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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-QSB
 þ
    
    Quarterly report under Section 13 or 15(d) of the Securities
Exchange Act of 1934.
 For the quarterly period ended December 31, 2005
 OR
 o
    
    Transition report under Section 13 or 15(d) of the Exchange Act.
 For the transition period from                      to                    .
 COMMISSION FILE NUMBER 333-123473
 SIOUXLAND ETHANOL, LLC
  Nebraska
(State or other jurisdiction of
incorporation or organization)
    
    22-3902184
(I.R.S. Employer Identification No.)
 110 East Elk Street, Jackson, Nebraska 68743
 (402) 632-2676
 þ o
 o þ
  o þ




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##### 



INDEX
 Page No.PART I. FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements
    
    
    3Item 2.
 Managements Discussion and Analysis and Plan of Operations
    
    
    9Item 3. Controls and Procedures
    
    
    19PART II. OTHER INFORMATION
    
    
    19Item 1. Legal Proceedings
    
    
    19Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    20Item 3. Defaults Upon Senior Securities
    
    
    20Item 4. Submission of Matters to a Vote of Security Holders
    
    
    20Item 5. Other Information
    
    
    20Item 6. Exhibits
    
    
    20SIGNATURES
    
    
    21Standard Form of Agreement and General ConditionsLump-Sum Design-Build AgreementLicense AgreementCertificationCertificationSection 1350 CertificationSection 1350 Certification




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PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
 SIOUXLAND ETHANOL, LLC
   December 312005(Unaudited)ASSETSCurrent AssetsCash and equivalents
    
    $
    34,244,550Prepaid and other
    
    
    11,616Total current assets
    
    
    34,256,166Property and EquipmentLand and improvements
    
    
    752,302Office equipment
    
    
    11,042Construction in progress
    
    
    1,184,6881,948,032Less accumulated depreciation
    
    
    (1,183
    )Net property and equipment
    
    
    1,946,849Other AssetsDeferred financing costs and other
    
    
    53,093Total Assets
    
    $
    36,256,108LIABILITIES AND EQUITYCurrent LiabilitiesAccounts payable
    
    $
    274,111Accrued expenses
    
    
    3,603Total current liabilities
    
    
    277,714Commitments and ContingenciesMembers EquityMember contributions, net of costs of raising capital,
3,783 units outstanding at December 31, 2005
    
    
    36,431,418Deficit accumulated during development stage
    
    
    (453,024
    )Total members equity
    
    
    35,978,394Total Liabilities and Members Equity
    
    $
    36,256,108
  3




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SIOUXLAND ETHANOL, LLC
   Quarter Ended
    
    
    Quarter Ended
    
    
    From InceptionDecember 31
    
    
    December 31
    
    
    (August 12, 2004) to2005
    
    
    2004
    
    
    December 31, 2005(Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)Revenues
    
    $
    
    
    
    $
    
    
    
    $
    Operating ExpensesProfessional fees
    
    
    106,777
    
    
    
    22,819
    
    
    
    477,460General and administrative
    
    
    75,948
    
    
    
    2,687
    
    
    
    167,477Total operating expenses
    
    
    182,725
    
    
    
    25,506
    
    
    
    644,937Operating Loss
    
    
    (182,725
    )
    
    
    (25,506
    )
    
    
    (644,937
    )Other Income ( Expense)Interest income
    
    
    192,342
    
    
    
    
    
    
    
    192,342Other income
    
    
    975
    
    
    
    
    
    
    
    3,094Interest expense
    
    
    (3,523
    )
    
    
    
    
    
    
    (3,523
    )Total other income, net
    
    
    189,794
    
    
    
    
    
    
    
    191,913Net Income (Loss)
    
    $
    7,069
    
    
    $
    (25,506
    )
    
    $
    (453,024
    )Weighted Average Units Outstanding
    
    
    2,496
    
    
    
    117
    
    
    
    581Net Income (Loss) Per Unit
    
    $
    2.83
    
    
    $
    (218.00
    )
    
    $
    (779.73
    )
  4




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SIOUXLAND ETHANOL, LLC
   Quarter Ended
    
    
    Quarter Ended
    
    
    From InceptionDecember 31
    
    
    December 31
    
    
    (August 12, 2004) to2005
    
    
    2004
    
    
    December 31, 2005(Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)Cash Flows from Operating ActivitiesNet income (loss)
    
    $
    7,069
    
    
    $
    (25,506
    )
    
    $
    (453,024
    )Adjustments to reconcile net income (loss) to net cash from operations:Depreciation
    
    
    557
    
    
    
    
    
    
    
    1,183Change in assets and liabilitiesPrepaid and other
    
    
    18,804
    
    
    
    
    
    
    
    (10,116
    )Accounts payable
    
    
    53,887
    
    
    
    (12,657
    )
    
    
    183,596Accrued expenses
    
    
    1,152
    
    
    
    
    
    
    
    3,603Net cash provided by (used in) operating activities
    
    
    81,469
    
    
    
    (38,163
    )
    
    
    (274,758
    )Cash Flows from Investing ActivitiesPayment for land options and other
    
    
    
    
    
    
    (2,000
    )
    
    
    (7,000
    )Capital expenditures
    
    
    (1,841,975
    )
    
    
    
    
    
    
    (1,853,017
    )Net cash used in investing activities
    
    
    (1,841,975
    )
    
    
    (2,000
    )
    
    
    (1,860,017
    )Cash Flows from Financing ActivitiesProceeds from bridge financing loan
    
    
    760,000
    
    
    
    
    
    
    
    760,000Payments on bridge financing loan
    
    
    (760,000
    )
    
    
    
    
    
    
    (760,000
    )Payments for financing costs
    
    
    (52,093
    )
    
    
    
    
    
    
    (52,093
    )Member contributions
    
    
    35,880,000
    
    
    
    925,000
    
    
    
    36,855,000Payments for deferred offering costs
    
    
    (36,449
    )
    
    
    (10,468
    )
    
    
    (423,582
    )Net cash provided by financing activities
    
    
    35,791,458
    
    
    
    914,532
    
    
    
    36,379,325Net Increase in Cash and Equivalents
    
    
    34,030,952
    
    
    
    874,369
    
    
    
    34,244,550Cash and
Equivalents  Beginning of Period
    
    
    213,598
    
    
    
    47,213
    
    
    
    Cash and
Equivalents  End of Period
    
    $
    34,244,550
    
    
    $
    921,582
    
    
    $
    34,244,550Supplemental Cash Flow InformationCash paid during the period for:Interest
    
    $
    3,523
    
    
    $
    
    
    
    $
    3,523Supplemental Disclosure of Noncash Investing and Financing ActivitiesLand options exercised for land purchased
    
    $
    4,500
    
    
    $
    
    
    
    $
    4,500Construction in progress in accounts payable
    
    $
    90,515
    
    
    $
    
    
    
    $
    90,515Deferred offering costs offset against member contributions
    
    $
    423,582
    
    
    $
    
    
    
    $
    423,582Deferred offering costs included in accounts payable
    
    $
    
    
    
    $
    8,493
    
    
    $
    
  5




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SIOUXLAND ETHANOL, LLC
   1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
   Nature of Business
  Fiscal Reporting Period
  Accounting Estimates
  Property and equipment
  Deferred Offering Costs
  Recently Issued Accounting Pronouncements
  6




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SIOUXLAND ETHANOL, LLC
   2. DEVELOPMENT STAGE ENTERPRISE
   3. MEMBERS EQUITY
  Registration Statement
  4. COMMITMENTS AND CONTINGENCIES
 Construction contracts
     7




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SIOUXLAND ETHANOL, LLC
    Land contracts
  Bridge financing loan
  Consulting contracts
   Conditional debt financing commitment
  5. SUBSEQUENT EVENTS
  8




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Item 2. Managements Discussion and Analysis and Plan of Operations.
 Forward Looking Statements
  
    
    Overcapacity in the ethanol industry;
    
    Our ability to obtain the debt financing necessary to construct and operate our plant;
    
    Changes in our business strategy, capital improvements or development plans;
    
    Construction delays and technical difficulties in constructing the plant;
    
    Changes in the environmental regulations that apply to our plant site and operations;
    
    Our ability to secure marketing services for the ethanol and distillers grains we expect
to produce;
    
    Our ability to hire and retain key employees for the operation of the plant;
    
    Changes in general economic conditions or the occurrence of certain events causing an
economic impact in the agriculture, oil or automobile industries;
    
    Changes in the availability and price of natural gas and the market for distillers grains;
    
    Changes in federal and/or state laws (including the elimination of any federal and/or
state ethanol tax incentives);
    
    Changes and advances in ethanol production technology; and
    
    Competition from alternative fuel additives.
  Overview
  9




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Plan of Operations to Start-Up of the Ethanol Plant
  Project Capitalization
     10




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Plant Construction Activity
   Earthwork and Site Preparation
  
    
    Site clearing/grading;
    
    Construction of plant roads;
    
    Spur track subgrade grading and subballast; and
    
    Installation of underground drainage piping.
  Phase I and Phase II Engineering Services
  Foundation and Site Preparation
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Plant Construction
   Duties under the Design-Build Agreement
 12




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
    
    Providing all necessary design services consistent with applicable law and provided
by licensed design professionals either employed by Fagen, Inc. or qualified
independent licensed design consultants;
    
    Providing testing, maintenance and training for all of our employees required for
the operation of the plant;
    
    Providing to us a warranty that the work performed is of good quality, conforms to
all contract and construction documents, and is free of defect in materials and
workmanship;
    
    Taking all actions necessary to remedy any deficiencies that prevent the successful
completion of the performance tests and pay all design and construction costs
associated with making the necessary corrections;
    
    For a period of one year after substantial completion, correcting any defects in
materials and workmanship and commencing correction of defects within seven days of
receipt of notice from us that the work performed was defective; and
    
    Indemnifying, defending and holding us, our officers, directors, agents and
employees harmless against any claims, losses, costs, injuries, demands, penalties,
damages, liabilities, and interest including attorneys fees and expenses, for any
bodily injury, sickness, death or damage or destruction of property if such arises from
the negligent acts or omissions of Fagen, Inc., its consultants, agents or employees.
  
    
    Providing timely approval of preliminary construction documents;
    
    Obtaining all necessary governmental permits as required by law and the agreement of the parties;
    
    Obtaining and maintaining liability insurance to protect us from any claims that may
arise from performance of our responsibilities;
    
    Obtaining and maintaining property insurance for the full insurable value of the
plant, including professional fees, overtime premiums and all other expenses incurred
to replace or repair the ethanol plant; and
    
    Indemnifying, defending and holding Fagen, Inc., its officers, directors, agents and
employees harmless against any claims, losses, damages, liabilities, including
attorneys fees and expenses, for any bodily injury, sickness, death or damage or
destruction of property due to the negligent act or omission of any separate
contractors we hire.
  
    
    We fail to make timely payment of amounts owed or cure problems within 7 days after
work on the plant has ceased;
    
    Any acts, omissions, conditions, events or circumstances beyond Fagen, Inc.s
control, provided the act or omission was not caused by Fagen, Inc., but caused by us
or someone under our control resulting in a delay in performance under the contract;
    
    The presence of any hazardous conditions or materials at the construction site.
Upon receiving notice of a hazardous condition, we must immediately correct the
condition. After the condition is corrected and our experts provide written
certification of correction and all necessary government approvals have been obtained,
Fagen, Inc. should resume work in the affected area but may be entitled to an
adjustment in price and time for completion if its price and performance time has been
adversely affected; and
    
    Work on the plant has stopped for 60 consecutive days, or more than 90 days total,
provided the stoppage is not attributable to Fagen, Inc. or because we or the
government ordered stoppage or because we failed to provide Fagen, Inc. with permits,
information or approvals, Fagen, Inc. is entitled to terminate the design-build
contract if we do not cure within seven days after receipt of Fagen, Inc.s termination
notice.
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
    
    All work completed and any proven loss, cost or expense incurred in connection with
such work;
    
    Reasonable costs and expenses attributable to the termination, including
demobilization costs and amounts required to settle terminated contracts with
previously-retained subcontractors and, consultants;
    
    Overhead and profit in the amount of 15% of the sum of the above-listed payments;
and
    
    All retained funds withheld by us for work completed in accordance with the
design-build agreement.
  Performance Guarantee
  Insurance Requirements
  Natural Gas Pipeline Construction
  Technology License
   
    
    Proprietary information and technology for our use in owning, operating, maintaining
and repairing our plant; and
    
    Proprietary information concerning the design, arrangement, configuration, and
specifications of the combinations of distillation, evaporation, and alcohol
dehydration equipment, the combination of the
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distillers grain drying and hear recovery
system generation equipment and all documents supporting those combinations, and the
computer system known as the distributed control system and all attendant documents.
    
    
    Keep confidential the information we obtain through the benefit of this agreement;
    
    Indemnify, defend, and hold harmless ICM, Inc., Fagen, Inc. and their respective
representatives against any losses, damages, and expenses, including attorneys fees,
for any negligent act performed by us, our failure to comply with the operating
procedures, or resulting from any unauthorized disclosure of the proprietary
information or technology;
    
    Notify ICM, Inc. of any modifications to the proprietary information or technology
and to assign all right, title or interest in the modification to ICM, Inc.;
    
    Obtain prior consent from ICM, Inc. before assigning any part of the information
received under the agreement to a third party; and
    
    Retain the proprietary property at our principal place of business or the plant;
  Operating Expenses
  Employees
  15




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Full-TimePosition
    
    
    
    
    
    PersonnelGeneral Manager
    
    
    
    
    
    
    1Plant Manager
    
    
    
    
    
    
    1Commodities Manager
    
    
    
    
    
    
    1Controller
    
    
    
    
    
    
    1Lab Manager
    
    
    
    
    
    
    1Lab Technician
    
    
    
    
    
    
    2Secretary/Clerical
    
    
    
    
    
    
    3Shift Supervisors
    
    
    
    
    
    
    4Office Manager
    
    
    
    
    
    
    1Maintenance Supervisor
    
    
    
    
    
    
    1Maintenance Craftsmen
    
    
    
    
    
    
    4Plant Operators
    
    
    
    
    
    
    12TOTAL
    
    
    
    
    
    
    32
 Liquidity and Capital Resources
 Sources of Funds
  Uses of Proceeds
  Percent ofUse of Proceeds
    
    Amount
    
    
    TotalPlant construction(1)
    
    $
    56,619,000
    
    
    
    70.33
    %Land & site development costs
    
    
    5,230,000
    
    
    
    6.50
    %Railroad
    
    
    2,760,000
    
    
    
    3.43
    %Fire Protection / Water Supply
    
    
    2,480,000
    
    
    
    3.08
    %Administrative Building
    
    
    265,000
    
    
    
    0.33
    %Office Equipment
    
    
    66,000
    
    
    
    0.08
    %Computers, Software, Network
    
    
    140,000
    
    
    
    0.17
    %Construction Manager Fees
    
    
    80,000
    
    
    
    0.10
    %Construction insurance costs
    
    
    100,000
    
    
    
    0.12
    %Construction contingency
    
    
    2,810,000
    
    
    
    3.49
    %Capitalized interest
    
    
    1,100,000
    
    
    
    1.37
    %Rolling stock
    
    
    290,000
    
    
    
    0.36
    %
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Percent ofUse of Proceeds
    
    Amount
    
    
    TotalStart up costs:Financing costs
    
    
    610,000
    
    
    
    0.76
    %Organization costs
    
    
    1,000,000
    
    
    
    1.24
    %Pre Production period costs
    
    
    750,000
    
    
    
    0.93
    %Inventory
 Spare parts
    
    
    500,000
    
    
    
    0.62
    %Working capital
    
    
    3,000,000
    
    
    
    3.73
    %Inventory
 corn
    
    
    1,200,000
    
    
    
    1.49
    %Inventory
 chemicals and ingredients
    
    
    250,000
    
    
    
    0.31
    %Inventory
 Ethanol and DDGS
    
    
    750,000
    
    
    
    0.93
    %Inventory
 Corn Hedged
    
    
    500,000
    
    
    
    0.63
    %Total
    
    $
    80,500,000
    
    
    
    100
    %
 
 (1)
    
    Change orders are not included in our current estimate of costs. If we
execute change orders that materially impact our estimated plant construction cost, the
budget will be revised to reflect such impact. Quarterly Financial Results
    Trends and Uncertainties Impacting the Ethanol Industry and Our Future Operations
    17




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Trends and Uncertainties Impacting the Corn and Natural Gas Markets and Our Future Cost of Goods
Sold
  18




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Application of Critical Accounting Estimates
  Off-Balance Sheet Arrangements
  
 Item 3. Controls and Procedures
   
 PART
II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
   Amount
    
    Aggregate price of the amount
    
    
    
    
    
    Aggregate price of theRegistered
    
    registered
    
    Amount Sold
    
    amount sold4,600
    
    $
    46,000,000
    
    
    $
    3,588
    
    
    $
    35,880,000
   Plant Construction
    
    $
    39,427Site Costs
    
    $
    1,841,774Railroad
    
    $
    15,166Fire Protection
    
    $
    27,679Rolling Stock
    
    $
    12,944Financing Costs
    
    $
    52,093Organizational Costs
    
    $
    75,917Total
    
    $
    2,065,000
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
  20




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10.1
    
    Standard Form of Agreement and General Conditions between Owner
and Contractor for Auger Cast Grout Piles dated January 6, 2006 with Blackhawk
Foundation Co.10.2
    
    Lump-Sum Design-Build Agreement dated January 9, 2006 with Fagen, Inc.10.3
    
    License Agreement dated January 20, 2006 with ICM, Inc.31.1
    
    Certificate Pursuant to 17 CFR 240.13a-14(a).31.2
    
    Certificate Pursuant to 17 CFR 240.13a-14(a).32.1
    
    Certificate Pursuant to 18 U.S.C. § 1350.32.2
    
    Certificate Pursuant to 18 U.S.C. § 1350.
 
 SIGNATURES
  SIOUXLAND ETHANOL, LLCDate:
February 14,
2006
    
    /s/ Tom LynchTom LynchChairman and President (Principal Executive Officer)Date:
February 14,
2006
    
    /s/ John KingsburyJohn KingsburyTreasurer (Principal Financial and Accounting Officer)
 21