EXHIBIT 10.2 -
Administrative Agency Agreement


ADMINISTRATIVE AGENCY AGREEMENT


          THIS
ADMINISTRATIVE AGENCY AGREEMENT is entered into as of the
30th day of January, 2007, among FARM CREDIT SERVICES OF AMERICA, FLCA (“Farm Credit”),
CoBANK, ACB (“CoBank”) and EAST
FORK BIODIESEL, LLC, Algona, Iowa, an Iowa corporation (“Borrower”). 


RECITALS


          A.          Farm
Credit
intends to extend financing to Borrower, which financing will consist of a master
loan agreement (“MLA”), a construction and term loan supplement in the amount
of $24,500,000.00 (“Term Loan”) and a construction
and revolving term loan supplement in the amount of $12,000,000.00 (“Term Revolver”). The MLA, Term Loan and Term Revolver
are hereinafter referred to as the “Loan Documents.”


          B.          Farm
Credit has agreed to sell a participation interest in the Loan
Documents on the closing of the loans contemplated therein
to CoBank (a participation interest up to and including 100%).


          C.          In
recognition of its participation interest and
its experience in the types of loans contemplated herein, CoBank has
agreed to undertake the initial drafting of the Loan Documents and related security documentation (“Security
Documents”) and has agreed to undertake the obligations as administrative agent for these loans.


          D.          Farm
Credit desires to enter into this agreement in order to appoint CoBank as administrative
agent for the Loan Documents and Security Documents. Hereafter, unless
otherwise indicated, “Loan Documents” shall
also mean the Security Documents.


          NOW,
THEREFORE, in consideration of the foregoing and for
good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by each party, the parties hereto agree as follows:


          1.          Appointment,
Powers and
Immunities of Administrative Agent. Farm Credit hereby appoints and authorizes CoBank to act as its agent under the Loan
Documents and under the Security Documents
(in such capacity the “Administrative Agent”) with such powers as are
specifically delegated to such
Administrative Agent by the terms of this Agreement, together with such other
powers as are reasonably incidental thereto. Farm Credit also agrees that as
part of CoBank’s duties as Administrative Agent, CoBank shall, on Farm Credit’s
behalf, perform the loan servicing duties of the “Lead” as such duties
are described in the Participation Agreement dated January 12, 1996, between
Farm Credit (formerly Farm Credit Services
of the Midlands, FLCA) and CoBank, ACB, as amended or replaced from time
to time (the “Participation Agreement”). The Administrative Agent shall have no
duties or responsibilities except those expressly set forth in this Agreement,
the Loan Documents, and the Participation
Agreement, and shall not by reason of this Agreement be a trustee or fiduciary
for Farm Credit; provided, however, the Administrative Agent shall administer
its duties and responsibilities in accordance
with its customary practices and procedures with respect to similar loans for
its own account. The Administrative Agent shall not be responsible to
Farm Credit for any recitals, statements, representations
or warranties made by Borrower or any officer or official of Borrower or any
other person contained in this
Agreement or any other Loan Document, or in any certificate or other document
or instrument referred to or provided for in, or received by Farm Credit or the
Administrative Agent under, this
Agreement or any other Loan Document, or for the value, legality, validity,
effectiveness,







	
 

	
 


	
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genuineness,
enforceability or sufficiency of this Agreement or the Loan Documents or any
other document or instrument referred to or
provided for herein or therein, or for any failure by Borrower to perform any of its obligations hereunder or
thereunder. The Administrative Agent may employ agents and attorneys-in-fact and shall not be
responsible, except as to money or securities received by it or its authorized agents, for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. Neither the Administrative
Agent nor any of its respective directors, officers, employees or agents shall be liable or responsible
for any action taken or omitted to be taken by it or them hereunder or under the Loan Documents or Security
Documents or in connection herewith or therewith, except for its material
breach of contract or for its or their own gross negligence or willful
misconduct. Borrower shall pay any
fee agreed to by Borrower and the Administrative Agent with respect to the Administrative Agent’s services hereunder. Borrower
acknowledges the appointment of the Administrative
Agent and agrees to be bound by the terms of this Agreement.


          2.          Reliance
by Administrative Agent. The Administrative Agent
shall be entitled to rely upon any certification, notice
or other communication (including any thereof by telephone, telex, facsimile, telegram or cable) believed by it to be genuine and
correct
and to have been signed or sent by or on behalf of the proper
person or persons, and upon advice and statements of legal counsel, independent accountants and other experts selected by the
Administrative Agent.


          3.          Defaults.
The
Administrative Agent shall not be deemed to have knowledge of the occurrence of a Potential Default or Event of
Default, as those terms are defined in the MLA, unless the Administrative Agent has received notice from Farm
Credit or Borrower specifying such Potential Default or Event of Default
and stating that such notice is a “Notice of Default.” In the event that the Administrative Agent receives such a Notice of
Default from Borrower, the Administrative Agent shall give prompt notice
thereof to Farm Credit. The Administrative Agent shall take such action with
respect to such Potential Default or Event of Default which is continuing as
determined by the parties under the Participation
Agreement. The Administrative Agent shall not be required to take any action
which it determines to be contrary
to Law.


          4.          Indemnification
of Administrative Agent. Farm Credit agrees to
indemnify the Administrative Agent (to the extent not
reimbursed under the applicable provisions of the Loan Documents), for its pro rata participation share of any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever (including reasonable attorneys’ fees) which may be imposed on,
incurred by or asserted against the Administrative
Agent in any way relating to or arising out of Loan Documents, or any other
documents contemplated by or referred
to therein, or the transactions contemplated hereby or thereby (including, without limitation, the costs and expenses which
Borrower is obligated to pay under the MLA) or under the applicable provisions of any of the Loan
Documents or the Security Documents or the enforcement of any of the terms hereof or thereof or of any such
other documents or instruments; provided that Farm Credit shall not be
liable for any of the foregoing to the extent they arise from material breach
of this Agreement or from the gross
negligence or willful misconduct of the Administrative Agent or its directors, officers, employees or agents.


          5.          Non-Reliance
on Administrative Agent. Farm Credit agrees that it
has, independently and without reliance on the Administrative
Agent, and based on such documents and information as it has deemed appropriate, made its own credit analysis of Borrower and the
decision to enter into this







	
 

	
 


	
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Agreement and either originate the loans and/or purchase
a participation in the Loan Documents and that it will, independently and without reliance upon the Administrative
Agent, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own analysis and decisions in taking or not taking action under this Agreement or
the Loan
Documents. The Administrative Agent shall be required to
keep itself informed as to the performance or observance by Borrower of the
Loan Documents
or any other document referred to or provided for herein or therein and to
inspect the properties or books of
Borrower. The Administrative Agent shall have the duty and responsibility to provide Farm Credit with any credit or other
information concerning the affairs, financial condition or business of Borrower which may come into the
possession of the Administrative Agent. The Administrative Agent shall not be required to file this Agreement, the
Loan Documents or any document or instrument referred to herein or therein, for
record or give notice of this Agreement or any other Loan Document or
any document or instrument referred to herein or therein, to anyone. Farm
Credit acknowledges and agrees that the
Administrative Agent only has the duties and responsibilities explicitly set
forth herein and in the Loan Documents and Security Documents.


          6.          Failure
of Administrative Agent to Act. Except for action expressly
required of the Administrative Agent hereunder, the
Administrative Agent shall in all cases be fully justified in failing or refusing
to act hereunder unless it shall have received further assurances (which may
include cash collateral) of the indemnification obligations of
Farm Credit under Section 4 above in respect of any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action.


          7.          Resignation
or Removal of
Administrative Agent. Subject to the appointment and acceptance of a successor Administrative Agent,
as provided below, the Administrative Agent may resign at any time by giving written notice thereof to
Farm Credit and Borrower. Upon any such resignation or removal, Farm
Credit shall have the right to appoint a successor Administrative Agent which
must be located in the United States of America.
If no successor Administrative Agent shall have been so appointed and shall have accepted such appointment
within thirty (30) days after the retiring Administrative Agent’s giving of notice of resignation, then the
retiring Administrative Agent may, on behalf of Farm Credit, appoint a
successor Administrative Agent which must be located in the United States of America. Farm Credit or the retiring
Administrative Agent, as the case may be, shall upon the appointment of a
successor Administrative Agent promptly so notify Borrower. Upon the acceptance
of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent
and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder, except
for any liability arising from gross negligence, willful misconduct or material
breach of this Agreement. After any retiring Administrative Agent’s resignation
hereunder as Administrative Agent,
the provisions of this Agreement shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Administrative Agent.


          8.          Amendments
Concerning Agency Function. The Administrative Agent
shall not be bound by any waiver, amendment, supplement or
modification of this Agreement or the Loan Documents or Security Documents
which affects its duties hereunder or thereunder unless it shall have given its
prior consent thereto.







	
 

	
 


	
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          9.   
        Liability
of Administrative Agent. Except as otherwise provided
in the Loan Documents, the Security Documents and herein, the
Administrative Agent shall not have any liabilities or responsibilities to Borrower on account of the failure of Farm Credit
to perform its obligations hereunder or to Farm Credit on account of the
failure of Borrower to perform their respective obligations hereunder or under the Loan Documents or Security Documents.


          10.          Transfer
of Agency Function. Without the consent of
Borrower, the Administrative Agent may at any time or
from time to time transfer its functions as Administrative Agent hereunder to
any of its offices located in the United States of America, provided that the
Administrative Agent shall promptly notify Borrower.


          11.          Non-Receipt
of Funds by
Administrative Agent.


                         A.          Unless
Administrative Agent shall have received
notice from Farm Credit prior to the
date on which Farm Credit is to provide funds to Administrative Agent for an
Advance to be made by Farm Credit that
Farm Credit will not make available to Administrative Agent such funds, Administrative
Agent may assume that Farm Credit has made such funds available to
Administrative Agent on the date of such
Advance in accordance with the terms of this Agreement and Administrative Agent in its sole discretion may, but shall not be
obligated to, in reliance upon such assumption, make available to Borrower on
such date a corresponding amount. If and to the extent Farm Credit shall not
have made such funds available to Administrative Agent, Farm Credit agrees to
repay Administrative Agent forthwith
on demand such corresponding amount together with interest thereon, for each
day from the date such amount is made
available to Borrower until the date such amount is repaid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three (3) Banking Days and
thereafter at the “Base Rate” (as that term is used and defined in the Loan Documents).
If Farm Credit shall repay to Administrative Agent such corresponding amount,
such amount so repaid shall constitute Farm
Credit’s Advance for purposes of this Agreement, the Loan Documents and/or
Security Documents. If Farm Credit does not pay such corresponding amount forthwith upon Administrative Agent’s demand
therefore, Administrative Agent shall promptly notify Borrower, and Borrower shall immediately pay such
corresponding amount to Administrative Agent with the interest thereon, for each day from the date
such amount is made available to Borrower until the date such amount is repaid to Administrative Agent, at
the rate of interest applicable at the time to such proposed Advance.


                         B.          Unless
Administrative Agent shall have received notice from Borrower
prior to the date on which any payment is due hereunder that Borrower will not
make such payment in full, Administrative
Agent may assume that Borrower has made such payment in full to Administrative
Agent on such date and Administrative Agent in its sole discretion may, but
shall not be obligated to, in reliance upon
such assumption, cause to be distributed to Farm Credit on such due date an
amount equal to the amount then due
Farm Credit. If and to the extent Borrower shall not have so made such payment
in full to Administrative Agent, Farm Credit shall repay to
Administrative Agent forthwith on demand such amount
distributed to Farm Credit together with interest thereon, for each day from
the date such amount is distributed
to Farm Credit until the date Farm Credit repays such amount to Administrative
Agent at the customary rate set by
Administrative Agent for the correction of errors among banks for three (3) Banking Days and thereafter at the Base Rate.







	
 

	
 


	
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          12.          Amendments,
Etc. No amendment, modification, termination, or
waiver of any provision of this Agreement or the Loan
Documents or Security Documents to which Borrower is a party, shall in any event be effective to modify or change the duties or
rights of the Administrative Agent unless the same shall be in writing and
signed by the Banks and the Administrative Agent.


          13.          Notices.
All notices or communications hereunder shall be in writing and shall be deemed duly given upon delivery if personally delivered or
sent by
telegram or facsimile transmission, or three (3) days after
mailing if sent by express, certified or registered mail, to the parties at the
following addresses (or such other address for a party as
shall be specified by like notice):


	
 

	
 

	
 


	
 

	
Farm Credit Services of America, FCLA

 P.O. Box 2409

 Omaha, Nebraska 68103-2409

 Attention: Shane Frahm

 Telephone: (402) 348-3413

 Facsimile: (402) 348-3324

	
 


	
 

	
 

	
 


	
 

	
CoBank, ACB

 11422 Miracle Hills Drive, Suite 300

 Omaha, Nebraska 68154-4404

 Attention: Jeff Grawe, Vice President

Telephone: (402) 492-2008

 Facsimile: (402) 492-2001

	
 


	
 

	

East Fork Biodiesel, LLC

 P.O. Box 21

 Algona, Iowa 50511

 Attention: President

Telephone:
 (515) 395-8888

 Facsimile: (515) 395-8891

	
 





          14.          Attorney’s
Fees. The prevailing party in any action or other
proceeding to enforce its rights under this Agreement,
shall be entitled to its costs of suit, and reasonable attorneys’ fees, in
addition to all other recovery or relief to which it may be entitled.


          15.          Governing
Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Colorado.


          16.          Counterparts.
This Agreement may be executed in any number of counterparts and by different parties to this Agreement in separate counterparts,
each of
which, when so executed, shall be deemed to be an original and
all of which taken together shall constitute one and the same Agreement.







	
 

	
 


	
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          IN
WITNESS WHEREOF, the parties hereto have caused the
execution of this Agreement as of the date first above written.


	
 

	
 

	
 

	
 


	
FARM CREDIT SERVICES

 OF AMERICA, FLCA

	
 


	
 

	
 

	
 


	
By: 

	
 

	
 

	
 


	
 

	


	
 

	
 


	
 

	
 

	
 

	
 


	
Title:

	
 

	
 

	
 


	
 

	


	
 

	
 


	
 

	
 


	
EAST FORK BIODIESEL, LLC 

	
 


	
 

	
 

	
 


	
By:

	



	
 

	
 


	
 

	


	
 

	
 


	
 

	
 

	
 

	
 


	
Title: 

	
President