors pursuant to applicable Bylaws.

MODIFICATION: No modification of this document or any related document shall be
enforceable unless in writing and signed by the party against whom enforcement
is sought. Oral agreements or commitments to loan money, extend credit, or to
forbear from enforcing repayment of a debt including promises to extend or renew
such debt are not enforceable, regardless of the legal theory upon which it is
based that is in any way related to the credit agreement. To protect you (the
Borrowers) and us (the Lender) from misunderstanding or disappointment, any
agreements we reach covering such matters are contained in this writing, which
is the complete and exclusive statement of the agreement between us, except as
we may later agree in writing to modify it.

REPORTING: Lender, its agents, successors and assigns may report Borrowers’
names and information regarding this loan and all of Borrowers’ past and future
loans to credit reporting agencies.

FOR ILLINOIS AND MISSOURI LOANS ONLY: Unless you (the Borrowers) provide us (the
Lender) with evidence of the insurance coverage required by your agreement with
us, we may purchase insurance at your expense to protect our interests in your
Collateral. This insurance may, but need not, protect your interests. The
coverage that we purchase may not pay any claim that you make or any claim that
is made against you in connection with the Collateral. You may later cancel any
insurance purchased by us, but only after providing us with evidence that you
have obtained insurance as required by our agreement, if we purchase insurance
for the Collateral, you will be responsible for the costs of that insurance,
including interest and any other charges we may impose in connection with the
placement of the insurance, until the affective date of the cancellation or
expiration of the insurance. The costs of the insurance may be added to your
total outstanding balance or obligation.  The costs of the insurance may be more
than the cost of insurance you may be able to obtain on your own.

POWER OF ATTORNEY: Borrowers hereby irrevocably appoint the Lender as Borrowers’
attorney-in-fact to act for the Borrowers with full authority in the place and
name of the Borrowers to take any action and to execute any instrument which the
Lender may deem advisable to accomplish the purposes of this Agreement,
including authority (a) to endorse, collect, sue for, compromise, and receive
any drafts, instruments, documents, or moneys due in connection with the
Collateral; (b) to file any claims or lake any action or institute any
proceedings which the Lender may deem desirable for the collection of any of the
Collateral or otherwise to enforce the rights of the Lender with respect to any
of the collateral; (c) to disburse funds including paying insurance premiums,
taxes, liens, end other costs of preserving the Collateral; and (d) to
establish, determine priority of,  perfect, continue as perfected, preserve,
enforce, or terminate the Lenders rights and interests under this Agreement. 
The Lender may charge its expenses of doing so to any of the Obligations and the
Borrowers shall pay them upon demand with interest from the date each expense is
incurred at the rate in effect on the date each expense is incurred on the
applicable Obligation.

AUTHORIZATION FOR ACCESS TO INFORMATION: Borrowers acknowledge and agree that
the verification or reverification of any information, whether contained in the
Borrowers’ loan application or in any other manner supplied by the Borrowers to
the Lender in connection therewith, may be made at any time by the Lender, its
agents, successors, or assigns, either directly or through a credit reporting
agency, from any source whether named in the Borrowers’ loan application or
otherwise provided to the Lender by the Borrowers.

BORROWERS’ PRIVACY DISCLOSURE: Your privacy is important to us. We want you to
know that we hold your financial and other personal information in strict
confidence. Since 1972, Farm Credit Administration regulations have forbidden
the directors and employees of Farm Credit Institutions from disclosing personal
borrower information to others without your consent We do not sell or trade our
customers’ personal information to marketing companies or information brokers.

      FCA rules allow us to disclose customer Information to others only in
these situations:

      — We may give it to another Farm Credit institution that you do business
with.

      — We can be a credit reference for you with other lenders and provide
information to a credit bureau or other consumer reporting agency.

      — We can provide information in certain types of legal or law enforcement
proceedings.

      — FCA examiners may review loan files during regular examinations of our
association.

      — If one of our employees applies to become a licensed real estate
appraiser, we may give copies of real estate appraisal reports to the State
agency that licenses appraisers when required. We will first remove as much
personal information from the appraisal report as possible.

      As a member/owner of this institution, your privacy and the security of
your personal information are vital to our continued ability to serve your
ongoing credit needs.

UNAUTHORIZED DISPOSITIONS AND FALSE STATEMENTS: Borrowers understand that it is
a federal crime punishable by fine, imprisonment, or both to knowingly make any
false statements in the Borrowers’ loan application as applicable under the
provisions of Title 18, United Stales Code, Section 1014, Borrowers also
understand that any unauthorized disposition of Collateral or the making of any
false statement or report to the Lender in connection with a loan could result
in civil and criminal consequences to the Borrowers as applicable under the
provisions of Title 18, United States Code, Sections 656 and 1014.

PARTIES BOUND: Each person signing the Note, other than the Lender, is a
Borrower. The Obligations of all Borrowers are joint and several, and all
Borrowers hereby acknowledge  receipt of all proceeds of the Loan. This
Agreement benefits the Lender, its successors, and assigns. This Agreement shall
bind the Borrowers, the Borrowers’ heirs, personal representatives, successors,
and assigns, and all persons and parties who become bound as a Borrower under
this Agreement.

FEES CHARGED: Lender has authority to charge and Borrowers agree to pay any
reasonable fees and costs charged by Lender to amend the terms of this Loan,
Borrowers give Lender authority to advance such fees and costs and charge them
to the loan. If Borrowers do not immediately repay such advance, interest at the
default rate shall begin to accrue on the amount advanced. The absence of
express authority in this Promissory Note/Loan Agreement to charge a specific
fee or cost to Borrowers shall not be construed as a prohibition on the charging
of such fees or costs.

 

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Assn.

 

B.O.No.

 

CIF No.

 

Loan No.

 

Product Code

 

Coll. Code

 

Customer Name

 

Commitment Amount

72

 

65

 

1895500

 

1192413700

 

1011

 

1

 

GREAT PLAINS ETHANOL

 

$15,000,000.00

 

EFFECTIVE INTEREST RATE AND DISCLOSURE

DATE: February 20, 2008

 

The disclosures on this page and made pursuant to Section 4.13(a) of the Farm
Credit Act of 1971, as amended, 12 U.S.C. 2199, and are not part of the
contractual agreement between the Borrowers and the Lender.  This Loan is not
subject to the Truth-in-Lending (TIL), 15 U.S.C. 1601 et seq., and the effective
rate of interest described herein is not to be construed as the equivalent of
the annual percentage rate which would be disclosed on a loan subject to TIL.

 

Stated Interest Rate

 

Effective Interest Rate

 

The rate of interest currently

 

The stated rate of interest

 

applicable to the Loan

 

adjusted to take into account

 

 

 

loan origination charges and

 

 

 

any purchase of stock

 

7.37%

 

6.50%

 

 

Except with respect to stock protected under Section 4.9A of the Farm Credit Act
of 1971, as amended, stock that is purchased in the lender or the Lender’s
parent association, as applicable, is a risk and can only be retired at the
discretion of the association board.  Effective Interest Rate is calculated as
if stock will never be retired.  If stock is retired, as is customary, the
Effective Interest Rate would be lower than the percentage stated above.  It is
generally the association’s practice to retire stock when a Borrower’s loan
balance is paid in full or upon full payment of all of a Borrower’s loans,
provided the association’s practice to retire stock when a Borrower’s loan
balance is paid in full or upon full payment of all of a Borrower’s loans,
provided the association has an adequate capita position.  At this time, the
association’s capital exceeds the regulatory capital requirements.

 

INTEREST RATE PLAN:

(Adjustable Rate LIBOR Based) The Interest rate is based on an index plus a
margin and may increase during the term of this transaction if there is an
increase in the One Month London Interbank Offered Rate (“One Month LIBOR”)
and/or margin. The Index is the One Month LIBOR published on the applicable date
in the Wall Street Journal. The margin is set by the Lender and pan change at
successive intervals of 1 year(s) each.

 

In the event of default at any time during the term of the Loan, however, and at
maturity, the Loan will be subject to a higher rate of interest.

 

ADJUSTMENT FACTORS: The factors which the Lender takes Into account in making
adjustments to the Interest rate on the Loan (except fixed rate loans and
adjustments based on changes in the prime Index or LIBOR Index) include cost of
funds, operating expenses, provision for loan  losses, capital requirements,
capital sharing, nonearning assets and competitive elements of the financial
environment. The factors considered by the Lender may change during the term of
the Loan.

 

REPRESENTATIVE EXAMPLES: These examples show the effect that changes in the
stock requirement and loan origination fees would have on the effective interest
rate of a representative loan with customer level stock. A $101,000 amortized
loan, including loan origination charges of $1,000 amortized over a 5-year term
with level annual payments, and a stated interest rate of 10% would have an
affective interest rate of 10.39%.  If the loan amount was to remain at
$101,000, but the loan origination charges increase to $1,500, the effective
interest rare would be 10.59%

 

 

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LOAN OPTIONS: The Lender may offer secured and unsecured short- and
intermediate-term loans including lines of credit with maturities up to 7 years
or, in some instances, 10 years, installments can be paid monthly, quarterly,
semi-annually, annually, or according to other  irregular repayment plans as may
be agreed upon by the Borrowers and the Lender. Interest rates may be variable
at the option of the Lender, fixed for a specified period and then variable
adjustable at specified intervals with the rate determined either at Lender’s
discretion or in   accordance with the prime index or LIBOR Index, or fixed for
the term of the Loan. Some loan options are subject to certain conditions and
are not available to all borrowers for all purposes. In addition, loan options,
including Interest rates, may vary by location and time period. The availability
of any loan option is subject to change at any time at the discretion of the
Lender. If the Lender is an ACA or FLCA, Lender also offers long-term real
estate loans with maturities of 5 to 40 years secured by agricultural real
estate or rural homes, interest rates may be fixed for the term of the loan,
variable at the option of the Lender, or adjustable at   specified intervals
with the rate adjusted either at Lender’s discretion or in accordance with  
Federal Farm Credit Banks Funding Corporation rates or the prime Index or LIBOR
Index. These reel estate mortgage loan options are subject to the same
conditions, limitations, and varying availability as mentioned above for the
short- and intermediate-term loans.

 

BORROWER RIGHTS:

1.                                       At loan closing, Borrowers shall
receive copies of loan documents signed by Borrowers. Upon request thereafter
Borrowers are entitled to copies of documents signed or delivered by Borrowers,
copies of Lender’s or the Lender’s parent association’s charter and bylaws, as
applicable, and copies of Lender’s appraisals of the collateral.

 

2.             If the loan has an adjustable or variable Interest rate,
Borrowers will be notified in writing of any change in interest rate.  The
notice will be given not later than any deadline date required by regulations
promulgated by the Farm Credit Administration.

 

3.             If Borrowers’ Loan is in a differential interest rate program,
Borrowers may request that Lender review the Loan to verify that the proper
interest rate category has been assigned, and also to explain in writing to
Borrowers the basis for the interest rate charged and how the credit status of
the Borrowers may be improved to receive a lower interest rate on the Loan.

 

4.             If Lender places Borrowers’ Loan in nonaccrual status and such
action results in an adverse action being taken against Borrowers (such as
revocation of any undisbursed loan commitment), the Lender shall notice,
Borrowers in writing of such change in status and the reasons therefor.  If
Borrowers were not delinquent in any payments under the Loan at the time and
Borrowers’ request to have the Loan reinstated to accrual status is denied,
Borrower may obtain a review of such denial before the Lender’s credit review
committee.

 

5.                                       Lender may not commence foreclosure or
other legal action against any collateral securing the Loan unless at least 45
days before such commencement Lender has provided Borrowers with a copy of
Lender’s restructuring policy and forms on which Borrowers may submit a request
for restructuring. If Borrowers’ request for restructuring is denied, Borrowers
may appeal the denial to Lender’s credit review committee, and may also obtain
an independent appraisal of any collateral (at Borrowers’ expense) for
consideration by the credit review   committee.

 

6.             If Lender acquires agricultural real estate by enforcement of
Lender’s lien, when Lender elects to sell or lease the acquired property,
Borrowers shall have a right of first refusal on the property. Lender shall
notify Borrowers In writing and Borrowers may purchase or lease the property, as
appropriate, at the appraised fair market value or fair rental value, or if the
property is sold by public offering, at the price of the highest qualified bid.

 

If you have any questions concerning the information contained on this
disclosure page, please contact your servicing office.

 

 

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ASSN. NO.

 

B.O.NO.

 

CIF NO.

 

EXHIBIT TO SECURITY AGREEMENT

 

72

 

65

 

1895500

 

DESCRIPTION OF COLLATERAL - GENERAL

 

 

 

1.                                       Description of Collateral. The
Collateral referred to in the Security Agreement dated February 20, 2008 by the
undersigned Debtors to AGCOUNTRY FARM CREDIT SERVICES, PCA (“Secured Party”)
includes, whether now owned or later acquired, the property described opposite
the box(es) checked below and the property described at Sections 1.9 through
1.13.

 

                                               
1.1                                 o                                    All
crops growing, grown or to be grown on real estate in the
State(s) of ___________________________.  The real estate is more specifically
described as follows (if required by state law):

                                                                  
 ACRES            QTR.     SEC.     TWP.     N/S       RNG.     E/W       
     COUNTY

                                                Tr. 1        ___________     
_____    _____    _____    _____    _____    _____    __________________

                                                Tr. 2        ___________     
_____    _____    _____    _____    _____    _____    __________________

                                                Tr. 3        ___________     
_____    _____    _____    _____    _____    _____    __________________

                                                Tr. 4        ___________     
_____    _____    _____    _____    _____    _____    __________________

                                                Tr. 5        ___________     
_____    _____    _____    _____    _____    _____    __________________

 

If the box at 1.1 above is checked and crops will be grown in North Dakota, the
following applies:

THIS SECURITY AGREEMENT COVERS CROPS NOW GROWING. THIS SECURITY AGREEMENT ALSO
COVERS FUTURE CROPS TO BE GROWN IN THE CURRENT YEAR OR ANY YEAR HEREAFTER.

 

                                                1.2
                              o                                    All harvested
crops end all processed crops, whether or not produced by Debtors.

 

                                                1.3
                              o                                    All livestock
end poultry.

 

                                                1.4
                              o                                    All feed,
seed, fertilizer, insecticides, herbicides and other agricultural chemicals and
supplies.

 

                                                1.5
                              o                                    All general
intangibles.

 

                                                1.6
                              o                                    All
equipment, all spare parts and special tools for such equipment, all motor
vehicles and all fixtures.

 

                                                1.7
                              o                                    All contract
rights, chattel paper, documents, accounts, end general intangibles, whether now
owned or hereafter acquired by Debtors, including, but not limited to, all
entitlements, rights to payment, end payments (in whatever form received,
including, but not limited to, payments in cash or in kind) under any current or
future state or federal governmental programs, including, but not limited to,
governmental agricultural diversion programs, governmental agricultural
assistance programs and the United Slates Department of Agriculture Farm Service
Agency (FSA) Feed Grain Program; and all proceeds of the foregoing.

 

                                               
1.8                                 x                                  Property
specifically described here:

All goods including inventory, equipment and software; all accounts and general
intangibles, instruments, investment property, documents, chattel paper, and
letter of credit rights; whether now owned or alter acquired; all accessions,
additions, replacements, and substitutions; all records of any kind relating to
any of the foregoing; and all proceeds.

 

                                               
1.9                                                                                
Association Stock.  Debtors’ stock, participation certificates, equity reserve
and allocated surplus in the Secured Party or its parent association, as
applicable, its successors and assigns.

 

                                               
1.10                                                                          
Proceeds.  To the extent not included in any of the subparagraphs herein as
original Collateral, all proceeds of the Collateral. (Debtors are NOT AUTHORIZED
TO SELL or

 

 

--------------------------------------------------------------------------------

 

dispose or any Collateral unless authorized in the Security Agreement or in a
writing signed by Secured Party.)

 

                                               
1.11                                                                          
Documents.  All documents of title, warehouse receipts, weight receipts, scale
tickets, storage contracts (including CCC contracts) and deficiency payments
covering or arising from any Collateral.

 

                                               
1.12                                                                          
Additions.  All additions, accessions, replacements and substitutions of or to
any Collateral and sit property of similar type or kind, including all offspring
of livestock and poultry.

 

                                               
1.13                                                                          
Products.  All products of crops, livestock and poultry given as Collateral
including eggs, milk and wool and all products into which any of the Collateral
has been or shall later tie manufactured, processed or assembled.

 

2.                                       The Collateral described in this
Exhibit is in addition to property described in additional Exhibits to the
Security Agreement, if any.  To the extent the Collateral described in this
Exhibit is similar to, or after-acquired property, products, or proceeds of
existing Collateral, its inclusion in this Exhibit is for the purpose of more
specifically identifying the Collateral. This Exhibit shall in no way affect the
priority of the security interest of Secured Party in existing Collateral or
limit the parties’ intention that all similar and after-acquired property,
products, and proceeds of the Collateral are also Collateral under the Security
Agreement.

 

Dated: February 20, 2008

 

GREAT PLAINS ETHANOL LLC

dba Poet Biorefining - Chancellor

a South Dakota Limited Liability Company

 

By:

/s/ Darin Ihnen

 

DARIN IHNEN, CHAIRMAN

 

 

--------------------------------------------------------------------------------

 

ASSN. NO.

 

B.O.NO.

 

CIF NO.

 

 

72

 

65

 

1895500

 

SECURITY AGREEMENT

 

1.                                       GRANT OF SECURITY INTEREST. For value
received, the undersigned Debtor, whether one or more, grants to AGCOUNTRY FARM
CREDIT SERVICES, PCA (‘Secured Party”), whose address is 1900 44th ST S, P0 BOX
6020, FARGO, NORTH DAKOTA 58108-6020, a security interest in all of the Debtor’s
rights, title, and interest in the property described in Section 2, including
all rights to transfer an interest in the Collateral (“Collateral’), to secure
the payment and performance of the obligations described in Section 5
(“Obligations”).

2.                                       COLLATERAL DESCRIPTION.  The Collateral
is the property described in one or more Exhibits to this Agreement which are by
this reference incorporated into this Agreement.

3.                                       OBLIGATIONS SECURED. “Obligations”
means:(a) all existing end future loans, advances, indebtedness and payment and
performances obligations owed or owing to Secured Party arising out of existing
or future credit granted by Secured Party to Debtor (or any of them, if more
than one), to Debtor and another, to another guaranteed or endorsed by Debtor,
or to another designated by Debtor, whether direct or indirect, absolute or
contingent, including both consumer and commercial credit, and both long-term
and short-term credit; and (b) all existing end future payment and performance
obligations of Debtor arising out of this Agreement; and (c) all casts end
expanses incurred by Secured Party in protecting or enforcing its rights under
this Agreement with interest from the date incurred by Secured Party’s
applicable loan rate on the date incurred, including, to the extent permitted by
law, attorneys’ fees and legal costs end expenses.

4.                                       DEBTOR’S DUTIES REGARDING COLLATERAL.

                                               
4.1                                 Prohibition on Disposition of Collateral by
Debtor. DEBTOR SHALL NOT SELL, STORE OFF-FARM, LEASE OR OTHERWISE DISPOSE OF ANY
COLLATERAL EXCEPT AS FOLLOWS:

a)  Subject to any restrictions stated in an addendum to this Agreement and to
Secured Party’s continuing security interest in all proceeds and accounts
arising from permitted disposition of Collateral, Debtor, before default, may in
a commercially reasonable manner, (1) market milk, (2) market eggs, end (3) use
feed, crops end products of crops as feed for Debtor’s livestock and poultry; or
b) as specifically authorized in a writing signed by Secured Party or in an
addendum to this Agreement, Secured Party reserves the right, in its sole
discretion, to revoke or modify any permission given Debtor to dispose of
Collateral.

                                               
4.2                                 Ownership Warranty. Debtor warrants that
Debtor is the absolute owner of all Collateral free of all interests, liens,
encumbrances, options and security interests except (a) Secured Party’s security
interest and (b) those disclosed to Secured Party by Debtor in writing.

                                               
4.3                                 Residence end Location. Debtor’s residence
(If Debtor is e Registered Organization, the State of Organization) is in the
state shown above Debtor’s signature. The Debtor has provided the Secured Party
with information concerning the location of the Collateral and the Debtor
warrants to the Secured Party that such information is true, accurate, and
complete. Except with the prior written consent of tile Secured Party, the
Debtor shall not remove any Collateral from any location as provided to the
Secured Party. Debtor shall immediately inform Secured Party in writing of any
change in Debtor’s address or the location of the Collateral.

                                               
4.4                                 Records and Reports. Debtor shall keep
permanent records of all material information on the acquisition, maintenance,
identification and disposition of all Collateral in a form acceptable to Secured
Party. Secured Party shall have the right to examine end copy these records at
reasonable times and places. Debtor’s records are kept at Debtor’s present
residence and shall not be removed from the state of Debtor’s present
residence.  Debtor agrees to furnish Secured Party with written reports on the
Collateral with content and at times as Secured Party may reasonably request.

                                               
4.5                                 Maintenance of Collateral. Debtor shall;
(a) care for the Collateral in accordance with good agricultural practices and
not permit its value to be impaired; (b) keep it free from all liens,
encumbrances end security interests (other than those created or expressly
permitted by this Agreement); (c) defend it against all claims and legal
proceedings by persons other than Secured Party; (d) pay end discharge when due
all taxes, license fees, levies and other charges upon it; (e) not permit it to
become a fixture or an accession to other goods except as specifically
authorized in a writing signed by Secured Party; and (f) not permit it to be
used in violation of any law,

 

 

--------------------------------------------------------------------------------

 

regulation or policy of insurance.  Loss of or damage to the Collateral shall
not release Debtor from any of the Obligations.

                                               
4.6                                 Insurance.  Debtor shall keep all Collateral
end Secured Party’s interest in it insured under policies with provisions,
coverages, amounts and by insurers satisfactory to Secured Party from time to
time.  Debtor shall furnish Secured Party with evidence of this insurance
satisfactory to Secured Party.  At Secured Party’s request, Secured Party shall
be specifically named in an appropriate union or standard mortgage clause
endorsed on the policy. Debtor assigns and directs any insurer to pay to Secured
Forty the proceeds of this insurance end all premium refunds.  Debtor authorizes
Secured Party to endorse in Debtor’s name any instrument for such proceeds or
refunds.  Secured Party shall have the option to apply the proceeds and refunds
to any of the Obligations, whether or not due, or to restoration of the
Collateral, returning any excess to Debtor.  Secured Party is authorized, in the
name of the Debtor or otherwise, to make, adjust and settle claims under any
credit insurance financed by Secured Party or any insurance on the Collateral
and to cancel the insurance after the occurrence of an event of Default.

                                               
4.7                                 Inspection.  Debtor shall permit and assist
Secured Party to verify and inspect the Collateral wherever located at
reasonable times.

 

THIS AGREEMENT INCLUDES ALL THE PROVISIONS ON ADDITIONAL PAGES OF THIS
AGREEMENT.  BY SIGNING, DEBTOR ACKNOWLEDGES THAT DEBTOR HAS READ ALL OF THESE
PROVISIONS AND HAS RECEIVED AN EXACT COPY OF THIS AGREEMENT.

 

Debtor’s State(s) of Residence or Organization: ____________________    SOUTH
DAKOTA

 

Dated: February 20, 2008

 

GREAT PLAINS ETHANOL LLC

dba Poet Biorefining - Chancellor

a South Dakota LLC

 

By:

/s/ Darin Ihnen

 

DARIN IHNEN, CHAIRMAN

 

 

5.                                     DEFAULT.

                                               
5.1                                 Default by Debtor. Each of the following
constitutes a default under this Agreement by Debtor (“Default”): (a) Failure to
pay when due any principal, interest, advances, late charges, costs, attorneys’
fees or other charges incurred on any of the Obligations; (b) The sale or other
disposition of any of the Collateral when it is not authorized by this
Agreement; (c) Failure to perform or observe any warranty, agreement or
obligation contained in this Agreement or in any mortgage, deed of trust,
security agreement, loan application or any evidence of or document relating to
any of the Obligations; (d) Any warranty or information given to Secured Party
in connection with this Agreement or any of the Obligations is false in any
material respect when made; (e) Loss, theft, substantial damage, destruction or
encumbrance of any of the Collateral or the making of any levy, seizure or
attachment against it; (f) The acceleration of the maturity of Debtor’s
indebtedness to any ether creditor; (g) The death, dissolution or termination of
existence, insolvency, business failure, appointment of a receiver for any
property, assignment for the benefit of creditors, the commencement of any
proceeding under any, bankruptcy or insolvency laws, of, by, or against Debtor
or any guarantor or surety of Debtor; (h) Failure of any of Debtor’s account
debtors or obligors to make payment when due or to honor secured party’s
security interest; (i) The occurrence of any event which causes Secured Party in
good faith to believe that the Obligations are inadequately secured or the
prospect of payment, performance or realization on the Collateral is impaired;
or (j) A default under any lease executed by any Debtor under which the Secured
Party is the lessor or a default under any ether loan or lease that any Debtor
has with either the Secured Party’s parent association or any subsidiaries of
the Secured Party’s parent association.

 

 

--------------------------------------------------------------------------------

 

                                               
5.2                                 Secured Party’s Remedies. Secured Party, in
addition to other rights and remedies provided in this Agreement or in any
evidence of or document associated with the Obligations or provided by law, may
do any one or more of the following if a Default occurs under Section 5.1:
(a) Declare any or all Obligations immediately due and payable; (b) Refuse to
make advances under any commitment; (c) Exercise all rights and remedies or a
secured party under the  Uniform Commercial Code; (d) Without notice to the
Debtor or judicial process, peaceably enter upon any premises where the
Collateral is located, take possession of all or any part of it, and remove it
from the premises; (e) Require Debtor at Debtor’s expense to assemble all or
part of the Collateral as directed by Secured Party and make it available to
Secured Party at a place to be designated by Secured Party which is reasonably
convenient to both parties; (f) Sell, lease or otherwise dispose of all or any
part of the Collateral, without notice to Debtor except as required by law, in
one or more parcels at public or private proceeding on such terms as Secured
Party may deem commercially reasonable; (g) Occupy and use the Debtor’s
premises, pasturage, food troughs and water to care for livestock Collateral;
(h) Crops are perishable and may decline rapidly in value end Secured Party at
Debtor’s expense may protect, cultivate, harvest, thresh and combine crops and
sell them at private sale; (i) Apply the proceeds of Debtor’s Association stock
and participation certificates to the Obligations in such order and at such
times as Secured Party shall determine: (j) Require Debtor to reimburse Secured
Party out of proceeds from the disposition of Collateral or otherwise or
expenses incurred by Secured Party to protecting or enforcing its rights under
this Agreement. These expenses include the expenses of retaking, holding,
preparing for sale or other disposition, and selling or disposing of the
Collateral and, to the extent not prohibited by law, attorney’s fees and legal
expenses.  Secured Party may charge these expenses to any of the Obligations and
Debtor shall pay them upon demand with interest from the data incurred at the
rate in effect on the date incurred on the applicable obligation.  After
deduction of these expenses, Secured Party may apply the proceeds of disposition
to the Obligations in the order and amounts it elects; (k) If there is any
security or collateral other than the Collateral described in this Agreement for
any or the Obligations, then Secured Party may proceed upon the Collateral and
the other security and collateral either concurrently or separately in any order
it chooses.

                                               
5.3                                 Commercially Reasonable.  In addition to
other means which are commercially reasonable: (a) commercially reasonable
notice is written notice sent to any address of Debtor given by Debtor to
Secured Party in conjunction with this Agreement at least 10 calendar days
(counting the day of sending) before the date or a proposed disposition of
Collateral; and (b) commercially reasonable means of disposition of livestock
include a sale through a livestock market and through a licensed livestock sales
company.

6.                                       MISCELLANEOUS PROVISIONS.

                                               
6.1                                 True Information.  Debtor warrants that all
information, statements and warranties given by or on behalf of Debtor to
Secured Party in connection with this Agreement or the Obligations are true and
correct.

                                               
6.2                                 Collections. (a) At any time Secured Party
may, end Debtor shall upon request, notify Debtor’s account debtors and obligors
on instruments to make payment directly to Secured Party.  Secured Party may
enforce collection of, settle, compromise, extend or renew the indebtedness of
such account debtors and obligors. Unless this notification is given, Debtor, as
agent of Secured Party, shall collect accounts and instruments. (b) When
required by Secured Party, all proceeds of Collateral received by Debtor shall
be held by Debtor upon an express trust for Secured Patty, shall not be
commingled with any other funds or property of Debtor and shall be turned over
to Secured Party In precisely the form received (but endorsed by Debtor, if
necessary for collection) not later than the third business day following the
date of receipt. All proceeds of Collateral received by Secured Party directly
or from Debtor shall be applied against the Obligations in such order and at
such time as Secured Party shall determine.

                                               
6.3                                 Maintenance of Security Interest. To the
extent permitted bylaw, Debtor shall pay all expenses, and upon request take any
action reasonably deemed advisable by Secured Party, to preserve the Collateral
or to establish, determine priority of, perfect, continue perfected, preserve,
enforce or terminate Secured Party’s rights and interests under this Agreement.

                                               
6.4                                 Power of Attorney. Debtor hereby irrevocably
appoints Secured Party as Debtor’s attorney-in-fact to act for Debtor with full
authority in the place and name of Debtor to take any action and to execute any
instrument which the Secured Party may deem advisable to accomplish the purposes

 

 

--------------------------------------------------------------------------------

 

of this Agreement, including authority: (a) to endorse, collect, sue for,
compromise and receive any drafts, instruments, documents or moneys due in
connection with the Collateral; (b) to file any claims or take any action or
institute any proceedings which Secured Petty may deem desirable for the
collection of any of the Collateral or otherwise to enforce the rights of
Secured Party with respect to any of the Collateral; (c) to disburse funds
including paying insurance premiums, taxes, liens, and other costs of preserving
the Collateral: end (d) to establish, determine priority of, perfect, continue
perfected, preserve, enforce or terminate Secured Party’s rights and interests
under this Agreement, Secured Party may charge its expenses of doing so to any
of the Obligations and Debtor shall pay them upon demand with interest from the
data incurred at the rate in effect on the date incurred on the applicable
Obligation.

                                               
6.5                                 Unauthorized Disposition and False
Statements.  Debtor understands that the unauthorized disposition of Collateral
or making a false statement or report to Secured Party in connection with a loan
could result in civil and criminal consequences to Debtor (Federal Statutes 18
U.S.C. 658, 1014).

                                               
6.6                                 Waiver.  The failure or delay of Secured
Party to enforce any right shall not be construed as a waiver of the right. 
Secured Party’s waiver of any default shall not constitute a waiver of any prior
or subsequent default.  Secured Party waives only those rights specified in a
writing signed by Secured Party.  The provisions of this Agreement shall not be
modified or waived by any course of dealing or bade usage.

                                               
6.7                                 Secured Party Not Liable. Secured Party has
no duty to exercise or to withhold the exercise of any of the rights and powers
expressly or implicitly granted to it in this Agreement and shall not be
responsible for any failure to do so or delay in so doing.  Secured Party has no
duty to protect, insure or realize upon the Collateral.  Debtor releases Secured
Party from all liability for any act or omission relating to the Obligations,
the Collateral or this Agreement except Secured Party’s willful misconduct.

                                               
6.8                                 Financing Statement. A carbon, photographic
or other reproduction of this Agreement or of a financing statement shall be
sufficient as a financing statement.

                                               
6.9                                 Persons Bound.  Each person signing this
Agreement, other than the Secured Party, is a Debtor. The Obligations of all
Debtors are joint and several, and all Debtors hereby acknowledge receipt or all
proceeds of the Loan. This Agreement benefits Secured Party, its successors, and
assigns. This Agreement binds the Debtor, the Debtor’s heirs, personal
representatives, successors, and assigns, and all parsons who become bound as a
Debtor under this Agreement.

                                                6.10                          
Agency.  Until Secured Party is prospectively notified in writing by Debtor to
the contrary, Secured Party may rely upon the following: (a) If Debtor is two or
more individuals, the act or signature of any one of them shall bind them all;
(b) If Debtor is a partnership, each partner is fully authorized to act for the
partnership in all matters governed by this Agreement; (c) If Debtor is a
corporation, each officer is fully authorized individually to act for and bind
the corporation in all matters governed by this Agreement.

                                                6.11                          
Cumulative Rights. At rights and remedies of Secured Party in this Agreement are
cumulative and are in addition to other rights and remedies given in this
Agreement or in any evidence of or document associated with the Obligations or
provided by law.

                                                6.12                          
Termination. This Agreement shall not be made null and void because at any
particular time there is no outstanding secured Obligation end no commitment to
lend money, if at the time the parties are contemplating additional loans or
advances, it shall continue in effect for all Obligations to Secured Petty
arising prior to the filing of record of a UCC Termination Statement covering
all Collateral, Debtor instructs Secured Party not to file a UCC Termination
Statement until requested by Debtor.

                                                6.13                          
Interpretation.  This Agreement shall be governed by the laws of the state in
which Secured Party’s office originating the credit is located.  In this
Agreement, “including” means “including but not limited to” and indicates an
illustrative and incomplete listing.

                                                6.14                          
Wisconsin Performance Deposit. If Debtor has and exercises a right to redeem any
Collateral under Section 425,208, Wisconsin Statutes, the performance deposit
tendered by Debtor shall not bear interest held by Secured Party.

                                                6.15                          
Public Filings.  The Debtor hereby authorizes the Secured Party to file all
financing statements describing the Collateral, and all amendments thereto, in
any offices as the Secured Party, in its sole discretion, may determine.  The
Debtor hereby also authorizes the Secured Party to file all

 

 

--------------------------------------------------------------------------------

 

effective financing statements describing the Collateral pursuant to 7 U.S.C.
section 1631, and all amendments thereto, in any offices as the Secured Party,
in its sole discretion may determine.

                                                6.16                          
Government Program Payments. If the Collateral includes federal or state
government program entitlements or payments, the Debtor shall execute and
deliver to the Secured Party all assignments, transfers, and other documents
required by the Secured Party to transfer, convey, end assign to the Secured
Party all such federal and state government program entitlements, payments,
rights to payment whether or not earned by performance, accounts, general
intangibles, and  benefits.

                                                6.17                          
Uniform Commercial Code. All terms in this Agreement that are defined in the
Uniform Commercial Code, as enacted in the state in which Secured Party’s office
originating the loan is located and as amended from time to time (‘UCC”), shall
have the meanings set Forth in the UCC.  The meaning of a term hereunder shall
automatically change on the effective date of each amendment to the definition
of such term in the UCC.

                                                6.18                          
Debtor Names.  For each Debtor that id not an individual, the legal name of each
such Debtor is as set forth in the Note or an addendum thereto, or in this
Agreement.  No Debtor has used any trade name, assumed name, or other name
except those set forth in the Note or an addendum thereto, or in this
Agreement.  The debtor shall give the Secured Early written notice at least 30
days before the date of (1) any change in any Debtor’s name or (2) any use by
any Debtor of another name.

                                                6.19                          
Registered Organizations. If any Debtor is a Registered Organization, as that
term is defined in the UCC, all information provided by such Debtor to the
Secured Party concerning the state or organization for such Debtor is true,
accurate, end complete.  No Debtor shall change its state of organization
without the prior written consent of the Secured Party. Debtor shall provide the
Secured Party with written notice at least 30 days before the date any Debtor
makes any action to change its state of organization.

                                                6.20                          
Addresses of Debtor. If any Debtor is an individual or an entity that is not a
Registered organization, all information provided by the Debtor to the Secured
Party concerning the address of an individual Debtor’s residence or the address
of the chief executive officer of en entity that is not a Registered
Organization is true, accurate, and complete. No individual Debtor shall change
that address of residence without providing written notice to the Secured Party
at least 30 days before the effective date of such address change. No Debtor
that is an entity that is not a Registered Organization shall change that
address of the chief executive officer without providing written notice to the
Secured Party at least 30 days before the effective date of such address change.

                                                6.21                          
Purchase Money Security Interests. To the extent that the Debtor uses proceeds
of the Loan extended by the Secured Party to purchase Collateral, Debtor’s
repayment of the Loan shall apply on a “first-in-first-out” basis so that the
portion of the Loan used to purchase a particular item of the Collateral shall
be paid in the chronological order the Debtor purchased the Collateral.

                                                6.22                          
Reporting. The Secured Party, its agents, successors, and assigns may report
Debtor’s names and information regarding this Loan and all of Debtors past and
future loans to credit reporting agencies.

                                                6.23                          
Authorization for Access to Information.  Debtor acknowledges end agrees that
the verification or reverification or any information, whether contained in the
Debtor’s loan application or in any other manner supplied by the Debtor to the
Secured Party in connection therewith, may be made at any time by the Secured
Party, its agents, successors, or assigns, either directly or through a credit
reporting agency, from any source whether named in the Debtor’s loan application
or otherwise provided to the Secured Party by the Debtor.

 

 

--------------------------------------------------------------------------------

 

UCC FINANCING STATEMENT

FOLLOW INSTRUCTIONS (front and back) CAREFULLY

 

A. NAME& PHONE OF CONTACTAT FILER (optional]

 

 

B. SEND ACKNOWLEDGMENT TO: (Name and Address)

 

 

            AGCOUNTRY FARM CREDIT SERVICES

            1900 44TH ST S P0 BOX 6020

            FARGO                                       ND           58108-6020

 

THE ABOVE SPACE IS FOR FILING OFFICE USE  ONLY

1.  DEBTOR’S EXACT FULL LEGALNAME  — insert only one debtor name (1a or 1b)-do
not abbreviate or combine names

1a,  ORGANIZATION’S NAME

 

 

 

 

 

 

GREAT PLAINS ETHANOL LLC

 

 

 

 

 

 

OR

 

 

 

 

 

 

1b.  INDIVIDUALS’S LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

1c  MAILING ADDRESS

 

CITY

 

STATE

POSTAL CODE

 

COUNTRY

27716 462ND AVE

 

CHANCELLOR

 

SD

57015

 

USA

1d  SEE INSTRUCTIONS

 

ADDL’ INFO RE

 

1e. TYPE OF

 

1f. JURISDICTION OF

 

1e. ORGANIZATIONAL ID#, if any

 

 

ORGANIZATION

 

ORGANIZATION

 

 

 

 

 

 

46-0459108

 

DEBTOR

 

LIMITED LIABILITY

 

ORGANIZATION

SD

 

 

 

o NONE

2.  ADDITONAL DEBTOR’S EXACT FULL LEGAL NAME —insert only one debtor name (2a
or2b) . do not abbreviate or combine names

 

 

 

 

 

 

 

 

 

 

 

2a.  ORGANIZATION’S NAME

 

 

 

 

 

 

 

 

Poet Biorefining — CHANCELLOR

 

 

 

 

 

 

 

 

OR

 

 

 

 

 

 

 

 

 

 

2b,  INDIVIDUAL’S LAST NAME

 

 

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

 

 

 

2c  MAILING ADDRESS

 

 

 

 

 

CITY

 

STATE

P’OSTAL CODE

 

COUNTRY

27716 462ND AVE

 

 

 

 

 

CHANCELLOR

 

SD

57015

 

USA

2d  SEE INSTRUCTIONS  

 

ADDL’ INFO RE

 

2e. TYPE OF

 

2f. JURISDICTION

 

2g. ORGANIZATIONAL ID#,

 

 

ORGANIZATION

 

ORGANIZATION

 

ORGANIZATION

 

if any

 

 

46-0459108

 

DEBTOR

 

LIMITED LIABILITY

 

SD

 

NONE

 

 

3.

SECURED PARTY’S NAME (or NAME OF TOTAL ASSIGNEE OF ASSIGNOR S/P)- insert only
one party name (3a or 3)

 

 

 

3a.  ORGANIZATION’S NAME

 

 

 

 

 

 

 

AGCOUNTRY FARM CREDIT SERVICES, PCA

 

 

OR

 

 

 

 

3b  INDIVIDUAL’S LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

3c  MAILING ADDRESS

 

CITY

 

STATE

POSTAL CODE

 

COUNTRY

1900 44TH ST  PO BOX 6020

 

FARGO

 

ND

58108.6020

 

USA

 

 

 

 

 

 

 

 

4.  This FINANCING STATEMEN covers the following collateral:

 

 

 

All goods including inventory, equipment and software; all accounts and general
intangibles, instruments, investment property, documents, chattel paper, and
letter of credit rights; whether now owned or after acquired; all accessions,
additions, replacements, and substitutions; all records of any kind relating to
any of the foregoing; and all proceeds.

 

5.  ALTERNATIVE DESIGNATION [if applicable]:  o LESSEE/LESSOR 
o CONSIGNEE/CONSIGNOR  o BAILEE/BAILOR  o SELLER/BUYER  o AG.LIEN  o NON-UCC
FILNG

 

 

 

 

 

 

 

 

6.  o THIS FINANCING STATEMENT is to be filed (for record)

 

7.  Check to REQUEST SEARCH REPORT(S) on Debtor(s)

 

 

(or recorded) in the REAL ESTATE Records. Attach

 

(ADDITIONAL FEE)    [optional]

 

o All Debtors   o Debtor   o Debtor 2

Addendum [if applicable]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,  OPTIONAL FILER REFERENCE DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FILING OFFICE COPY — 11CC FINANCING STATEMENT (FORM UCC1)(REV. 06/22/02)

 

UCCI (09/2005)

 

--------------------------------------------------------------------------------

 

ASSN. NO.  B.O.NO.    CIF NO.                          EXHIBIT TO SECURITY
AGREEMENT

     72                 65         1895500                           DESCRIPTION
OF COLLATERAL - GENERAL

 

1.                                       Description of Collateral. The
Collateral referred to in the Security Agreement dated February 20, 2008 by the
undersigned Debtors to AGCOUNTRY FARM CREDIT SERVICES, PCA (“Secured Party”)
includes, whether now owned or later acquired, the property described opposite
the box(es) checked below and the property described at Sections 1.9 through
1.13.

 

                                                A.a          o            All
crops growing, grown or to be grown on real estate in the State(s) or
____________________________.  The real estate is more specifically described as
follows (if required by state law):

 

 

 

ACRES

 

QTR.

 

SEC.

 

TWP.

 

N/S

 

RNG.

 

E/W

 

COUNTY

Tr. 1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tr. 2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tr. 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tr. 4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tr. 5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

If the box at 1.1 above is checked end crops will be grown in North Dakota, the
following applies:

THIS SECURITY AGREEMENT COVERS CROPS NOW GROWING. THIS SECURITY AGREEMENT ALSO
COVERS FUTURE CROPS TO SE GROWN IN THE CURRENT YEAR OR ANY YEAR HEREAFTER.

 

1.2

o

All harvested crops and all processed crops, whether or not produced by Debtors.

 

 

 

1.3

o

All livestock end poultry.

 

 

 

1.4

o

All feed, seed, fertilizer, insecticides, herbicides and other agricultural
chemicals and supplies.

 

 

 

1.5

o

All general intangibles.

 

 

 

1.6

o

All equipment, all spare parts and special tools for such equipment, all motor
vehicles and all fixtures.

 

 

 

1.7

o

All contract rights, chattel paper, documents, accounts, and general
intangibles, whether now owned or hereafter acquired by Debtors, including, but
not limited to, all entitlements, rights to payment, and payments (in whatever
form received, including, but not limited to, payments in cash or in kind) under
any current or future state or federal governmental programs, including, but not
limited to, governmental agricultural diversion programs, governmental
agricultural assistance programs and the United States Department of Agriculture
Farm Service Agency (PSA) Feed Grain Program; and all proceeds of the foregoing.

 

 

 

1.8

x

Property specifically described here:

 

 

All of Debtor’s right, title and interest, whether now or hereafter owned,
existing, arising or acquired, in all fixtures or every kind and nature, and any
accessions thereto, and all recorded data of any kind or nature relating to such
fixtures, regardless of the medium or recording, including, without limitation,
all software, writings, plans specification and schematics, and all proceeds and
products of any of the foregoing.

 

 

 

1.9

 

Association Stock.  Debtors’ stock, participation, certificates, equity reserve
and allocated surplus in the Secured Party or its parent association, as
applicable, its successors and assigns.

 

 

 

1.10

 

Proceeds. To the extent not included in any of the subparagraphs herein as
original Collateral, all proceeds of the Collateral. (Debtors are NOT AUTHORIZED
TO SELL or dispose of any Collateral unless authorized in the Security Agreement
or in a writing signed by Secured Party.)

 

 

 

1.11

 

Documents. All documents of title, warehouse receipts, weight receipts, scale
tickets, storage contracts (including CCC contracts) and deficiency payments
covering or arising from any Collateral.

 

 

--------------------------------------------------------------------------------

 

1.12

 

Additions. All additions, accessions, replacements and substitutions of or to
any Collateral and all property of similar type or kind, including all offspring
of livestock and poultry.

 

 

 

1.13

 

Products. All products of crops, livestock end poultry given as Collateral
including eggs, milk end wool and all products into which any of the Collateral
has been or shall later be manufactured, processed or assembled.

 

2.           The Collateral described in this Exhibit is in addition to property
described in additional Exhibits to the Security Agreement, if any. To the
extent the Collateral described in this Exhibit is similar to, or after-acquired
property, products, or proceeds of existing Collateral, its inclusion in this
Exhibit is for the purpose of more specifically identifying the Collateral. 
This Exhibit shall in no way effect the priority of the security interest of
Secured Party in existing Collateral or limit the parties’ intention that all
similar and after-acquired property, products, end proceeds of the Collateral
are also Collateral under the Security Agreement.

 

Dated: February 20, 2008

 

GREAT PLAINS ETHANOL LLC

dba Poet Biorefining - Chancellor

a South Dakota limited Liability Company

 

By:

/s/ Darin Ihnen

 

DARIN IHNEN, CHAIRMAN

 

--------------------------------------------------------------------------------

 

EXHIBIT 1

 

 

 

Debtor:

 

GREAT PLAINS ETHANOL, LLC

 

 

27716 - 462nd Avenue

 

 

Chancellor, SD 57105

 

 

 

Secured Party:

 

AGCOUNTRYFARM CREDIT SERVICES, FLCA

 

 

1900 44th Street South

 

 

Fargo, North Dakota 58108

 

Description of Real Estate:

 

Real property in Turner County in the State of South Dakota, to wit:

 

Parcel I:  The Northwest Quarter (NW ¼) less Plucker’s Tract 1 in the South Half
of the Northwest Quarter (S ¼ NW ¼) and except the Substation Addition in the
Northwest Quarter (NW ¼) and except the South Dakota Central Railroad
Right-of-Way and except Lot H-1, all in Section Twenty-six (26), Township
Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M., Turner
County, South Dakota.

 

Parcel 2:  Tract 1 in the Northeast Quarter (NE ¼) of Section Twenty-Six (26),
Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th PM, Turner
County, South Dakota, according to the recorded plat thereof.

 

Parcel 3: Tract 3 in the Southeast Quarter (SE ¼) of Section Twenty-Six (26),
Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota, according to recorded plat thereof.

 

Tract 4:  Tract 1 and Tract 2 of Great Plains Addition in the Northeast Quarter
(NE ¼) of Section Thirty (30), Township Ninety-Eight (98) North, Range Fifty-Two
(52) West of the 5th P.M., Turner County, South Dakota, according to the
recorded plat thereof.

 

Property Address: 27716 — 452nd Avenue, Chancellor, South Dakota

 

--------------------------------------------------------------------------------

 

UCC FINANCING STATEMENT

FOLLOW INSTRUCTIONS (front and back) CAREFULLY

 

A. NAME& PHONE OF CONTACTAT FILER (optional]

 

 

B. SEND ACKNOWLEDGMENT TO: (Name and Address)

 

 

            AGCOUNTRY FARM CREDIT SERVICES

            1900 44TH ST S P0 BOX 6020

            FARGO                                       ND           58108-6020

 

THE ABOVE SPACE IS FOR FILING OFFICE USE  ONLY

1.  DEBTOR’S EXACT FULL LEGALNAME  — insert only one debtor name (1a or 1b)-do
not abbreviate or combine names

1a,  ORGANIZATION’S NAME

 

 

 

 

 

 

GREAT PLAINS ETHANOL LLC

 

 

 

 

 

 

OR

 

 

 

 

 

 

1b.  INDIVIDUALS’S LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

1c  MAILING ADDRESS

 

CITY

 

STATE

POSTAL CODE

 

COUNTRY

27716 462ND AVE

 

CHANCELLOR

 

SD

57015     

 

USA

1d  SEE INSTRUCTIONS

 

ADDL’ INFO RE

 

1e. TYPE OF

 

1f. JURISDICTION OF

 

1e. ORGANIZATIONAL ID#, if any

 

 

ORGANIZATION

 

ORGANIZATION

 

 

 

 

 

 

46-0459108

 

DEBTOR

 

LIMITED LIABILITY

 

ORGANIZATION

SD

 

 

 

o NONE

2.  ADDITONAL DEBTOR’S EXACT FULL LEGAL NAME —insert only one debtor name (2a
or2b) . do not abbreviate or combine names

 

 

 

 

 

 

 

 

 

 

 

2a.  ORGANIZATION’S NAME

 

 

 

 

 

 

 

 

Poet Biorefining — CHANCELLOR

 

 

 

 

 

 

 

 

OR

 

 

 

 

 

 

 

 

 

 

2b,  INDIVIDUAL’S LAST NAME

 

 

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

 

 

 

2c. MAILING ADDRESS

 

 

 

 

 

CITY

 

STATE

P’OSTAL CODE

 

COUNTRY

27716 462ND AVE

 

 

 

 

 

CHANCELLOR

 

SD

57015     

 

USA

2d  SEE INSTRUCTIONS  

 

ADDL’ INFO RE

 

2e. TYPE OF

 

2f. JURISDICTION

 

2g. ORGANIZATIONAL ID#,

 

 

ORGANIZATION

 

ORGANIZATION

 

ORGANIZATION

 

if any

 

 

46-0459108

 

DEBTOR

 

LIMITED LIABILITY

 

SD

 

NONE

 

 

3.

 SECURED PARTY’S NAME (or NAME OF TOTAL ASSIGNEE OF ASSIGNOR S/P)- insert only
one party name (3a or 3)

 

 

 

3a.  ORGANIZATION’S NAME

 

 

 

 

 

 

 

AGCOUNTRY FARM CREDIT SERVICES, PCA

 

 

OR

 

 

 

.

3b  INDIVIDUALS’S LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

3c  MAILING ADDRESS

 

CITY

 

STATE

POSTAL CODE

 

COUNTRY

1900 44TH ST  PO BOX 6020

 

FARGO

 

ND

58108.6020

 

USA

 

 

 

 

 

 

 

 

4.  This FINANCING STATEMEN covers the following collateral:

 

 

 

All of Debtor’s right, title and interest, whether now or hereafter owned,
existing, arising or acquired, in all fixtures or every kind and nature, and any
accessions thereto, and all recorded data of any kind or nature relating to such
fixtures, regardless of the medium of recording, including, without limitation,
all software, writings, plans specifications and schematics, and all proceeds
and products of any of the foregoing.

 

5.  ALTERNATIVE DESIGNATION [if applicable]:  o LESSEE/LESSOR 
o CONSIGNEE/CONSIGNOR  o BAILEE/BAILOR  o SELLER/BUYER  o AG.LIEN  o NON-UCC
FILNG

 

 

 

 

 

 

 

 

6.  x THIS FINANCING STATEMENT is to be filed (for record)

 

7.  Check to REQUEST SEARCH REPORT(S) on Debtor(s)

 

 

(or recorded) in the REAL ESTATE Records. Attach

 

(ADDITIONAL FEE)    [optional]

 

o All Debtors   o Debtor   o Debtor 2

Addendum [if applicable]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,  OPTIONAL FILER REFERENCE DATA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FILING OFFICE COPY — 11CC FINANCING STATEMENT (FORM UCC1)(REV. 06/22/02)

 

UCCI (09/2005)

 

--------------------------------------------------------------------------------

 

UCC FINANCING STATEMENT ADDENDUM

FOLLOW INSTRUCTIONS (front and back) CAREFULLY

 

9.  NAME OF FIRST DEBTOR (1a or 1b) ON RELATED FINANCING STATEMENT

 

 

 

 

9a ORGANIZATlONS NAME

 

 

 

 

Great Plains Ethanol LLC dba Poet Biorefining - Chancellor

 

 

 

 

OR

 

 

 

 

9b,INDN1DLIAL’SLAST NAME           

 

FIRST NAME

 

MIDDLE NAME, SUFFIX

 

 

 

 

 

 

 

10.  MISCELLANEOUS:

 

 

 

 

 

 

 

 

 

 

 

THE ABOVE SPACE IS FOR FILING OFFICE USE ONLY

11.  ADDITIONAL DEBTOR’S EXACT FULL LEGAL NAME — insert only one name (11a or
11b) - do not abbreviate or combine names

11a. ORGANIZATION’S NAME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OR

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11 lb. INDIVIDUAL’S LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

 

11c. MAILING ADDRESS

 

CITY

 

STATE,

POSTAL CODE

 

COUNTRY

 

 

 

 

 

 

 

 

11d  SEE INSTRUCTIONS

 

ADDL’ INFO RE

 

11a. TYPE OF ORGANIZATION

 

11f. JURISDICTION OF

 

11g. ORGANIZATION ID#,

 

 

ORGANIZATION

 

 

 

ORGANIZATION

 

 

 

 

DEBTOR

 

 

 

 

 

if any     0  NONE

12.  o ADDITIONAL SECURED PARTY’S or   o  ASSIGNOR SIP’S NAME. Insert only one
name (12a or 12b)

 

 

12a. ORGANIZATlONS NAME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OR

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12b. INDIVIDUALS LAST NAME

 

FIRST NAME

 

MIDDLE NAME

 

SUFFIX

 

 

 

 

 

 

 

 

 

MAILING ADDRESS

 

 

 

CITY

 

STATE

POSTAL CODE

 

C0UNTRY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13. This FINANCING STATEMENT covers o timber to be cut

 

16. Additional collateral description:

 

 

or o as extracted collateral, or is filed as a x fixture filing.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14. Description of real estate:

 

 

 

 

 

 

See attached Exhibit I

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

15. Name and address of a RECORD OWNER ob above

 

 

 

 

 

 

(if Debtor does not have a record interest):

 

 

 

 

 

 

 

 

 

 

17. Check only if applicable and check only one box.

Debtor has a record of interest

 

Debtor is a o Trust or o Trustee acting with respect to property held in trust
or

 

 

 

 

o Decedent’s Estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18. Check only if applicable and check only one box.

 

 

 

 

 

 

o Debtor is a TRANSMITTING UTILITY

 

 

 

 

o Filed in connection with a Manufactured-Home Transaction—effective 30 years

 

 

 

 

o Filed in connection with a Public-finance Transaction-effective 30 years

FILING OFFICE COPY — UCC FINANCING STATEMENT ADDENDUM (FORM UCC1Ad)(REV.
05/22/02)

 

UCC1Ad (11/2005)

 

--------------------------------------------------------------------------------

 

EXHIBIT I

 

 

Debtor:

 

GREAT PLAINS ETHANOL, LLC

 

 

27716 462nd Avenue

 

 

Chancellor, SD 57105

 

 

 

Secured Party:

 

AGCOUNTRY FARM CREDIT SERVICES, FLCA

 

 

1900 44th Street South

 

 

Fargo, North Dakota 58108

 

Description of Real Estate:

 

Real property in Turner County in the State of South Dakota, to wit:

 

Parcel 1: The Northwest Quarter (NW ‘4) less Plucker’s Tract 1 in the South Half
of the Northwest Quarter (S ½ NW ¼) and except the Substation Addition in the
Northwest Quarter (NW ¼) and except the South Dakota Central Railroad
Right-of-Way and except Lot H-1 all in Section Twenty-six (26), Township
Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th PM., Turner County,
South Dakota.

 

Parcel 2: Tract 1 in the Northeast Quarter (NE ¼) of Section Twenty-Six (26),
Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota, according to the recorded plat thereof.

 

Parcel 3: Tract 3 in the Southeast Quarter (SE ¼) of Section Twenty-Six (26);
Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota, according to the recorded plat thereof.

 

Tract 4: Tract 1 and Tract 2 of Great Plains Addition in the Northeast Quarter
(NE ¼) of Section Thirty (30), Township Ninety-Eight (98) North, Range Fifty-Two
(52) West of the 5th P.M., Turner County, South Dakota, according to the
recorded plat thereof.

 

Property Address:   27716 — 462nd Avenue, Chancellor, South Dakota

 

--------------------------------------------------------------------------------