##### Table of Contents



UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 Form 10-Q
 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED: DECEMBER 31, 2009
 Commission file number: 000-52421
 ADVANCED BIOENERGY, LLC
 (Exact name of Registrant as Specified in its Charter)
 Delaware(State or Other Jurisdiction of 
Incorporation or Organization)
    
    20-2281511(I.R.S. Employer
Identification No.)
 10201 Wayzata Boulevard, Suite 250
Minneapolis, Minnesota 55305
(763) 226-2701  (Address, including zip code, and telephone number,
including area code, of Registrants Principal Executive Offices)
 þ o
  o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




---



##### 



ADVANCED BIOENERGY, LLC
FORM 10-Q
Index
 PagePart I. Financial Information
    
    
    1Item 1. Financial Statements
    
    
    1Consolidated Balance Sheets
    
    
    1Consolidated Statements of Operations and Comprehensive Loss
    
    
    2Consolidated Statement of Changes in Members Equity
    
    
    3Consolidated Statements of Cash Flows
    
    
    4Notes to Consolidated Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    24Item 4T. Controls and Procedures
    
    
    25Part II. Other Information
    
    
    25Item 1. Legal Proceedings
    
    
    25Item 1A. Risk Factors
    
    
    25Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    25Item 3. Defaults Upon Senior Securities
    
    
    26Item 4. Submission of Matters to a Vote of Security Holders
    
    
    26Item 5. Other Information
    
    
    26Item 6. Exhibits
    
    
    26Signatures
    
    
    26Exhibit IndexEX-31.1EX-31.2EX-32




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
 
 ADVANCED BIOENERGY, LLC & SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in Thousands)
 December 31,
    
    
    September 30,2009
    
    
    2009(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    29,408
    
    
    $
    26,367Receivables:Trade accounts receivable
    
    
    12,456
    
    
    
    9,613Due from broker
    
    
    597
    
    
    
    Other receivables
    
    
    4,257
    
    
    
    3,090Derivative financial instrument
    
    
    614
    
    
    
    Inventories
    
    
    10,598
    
    
    
    7,618Prepaid expenses
    
    
    2,953
    
    
    
    2,242Current portion of restricted cash
    
    
    1,017
    
    
    
    6,767Total current assets
    
    
    61,900
    
    
    
    55,697Property and equipment, net
    
    
    197,298
    
    
    
    203,364Other assets:Restricted cash
    
    
    1,153
    
    
    
    1,146Other assets
    
    
    2,113
    
    
    
    2,146Total Assets
    
    $
    262,464
    
    
    $
    262,353LIABILITIES AND MEMBERS EQUITYCurrent liabilities:Accounts payable
    
    $
    5,343
    
    
    $
    6,057Accrued expenses
    
    
    5,032
    
    
    
    5,490Current portion of long-term debt
    
    
    148,650
    
    
    
    146,303Total current liabilities
    
    
    159,025
    
    
    
    157,850Deferred income
    
    
    5,386
    
    
    
    5,554Long-term debt
    
    
    68,635
    
    
    
    76,625Other liabilities
    
    
    702
    
    
    
    535Members equity:Members capital, no par value,
20,000,000 units authorized;
17,814,180 and 15,985,295 issued and
outstanding and 0 and 971,003 units
subscribed for at December 31, 2009
and September 30, 2009, respectively
    
    
    161,165
    
    
    
    160,392Retained deficit
    
    
    (132,449
    )
    
    
    (138,603
    )Accumulated other comprehensive loss
    
    
    
    
    
    
    Total members equity
    
    
    28,716
    
    
    
    21,789Total liabilities and members equity
    
    $
    262,464
    
    
    $
    262,353




---



##### Table of Contents



ADVANCED BIOENERGY, LLC & SUBSIDIARIES
Consolidated Statements of Operations and Comprehensive Loss
(Dollars in thousands, except per unit data)
(Unaudited)
 Quarter EndedDecember 31,
    
    
    December 31,2009
    
    
    2008Net salesEthanol and related products
    
    $
    96,006
    
    
    $
    98,513Other
    
    
    250
    
    
    
    341Total net sales
    
    
    96,256
    
    
    
    98,854Cost of goods sold
    
    
    84,128
    
    
    
    98,778Gross profit
    
    
    12,128
    
    
    
    76Selling, general and administrative
    
    
    2,097
    
    
    
    2,492Operating income (loss)
    
    
    10,031
    
    
    
    (2,416
    )Other income (expense)
    
    
    (9
    )
    
    
    90Interest income
    
    
    41
    
    
    
    79Interest expense
    
    
    (3,909
    )
    
    
    (8,461
    )Net income (loss)
    
    $
    6,154
    
    
    $
    (10,708
    )Other comprehensive income (loss):Interest rate swap obligation
    
    
    
    
    
    
    1,786Comprehensive income (loss)
    
    $
    6,154
    
    
    $
    (8,922
    )Basic & diluted weighted average units outstanding
    
    
    17,673,982
    
    
    
    11,929,944Income
(loss) per unit  basic and diluted
    
    $
    .35
    
    
    $
    (0.90
    )
  2




---



##### Table of Contents



ADVANCED BIOENERGY, LLC & SUBSIDIARIES
Consolidated Statements of Changes in Members Equity
For the Quarter Ended December 31, 2009
(Dollars in thousands)
(Unaudited)
 Member
    
    
    Member
    
    
    RetainedUnits
    
    
    Capital
    
    
    Deficit
    
    
    TotalMEMBERS EQUITY  September 30, 2009
    
    
    15,985,295
    
    
    $
    160,392
    
    
    $
    (138,603
    )
    
    $
    21,789Cumulative effect of change in accounting
principle-October 1, 2009 reclassification of
embedded feature of equity-linked financial
instrument to derivative warrant liability
    
    
    
    
    
    
    (489
    )
    
    
    
    
    
    
    (489
    )Issuance of previously subscribed units
    
    
    971,003
    
    
    
    
    
    
    
    
    
    
    
    Unit compensation expense
    
    
    
    
    
    
    11
    
    
    
    
    
    
    
    11Put options exercised
    
    
    (2,000
    )
    
    
    (3
    )
    
    
    
    
    
    
    (3
    )Units issued  private placement offering (net)
    
    
    859,882
    
    
    
    1,254
    
    
    
    
    
    
    
    1,254Net income
    
    
    
    
    
    
    
    
    
    
    6,154
    
    
    
    6,154MEMBERS EQUITY  December 31, 2009
    
    
    17,814,180
    
    
    $
    161,165
    
    
    $
    (132,449
    )
    
    $
    28,716
  3




---



##### Table of Contents



ADVANCED BIOENERGY, LLC & SUBSIDIARIES
Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
 Quarter EndedDecember 31,
    
    
    December 31,2009
    
    
    2008Cash flows from operating activitiesNet income (loss)
    
    $
    6,154
    
    
    $
    (10,708
    )Adjustments to reconcile net income (loss) to net cash used in operating activities:Depreciation
    
    
    5,338
    
    
    
    6,479Amortization of deferred financing costs
    
    
    33
    
    
    
    263Amortization of debt discount
    
    
    263
    
    
    
    Amortization of deferred revenue
    
    
    (168
    )
    
    
    Amortization of lease liability
    
    
    (95
    )
    
    
    Unit compensation expense
    
    
    11
    
    
    
    58Termination and accrual of interest rate swap settlement charges
    
    
    
    
    
    
    4,213Change in risk management activities
    
    
    (614
    )
    
    
    (1,242
    )Changes in working capital components:Receivables
    
    
    (3,507
    )
    
    
    3,301Inventories
    
    
    (2,980
    )
    
    
    (4,314
    )Prepaid expenses
    
    
    (711
    )
    
    
    (138
    )Accounts payable
    
    
    (714
    )
    
    
    (448
    )Accrued expenses
    
    
    2,057
    
    
    
    1,442Net cash provided by (used in) operating activities
    
    
    5,067
    
    
    
    (1,094
    )Cash flows from investing activities:Purchase of property and equipment
    
    
    (372
    )
    
    
    (144
    )Change in other assets
    
    
    
    
    
    
    (226
    )Decrease in cash held in escrow
    
    
    5,743
    
    
    
    1,551Net cash provided by investing activities:
    
    
    5,371
    
    
    
    1,181Cash flows from financing activitiesPayments on debt
    
    
    (8,648
    )
    
    
    (2,652
    )Proceeds from issuance of units
    
    
    1,254
    
    
    
    Repurchase of units
    
    
    (3
    )
    
    
    (6
    )Net cash (used in) financing activities
    
    
    (7,397
    )
    
    
    (2,658
    )Net increase (decrease) in cash and cash equivalents
    
    
    3,041
    
    
    
    (2,571
    )Beginning cash and cash equivalents
    
    
    26,367
    
    
    
    14,762Ending cash and cash equivalents
    
    $
    29,408
    
    
    $
    12,191Supplemental disclosure of non cash transactionsWarrant obligation recognized as liability
    
    $
    489
    
    
    $
    Other receivable offset against equipment
    
    
    1,100
    
    
    
    Accrued interest at HGF transferred to debt
    
    
    2,516
    
    
    
    Supplemental disclosure of cash flow information:Cash paid for interest
    
    $
    1,256
    
    
    $
    3,603
  4




---



##### Table of Contents



ADVANCED BIOENERGY, LLC & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2009 and 2008
(Unaudited)
 1. Organization and Significant Accounting Policies
   Cash, Cash Equivalents and Restricted Cash
  Fair Value of Financial Instruments
  Fair Value Measurements
    5




---



##### Table of Contents



Total
    
    Level 1
    
    Level 2
    
    Level 3Assets  Derivative Financial
Instruments
    
    $
    614
    
        

    $614
    
    
    
    
    
    
    
    Liabilities  Warrant Derivative
    
    $
    488
    
        

    
    
    
    
    
    
    
    $
    488
   December 31,2009Market value
    
    $
    1.50
    (1)Expected volatility
    
    
    110.6
    %Expected life (years)
    
    
    2.375Risk free interest rate
    
    
    1.063
    %Forfeiture rate
    
    
    Dividend rate
    
    
    
  (1)
    
    Market value based on recent unit transactions.  Initial
recognition of
warrant derivative
as of October 1, 2009
    
    $
    489Unrealized gain
related to the
change in fair
value
    
    
    (1
    )Balance as of
December 31, 2009
    
    $
    488
 Derivative Instruments/Due From Broker
  6




---



##### Table of Contents



Receivables
   Inventories
  Property and Equipment
  Buildings
    
    40 YearsProcess equipment
    
    10 YearsOffice equipment
    
    5-7 Years
  Revenue Recognition
  Shipping Costs
  Income (Loss) Per Unit
  7




---



##### Table of Contents



Accounting Estimates
  2. Inventories
  December 31,
    
    
    September 30,2009
    
    
    2009Corn
    
    $
    3,009
    
    
    $
    1,341Chemicals
    
    
    989
    
    
    
    489Work in process
    
    
    1,943
    
    
    
    1,893Ethanol
    
    
    2,321
    
    
    
    1,678Distillers grain
    
    
    476
    
    
    
    412Supplies and parts
    
    
    1,860
    
    
    
    1,805Total
    
    $
    10,598
    
    
    $
    7,618
 3. Property and Equipment (in thousands)
  December 31,
    
    
    September 30,2009
    
    
    2009Land
    
    $
    3,962
    
    
    $
    3,962Buildings
    
    
    21,295
    
    
    
    21,295Process equipment
    
    
    215,051
    
    
    
    215,820Office equipment
    
    
    1,265
    
    
    
    1,273Construction in process
    
    
    129
    
    
    
    81241,702
    
    
    
    242,430Accumulated depreciation
    
    
    (44,404
    )
    
    
    (39,066
    )Property and equipment, net
    
    $
    197,298
    
    
    $
    203,364
 4. Long Term Debt
  December 31,
    
    
    December 31,
    
    
    September 30,2009
    
    
    2009
    
    
    2009Interest Rate
    
    
    Principal Amount
    
    
    Principal AmountABE Fairmont senior credit
facility  variable
    
    
    3.64
    %
    
    $
    52,850
    
    
    $
    55,450ABE Fairmont senior credit facility 
fixed
    
    
    7.53
    %
    
    
    20,000
    
    
    
    20,000ABE Fairmont seasonal line  variable
    
    
    3.34
    %
    
    
    3,000
    
    
    
    3,000ABE Fairmont subordinate exempt
facilities bonds  fixed
    
    
    6.75
    %
    
    
    7,000
    
    
    
    7,000HGF senior credit facility  fixed
    
    
    8.50
    %
    
    
    87,979
    
    
    
    87,979HGF working capital   fixed
    
    
    8.50
    %
    
    
    7,100
    
    
    
    7,100HGF subordinated solid waste
facilities revenue bonds  fixed
    
    
    8.25
    %
    
    
    19,000
    
    
    
    19,000HGF notes payable  fixed
    
    
    8.27
    %
    
    
    4,213
    
    
    
    4,213HGF accrued interest
    
    
    
    
    
    
    12,433
    
    
    
    9,917ABE PJC Capital note  fixed
    
    
    10.0
    %
    
    
    3,710
    
    
    
    9,269Total outstanding
    
    
    
    
    
    
    217,285
    
    
    
    222,928Less: Amounts due within one year
    
    
    
    
    
    
    (148,650
    )
    
    
    (146,303
    )Long-term debt
    
    
    
    
    
    $
    68,635
    
    
    $
    76,625
 8




---



##### Table of Contents



2010
    
    $
    148,6502011
    
    
    11,2152012
    
    
    11,2152013
    
    
    11,2152014
    
    
    12,065Thereafter
    
    
    22,925Total debt
    
    $
    217,285
 Senior Credit Facility for the Fairmont Plant
     Fillmore County Subordinate Exempt Facilities Revenue Bonds for the Fairmont plant
  9




---



##### Table of Contents



Senior Credit Agreement for the South Dakota Plants
   Subordinate Solid Waste Facilities Revenue Bonds
   HGF Restructuring
  PJC
Capital Secured Note Advanced BioEnergy LLC
  5. Members Equity and Subsequent Events Private Offering
 Private Offering
  10




---



##### Table of Contents



Investment by Hawkeye Energy Holdings, LLC
  Warrants
  6. Major Customers
    December 31,
    
    December 31,2009
    
    2008Gavilon EthanolThree month revenues
    
    $
    81,188
    
    
    $
    77,609Receivable balance
    
    
    10,158
    
    
    
    5,935Dakotaland  HGF Distiller GrainsThree month revenues
    
    
    6,079
    
    
    
    4,942Receivable balance
    
    
    586
    
    
    
    755
 7. Risk Management
  11




---



##### Table of Contents



Commodity
    
    Quantity
    
    
    Amount
    
    
    Period CoveredCorn purchase contracts
    
    5,521 bushels
    
    $
    19,987
    
    
    March 2010Ethanol sales contracts
    
    24,215 gallons
    
    
    44,228
    
    
    March 2010Dried distiller grains sale contracts
    
    50 tons
    
    
    5,483
    
    
    March 2010
   Income Statement
    
    
    Realized
    
    
    Unrealized
    
    
    Total GainDerivatives not designated as hedging
instruments:
    
    Classification
    
    
    Gain (Loss)
    
    
    Gain (Loss)
    
    
    (Loss) Commodity Contracts
for the quarter
ending December 31,
2009
    
    Cost of Goods Sold
    
    $
    56
    
    
    
    614
    
    
    
    670 Commodity Contracts
for the quarter
ending December 31,
2008
    
    Cost of Goods Sold
    
    $
    (3,111
    )
    
    
    (27
    )
    
    
    (3,138
    )
 Balance SheetClassification
    
    
    December 31, 2009
    
    
    September 30, 2009Futures contracts through March 2010
    
    Current Assets
    
    $
    614
    
    
    
    
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Information Regarding Forward-Looking Statements
  
    
    we are in default under various existing debt financing agreements;
    
    our planned operations require additional liquidity that may not be available;
    
    our operational results are subject to fluctuations in the prices of grain, utilities and
ethanol, which are affected by various factors including weather, production levels, supply,
demand, changes in technology and government support and regulations;
    
    margins can be volatile and can evaporate, which may impact our ability to meet current
obligations and debt service requirements at our operating entities;
    
    our hedging transactions and mitigation strategies could materially harm our results;
 12




---



##### Table of Contents




    
    cash distributions depend upon our future financial and operational performance and will
be affected by debt covenants, reserves and operating expenditures;
    
    current governmental mandated tariffs, credits and standards may be reduced or eliminated
and legislative acts taken by state governments such as California, related to low carbon
fuels that include the effects caused by indirect land use, may have an adverse effect on
our business;
    
    alternative fuel additives may be developed that are superior to or cheaper than ethanol;
    
    transportation, storage and blending infrastructure may become impaired, preventing
ethanol from reaching markets;
    
    our operation facilities may experience technical difficulties and not produce the
gallons of ethanol as expected; and
    
    our units are subject to a number of transfer restrictions and no public market exists
for our units and none is expected to develop.
  General
  Overview
   13




---



##### Table of Contents



DRY MILL PROCESS
   14




---



##### Table of Contents



FACILITIES
  EstimatedEstimated
    
    
    Annual
    
    
    EstimatedAnnual
    
    
    Distillers
    
    
    AnnualEthanol
    
    
    Grains
    
    
    CornProduction(1)
    
    
    Production(2)
    
    
    Processed
    
    
    PrimaryLocation
    
    (Million gallons)
    
    
    (Tons)
    
    
    (Million bushels)
    
    
    Energy Source
    
    
    BuilderFairmont, NE
    
    
    110
    
    
    
    334,000
    
    
    
    39.3
    
    
    Natural Gas
    
    FagenAberdeen, SD (2)
    
    
    9
    
    
    
    27,000
    
    
    
    3.2
    
    
    Natural Gas
    
    BroinAberdeen, SD (2)
    
    
    44
    
    
    
    134,000
    
    
    
    15.7
    
    
    Natural Gas
    
    ICMHuron, SD
    
    
    32
    
    
    
    97,000
    
    
    
    11.4
    
    
    Natural Gas
    
    ICMConsolidated
    
    
    195
    
    
    
    592,000
    
    
    
    69.6
 
 (1)
    
    Our plants produce and sell wet, modified wet and dried distillers grains. The stated quantities are on a fully dried basis operating at nameplate capacity.(2)
    
    Our plant at Aberdeen consists of two separate production facilities which operate on a separate basis.     Plan of Operations Through September 30, 2010
   15




---



##### Table of Contents



RESULTS OF OPERATIONS
 Quarter Ended December 31, 2009 Compared to Quarter Ended December 31, 2008
  Three Months Ended
    
    
    Three Months EndedDecember 31, 2009
    
    
    December 31, 2008Sold/Consumed
    
    
    Average
    
    
    Sold/Consumed
    
    
    Average(In thousands)
    
    
    Net Price/Cost
    
    
    (In thousands)
    
    
    Net Price/CostEthanol (gallons)
    
    
    49,651
    
    
    $
    1.66
    
    
    
    44,729
    
    
    $
    1.76Dried distillers grains (tons)
    
    
    115
    
    
    
    92.72
    
    
    
    84
    
    
    
    145.41Wet distillers grains (tons)
    
    
    88
    
    
    
    35.67
    
    
    
    145
    
    
    
    52.41Corn (bushels)
    
    
    17,998
    
    
    $
    3.47
    
    
    
    16,518
    
    
    $
    4.29Gas (mmbtus)
    
    
    1,377
    
    
    
    4.48
    
    
    
    1,254
    
    
    
    5.51
 Net Sales
  Cost of Goods Sold
  Gross Profit
  Selling, General, and Administrative Expenses
  Interest Expense
  16




---



##### Table of Contents



TRENDS AND UNCERTAINTIES IMPACTING THE ETHANOL INDUSTRY AND OUR FUTURE OPERATIONS
 Overview
        17




---



##### Table of Contents



The Renewable Fuels Standard
   RFS RequirementTotal Renewable
    
    Cellulosic
    
    Biodiesel
    
    
    
    
    
    That Can Be MadeFuel
    
    Ethanol Minimum
    
    Minimum
    
    Advanced
    
    With Corn BasedYear
    
    Requirement
    
    Requirement
    
    Requirement
    
    Biofuel
    
    Ethanol2010
    
    
    12.95
    
    
    
    .10
    
    
    
    .65
    
    
    
    0.20
    
    
    
    12.002011
    
    
    13.95
    
    
    
    .25
    
    
    
    .80
    
    
    
    0.30
    
    
    
    12.602012
    
    
    15.20
    
    
    
    .50
    
    
    
    1.00
    
    
    
    0.50
    
    
    
    13.202013
    
    
    16.55
    
    
    
    1.00
    
    
    
    
    
    
    
    1.75
    
    
    
    13.802014
    
    
    18.15
    
    
    
    1.75
    
    
    
    
    
    
    
    2.00
    
    
    
    14.402015
    
    
    20.50
    
    
    
    3.00
    
    
    
    
    
    
    
    2.50
    
    
    
    15.002016
    
    
    22.25
    
    
    
    4.25
    
    
    
    
    
    
    
    3.00
    
    
    
    15.002017
    
    
    24.00
    
    
    
    5.50
    
    
    
    
    
    
    
    3.50
    
    
    
    15.002018
    
    
    26.00
    
    
    
    7.00
    
    
    
    
    
    
    
    4.00
    
    
    
    15.002019
    
    
    28.00
    
    
    
    8.50
    
    
    
    
    
    
    
    4.50
    
    
    
    15.002020
    
    
    30.00
    
    
    
    10.50
    
    
    
    
    
    
    
    4.50
    
    
    
    15.002021
    
    
    33.00
    
    
    
    13.50
    
    
    
    
    
    
    
    4.50
    
    
    
    15.002022
    
    
    36.00
    
    
    
    16.00
    
    
    
    
    
    
    
    5.00
    
    
    
    15.00
  Blending Incentives (VEETC)
  Imported Ethanol Tariffs
  18




---



##### Table of Contents



COMPETITION
 Ethanol
  Distillers Grains
    LIQUIDITY AND CAPITAL RESOURCES
 Financing and Existing Debt Obligations
  19




---



##### Table of Contents



Advanced BioEnergy, LLC
   ABE Fairmont
     20




---



##### Table of Contents



Heartland Grain Fuels
     CREDIT ARRANGEMENTS
  December 31,
    
    
    December 31,
    
    
    September 30,2009
    
    
    2009
    
    
    2009Interest Rate
    
    
    Principal Amount
    
    
    Principal AmountABE Fairmont senior credit
facility  variable
    
    
    3.64
    %
    
    $
    52,850
    
    
    $
    55,450ABE Fairmont senior credit facility 
fixed
    
    
    7.53
    %
    
    
    20,000
    
    
    
    20,000ABE Fairmont seasonal line  variable
    
    
    3.34
    %
    
    
    3,000
    
    
    
    3,000ABE Fairmont subordinate exempt
facilities bonds  fixed
    
    
    6.75
    %
    
    
    7,000
    
    
    
    7,000HGF senior credit facility  fixed
    
    
    8.50
    %
    
    
    87,979
    
    
    
    87,979HGF working capital   fixed
    
    
    8.50
    %
    
    
    7,100
    
    
    
    7,100HGF subordinated solid waste
facilities revenue bonds  fixed
    
    
    8.25
    %
    
    
    19,000
    
    
    
    19,000HGF notes payable  fixed
    
    
    8.27
    %
    
    
    4,213
    
    
    
    4,213HGF accrued interest
    
    
    
    
    
    
    12,433
    
    
    
    9,917ABE PJC Capital note   fixed
    
    
    10.0
    %
    
    
    3,710
    
    
    
    9,269Total outstanding
    
    
    
    
    
    
    217,285
    
    
    
    222,928Less: Amounts due within one year
    
    
    
    
    
    
    (148,650
    )
    
    
    (146,303
    )Long-term debt
    
    
    
    
    
    $
    68,635
    
    
    $
    76,625
 21




---



##### Table of Contents



The estimated maturities of debt at December 31, as follows (in thousands):
 2010
    
    $
    148,6502011
    
    
    11,2152012
    
    
    11,2152013
    
    
    11,2152014
    
    
    12,065Thereafter
    
    
    22,925Total debt
    
    $
    217,285
 SUMMARY OF CRITICAL ACCOUNTING POLICIES AND ESTIMATES
  Fair Value of Financial Instruments
  Derivative Instruments/Due From Broker
   22




---



##### Table of Contents



Inventories
  Property and Equipment
  Buildings
    
    40 YearsProcess equipment
    
    10 YearsOffice equipment
    
    5-7 Years
  Revenue Recognition
  OFF-BALANCE SHEET ARRANGEMENTS
  GOVERNMENT PROGRAMS, TAX CREDITS AND TAX INCREMENT FINANCING
    23




---



##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures about Market Risk
      Estimatedat Risk
    
    
    
    
    
    Hypothetical
    
    
    
    
    
    Change in AnnualVolume(1)
    
    
    
    
    
    Change in
    
    Spot
    
    Operating Income(In millions)
    
    Units
    
    Price
    
    Price(2)
    
    (In millions)Ethanol
    
    
    98.1
    
    
    gallons
    
    
    10.0
    %
    
    $
    1.95
    
    
    $
    19.1Distiller grains
    
    
    .39
    
    
    tons
    
    
    10.0
    %
    
    
    112
    
    
    
    4.4Corn
    
    
    47.5
    
    
    bushels
    
    
    10.0
    %
    
    
    4.14
    
    
    
    24.9Natural gas
    
    
    3.5
    
    
    btus
    
    
    10.0
    %
    
    
    5.57
    
    
    
    2.0
 
 (1)
    
    The volume of ethanol at risk is based on the assumption that we will enter into contracts for 49.7% of our expected annual gallons capacity of 195 million gallons. The volume of distiller
grains at risk is based on the assumption that we will enter into contracts for 33.8% of our expected annual distiller grain production of 592,000 tons. The volume of corn is based on the
assumption that we will enter into forward contracts for 31.7% of our estimated current 69.6 million bushel annual requirement. The volume of natural gas at risk is based on the assumption
that we will continue to lock in one months gas usage.(2)
    
    Current spot prices include the CBOT price per gallon of ethanol and the price per bushel of corn, the NYMEX price per mmbtu of natural gas and our listed local advertised dried distillers
grain price per ton as of December 31, 2009. INTEREST RATE/FOREIGN EXCHANGE RISK
  24




---



##### Table of Contents



IMPACT OF INFLATION
  
 Item 4T. Controls and Procedures
  
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    25




---



##### Table of Contents



Item 3. Defaults Upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  
 Item 6. Exhibits
  
 SIGNATURES
  ADVANCED BIOENERGY, LLCDate: February 16, 2010
    By:
    /s/ Richard R. PetersonRichard R. PetersonChief Executive Officer,
President,
Chief Financial Officer and Director 26




---



##### Table of Contents



EXHIBIT INDEX
 ExhibitNo.
    
    Description
    
    Method of Filing3.1
    
    
    Certificate of Formation
    
    Incorporated by
reference to Exhibit 2.1
to the Registrants
Current Report on Form
8-K, filed on November
8, 20063.2
    
    
    Third Amended and Restated
Operating Agreement of the
Registrant dated as of February
1, 2006 as amended on September
18, 2009
    
    Incorporated herein by
reference to Exhibit 3.1
to the Registrants
Current Report on Form
8-K, filed on September
24, 200931.1
    
    
    Rule 13a-14(a)/15d-14(a)
Certification by Principal
Executive Officer
    
    Filed Electronically31.2
    
    
    Rule 13a-14(a)/15d-14(a)
Certification by Principal
Financial and Accounting
Officer
    
    Filed Electronically32
    
    
    Section 1350 Certifications
    
    Filed Electronically