Exhibit 10.34
SECURITY AGREEMENT
& DEPOSIT ACCOUNT CONTROL AGREEMENT
     THIS AGREEMENT, made effective this 16th day of August, 2006, by and among
First National Bank of Omaha (hereinafter called “SECURED PARTY”), Red Trail
Energy, LLC, a North Dakota limited liability company (hereinafter called
“DEBTOR”), and Bremer Bank (“DEPOSITARY BANK”), a bank organized under the laws
of North Dakota, whose mailing address is PO Box 352, Richardton, ND 58652.
WITNESSETH:
     1. DEBTOR warrants that DEBTOR’s only place of business is the address
appearing following DEBTOR’s signatures. DEBTOR will promptly notify SECURED
PARTY, in writing, of any change in the location of any place of business,; or
the establishment of any new place of business.
     2. For valuable consideration, receipt of which is hereby acknowledged,
DEBTOR hereby grants to the SECURED PARTY a security interest in the following
property (hereinafter called the “COLLATERAL”).
     A. A certain deposit account numbered 8620810 in the name of DEBTOR,
established at DEPOSITARY BANK on behalf of DEBTOR. DEBTOR agrees to maintain a
minimum amount in the account but said account balance shall not exceed Five
Hundred Thousand Dollars ($500,000.00) at any time. If said account balance
exceeds Five Hundred Thousand Dollars ($500,000.00), DEBTOR shall transfer the
excess funds to an account established at the banking offices of SECURED PARTY.
     B. Each and every deposit account now or hereinafter identified to or
becoming a part of the account hereinabove set out, and all monies or funds now
or hereinafter identified to or becoming a part of said account above set out.
     3. The COLLATERAL secures several Promissory Notes dated December 16,2006,
in the aggregate amount of Fifty Eight Million Seven Hundred Eleven Thousand
Seven Hundred Forty Dollars ($59,711,740.00), plus interest accruing thereon;
and all prior, contemporaneous and future debts owed to the SECURED PARTY by the
DEBTOR, whether Originally owned of transferred to the SECURED PARTY.
     4. DEBTOR does hereby grant to the SECURED PARTY such control of the above
set out account and money which is a “deposit account” within the meaning of the
Nebraska Uniform Commercial Code §9-l02(a)(29) and similar statutes which may
govern any aspect of this transaction.

 

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     5. DEBTOR may acquire assets to be identified to or become a part of the
above set out account. None of the COLLATERAL may be pledged or otherwise
hypothecated without the prior written consent of SECURED PARTY.
     6. The DEBTOR warrants that there are no adverse claims to the COLLATERAL.
     7. Hereinafter, DEPOSITARY BANK shall hold the account and any monies on
behalf of the SECURED PARTY, and such retention of possession thereof by
DEPOSITARY BANK shall constitute possession of the account by the SECURED PARTY.
     8. It is agreed and understood that DEPOSITARY BANK does not represent that
any valid security interest exists in the account and the assets in the account
and DEPOSITARY BANK shall have no ongoing responsibility for ensuring that a
valid security interest exists in favor of the SECURED PARTY.
     9. DEPOSITARY BANK shall send to SECURED PARTY at the following address
monthly statements of the above account: First National Bank of Omaha, 1620
Dodge St. STOP 1050, Omaha, NE 68197-1050, Attention: Christopher Reiner.
     10. REMEDIES. If total or partial default is made in the payment at
maturity of any sum (principal or interest), at any time secured hereby, or if
default is made in the performance of any obligation imposed upon the DEBTOR
hereunder, or by any document, instrument or thing executed by the DEBTOR in
connection with any debt or obligation secured hereby, or hereafter secured
hereby; or if any of the representations or warranties of the DEBTOR made in
connection with this transaction shall prove raise; or if any proceeding is
instituted by or against the DEBTOR under provisions of the Bankruptcy Code, or
any other insolvency law; or if the SECURED PARTY shall reasonably at any time
deem its rights hereunder insecure, then, in any of such events, the holder Of
this security interest may, at its option, declare the entire indebtedness
secured hereby (with all interest secured hereunder) to be immediately due and
payable. In such event, DEPOSITARY BANK, upon written notice from the SECURED
PARTY of the default and of the amount of debt in default, shall immediately
proceed to relinquish all monies in or identified to the account and pay the
amount of the debt to the SECURED PARTY. In such an event, the SECURED PARTY may
also enforce all remedies available to it afforded under the Uniform Commercial
Code, or otherwise authorized by law, or at equity, or given in this instrument,
or any other document, instrument or thing executed by the DEBTOR in connection
with any debt or obligation secured, hereby or hereinafter secured hereby. Such
remedies may be pursued contemporaneously, or otherwise.
     11. All rights of the SECURED PARTY will inure to the benefit of its
successors and assigns.
     SIGNED IN TRIPLICATE and delivered on the date first above written, the
DEBTOR hereby acknowledging receipt of a copy of this Agreement.

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          SECURED PARTY: First National Bank of Omaha    
 
       
By:
Its
  /s/ Chris Reiner
 
Commercial Loan Officer    
 
        DEBTOR: Red Trail Energy, LLC    
 
       
By:
Its
  /s/ Mick J. Miller
 
CEO    
 
       
And
       
 
       
By:
Its
  /s/ Bonnie Eckelberg
 
CFO    
 
       

     
DEBTOR’s Address:
  Red Trail Energy, LLC
 
  P.O. Box 11
 
  Richardton, North Dakota 58652
 
  Attention: Ambrose Hoff

          DEPOSITARY BANK: Bremer Bank    
 
       
By:
  /s/ Brian Hagen
 
   
Its
  EVP    

ACKNOWLEDGMENT AND AGREEMENT
     THE UNDERSIGNED, Bremer Bank, does hereby acknowledge receipt of an
executed copy of the above and foregoing Security Agreement, and does hereby
agree to be bound by the agreement and does adopt and publish to the SECURED
PARTY the warranties provided therein.
     EXECUTED effective the 16th day of August, 2006.

             
 
  BREMER   BANK    
 
           
 
  By:
Its   /s/ Brian Hagen
 
EVP    
 
           
ATTEST:
           
 
           
By: /s/ Beth Odegaard
 
       Secretary
           

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