Execution
Draft

    TERM
SHEET

    FOR

    THE USE
OF CASH COLLATERAL AND ADEQUATE PROTECTION

    BY

    OTTER
TAIL AG ENTERPRISES, LLC,

    AS DEBTOR
IN POSSESSION,

    IN ITS
PROPOSED BANKRUPTCY CASE IN THE

    UNITED
STATES BANKRUPTCY COURT, DISTRICT OF MINNESOTA

    


    Effective
as of October 23, 2009

    


    AGSTAR
FINANCIAL SERVICES, PCA, as the cash collateral lender (the “Cash Collateral Lender”), and
MMCDC New Markets Fund II, LLC (“NMF”) hereby provide OTTER
TAIL AG ENTERPRISES, LLC, a Minnesota limited liability company (the “Debtor”), with the following
proposal for the use of cash collateral and adequate protection during the
Debtor’s proposed Chapter 11 case pursuant to the terms of a cash collateral
stipulation which is consented to by NMF (the “Cash Collateral
Stipulation”).

    


    Reference
is made herein to the following AgStar Loan Agreements (collectively, the “AgStar Loan
Agreements”):

    


    
      	
               
      

            	
              a.

            	
              Master
      Loan Agreement dated March 28,
2007;

            


    

    


    
      	
               
      

            	
              b.

            	
              First
      Supplement to the Master Loan Agreement (Construction and Term Loan) dated
      as of March 28, 2007;

            


    

    


    
      	
               
      

            	
              c.

            	
              Amended
      and Restated Master Loan Agreement dated as of June 23,
    2008;

            


    

    


    
      	
               
      

            	
              d.

            	
              Amended
      and Restated Second Supplement to the Master Loan Agreement (Term
      Revolving Loan) dated as of June 23, 2008;
and

            


    

    


    
      	
               
      

            	
              e.

            	
              Second
      Amended and Restated Third Supplement to the Master Loan Agreement (the
      “Revolving Line of Credit Loan”) dated as of June 23,
  2008.

            


    

    


    Reference
is made herein to the following NMF Notes and Loan Agreements (collectively, the
“NMF Loan
Agreements”):

    


    
      	
               
      

            	
              a.

            	
              Senior
      Loan Note dated March 30, 200;

            


    

    


    
      	
               
      

            	
              b.

            	
              Subordinate
      Loan Note dated March 30, 2007;

            


    

    


    
      	
               
      

            	
              c.

            	
              Construction
      and Term Loan Agreement dated March 30,
2007.

            


    

    


    Unless
otherwise expressly defined herein, capitalized terms used herein shall have the
same meaning ascribed to them in the AgStar Loan Agreements. Terms and
conditions of the proposal are as follows:

    


    
      
        	
                Debtor:

              	 
      	
                Otter
      Tail Ag Enterprises, LLC, a Minnesota limited liability company, as Debtor
      in Possession in its proposed Chapter 11 case in the United States
      Bankruptcy Court, District of Minnesota (the “Debtor’s Chapter 11
      Case”).

              


      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  Cash
      Collateral Lender:

                	 
      	
                  AgStar
      Financial Services, PCA.

                
	
                  Prepetition
      Lenders:

                	 
      	
                  Collectively
      the Cash Collateral Lender and NMF.

                
	 
      	 
      	 
      
	
                  Prepetition
      Loans:

                	 
      	
                  Collectively,
      all amounts due the Prepetition Lenders under the AgStar Loan Agreements
      and the NMF Loan Agreements as of the Commencement
Date.

                
	 
      	 
      	 
      
	
                  Commencement
      Date:

                	 
      	
                  The
      date the Interim Order is entered and becomes
effective.

                
	
                  Cash
      Collateral:

                	 
      	
                  As
      defined in § 363(a) of the Bankruptcy Code.

                
	 
      	 
      	 
      
	
                  Purposes:

                	 
      	
                  Cash
      Collateral may be used by the Debtor to fund the expenses set forth in the
      budget attached as Exhibit
      A (the “Budget”). After making the Re-margin
      Payment, to the extent there is, if any, excess cash generated above the
      Cash Beginning Balance, as determined under the reports required under the
      Interim Order, the Final Order, the Cash Collateral Stipulation or the
      other Cash Collateral Documents, that excess cash shall be paid to the
      Cash Collateral Lender to be applied to the reduction of the Revolving
      Line of Credit Loan.

                
	 	 	 
	 
      	 
      	
                  Upon
      entry of the Interim Order approving the Cash Collateral Stipulation and
      the other Cash Collateral Documents (excluding the Final Order), each of
      which must be acceptable to the Cash Collateral Lender, and satisfaction
      of the conditions precedent to the Debtor’s use of Cash Collateral set
      forth in the Interim Order and the other Cash Collateral Documents
      (excluding the Final Order), the Cash Collateral Lender shall authorize
      the use of Cash Collateral for the purposes described in the Interim Order
      and the other Cash Collateral Documents (excluding the Final Order) and
      itemized in the Budget, subject to the terms and conditions set forth in
      the Interim Order and the other Cash Collateral Documents (excluding the
      Final Order).

                
	 
      	 
      	 
      
	 
      	 
      	
                  Upon
      entry of the Final Order on or before November 30, 2009, approving the
      Cash Collateral Stipulation and other Cash Collateral Documents, each of
      which must be acceptable to the Cash Collateral Lender, and satisfaction
      of the conditions precedent to the Debtor’s use of Cash Collateral set
      forth in the Final Order, the Cash Collateral Stipulation and the other
      Cash Collateral Documents, the Cash Collateral Lender shall authorize the
      use of Cash Collateral for the purposes described in the Final Order, the
      Cash Collateral Stipulation and the other Cash Collateral Documents and
      itemized in the Budget, subject to the terms and conditions set forth in
      the Final Order and the other Cash Collateral
Documents.

                
	 
      	 
      	 
      
	 
      	 
      	
                  Nothing
      in the Interim Order, the Final Order, the Cash Collateral Stipulation or
      the other Cash Collateral Documents shall bind the Cash Collateral Lender
      to any Plan incorporating the terms set forth in the Cash Collateral
      Documents, without the prior express written consent of the Cash
      Collateral Lender.

                


        

      

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      
        	
                Maturity
      Dates:

              	 
      	
                The
      Interim Order will mature on the earliest of (i) the entry of the Final
      Order, (ii) November 30, 2009, or (iii) such earlier date as is provided
      in the Interim Order or the other Cash Collateral Documents (excluding the
      Final Order) (the “Interim Cash Collateral Order
      Maturity Date”).

              
	 
      	 
      	 
      
	 
      	 
      	
                The
      Cash Collateral Stipulation will mature on (i) February 28, 2010, or (ii)
      such earlier date as is provided in the Final Order or the other Cash
      Collateral Documents (the “Cash Collateral Maturity
      Date”).

              
	 
      	 
      	 
      
	
                Conditions
      Precedent To Allowing the

              	 
      	
                ·

              	
                Execution
      and delivery of the Cash Collateral Stipulation satisfactory to the Cash
      Collateral Lender;

              
	
                Interim
      Use of Cash 

                
                  
                    Collateral:

                  

                

              	 
      	
                ·

              	
                Execution
      and delivery of such other notes, mortgages, security agreements, control
      agreements, documents, and agreements as may be required by the Cash
      Collateral Lender satisfactory to the Cash Collateral Lender (together
      with the Cash Collateral Stipulation, the Interim Order and the Final
      Order, collectively the “Cash Collateral
      Documents”);

              
	
                 
      

              	 
      	
                ·

              	
                Entry
      of the Interim Order;

              
	
                 
      

              	 
      	
                ·

              	
                All
      other conditions precedent to allowing the interim use of Cash Collateral
      as set forth in the Interim Order and the other Cash Collateral Documents
      (excluding the Final Order); and

              
	 
      	 
      	
                ·

              	
                Debtor
      shall pay to the Cash Collateral Lender the amount necessary to reduce the
      Revolving Line of Credit to an amount no greater than 100% of the sum of
      the Debtor’s Eligible Accounts Receivable and Eligible Inventory (“the
      Re-Margin
      Payment”).

              
	 
      	 
      	
                ·

              	
                Debtor
      shall pay all interest accrued at the contract rate, rather than the
      Default Rate, on the Prepetition Loans payable on or after October 1,
      2009.

              
	 
      	 
      	 
      	 
      
	
                Conditions
      Precedent To
      Allowing the

              	 
      	
                ·

              	
                Execution
      and delivery of the Cash Collateral Stipulation satisfactory to the Cash
      Collateral Lender;

              
	
                Final
      Use of Cash

              	 
      	
                ·

              	
                Entry
      of the Final Order; and

              
	
                Collateral:

              	 
      	
                ·

              	
                All
      other conditions precedent to allowing the use of Cash Collateral set
      forth in the Final Order, the Cash Collateral Stipulation and the other
      Cash Collateral Documents.

              
	 
      	 
      	 
      
	
                Postpetition
      Security Interest:

              	 
      	
                The
      Debtor shall grant to the Cash Collateral Lender a first priority
      perfected Security Interest in all of the real and personal property of
      the Debtor, whether now owned or hereafter acquired (collectively, the
      “Collateral”), including any
      Collateral acquired by the Debtor after the commencement of the Debtor’s
      Chapter 11 Case, as such property is more fully described in the AgStar
      Loan Agreements, which security interest shall have the same priority,
      dignity and effect as the prepetition security interests, without any
      requirement for the execution, delivery,
      recording or filing of any security
      agreement, mortgage, deed of trust, control agreement, financing statement
      or similar document, instrument or agreement covering such Collateral;
      provided, however, that the
      Security Interests granted to the Cash Collateral Lender under the Interim
      Order, the Final Order or the other Cash Collateral Documents shall not
      extend to causes of action under Chapter 5 of the Bankruptcy Code or the
      proceeds thereof.

              


      

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      
        	 
      	 
      	
                During
      the term of the Cash Collateral Stipulation, Debtor shall not grant or
      permit any Security Interest in the Collateral to any other Person, other
      than certain permitted liens agreed to by the Cash Collateral Lender (the
      “Permitted
      Liens”).

              
	 
      	 
      	 
      
	
                Administrative
      Expense Claims:

              	 
      	
                The
      Cash Collateral Lender shall have all administrative expense priorities
      allowed under Title 11 of the United States Code (the “Bankruptcy
      Code”).

              
	 
      	 
      	 
      
	
                Interest
      Rate:

              	 
      	
                Interest
      shall accrue on the Prepetition Loans at the Default Rate provided by the
      AgStar Loan Agreements and the NMF Loan Agreements.

              
	 
      	 
      	 
      
	 
      	 
      	
                Interest
      shall be calculated in the manner set forth in the AgStar Loan Agreements
      and the NMF Loan Agreements.

              
	 
      	 
      	 
      
	
                Adequate
      Protection and Interest Payments:

              	 
      	
                The
      Debtor shall provide to the Prepetition Lenders the following as and for
      adequate protection during the term of the Cash Collateral
      Stipulation:

              
	 
      	 
      	 
      
	 
      	 
      	
                ·

              	
                Accrued
      interest at the contract rate, rather than the Default Rate, on the
      Prepetition Loans shall be paid by the Debtor to the Prepetition Lenders
      on the first day of each month, beginning on October 1, 2009, and monthly
      thereafter, through the Cash Collateral Maturity Date, to the Prepetition
      Lenders; provided,
      however,
      that the rights of all interested parties to later assert
      that the Adequate Protection Payments should be re-allocated to principal
      in accordance with § 506 of the Bankruptcy Code are
    preserved.

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                ·

              	
                Debtor
      shall maintain a minimum cash balance at all times through the Cash
      Collateral Maturity Date of $2,000,000, measured as of the close of
      business each Friday and included in the financial reports required
      herein.

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                ·

              	
                Provide
      the Prepetition Lenders with the financial and operating reports set forth
      herein.

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                ·

              	
                The
      Debtor shall pay all real estate taxes and assessments on all of the
      Collateral which become due and payable after the commencement of the
      Debtor’s Chapter 11 Case, including the October 15, 2009, real estate
      taxes.

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                ·

              	
                The
      Debtor shall maintain all of the Collateral and shall provide proof of
      insurance as required by the AgStar Loan Agreements and the NMF Loan
      Agreements to the Prepetition
Lenders.

              


      

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    


    
      
        
          
            
              	
                      Reports:

                    	 
      	
                      So
      long as the Debtor is utilizing Cash Collateral, the Debtor shall, unless
      the Cash Collateral Lender shall otherwise consent in advance in
      writing:

                    
	 
      	 
      	 
      	 
      
	 
      	 
      	
                      ·

                    	
                      Provide
      the Cash Collateral Lender with all reports required to be delivered by
      the Debtor under Section 5.01(c) of the Master Loan
    Agreement.

                    
	 
      	 
      	
                      ·

                    	
                      Provide
      the Cash Collateral Lender with all reports filed with the United States
      Trustee in the Debtor’s Chapter 11 Case;

                    
	 
      	 
      	
                      ·

                    	
                      By
      5:00 p.m. (Central Time) on Thursday of each week, provide the Cash
      Collateral Lender a weekly report comparing on a line item basis budgeted
      amounts, as itemized in the Budget, to actual amounts disbursed during the
      preceding week; and

                    
	 
      	 
      	
                      ·

                    	
                      By
      5:00 p.m. (Central Time) on Thursday of each week, provide the Cash
      Collateral Lender a weekly report itemizing all expenditures during the
      preceding week for each of the following:

                    
	 
      	 
      	 
      	 
      
	 
      	 
      	
                      ·

                    	
                      Corn;

                    
	 
      	 
      	
                      ·

                    	
                      Denaturant;

                    
	 
      	 
      	
                      ·

                    	
                      Chemicals;

                    
	 
      	 
      	
                      ·

                    	
                      Natural
      gas;

                    
	 
      	 
      	
                      ·

                    	
                      Electricity;

                    
	 
      	 
      	
                      ·

                    	
                      Water;

                    
	 
      	 
      	
                      ·

                    	
                      Transportation;

                    
	 
      	 
      	
                      ·

                    	
                      Rail
      car lease payments;

                    
	 
      	 
      	
                      ·

                    	
                      Fixed
      and variable terminal fees;

                    
	 
      	 
      	
                      ·

                    	
                      Plant
      overhead (non-labor);

                    
	 
      	 
      	
                      ·

                    	
                      Payroll;

                    
	 
      	 
      	
                      ·

                    	
                      Excise
      and sales taxes remitted;

                    
	 
      	 
      	
                      ·

                    	
                      Insurance;

                    
	 
      	 
      	
                      ·

                    	
                      Severance;
      and

                    
	 
      	 
      	
                      ·

                    	
                      All
      other expenses.

                    
	 
      	 
      	 
      	 
      
	 
      	 
      	
                      ·

                    	
                      By
      5:00 p.m. (Central Time) on Thursday of each week, provide the Cash
      Collateral Lender its certification of the ledger balance of all deposit
      accounts of the Debtor as of the close of business on the immediately
      preceding Friday.

                    
	 
      	 
      	 
      	 
      
	
                      Plan
      of Reorganization:

                    	 
      	The
      Debtor shall file a plan of reorganization (the “Plan”), acceptable to the
      Prepetition Lenders, on or before the Cash Collateral Maturity
    Date.
	 
      	 
      	 
      	 
      
	 
      	 
      	At
      a minimum, the Plan shall not be deemed acceptable to the Prepetition
      Lenders unless:
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                      ·

                    	
                      The
      Plan provides for and treats the Prepetition Lenders as fully secured
      creditors.

                    


            

          

        

      

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      
        
          
            
              
                	 
      	 
      	 
      	
                        ·

                      	
                        The
      Plan provides that the Project will be free from any and all subordinate
      mortgages, liens, and encumbrances, including any lessor’s interests,
      except as may be accepted by the Prepetition Lenders.

                      
	
                        Equity
      Commitments:

                      	 
      	
                        The
      Debtor shall obtain subscription letters, acceptable to the Prepetition
      Lenders, in an amount not less than $6,000,000.00 on or before January 15,
      2010. The Debtor shall obtain subscription letters, acceptable to the
      Prepetition Lenders, in an amount not less than $10,000,000 on or before
      February 28, 2010.

                      
	 
      	 
      	 
      	 
      
	
                        Sale
      of Ethanol Facility:

                      	 
      	
                        If
      no Plan acceptable to the Prepetition Lenders is filed by the Cash
      Collateral Maturity Date, the Debtor shall file, within ten (10) Business
      Days thereafter, a motion to sell the Debtor’s assets, including the
      ethanol production facility, free and clear of interests, liens,
      encumbrances and claims pursuant to Bankruptcy Code § 363(b) and (f). Such
      motion must be accompanied by sales procedures acceptable to the
      Prepetition Lenders, including that any such sale shall close not later
      than April 1, 2010.

                      
	 
      	 
      	 
      	 
      
	 
      	 
      	
                        Within
      ten (10) Business Days of filing such motion, the Debtor shall engage a
      financial advisor reasonably acceptable to the Prepetition Lenders to
      manage the sale of the ethanol facility.

                      
	 
      	 
      	 
      	 
      
	
                        Events
      of Default:

                      	 
      	
                        The
      occurrence of any of the following shall constitute an Event of Default
      under the Cash Collateral Documents:

                      
	 
      	 
      	 
      	 
      
	 
      	 
      	
                        ·

                      	
                        Failure
      to comply with the terms and conditions set forth in the Interim Order,
      the Final Order, the Cash Collateral Stipulation, the other Cash
      Collateral Documents, and the AgStar Loan Agreements (except those Events
      of Default set forth in Section 6.01(g) of the Master Loan Agreement which
      constitutes one of the AgStar Loan Agreements and except for any Event of
      Default arising as a result of the filing or the pendency of the Debtor’s
      Chapter 11 Case);

                      
	 
      	 
      	
                        ·

                      	
                        If
      required under the Sale of Ethanol Facility provision, failure to retain
      and employ a Financial Advisor acceptable to the Prepetition Lenders to
      manage the sale of the ethanol facility;

                      
	 	 	
                        ·

                      	
                        Failure
      to deliver the weekly report comparing on a line item basis budgeted
      amounts, as itemized in the Budget, to actual amounts
      disbursed;

                      
	 	 	
                        ·

                      	
                        Failure
      to maintain the $2,000,000 cash floor, measured as of the close of
      business each Friday and included in the financial reports required
      herein, subject to a cure period of five (5) business
  days;

                      
	 	 	
                        ·

                      	
                        The
      Debtor’s actual weekly disbursements, on a line item basis, are more than
      ten percent (10%) in excess of the budgeted amounts, as itemized in the
      Budget, excluding input commodities such as corn, natural gas, electricity
      and other chemicals used for the production of ethanol;

                      
	 	 	
                        ·

                      	
                        Debtor
      shall not contract to purchase input commodities such as corn, natural
      gas, electricity and other chemicals used for the production of ethanol
      for prices 10% or more above fair market prices without the consent of the
      Prepetition Lenders. Consent shall not be unreasonably
      withheld;

                      


              

            

          

        

      

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      
        
          
            
              
                	 
      	 
      	
                        ·

                      	
                        Failure
      to deliver any other reports required under the Cash Collateral
      Documents;

                      
	 
      	 
      	
                        ·

                      	
                        The
      Debtor rejects any long term ethanol or DDG marketing agreement, and fails
      to replace such agreement with a similar agreement acceptable to the Cash
      Collateral Lender;

                      
	 
      	 
      	
                        ·

                      	
                        On
      or before November 30, 2009, a Final Order acceptable to the Cash
      Collateral Lender has not been entered;

                      
	 
      	 
      	
                        ·

                      	
                        The
      appointment of a trustee or an examiner with expanded powers in the
      Debtor’s Chapter 11 Case;

                      
	 
      	 
      	
                        ·

                      	
                        The
      Debtor seeks an order dismissing the Debtor’s Chapter 11 Case without the
      consent of the Cash Collateral Lender prior to the indefeasible payment in
      full in cash of all obligations and indebtedness owing to the Prepetition
      Lenders;

                      
	 
      	 
      	
                        ·

                      	
                        The
      Debtor’s Chapter 11 Case is dismissed or converted to a case under Chapter
      7 of the Bankruptcy Code; and

                      
	 
      	 
      	
                        ·

                      	
                        Such
      other Events of Default as are set forth in the Interim Order, the Final
      Order or the other Cash Collateral Documents.

                      
	 
      	 
      	 
      	 
      
	
                        Remedies:

                      	 
      	
                        Upon
      the occurrence of an Event of Default, as defined in the Interim Order, the Final Order,
      the Cash Collateral Stipulation or the other Cash Collateral
      Documents:

                      
	 
      	 
      	 
      	 
      
	 
      	 
      	
                        ·

                      	
                        The
      Cash Collateral Lender shall be entitled to exercise all of the remedies
      set forth in the Interim Order, the Final Order, Cash Collateral
      Stipulation and the other Cash Collateral Documents;

                      
	 
      	 
      	
                        ·

                      	
                        Immediately
      upon written notice from the Cash Collateral Lender, the Debtor shall no
      longer be authorized to use Cash Collateral; and

                      
	 
      	 
      	
                        ·

                      	
                        The
      Prepetition Lenders, or either of them individually, shall be authorized
      to file a motion seeking relief from the automatic stay and/or any and all
      other remedies permitted under the Bankruptcy Code.

                      
	 
      	 
      	 
      	 
      
	
                        Financial
      Affairs:

                      	 
      	
                        The
      Cash Collateral Lender shall be authorized to discuss the Debtor’s
      financial affairs with any potential investor identified to the Cash
      Collateral Lender in writing by the Debtor, provided, however, the Cash
      Collateral Lender shall not attempt to negotiate a sale of the Plant prior
      to the filing of the Debtor’s motion to sell the plant pursuant to the
      Final Order.

                      
	 
      	 
      	 
      	 
      
	
                        Limited
      Carve-Out

                      	 
      	
                        The
      Cash Collateral Lender’s Postpetition Security Interest shall be subject
      to payment of the Limited Carve-Out not to exceed $75,000 (the “Limited Carve-Out”). The
      Limited Carve-Out may only be used for the payment of the allowed fees and
      expenses of the U.S. Trustee’s office and professionals retained pursuant
      to Bankruptcy Code § 327 or 1103(a) by the Debtor or any statutory
      committee appointed in this Case (collectively “Professionals”).

                      


              

            

          

        

      

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      
        	 
      	 
      	
                Prior
      to the Carve-Out Date, to the extent detailed in the Budget and subject to
      the entry of an appropriate order of the Bankruptcy Court, the Debtor
      shall be entitled to use the Cash Collateral to pay the allowed fees and
      expenses of Professionals, except to the extent such fees and expenses are
      incurred in prosecuting claims against the Prepetition Lenders or any in
      seeking to invalidate, challenge, dispute, avoid, subordinate, hinder,
      delay or otherwise attempt to prevent the enforcement by the Prepetition
      Lenders of its claims or liens or realization upon the
      Collateral.

              
	 
      	 
      	 
      
	 
      	 
      	
                The
      Limited Carve-Out shall not be reduced by the amount of allowed fees and
      expenses accrued, incurred, awarded or paid to Professionals prior to the
      occurrence of the Carve-Out Date.

              
	 
      	 
      	 
      
	 
      	 
      	
                On
      the date earlier of (i) the Debtor’s receipt of written notice of an Event
      of Default from the Cash Collateral Lender withdrawing the authorization
      to use the Cash Collateral or (ii) within ten days of the Cash Collateral
      Maturity Date if no acceptable Plan has been filed and no sales motion has
      been filed (the “Carve-Out Date”), any
      amounts subsequently paid to Professionals by any means will reduce the
      Limited-Carve Out on a dollar-for-dollar basis.

              
	 
      	 
      	 
      
	
                Expenses:

              	 
      	
                The
      claims of the Prepetition Lenders shall include the reasonable prepetition
      and postpetition costs and expenses of the Prepetition Lenders, including,
      without limitation, all legal fees, consultant fees, appraisal fees,
      financial advisor fees, and other similar fees, and all such fees and
      expenses incurred in connection with the pre-petition negotiations with
      Debtor, the negotiation and preparation of the Cash Collateral Documents
      and in the handling of all matters in this bankruptcy proceeding and any
      subsequent Chapter 11 or Chapter 7 proceedings, including, without
      limitation, the attorneys’ fees in any way arising from or in connection
      with any action taken by the Prepetition Lenders to monitor, advise,
      enforce or collect the Prepetition Obligations, or any other document or
      agreement arising from or relating to the relationship between Debtor and
      the Prepetition Lenders.

              
	 
      	 
      	 
      
	 
      	 
      	
                The
      Debtor shall reimburse the Prepetition Lenders for all such reasonable
      pre- and postpetition costs and expenses described above to the extent
      allowed in the Budget.

              


      

    

     

    
      If not
acted on, these terms will expire on October 23, 2009, at 5:00 p.m. (CST).
Please return a signed copy of this letter to evidence your acceptance of the
terms and conditions contained in this Term Sheet.

      


      Sincerely,

      


      AGSTAR
FINANCIAL SERVICES, PCA,

      


      
        
          
            
              
                
                  
                    	/s/
      Ron Monson
	
                            By:

                          	
                            Ron
      Monson

                          
	
                            Its:

                          	VP


                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      SIGNATURE
PAGE TO

      TERM
SHEET

      FOR

      THE USE
OF CASH COLLATERAL AND ADEQUATE PROTECTION

      BY

      OTTER
TAIL AG ENTERPRISES, LLC,

      AS DEBTOR
IN POSSESSION,

      IN ITS
PROPOSED BANKRUPTCY CASE IN THE

      UNITED
STATES BANKRUPTCY COURT, DISTRICT OF MINNESOTA

      


      This Term
Sheet is accepted this 21st day of October 2009.

      


      DEBTOR:

      


      OTTER
TAIL AG ENTERPRISES, LLC,

      a
Minnesota limited liability company

      


      
        
          
            
              
                
                  	
                          By

                        	
                          /s/
      ANTHONY J. HICKS

                        
	 
      	
                          Name:

                        	
                          ANTHONY
      J. HICKS

                        
	 
      	
                          Title:

                        	
                          CEO

                        


                

              

            

          

        

      

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
A

      


      BUDGET

      


      See
attached

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    

    
      
        
           

          Otter
Tail Ag Enterprises, LLC

          Weekly
Cash-flow Statement

          ACTUALS

        

         

        
          
            
              
                
                  
                    	
                            Week
      Ending:

                          	 	
                            4-Sep

                          	 	 	
                            11-Sep

                          	 	 	
                            18-Sep

                          	 	 	
                            25-Sep

                          	 	 	
                            2-Oct

                          	 	 	
                            9-Oct

                          	 	 	
                            16-Oct

                          	 	 	
                            23-Oct

                          	 	 	
                            30-Oct

                          	 	 	
                            6-Nov

                          	 	 	
                            13-Nov

                          	 	 	
                            20-Nov

                          	 	 	
                            27-Nov

                          	 
	
                            Working
      Days

                          	 	
                            7

                          	 	 	
                            6

                          	 	 	
                            7

                          	 	 	
                            7

                          	 	 	
                            5

                          	 	 	
                            7

                          	 	 	
                            7

                          	 	 	
                            7

                          	 	 	
                            7

                          	 	 	
                            6

                          	 	 	
                            7

                          	 	 	
                            7

                          	 	 	
                            7

                          	 
	
                            Opening
      Balance

                          	 	 	2,493,409	 	 	 	2,482,027	 	 	 	2,417,157	 	 	 	3,001,722	 	 	 	3,308,479	 	 	 	3,781,074	 	 	 	3,552,985	 	 	 	4,476,349	 	 	 	4,736,368	 	 	 	4,614,787	 	 	 	3,765,930	 	 	 	4,723,557	 	 	 	4,769,501	 
	
                            Wires/ACH
      in

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                            RPMG

                          	 	 	1,491,654	 	 	 	1,258,099	 	 	 	2,007,263	 	 	 	1,474,239	 	 	 	1,455,103	 	 	 	1,394,811	 	 	 	2,292,964	 	 	 	1,825,902	 	 	 	1,718,640	 	 	 	1,515,933	 	 	 	2,490,271	 	 	 	1,768,588	 	 	 	1,768,588	 
	
                            CHS

                          	 	 	130,831	 	 	 	170,919	 	 	 	190,052	 	 	 	221,411	 	 	 	176,144	 	 	 	239,073	 	 	 	244,027	 	 	 	291,283	 	 	 	197,839	 	 	 	197,839	 	 	 	230,812	 	 	 	230,812	 	 	 	230,812	 
	
                            Wet
      Cake

                          	 	 	10,026	 	 	 	19,067	 	 	 	20,771	 	 	 	9,898	 	 	 	17,322	 	 	 	11,520	 	 	 	10,178	 	 	 	12,826	 	 	 	27,529	 	 	 	29,495	 	 	 	34,411	 	 	 	34,411	 	 	 	34,411	 
	
                            Other
      Checks in

                          	 	 	1,155	 	 	 	1,684	 	 	 	366	 	 	 	75	 	 	 	321	 	 	 	1,030	 	 	 	3,265	 	 	 	468	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                            Sub
      Total

                          	 	 	4,127,075	 	 	 	3,931,796	 	 	 	4,635,609	 	 	 	4,707,346	 	 	 	4,957,369	 	 	 	5,427,508	 	 	 	6,103,420	 	 	 	6,606,829	 	 	 	6,680,375	 	 	 	6,358,053	 	 	 	6,521,424	 	 	 	6,757,368	 	 	 	6,803,312	 
	
                            Denaturant

                          	 	 	32,222	 	 	 	 	 	 	 	63,105	 	 	 	32,146	 	 	 	32,047	 	 	 	48,851	 	 	 	30,704	 	 	 	65,880	 	 	 	39,100	 	 	 	41,003	 	 	 	47,836	 	 	 	47,836	 	 	 	47,836	 
	
                            Chemicals/ingredients

                          	 	 	63,820	 	 	 	179,186	 	 	 	23,694	 	 	 	33,919	 	 	 	37,079	 	 	 	22,631	 	 	 	166,187	 	 	 	109,822	 	 	 	72,695	 	 	 	72,695	 	 	 	72,695	 	 	 	72,695	 	 	 	72,695	 
	
                            Electricity

                          	 	 	 	 	 	 	147,664	 	 	 	 	 	 	 	100,663	 	 	 	 	 	 	 	300,289	 	 	 	 	 	 	 	92,682	 	 	 	 	 	 	 	100,000	 	 	 	 	 	 	 	100,000	 	 	 	 	 
	
                            Payroll/Benefits

                          	 	 	1,970	 	 	 	100,000	 	 	 	13,413	 	 	 	56,743	 	 	 	55,755	 	 	 	9,819	 	 	 	55,331	 	 	 	19,503	 	 	 	 	 	 	 	90,000	 	 	 	 	 	 	 	90,000	 	 	 	 	 
	
                            Natural
      Gas

                          	 	 	119,291	 	 	 	119,291	 	 	 	143,024	 	 	 	15,525	 	 	 	120,449	 	 	 	151,263	 	 	 	151,263	 	 	 	187,434	 	 	 	147,272	 	 	 	173,545	 	 	 	173,545	 	 	 	173,545	 	 	 	173,545	 
	
                            Corn
      payments

                          	 	 	1,330,000	 	 	 	940,000	 	 	 	1,270,000	 	 	 	1,130,000	 	 	 	885,000	 	 	 	1,240,000	 	 	 	1,095,000	 	 	 	1,250,000	 	 	 	1,483,790	 	 	 	1,271,820	 	 	 	1,483,790	 	 	 	1,483,790	 	 	 	1,483,790	 
	
                            Insurance/Taxes

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	25,393	 	 	 	36,283	 	 	 	1,440	 	 	 	 	 	 	 	25,393	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                            R&M/Supplies

                          	 	 	84,586	 	 	 	19,114	 	 	 	43,615	 	 	 	21,542	 	 	 	1,971	 	 	 	16,108	 	 	 	45,900	 	 	 	53,817	 	 	 	15,000	 	 	 	15,000	 	 	 	15,000	 	 	 	15,000	 	 	 	15,000	 
	
                            Marketing/Fillng
      fees

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	48,112	 	 	 	3,500	 	 	 	 	 	 	 	 	 	 	 	41,432	 
	
                            Professional
      fees

                          	 	 	 	 	 	 	2,411	 	 	 	22,787	 	 	 	8,129	 	 	 	14,000	 	 	 	1,778	 	 	 	76,387	 	 	 	89,511	 	 	 	41,000	 	 	 	94,000	 	 	 	0	 	 	 	0	 	 	 	71,000	 
	
                            Interest/BB
      paydown

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	174,455	 	 	 	653,618	 	 	 	 	 	 	 	 	 	 	 	174,455	 
	
                            Consultant

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	30,000	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                            Leases/Rental

                          	 	 	 	 	 	 	4,456	 	 	 	48,767	 	 	 	 	 	 	 	3,472	 	 	 	41,943	 	 	 	 	 	 	 	 	 	 	 	10,272	 	 	 	41,943	 	 	 	0	 	 	 	0	 	 	 	13,272	 
	
                            Miscellaneous

                          	 	 	13,159	 	 	 	2,517	 	 	 	5,482	 	 	 	200	 	 	 	1,130	 	 	 	5,558	 	 	 	4,858	 	 	 	1,812	 	 	 	8,500	 	 	 	5,000	 	 	 	5,000	 	 	 	5,000	 	 	 	5,000	 
	
                            Sub
      Total

                          	 	 	1,645,048	 	 	 	1,514,639	 	 	 	1,633,887	 	 	 	1,398,866	 	 	 	1,176,295	 	 	 	1,874,523	 	 	 	1,627,070	 	 	 	1,870,461	 	 	 	2,065,588	 	 	 	2,592,123	 	 	 	1,797,866	 	 	 	1,987,866	 	 	 	2,098,024	 
	
                            End
      Balance

                          	 	 	2,482,027	 	 	 	2,417,157	 	 	 	3,001,722	 	 	 	3,308,479	 	 	 	3,781,074	 	 	 	3,552,985	 	 	 	4,476,349	 	 	 	4,736,368	 	 	 	4,614,787	 	 	 	3,765,930	 	 	 	4,723,557	 	 	 	4,769,501	 	 	 	4,705,288	 
	
                            Weekly
      Cash Position

                          	 	 	-11,382	 	 	 	-64,870	 	 	 	584,565	 	 	 	306,757	 	 	 	472,595	 	 	 	-228,089	 	 	 	923,364	 	 	 	260,019	 	 	 	-121,581	 	 	 	-848,857	 	 	 	957,627	 	 	 	45,944	 	 	 	-64,214	 
	
                            Average
      $/bu

                          	 	$	3.34	 	 	$	2.90	 	 	$	3.08	 	 	$	2.86	 	 	$	3.28	 	 	$ 	3.31	 	 	$ 	3.53	 	 	$	3.85	 	 	$	3.85	 	 	$	3.85	 	 	$	3.85	 	 	$	3.85	 	 	$	3.85	 
	
                            Total
      Bushels

                          	 	 	398,442	 	 	 	324,013	 	 	 	412,537	 	 	 	394,763	 	 	 	269,748	 	 	 	374,599	 	 	 	310,105	 	 	 	385,000	 	 	 	385,000	 	 	 	330,000	 	 	 	385,000	 	 	 	385,000	 	 	 	385,000	 
	
                            Gallons
      per bushel

                          	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 
	
                            Number
      of Etoh gallons

                          	 	 	1,111,653	 	 	 	903,996	 	 	 	1,150,978	 	 	 	1,101,389	 	 	 	752,597	 	 	 	1,045,131	 	 	 	865,192	 	 	 	1,074,150	 	 	 	1,074,150	 	 	 	920,700	 	 	 	1,074,150	 	 	 	1,074,150	 	 	 	1,074,150	 
	
                            Ethanol
      price per gallon

                          	 	$	1.57	 	 	$	1.57	 	 	$	1.57	 	 	$	1.57	 	 	$	1.75	 	 	$	1.75	 	 	$	1.75	 	 	$	1.75	 	 	$	1.75	 	 	$	1.78	 	 	$	1.78	 	 	$	1.78	 	 	$	1.78	 
	
                            Advance
      Rate

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	1.60	 	 	$	1.60	 	 	$	1.60	 	 	$	1.60	 	 	$	1.60	 	 	$	1.65	 	 	$	1.65	 	 	$	1.65	 	 	$	1.65	 
	
                            RPMG
      Proj/CBOT

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	1.87	 	 	$	1.87	 	 	$	1.87	 	 	$	1.87	 	 	$	1.87	 	 	$	1.90	 	 	$	1.90	 	 	$	1.90	 	 	$	1.90	 
	
                            Basis

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)
	
                            Natural
      gas

                          	 	$	4.27	 	 	$	4.27	 	 	$	4.27	 	 	$	4.27	 	 	$	4.49	 	 	$	4.49	 	 	$	4.49	 	 	$	4.49	 	 	$	4.49	 	 	$	5.29	 	 	$	5.29	 	 	$	5.29	 	 	$	5.29	 
	
                            Transportation

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 
	
                            NYMEX

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	3.98	 	 	$	3.98	 	 	$	3.98	 	 	$	3.98	 	 	$	3.98	 	 	$ 	4.78	 	 	$	4.78	 	 	$	4.78	 	 	$	4.78	 
	
                            Natural
      Gas (use)

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 
	
                            DDGS
      (tons)

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	11,553	 	 	 	1,678	 	 	 	2,331	 	 	 	1,930	 	 	 	2,396	 	 	 	2,396	 	 	 	2,053	 	 	 	2,396	 	 	 	2,396	 	 	 	2,396	 
	
                            DDGS
      $/ton

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	$	70.31	 	 	$	70.30	 	 	$	70.93	 	 	$ 	75.67	 	 	$	82.59	 	 	$ 	82.59	 	 	$	96.35	 	 	$	96.35	 	 	$	96.35	 	 	$	96.35	 
	
                            % of
      Corn

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	60	%	 	 	60	%	 	 	60	%	 	 	60	%	 	 	60	%	 	 	70	%	 	 	70	%	 	 	70	%	 	 	70	%
	
                            Ton of corn

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	117	 	 	$	118	 	 	$	126	 	 	$	138	 	 	$	138	 	 	$	138	 	 	$	138	 	 	$	138	 	 	$	138	 
	
                            WDGS
      $/ton 

                          	 	$ 	-	 	 	$ 	-	 	 	$ 	-	 	 	$ 	21.27	 	 	$ 	23.43	 	 	$ 	23.64	 	 	$ 	25.22	 	 	$ 	 27.53	 	 	$ 	27.53	 	 	$ 	34.41	 	 	$ 	34.41	 	 	$ 	34.41	 	 	$ 	34.41	 
	
                            % of
      Corn

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	20	%	 	 	20	%	 	 	20	%	 	 	20	%	 	 	20	%	 	 	25	%	 	 	25	%	 	 	25	%	 	 	25	%
	
                            WDGS
      (tons)

                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3,501	 	 	 	714	 	 	 	1,000	 	 	 	1,000	 	 	 	1,000	 	 	 	1,000	 	 	 	857	 	 	 	1,000	 	 	 	1,000	 	 	 	1,000	 


                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    	
                                                                            Week
      Ending:

                                                                          	
                                                                            4-Dec

                                                                          	 	
                                                                            11-Dec

                                                                          	 	
                                                                            18-Dec

                                                                          	 	
                                                                            25-Dec

                                                                          	 	
                                                                            1-Jan

                                                                          	 	
                                                                            8-Jan

                                                                          	 	
                                                                            15-Jan

                                                                          	 	
                                                                            22-Jan

                                                                          	 	
                                                                            29-Jan

                                                                          	 	
                                                                            5-Feb

                                                                          	 	
                                                                            12-Feb

                                                                          	 	
                                                                            19-Feb

                                                                          	 	
                                                                            26-Feb

                                                                          	 	 	 
	
                                                                            Working
      Days

                                                                          	
                                                                            7

                                                                          	 	
                                                                            6

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            6

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            6

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            7

                                                                          	 	
                                                                            6

                                                                          	 	
                                                                            Total's

                                                                          	 
	
                                                                            Opening
      Balance

                                                                          	 	4,705,288	 	 	4,518,753	 	 	4,600,130	 	 	5,107,648	 	 	4,967,324	 	 	4,640,969	 	 	4,697,463	 	 	5,098,112	 	 	5,147,805	 	 	4,622,885	 	 	4,609,515	 	 	4,403,343	 	 	4,985,616	 	 	 
	
                                                                            Wires/ACH
      in

                                                                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	520,483	 	$	520,483.22	 
	
                                                                            RPMG

                                                                          	 	1,707,979	 	 	1,463,982	 	 	2,261,090	 	 	1,707,979	 	 	1,430,768	 	 	1,669,229	 	 	2,203,385	 	 	1,669,229	 	 	1,430,768	 	 	1,664,261	 	 	1,664,261	 	 	2,302,306	 	 	1,426,510	 	$	45,063,800.82	 
	
                                                                            CHS

                                                                          	 	230,812	 	 	197,839	 	 	230,812	 	 	238,118	 	 	204,101	 	 	238,118	 	 	238,118	 	 	238,118	 	 	204,101	 	 	238,118	 	 	238,118	 	 	238,118	 	 	204,101	 	$	5,690,446.60	 
	
                                                                            Wet
      Cake

                                                                          	 	34,411	 	 	29,495	 	 	34,411	 	 	35,500	 	 	30,429	 	 	35,500	 	 	35,500	 	 	35,500	 	 	30,429	 	 	35,500	 	 	35,500	 	 	35,500	 	 	30,429	 	$	709,966.35	 
	
                                                                            Other
      Checks in

                                                                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	8,364.69	 
	
                                                                            Sub
      Total

                                                                          	 	6,678,489	 	 	6,210,069	 	 	7,126,442	 	 	7,089,246	 	 	6,632,622	 	 	6,583,817	 	 	7,174,466	 	 	7,040,959	 	 	6,813,103	 	 	6,560,765	 	 	6,547,394	 	 	6,979,268	 	 	7,167,139	 	$	51,993,061.68	 
	
                                                                            Denaturant

                                                                          	 	48,194	 	 	41,309	 	 	48,194	 	 	48,194	 	 	41,784	 	 	48,748	 	 	48,748	 	 	48,748	 	 	41,784	 	 	49,301	 	 	49,301	 	 	49,301	 	 	42,258	 	$	1,134,429.98	 
	
                                                                            Chemicals/

                                                                            ingredients

                                                                          	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	 	72,695	 	$	1,944,847.63	 
	
                                                                            Electricity

                                                                          	 	100,000	 	 	 	 	 	100,000	 	 	 	 	 	100,000	 	 	 	 	 	100,000	 	 	 	 	 	100,000	 	 	 	 	 	100,000	 	 	 	 	 	100,000	 	$	1,541,297.60	 
	
                                                                            Payroll/Benefits

                                                                          	 	90,000	 	 	 	 	 	90,000	 	 	 	 	 	90,000	 	 	 	 	 	90,000	 	 	 	 	 	90,000	 	 	 	 	 	90,000	 	 	 	 	 	90,000	 	$	1,122,533.53	 
	
                                                                            Natural
      Gas

                                                                          	 	204,114	 	 	204,114	 	 	204,114	 	 	204,114	 	 	214,151	 	 	214,151	 	 	214,151	 	 	214,151	 	 	214,151	 	 	248,493	 	 	281,293	 	 	314,093	 	 	346,893	 	$	4,926,975.94	 
	
                                                                            Corn
      payments

                                                                          	 	1,483,790	 	 	1,271,820	 	 	1,483,790	 	 	1,530,760	 	 	1,312,080	 	 	1,530,760	 	 	1,530,760	 	 	1,530,760	 	 	1,312,080	 	 	1,530,760	 	 	1,530,760	 	 	1,530,760	 	 	1,312,080	 	$	35,237,940.00	 
	
                                                                            Insurance/Taxes

                                                                          	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	$	88,508.16	 
	
                                                                            R&M/Supplies

                                                                          	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,000	 	 	15,001	 	 	15,002	 	 	15,003	 	 	15,004	 	$	556,663.48	 
	
                                                                            Marketing/Fillng
      fees

                                                                          	 	 	 	 	 	 	 	 	 	 	41,432	 	 	 	 	 	 	 	 	 	 	 	 	 	 	50,639	 	 	 	 	 	 	 	 	 	 	 	50,639	 	$	235,752.21	 
	
                                                                            Professional
      fees

                                                                          	 	69,000	 	 	0	 	 	0	 	 	20,000	 	 	69,000	 	 	0	 	 	0	 	 	0	 	 	69,000	 	 	0	 	 	0	 	 	0	 	 	69,000	 	$	717,003.47	 
	
                                                                            Interest/BB
      paydown

                                                                          	 	 	 	 	 	 	 	 	 	 	174,455	 	 	 	 	 	 	 	 	 	 	 	 	 	 	174,455	 	 	 	 	 	 	 	 	 	 	 	174,455	 	$	1,525,891.09	 
	
                                                                            Consultant

                                                                          	 	30,000	 	 	 	 	 	 	 	 	 	 	 	30,000	 	 	 	 	 	 	 	 	 	 	 	 	 	 	30,000	 	 	 	 	 	 	 	 	 	 	$	120,000.00	 
	
                                                                            Leases/Rental

                                                                          	 	41,943	 	 	0	 	 	0	 	 	10,272	 	 	41,943	 	 	0	 	 	0	 	 	6,800	 	 	45,415	 	 	0	 	 	0	 	 	6,800	 	 	3,472	 	$	320,767.41	 
	
                                                                            Miscellaneous

                                                                          	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	 	5,000	 	$	128,215.99	 
	
                                                                            Sub
      Total

                                                                          	 	2,159,737	 	 	1,609,939	 	 	2,018,794	 	 	2,121,921	 	 	1,991,653	 	 	1,886,354	 	 	2,076,354	 	 	1,893,154	 	 	2,190,218	 	 	1,951,250	 	 	2,144,051	 	 	1,993,652	 	 	2,281,495	 	$	49,600,826.48	 
	
                                                                            End
      Balance

                                                                          	 	4,518,753	 	 	4,600,130	 	 	5,107,648	 	 	4,967,324	 	 	4,640,969	 	 	4,697,463	 	 	5,098,112	 	 	5,147,805	 	 	4,622,885	 	 	4,609,515	 	 	4,403,343	 	 	4,985,616	 	 	4,885,644	 	$	4,885,644.20	 
	
                                                                            Weekly
      Cash

                                                                            Position

                                                                          	 	-186,535	 	 	81,377	 	 	507,519	 	 	-140,324	 	 	-326,355	 	 	56,494	 	 	400,649	 	 	49,694	 	 	-524,920	 	 	-13,370	 	 	-206,171	 	 	582,273	 	 	-99,972	 	 	 	 
	
                                                                            Average
      $/bu

                                                                          	$	3.85	 	$	3.85	 	$ 	3.85	 	$	3.98	 	$	3.98	 	$	3.98	 	$	3.98	 	$	3.98	 	$ 	3.98	 	$	3.98	 	$	3.98	 	$	3.98	 	$	3.98	 	$	3.70	 
	
                                                                            Total
      Bushels

                                                                          	 	385,000	 	 	330,000	 	 	385,000	 	 	385,000	 	 	330,000	 	 	385,000	 	 	385,000	 	 	385,000	 	 	330,000	 	 	385,000	 	 	385,000	 	 	385,000	 	 	330,000	 	 	9,524,207	 
	
                                                                            Gallons
      per bushel

                                                                          	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	2.79	 	 	 	 
	
                                                                            Number
      of Etoh gallons

                                                                          	 	1,074,150	 	 	920,700	 	 	1,074,150	 	 	1,074,150	 	 	920,700	 	 	1,074,150	 	 	1,074,150	 	 	1,074,150	 	 	920,700	 	 	1,074,150	 	 	1,074,150	 	 	1,074,150	 	 	920,700	 	 	 	 
	
                                                                            Ethanol
      price per gallon

                                                                          	$	1.72	 	$	1.72	 	$	1.72	 	$	1.72	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	$	1.68	 	 	 	 
	
                                                                            Advance
      Rate

                                                                          	$	1.59	 	$ 	1.59	 	$	1.59	 	$	1.59	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	$	1.55	 	 	 	 
	
                                                                            RPMG
      Proj/CBOT

                                                                          	$	1.84	 	$	1.84	 	$ 	1.84	 	$	1.84	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	$	1.80	 	 	 	 
	
                                                                            Basis

                                                                          	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	$	(0.12	)	 	 	 
	
                                                                            Natural
      gas

                                                                          	$	6.22	 	$	6.22	 	$	6.22	 	$	6.22	 	$	6.53	 	$	6.53	 	$	6.53	 	$	6.53	 	$	6.53	 	$	7.58	 	$	8.58	 	$ 	9.58	 	$	10.58	 	 	 	 
	
                                                                            Transportation

                                                                          	$	0.51	 	$	0.51	 	$	0.51	 	$	0.51	 	$	0.51	 	$	0.51	 	$	0.51	 	$ 	0.51	 	$	0.51	 	$	1.51	 	$	2.51	 	$	3.51	 	$	4.51	 	 	 	 
	
                                                                            NYMEX

                                                                          	$	5.71	 	$	5.71	 	$	5.71	 	$	5.71	 	$	6.02	 	$	6.02	 	$	6.02	 	$	6.02	 	$	6.02	 	$	6.07	 	$	6.07	 	$	6.07	 	$	6.07	 	 	 	 
	
                                                                            Natural
      Gas (use)

                                                                          	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	32,800	 	 	 	 
	
                                                                            DDGS
      (tons)

                                                                          	 	2,396	 	 	2,053	 	 	2,396	 	 	2,396	 	 	2,053	 	 	2,396	 	 	2,396	 	 	2,396	 	 	2,053	 	 	2,396	 	 	2,396	 	 	2,396	 	 	2,053	 	 	 	 
	
                                                                            DDGS
      $/ton

                                                                          	$	96.35	 	$	96.35	 	$	96.35	 	$	99.40	 	$	99.40	 	$	99.40	 	$	99.40	 	$ 	99.40	 	$	99.40	 	$	99.40	 	$	99.40	 	$	99.40	 	$	99.40	 	 	 	 
	
                                                                            % of
      Corn

                                                                          	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	70	%	 	 	 
	
                                                                            Ton
      of corn

                                                                          	$	138	 	$	138	 	$	138	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	$	142	 	 	 	 
	
                                                                            WDGS
      $/ton

                                                                          	$	34.41	 	$	34.41	 	$	34.41	 	$ 	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$	35.50	 	$ 	35.50	 	 	 	 
	
                                                                            % of
      Corn

                                                                          	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	25	%	 	 	 
	
                                                                            WDGS
      (tons)

                                                                          	 	1,000	 	 	857	 	 	1,000	 	 	1,000	 	 	857	 	 	1,000	 	 	1,000	 	 	1,000	 	 	857	 	 	1,000	 	 	1,000	 	 	1,000	 	 	857	 	 	 	 


                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Otter
Tail Ag Enterprises, LLC

    Monthly
Cash-flow Statement


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	 
      	 	
                                          September

                                        	 	 	
                                          October

                                        	 	 	
                                          November

                                        	 	 	
                                          December

                                        	 	 	
                                          January

                                        	 	 	
                                          February

                                        	 	 	 	 
	
                                          Working
      Days

                                        	 	
                                          27

                                        	 	 	
                                          33

                                        	 	 	
                                          27

                                        	 	 	
                                          27

                                        	 	 	
                                          33

                                        	 	 	
                                          27

                                        	 	 	
                                          Total's

                                        	 
	
                                          Opening
      Balance

                                        	 	 	2,493,409	 	 	 	3,308,479	 	 	 	4,614,787	 	 	 	4,705,288	 	 	 	4,967,324	 	 	 	4,622,885	 	 	 	 
	
                                          Wires/ACH
      in

                                        	 	 	 	 	 	 	0	 	 	 	0	 	 	 	 	 	 	 	0	 	 	 	520,483	 	 	$	520,483.22	 
	
                                          RPMG

                                        	 	 	6,231,255	 	 	 	8,687,420	 	 	 	7,543,380	 	 	 	7,141,030	 	 	 	8,403,379	 	 	 	7,057,338	 	 	$	45,063,800.82	 
	
                                          CHS

                                        	 	 	713,213	 	 	 	1,148,366	 	 	 	890,274	 	 	 	897,580	 	 	 	1,122,557	 	 	 	918,456	 	 	$	5,690,446.60	 
	
                                          Wet
      Cake

                                        	 	 	59,762	 	 	 	79,375	 	 	 	132,727	 	 	 	133,816	 	 	 	167,357	 	 	 	136,929	 	 	$	709,966.35	 
	
                                          Other
      Checks in

                                        	 	 	3,280	 	 	 	5,085	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	$	8,364.69	 
	
                                          Sub
      Total

                                        	 	 	9,500,920	 	 	 	13,228,724	 	 	 	13,181,168	 	 	 	12,877,714	 	 	 	14,660,617	 	 	 	13,256,091	 	 	$	51,993,061.68	 
	
                                          Denaturant

                                        	 	 	127,473	 	 	 	216,582	 	 	 	184,512	 	 	 	185,892	 	 	 	229,810	 	 	 	190,161	 	 	$	1,134,429.98	 
	
                                          Chemicals/ingredients

                                        	 	 	300,619	 	 	 	408,414	 	 	 	290,780	 	 	 	290,780	 	 	 	363,475	 	 	 	290,780	 	 	$	1,944,847.63	 
	
                                          Electricity

                                        	 	 	248,327	 	 	 	392,971	 	 	 	200,000	 	 	 	200,000	 	 	 	300,000	 	 	 	200,000	 	 	$	1,541,297.60	 
	
                                          Payroll/Benefits

                                        	 	 	172,126	 	 	 	140,408	 	 	 	180,000	 	 	 	180,000	 	 	 	270,000	 	 	 	180,000	 	 	$	1,122,533.53	 
	
                                          Natural
      Gas

                                        	 	 	397,131	 	 	 	757,681	 	 	 	694,179	 	 	 	816,458	 	 	 	1,070,756	 	 	 	1,190,771	 	 	$	4,926,975.94	 
	
                                          Corn
      payments

                                        	 	 	4,670,000	 	 	 	5,953,790	 	 	 	5,723,190	 	 	 	5,770,160	 	 	 	7,216,440	 	 	 	5,904,360	 	 	$	35,237,940.00	 
	
                                          Insurance/Taxes

                                        	 	 	0	 	 	 	88,508	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	$	88,508.16	 
	
                                          R&M/Supplies

                                        	 	 	168,857	 	 	 	132,796	 	 	 	60,000	 	 	 	60,000	 	 	 	75,000	 	 	 	60,010	 	 	$	556,663.48	 
	
                                          Marketing/Filing
      fees

                                        	 	 	0	 	 	 	48,112	 	 	 	44,932	 	 	 	41,432	 	 	 	50,639	 	 	 	50,639	 	 	$	235,752.21	 
	
                                          Professional
      fees

                                        	 	 	33,327	 	 	 	222,677	 	 	 	165,000	 	 	 	89,000	 	 	 	138,000	 	 	 	69,000	 	 	$	717,003.47	 
	
                                          Interest/BB
      paydown

                                        	 	 	0	 	 	 	174,455	 	 	 	828,073	 	 	 	174,455	 	 	 	174,455	 	 	 	174,455	 	 	$	1,525,891.09	 
	
                                          Consultant

                                        	 	 	0	 	 	 	0	 	 	 	30,000	 	 	 	30,000	 	 	 	30,000	 	 	 	30,000	 	 	$	120,000.00	 
	
                                          Leases/Rental

                                        	 	 	53,223	 	 	 	55,686	 	 	 	55,215	 	 	 	52,215	 	 	 	94,158	 	 	 	10,272	 	 	$	320,767.41	 
	
                                          Miscellaneous

                                        	 	 	21,358	 	 	 	21,858	 	 	 	20,000	 	 	 	20,000	 	 	 	25,000	 	 	 	20,000	 	 	$	128,215.99	 
	
                                          Sub
      Total

                                        	 	 	6,192,440	 	 	 	8,613,937	 	 	 	8,475,880	 	 	 	7,910,390	 	 	 	10,037,732	 	 	 	8,370,447	 	 	$	49,600,826.48	 
	
                                          End
      Balance

                                        	 	 	3,308,479	 	 	 	4,614,787	 	 	 	4,705,288	 	 	 	4,967,324	 	 	 	4,622,885	 	 	 	4,885,644	 	 	$	4,885,644.20	 
	
                                          Monthly
      Cash Position

                                        	 	 	815,070	 	 	 	1,306,308	 	 	 	90,501	 	 	 	262,036	 	 	 	-344,439	 	 	 	262,759	 	 	 	 	 
	
                                          Average
      $/bu

                                        	 	$	3.05	 	 	$	3.45	 	 	$ 	3.85	 	 	$	3.89	 	 	$ 	3.98	 	 	$	3.98	 	 	$	3.70	 
	
                                          Total
      Bushels

                                        	 	 	1,529,755	 	 	 	1,724,452	 	 	 	1,485,000	 	 	 	1,485,000	 	 	 	1,815,000	 	 	 	1,485,000	 	 	 	9,524,207	 
	
                                          Gallons
      per bushel

                                        	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	2.79	 	 	 	 	 
	
                                          Number
      of Etoh gallons

                                        	 	 	4,268,016	 	 	 	4,811,221	 	 	 	4,143,150	 	 	 	4,143,150	 	 	 	5,063,850	 	 	 	4,143,150	 	 	 	 	 
	
                                          Ethanol
      price per gallon

                                        	 	$ 	1.57	 	 	$	1.75	 	 	$	1.78	 	 	$	1.72	 	 	$	1.68	 	 	$	1.68	 	 	 	 	 
	
                                          RPMG
      Proj/CBOT

                                        	 	 	 	 	 	$	1.87	 	 	$	1.90	 	 	$	1.84	 	 	$	1.80	 	 	$	1.80	 	 	 	 	 
	
                                          Basis

                                        	 	 	 	 	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	$	(0.12	)	 	 	 	 
	
                                          Natural
      gas

                                        	 	$	4.40	 	 	$	4.49	 	 	$	5.29	 	 	$	6.22	 	 	$	6.22	 	 	$	7.58	 	 	 	 	 
	
                                          Transportation

                                        	 	 	 	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	0.51	 	 	$	1.51	 	 	 	 	 
	
                                          NYMEX

                                        	 	 	 	 	 	$	3.98	 	 	$	4.78	 	 	$	5.71	 	 	$	6.02	 	 	$	6.07	 	 	 	 	 
	
                                          Natural
      Gas (use)

                                        	 	 	-	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	32,800	 	 	 	 	 
	
                                          DDGS
      (tons)

                                        	 	 	9,518	 	 	 	10,730	 	 	 	9,240	 	 	 	9,240	 	 	 	11,293	 	 	 	9,240	 	 	 	 	 
	
                                          DDGS
      $/ton

                                        	 	$	-	 	 	$	73.98	 	 	$	96.35	 	 	$	97.14	 	 	$	99.40	 	 	$	99.40	 	 	 	 	 
	
                                          % of
      Corn

                                        	 	 	 	 	 	 	60	%	 	 	70	%	 	 	70	%	 	 	70	%	 	 	70	%	 	 	 	 
	
                                          Ton
      of corn

                                        	 	$	109	 	 	$	123	 	 	$	138	 	 	$	139	 	 	$	142	 	 	$	142	 	 	 	 	 
	
                                          WDGS
      $/ton

                                        	 	$	-	 	 	$	24.66	 	 	$	34.41	 	 	$	34.69	 	 	$	35.50	 	 	$	35.50	 	 	 	 	 
	
                                          % of
      Corn

                                        	 	 	 	 	 	 	20	%	 	 	25	%	 	 	25	%	 	 	25	%	 	 	25	%	 	 	 	 
	
                                          WDGS
      (tons)

                                        	 	 	
                                          3,857

                                        	 	 	 	4,714	 	 	 	3,857	 	 	 	3,857	 	 	 	4,714	 	 	 	3,857