Exhibit 10.25


CONTRACT AND
AGREEMENT

BY AND BETWEEN 

ETHANOL GRAIN PROCESSORS, LLC

AND

HAROLD COFFEY CONSTRUCTION, INC.


This Contract and
agreement entered this 22nd day of
December, 2006, by and between Ethanol Grain Processors, LLC (“Owner”) and
Harold Coffey Construction, Inc. (“Contractor”). For and in consideration
of the agreements, covenants, payments and promises mentioned herein, the Owner
and Contractor contract, covenant and agree to as follows:


1.                 Definitions


1.1        Wherever
used in the Contract Documents, the following terms shall have the meanings
indicated which shall be applicable to both the singular and plural thereof:


1.2        Addenda:   Written or graphic instruments issued prior
to the execution of the Agreement which modify or interpret the Contract
Documents, Drawings, and Specifications, by additions, deletions,
clarifications, or corrections.


1.3        Bid:   The respective offer of proposal of the
Contractor submitted on the prescribed form setting forth the prices for the
Work to be performed as designated in 2.1 above.


1.4        Change Order:   A written order to the Contractor
authorizing an addition, deletion, or revision in the Work within the general
scope of the Contract Documents, or authorizing an adjustment in the Contract
price or Contract time.


1.5        Contract or Agreement:   The written agreement between
the Owner and the Contractor for the performance of the Work consisting of this
document together with all other Contract Documents designated in 2.1 below. Whenever,
in any portion of the Contract Documents, a requirement of the Contract is
stated, it shall be interpreted to mean a requirement of the Contract Documents
as defined herein.


1.6        Contract Price:   The Contract price or Contract prices
named in the Contract Documents shall be the amount of the compensation to the
Contractor agreed to by the Owner and the Contractor for the proper and
satisfactory completion of the Work specified herein, including all
contingencies, in full conformity with the Contract Documents.


1.7        Contract Time:   The number of calendar days allowed by
these Contract Documents for the completion of the Work, including authorized
time extensions for the completion of the Work sufficient for acceptance as
substantially complete by the Owner.


1.8        Drawings:   Drawings, which are sometimes referred to
herein as “plans,” are defined as all (a) drawings furnished by the Owner
as a basis for bids including those summarized on Exhibit D
hereto; (b) supplementary drawings furnished by the Owner to clarify and
to define in greater detail the intent of the Contract Drawings and
Specifications; (c) drawings submitted by the Contractor, provided such
drawings are acceptable to the Owner; (d) drawings furnished by the Owner
to the Contractor during the progress of the Work; and (e) engineering
data and drawings submitted by the Contractor during the progress of the Work,
provided such drawings are acceptable to the owner.


1.9        Field Order:   A written order effecting a change in the
Work not involving an adjustment in the Contract price or an extension of the
Contract time issued by the Owner to the Contractor during construction.


1.10     Notice to Proceed:   Written communication issued by the
Owner to the Contractor authorizing him to proceed with the Work and
establishing the date of commencement of the Work as applied separately to
Phase I and to Phase II of the Project.











1.11     Owner:   Ethanol Grain Processors, LLC.


1.12     Person:   The word “person” shall mean and include any
individual, combination of individuals, partnership, society, association,
joint stock company, corporation, firm, estate, receiver, trustee, assignee,
referee, or any other person acting in a fiduciary or representative capacity,
whether appointed by a court or otherwise.


1.13     Phase I:   All Work described in Exhibit A-1
hereto consisting of grading and drainage Work for the Project.


1.14     Phase II:   All Work described in Exhibit B-1
consisting of the site Work for Spur Track for the Project.


1.15     Project:   The Ethanol Plant to be constructed on the
Owner’s Property located near Obion, Tennessee consisting of 230 acres, more or
less, bordered by Black Lane Road and McDonald Road.


1.16     Shop Drawings:   All drawings, diagrams, illustrations,
brochures, schedules, and other data which are prepared by the Contractor, a
Subcontractor, a manufacturer, a supplier, or a distributor, which illustrate
how specific portions of the Work shall be fabricated or installed. Shop
drawings may also be referred to in these Contract Documents and shall have the
same meaning as detail drawings, working drawings, construction drawings, and
engineering data.


1.17     Specifications:   A part of the Contract Documents
consisting of written descriptions of a technical nature of materials,
equipment, construction systems, standards, and Workmanship, including the
notes and remarks on the Contract drawings. The Specifications are detailed on Exhibit D hereto.


1.18     Subcontractor:   The person, firm, or corporation having
a direct Contract with the Contractor or with any other Subcontractor for
performing Work covered by these Contract Documents which the Contractor is
obligated to perform or to cause to be performed.


1.19     Substantial Completion:   That date when the
construction of the project is sufficiently completed, in accordance with the
Contract Documents, as determined by Owner in Owner’s reasonable determination,
so that the Project can be turned over to the general contractor for the
Project and that the general contractor can commence its Work. Substantial
Completion shall not be deemed to have occurred until and unless Contractor has
obtained and delivered to Owner any and all certificates of completion or
similar sign-offs required from any applicable governmental authority.


1.20     Supplier:   The person, firm, or corporation who will
furnish products for incorporation into the Work covered by these Contract
Documents. A supplier may also be referred to as “manufacturer” or “distributor”
in these Contract Documents.


1.21     Work:   Everything specified, indicated, shown, or
contemplated, including materials, labor, equipment, transportation, supplies,
and things required to be done, furnished, or performed by the Contractor under
these Contract Documents. The Work shall include everything expressly or
impliedly required of the Contractor by the Contract Documents. The Work
consists, generally of Phase I and Phase II.


1.22     Written Notice:   Any
notice to any party of the Agreement relative to any part of this agreement in
writing and considered delivered and the service thereof completed, when posted
by certified or registered mail to the said party at its last given
address, or delivered in person to said party or its authorized representative
on the Work or by electronic mail or facsimile provided evidence of receipt
is included.



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2.                 Contract
Documents


2.1        The
following Contract Documents are a part of this Contract and agreement (“Contract”)
to which reference is made:


Bid Sheet for Phase I,
attached hereto as Exhibit A


Phase I Construction
Drawings and Specifications referenced on Exhibit D


Bid Sheet for Phase II,
attached hereto as Exhibit B


Phase II Construction
Drawings and Specifications referenced on Exhibit D


Geotechnical
Engineering Report dated September 20, 2006, prepared by Terracon


2.2        The
Contract Documents cover all matters relating to the Work the Contractor is
obligated to perform.


The
Contract Documents, as defined herein, form the Contract between the Owner and
the Contractor for the performance of the Work covered by these Contract
Documents. It is agreed by the Owner and the Contractor, as evidenced by and
through the execution of the Contract, that all terms of the Contract Documents
shall be a part of the Contract, the same as if the Contract Documents are
repeated therein. Contractor shall perform the Work in strict conformance with
the Contract Documents and, in particular the Drawings and Specifications
detailed on Exhibit D.


3.                 Contractor’s
Obligations


3.1        Contractor
agrees to furnish and pay all material, supplies, tool, equipment, labor and
other services required to do and perform all the Work required to complete
Phase I and II, all in strict and complete compliance with the terms and
conditions of this Contract and the other Contract Documents for this
project, all of which shall be deemed a part hereof as fully and completely as
if set out and copied verbatim herein. The Owner agrees to pay the Contractor
for said Work described in Section 2.1 as shown on the Bid Sheets and
pursuant to the terms and conditions of this Contract and the other
Contract Documents.


3.2        In
performing the Work, Contractor shall be entitled to rely on data provided by
Owner including but not limited to the Geotechnical Engineering Report prepared
by Terracon for EGP dated September 20, 2006.


4.                 Intentionally
Omitted.


5.                 Contract
Price.


The Contract Price
for Phase I of the Work shall be based solely on the unit prices set forth on Exhibit A attached hereto and, except as specifically
provided for herein, there shall be no other basis of compensation due to
Contractor for the Phase I Work except as set forth on Exhibit A.
The Contract Price for Phase II of the Work shall be based solely on the unit
prices set forth on Exhibit B attached hereto and, except as specifically
provided for herein, there shall be no other basis of compensation due to
Contractor for the Phase II Work except as set forth on Exhibit B.


6.      Legal Addresses:   Both
the business address of the Contractor given in the Bid Proposal Form and
the Contractor’s office in the vicinity of the Work either of which are hereby
designed as the place to which all notices, letters, and other communication to
the Contractor will be mailed or delivered.


The address of the Owner is indicated in the bidding
instructions, and is hereby designated as the place to which all notices,
letters, and other communication to the Owner shall be mailed or delivered. Either
party may change its address at any time by an instrument in writing delivered
to the other party.


7.      Independent Contractor:   The
relation of the Contractor to the Owner shall be that of an independent contractor.



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8.      Standard Specifications:   Standard
specifications or other specifications of organizations, societies,
governmental agencies, or bodies, referred to in these Contract Documents, are
made a part of these Contract Documents the same as if repeated herein. Unless
specifically stated otherwise, the standard shall be that adopted and published
at the date of the Advertisement for Bids.


9.                 Additional
Instructions and Detail Drawings


The Contractor may be furnished additional instruction
and detail drawings, by the Owner, as necessary to carry out the Work required
by the Contract Documents.


10.          Schedules,
Reports, and Records


Prior to the commencement of each Phase of the Work,
Contractor shall prepare and deliver to Owner a schedule of the Work included
within the Phase (the “Schedule”). No less frequently than every thirty (30)
days, Contractor shall deliver an updated Schedule to Owner and if the Schedule
contains any material delays, including; the anticipated date of Substantial
Completion, then the updated Schedule to owner shall specify in detail the
basis for such changes. Contractor shall also prepare and deliver to Owner, in
such form and at such intervals as are either required by the Contract
Documents or are reasonably requested by Owner, such schedules of quantities
and costs, progress schedules, reports, estimates, records, and other relevant
data pertaining to the Work.


11.          Correlation
of Documents


11.1     Drawings
and specifications are cooperative and supplementary. Portions of the Work
which can best be illustrated by the drawings may not be included in the
specifications and portions best described by the specifications may not be
depicted on the drawings. All items necessary or incidental to completely
construct the Work shall be furnished, whether called for in the specifications
or shown on the drawings, or anything shown or mentioned on the drawings and
not mentioned in the specifications, shall be of like effect as if shown or
mentioned in both.


11.2     In the
event of conflicting provisions, the terms and conditions stated herein shall
prevail over other earlier or contemporaneous documents, including bid
documents and shall have precedence over any incorporated Supplementary or
General Conditions, specifications, plans and drawings.


11.3     The
drawings, specifications, and addenda shall form part of this Contract and the
provisions thereof shall be as binding upon the parties hereto as if they were
herein fully set forth.


11.4     Contractor
shall carefully review the Drawings and Specifications and the other Contract
Documents and shall immediately report in writing to Owner (a) any errors,
incomplete items or (b) elements which, in Contractor’s opinion or
experience, fail to comply with applicable law.


12.          Materials,
Services, and Facilities


12.1     It is
understood that, except as otherwise specifically stated in the Contract Documents,
the Contractor shall provide and pay for all materials, labor, tools,
equipment, transportation, supervision, temporary construction of any nature,
and all other services and facilities of any nature whatsoever necessary to
execute, complete, and deliver the Work within the specified time.


12.2     Any Work
necessary to be performed after regular working hours or on legal holidays
shall be performed without additional expense to the Owner.


12.3     The
Contractor warrants that it has good title to all materials, supplies, and
equipment used by it in the Work.


12.4     All
materials required in the Work may be stored on the site upon which the project
is to be constructed, provided that Contractor has paid for such materials,
Contractor takes commercially 



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reasonable steps to
properly store such materials and that all such materials are insured against
loss, damage and theft


12.5     The
Contractor shall make its own arrangements for delivery and handling of
equipment and materials as it may require for the prosecution of the Work.


13.          Inspection
and Testing


13.1     All
materials and equipment used in the construction of the project shall be
subject to adequate inspection and testing in accordance with generally
accepted standards, as required and defined in the Contract Documents.


13.2     The
Owner shall provide all inspection and testing services unless otherwise
required by Contract Documents. Owner and its project representatives (the “Owner’s
Parties”, which Owner’s Parties shall include, without limitation, Owner’s
Representative, Terracon representatives, representatives from the Owner’s
general contractor, Owner’s surveyor and such other professional and
consultants as Owner, in its sole determination, elects to employ with respect
to the Work) shall have access to the project site at all times. Any inspectors
employed by Owner have the authority, acting through the Owner’s
Representative, to specify testing parameters and to reject defective material
or Work that is being improperly done subject to the final decision of the
Owner. Contractor shall consult with and coordinate the Work with Owner through
the Owner’s Representative. Contractor shall comply with such reasonable
testing and inspection requirements as may be imposed by Owner to allow Owner
to complete the required testing and such requirements shall not be the
basis for any extension of time or increase in price hereunder.


13.3     If the
Contract Documents, laws, ordinances, rules, regulations, or orders of any
public authority having jurisdiction require any Work to specifically be
inspected, tested, or approved by someone other than the Contractor, the
Contractor will give the Owner timely notice of readiness.


13.4     Authorized
representatives and agents of any Federal or state agency shall be permitted to
inspect all Work, materials, payrolls, records of personnel, and other relevant
data and records.


13.5     If any
Work is covered contrary to the written instructions of the Owner it must, if
requested by the Owner, be uncovered for its observation and replaced at the Contractor’s
expense.


13.6     If the
Owner considers it necessary that covered Work be inspected or tested by
others, the Contractor, at the Owner’s request, will uncover, expose, or
otherwise make available for observation, inspection, or testing as the Owner
may require, that portion of the Work in question, furnishing all necessary
labor, materials, tools, and equipment. If it is found that such Work is
defective, the Contractor will bear all the expenses of such uncovering,
exposure, observation, inspection and testing, and of satisfactory
reconstruction. If, however, such Work is not found to be defective, the
Contractor will be allowed an increase in the Contract price or an extension of
the Contract time, or both, directly attributable to such uncovering, exposure,
observation, inspection, testing, and reconstruction and an appropriate change
order shall be issued.


13.7     The
Contractor shall submit samples of materials for testing as required by the
Owner. The cost of all retests made necessary by the failure of materials to
conform to the requirements of these Contract Documents shall be paid by the
Contractor.


13.8     The
testing of equipment and products shall be performed as provided in the
Contract Documents and as additionally requested by Owner or its representatives.


14.          Surveys,
Permits, and Regulations


14.1     Contractor
acknowledges Owner has delivered to Contractor and Contractor has reviewed and
is satisfied with boundary surveys of the Project site and that such surveys
establish all Contractor-required 



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base lines for performing
all the Work together with a suitable number of benchmarks adjacent to the Work
as shown in the Contract Documents and such other details and markings as is
necessary for Contractor to perform the Work.


14.2     All
permits and licenses necessary for the prosecution of the Work shall be
obtained and paid for by Owner. Permits, licenses, and easements for permanent
structures or permanent changes in existing facilities shall be secured and
paid for by the Owner unless otherwise specified. The Contractor shall give all
notices and comply with all laws, ordinances, rules, and regulations bearing on
the conduct of the Work as drawn and specified. If the Contractor observes that
the Contract Documents are at variance therewith, it shall promptly notify the
Owner in writing, and any necessary changes shall be adjusted as provided herein.


14.3     Contractor
shall coordinate with Owner to determine the areas of Owner’s property
available for materials and equipment storage.


15.          Protection
of Work, Property, and Persons


15.1     The
Contractor will be responsible for initiating, maintaining, and supervising all
safety precautions and programs in connection with the Work. It will take all
necessary precautions for the safety of, and will provide the necessary
protection to prevent damage, injury, or loss to all employees on the Work, all
the Work and all materials or equipment to be incorporated therein.


15.2     The
Contractor will comply with all applicable laws, ordinances, rules,
regulations, and orders of any public body having jurisdiction. It will erect
and maintain as required by the conditions and progress of the Work, all
necessary safeguards for safety and protection. Contractor will notify owners
of adjacent utilities when prosecution of the Work may affect them. The
Contractor will remedy all damage, injury, or loss to any property caused, in
whole or in part, by the Contractor, or anyone directly or indirectly employed
by Contractor except damage or loss attributable to the fault of the Contract
Documents or to the acts or omissions of the Owner or other persons or
entities.


15.3     In
emergencies affecting the safety of persons or the Work or property at the site
or adjacent thereto, the Contractor, without special instruction or
authorization from the Owner, shall act to prevent threatened damage, injury,
or loss. It will give the Owner prompt written notice of any significant
changes in the Work or deviations from the Contract Documents caused thereby,
and a change order shall thereupon be issued covering the changes and
deviations involved.


15.4     The
Contractor shall protect from damage all property in the vicinity of the Work
or that is in any way affected by the Work, the removal or destruction of which
is not called for by the Contract Documents except that Owner hereby agrees to
be responsible for any and all damage or injury, including wear and tear, to
all public roadways providing access to the Project site.


15.5     Owner
shall cooperate with Contractor in giving notice to and obtaining permission
from any adjacent property owner or governmental authority, whichever is
applicable.


15.6     The
Contractor shall be responsible for initiating, maintaining, and supervising
all safety precautions and programs in connection with the Work. The Contractor
shall take all necessary precautions for the safety of its employees on the
Work and shall comply with all applicable provisions of federal, state, and
local safety laws and codes to prevent accidents or injury to persons on,
about, or adjacent to the premises where the Work is being performed.


15.7     Contractor
shall not enter or occupy Railroad property unless it is for the purpose of
performing the Work. Railroad property is not available for materials or
equipment storage or as an access road without Railroad approval. If required
when working on Railroad property, a flagman will be present, the cost of which
shall be born by Owner. Safety training for Contractor’s employees shall be
provided by Owner or Railroad, if required.



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15.8     In
emergencies affecting the safety of persons or the Work or property at the site
or adjacent thereto, the Contractor shall give the Owner prompt written notice
of any significant changes in the Work or deviations from these Contract
Documents caused by and threatened damage, injury or loss, and a change order
shall thereupon be issued covering the changes and deviations involved.


16.          Supervision
by Contractor


The Contractor will supervise and direct the Work. Contractor
will be solely responsible for the means, methods, techniques, sequences, and
procedures of construction. The Contractor will employ and maintain on the Work
a qualified supervisor or superintendent who shall have been designated in
writing by the Contractor as the Contractor’s representative at the site. The
supervisor shall have full authority to act on behalf of the Contractor and all
communications given to the supervisor shall be as binding as if given to the
Contractor. The Contractor shall maintain mobile telephone service at each job
site sufficient that emergency calls can be made directly to local emergency
dispatchers from the job site.


17.          Changes
in the Work


17.1     The
Owner may at any time, as the need arises, order changes within the scope of
the Work without invalidating the agreement. If such changes increase or
decrease the amount due under the Contract Documents, or in the time required
for performance of the Work, an equitable adjustment in time and Contract price
shall be authorized by change order.


17.2     The
Owner, also, may at any time, by issuing a field order, make changes in the
details of the Work. The Contractor shall proceed with the performance of any
changes in the Work so ordered by the Owner unless the Contractor believes that
such field order entitled it to a change in the Contract price or time, or
both, in which event it shall give the Owner written notice thereof within a
reasonable time after the receipt of the ordered change. Thereafter, the
Contractor shall document the basis for the change in Contract price or time. The
Contractor shall not execute such changes pending the receipt of an executed
change order or further instruction from the Owner.


17.3     The
Owner reserves the right to make at any time, such alterations in the drawings
or in the character of the Work as the Owner may consider necessary or
desirable to complete the proposed Work in a satisfactory manner and consistent
with the intent of these Contract Documents. Notice of every such alteration or
change shall be given in writing to the Contractor by the Owner, and no such
alteration or change shall be considered as constituting a waiver of any of the
provisions of these Contract Documents or as nullifying or invalidating any of
such provisions. Should any such alteration or change result in an increase or
decrease in the quantity or the cost of the Work or materials described in
these Contract Documents, the total amount payable under the Contract will be
accordingly modified. If alterations or changes are thus made, the Contract
time will be correspondingly modified, if the Contractor so requests, before
commencing the Work attributable to such alterations or changes.


17.4     It is
understood and agreed that the Contractor shall perform all extra Work that may
be ordered in writing by the Owner arising out of the modification of the
specifications or drawings made or approved by the Owner. For this extra Work,
the Contractor shall be compensated as provided hereinafter and in the change
order covering the extra Work.


17.5     Extra
Work is defined as: (1) that additional Work of a different character or
function and for which no basis of payment is prescribed in these Contract
Documents; or (2) that Work involving revisions of the details of the Work
in such manner as to render inequitable payment under items upon which the
Contractor bid; or (3) that additional Work of a similar nature and
character as that done under the unit prices named in these Contract Documents;
or (4) any Work performed in a manner different from that planned by the
Contractor which causes an increase in the cost of any part of the Work.



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17.6     If the
performance of the extra Work results in additional time being required by the
Contractor to complete the Work covered by these Contract Documents, said
change order will provide an equitable extension in the Contract time.


17.7     All
change orders, including a change in technical design or an increase in cost,
must be approved in writing by the Owner.


18.          Changes
in Contract Price


18.1     The
Contract price may be changed only by a change order. The value of the Work covered
by a change order or of any claim for increase or decrease in the Contract
price shall be determined by one or more of the following methods in the order
precedence listed below.


(1)          Method A—unit prices
contained in the Contractor’s proposal for same type of Work unless inequitable
under the circumstances.


(2)          Method B—by an
acceptable unit price proposal from the Contractor


(3)          Method C—by an
acceptable lump sum price proposal from the Contractor.


18.2     When
compensation for extra Work is provided under paragraph 18.1 above, the
Contractor’s representative and the Owner shall compare records of extra Work
done. Such records shall be signed by both representatives referred to herein,
a copy being submitted to the Owner and a copy being retained by the Contractor.
AED Rental Rates for Contractor owned equipment shall be used to calculate
equipment related to any change in Contract price.


19.          Time
for Completion


19.1     The date
of beginning and the time for completion of Phase I of the Work shall be commenced
on a date specified in the Phase I Notice to Proceed, Owner may deliver the
Phase I Notice to Proceed any time after the execution of this Contract
provided all necessary permits and licenses under Paragraph 14.2 have been
provided to Contractor. Phase I shall be substantially completed within 112
working days (as defined in Section 19.4 below) of the date Contractor
receives the Phase I Notice to Proceed (which 112 days shall include two
days to mobilize equipment to the jobsite) (the “Scheduled Completion Date”).
The Final Completion date for the Phase I Work shall be determined by
Contractor, prior to the Substantial Completion Date, by delivering a Final
Completion schedule to Owner for Owner’s approval (which approval shall not be
unreasonably withheld).


19.2     All Work
shall be completed expeditiously in a manner consistent with prevailing weather
conditions and other factors affecting ability to proceed with the Work.


19.3     An
extension of the Contract period may be granted by the Owner for any of the
following reasons:


(1)          Additional Work
resulting from a modification of the Contract Documents for the project.


(2)          Any preference, priority
or allocation order issued by the Government.


(3)          Any condition rendering
the site unsuitable for the Work as determined in the field including but not
limited to rain, snow or other weather conditions affecting soil conditions,
provided that Owner has received written notice from Contractor making such
claim for additional time within fifteen (15) days after the event rendering
the site unsuitable for Work;



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(4)          Unforeseeable cause
beyond the control and without the fault or negligence of the Contractor,
including, but not restricted to, acts of God which are unusual weather
phenomena, or acts of the public enemy, acts of the Owner, fires, epidemics,
quarantine restrictions, and weather as provided above, provided Owner has
received written notice from Contractor making claim for additional time within
fifteen (15) days after the occurrence of any such event; or


(5)          Delays of a Contractor’s
Subcontractor or occasioned by any of the causes specified above, provided
Owner receives written notice from Contractor making claim for additional time
within fifteen (15) days after the occurrence of such events.


19.4     Normal
working hours are one single shift of ten (10) hours Monday through Sunday
(with all holidays included, except Christmas Day, New Year’s Day, Memorial
Day, July 4th and Labor Day).


19.5     Phase II
of the Work shall commence immediately upon receipt by Contractor of the Phase
II Notice to Proceed. Owner may issue the Phase II Notice to Proceed at any
time. Notwithstanding the delivery of the Phase II Notice to Proceed,
Contractor shall not be obligated to commence the Phase II portion of the Work
(nor shall the contract period for the Phase II portion of the Work commence)
until (a) the Phase I Work is Substantially Complete and (2) the
Owner authorizes the removal of the soils removed as part of the Phase I Work
and used as engineering weight and otherwise stockpiled for use in the Phase II
Work.


19.6     Contractor
shall substantially complete Phase II of the Work within 135 working days (as
computed in Section 19.4) after Contractor receives the Phase II Notice to
Proceed (subject to the permitted delays set forth in Section 19.5 above
and to extensions pursuant to Section 19.3). Contractor acknowledges that
during Phase II, Contractor will share the Project site with the general
contractor and Contractor shall reasonably accommodate and defer to the general
contractor’s staging requirements.


20.          Correction
of Work


20.1     The
Contractor shall remove from the premises all Work rejected by the Owner for
failure to comply with the Contract Documents, whether incorporated in the
construction or not, and the Contractor shall replace and re-execute the Work
in accordance with the Contract Documents and without expense to the Owner and
shall bear the expense of making good all Work of other Contractors destroyed
or damaged by such removal or replacement.


20.2     If, in
the opinion of the Owner, it is undesirable to replace any defective Work or to
reconstruct or correct any portion of the Work injured or not performed in
accordance with the Contract Documents, the compensation to be paid to the
Contractor hereunder shall be adjusted accordingly.


21.          Suspension
of Work, Termination, and Delay


21.1     The
Owner may suspend the Work or any portion thereof for a period of not more than
ninety days or such further time as agreed upon by the Contractor, by written
notice to the Contractor which notice shall fix the date on which Work shall be
resumed. The Contractor will resume that Work on the date so fixed. The
Contractor will be allowed an increase in the Contract price or an extension of
the Contract time, or both, directly attributable to any suspension.



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21.2     If the
Contractor is adjudged as bankrupt or insolvent, or if it makes a general
assignment for the benefit of its creditors, or if a trustee or receiver is
appointed for the Contractor or for any of its property, or if it files a
petition to take advantage of any debtor’s act, or to reorganize under the
bankruptcy or applicable laws, or if it fails to supply sufficient skilled
Workmen or suitable materials or equipment, or if it fails to make prompt
payments to Subcontractors or for labor, materials, or equipment or if it
disregards laws, ordinances, rules, regulations, or orders of any public body
having jurisdiction of the Work or if it disregards the authority of the Owner,
or it falls materially behind the Project Schedule and fails to provide Owner
with a plan reasonably acceptable to Owner for the Work to return to the
Project Schedule or if it otherwise violates any provision of the Contract
Documents, then the Owner may, without prejudice to any other right or remedy
and after giving the Contractor a minimum of ten (10) days from delivery
of a written notice, terminate the services of the Contractor, and/or finish
the Work by whatever method it may deem expedient. In such case the Contractor
shall not be entitled to receive any further payment until the Work is finished.
If the unpaid balance of the Contract price exceeds the direct and indirect
costs incurred by Owner in completing the project, including compensation for
additional professional services, such excess shall be paid to the Contractor. If
such costs exceed such unpaid balance, the Contractor will pay the difference
to the Owner immediately upon receipt of written notice thereof from Owner. If
such unpaid balance is not paid within ten (10) days after receipt of
notice, then the unpaid balance shall bear interest from the date of the notice
at the rate of (a) ten percent (10%) per annum or (b) the highest
rate allowed by law, whichever is lower.


21.3     If the
performance of all or any portion of the Work is suspended, delayed, or
interrupted as a result of a failure of the Owner to act within a reasonable
time and Contractor has delivered written notice to Owner of such event within
fifteen (15) days after the occurrence of the event, an adjustment in the
Contract price or an extension of the Contract time, or both, shall be made by
change order to compensate the Contractor for the costs and delays necessarily
caused by the failure of the Owner.


21.4     The
Contractor shall not suspend the Work and shall not remove any equipment,
tools, supplies, materials, or other items without the written permission of
the Owner except in the event of default by Owner including nonpayment of
progress payments, in which event Contractor may suspend performance until such
default is cured and may pursue a claim for any damages resulting from such
default, all provided Contractor has given Owner at least ten (10) days
written notice of default and opportunity to cure. If such default is not
cured, then Contractor may, after it delivers to Owner a second notice of
default (with a ten (10) day cure period), Contractor may terminate the
Contract for default.


21.5     The
Owner shall have the authority to suspend the Work wholly or in part, for such
period as he may deem necessary, due to unsuitable weather; such other conditions
as are considered unfavorable for the suitable prosecution of the Work; or due
to the failure on the part of the Contractor to carry out orders given,
prosecute the Work satisfactorily and in a workmanlike manner, or to perform
any obligations or requirements of these Contract Documents. The Contractor
shall immediately comply with the written order of the Owner to suspend the
Work wholly or in part. The suspended Work shall be resumed when conditions are
favorable and methods are corrected, as ordered or approved in writing by the
Owner.


21.6     No
portion of the Work shall be constructed under conditions which would adversely
affect the quality or efficiency thereof, unless special means or precautions
are taken by the Contractor to perform the Work in a proper and satisfactory
manner. Owner shall grant reasonable time extensions consistent herewith.


22.          Payments
to Contractor


22.1     By the
end of each month before each progress payment falls due, the Contractor will
submit to the Owner an application for payment using an applicable AIA form of
application for payment. Each application for payment shall be accompanied by
detailed support from Contractor evidencing the that 



 10
 








portion of the Work
completed and covered by the Application, including evidence reasonably
satisfactory to Owner of quantities and unit prices, together with such other
information and support as Owner may reasonably require. Each application for
payment shall be accompanied by a lien waiver from Contractor and each
Subcontractor waiving its mechanic’s lien rights with respect to the Work
covered by the application. Owner will either indicate in writing its approval
of payment or promptly return the application to Contractor indicating in
writing Owner’s reasons for refusing to approve the application. In the latter
case, the Contractor may make the necessary corrections and resubmit the
Application. The Owner will pay the Contractor progress payments on the basis
of each approved application within ten (10) days of receipt of the approved
application by Owner. In addition to the foregoing, Contractor shall comply
with such other customary and typical payment and disbursement procedures as
are reasonably required by Owner’s lender and title insurer.


22.2     Each
application for payment shall be subject to retainage by Owner in the amount of
ten percent (10%) of the amount of the application until the Work is 50%
complete and thereafter each application shall be subject to retainage in the
amount of five percent (5%) of the amount of the Application. Upon Contractor’s
full and timely completion of the portion of the Work included within each
Phase, Owner shall pay the retainage for each Phase of the Work to Owner with
the final payment for the Work included in the Phase, all within ten (10) days
after the delivery of a proper application for payment covering the final
payment and retainage. Notwithstanding the foregoing, if the parties agree to
allow the completion of certain items of Work of a Phase until the completion
of the Project by the general contractor (which items currently under
consideration being the spreading of top soil and seeding) (the “Deferred Work”),
then assuming completion of all of other Work in the Phase and the receipt by
Owner of a proper application therefore, Owner shall disburse the all of the
retainage for the Phase but withhold from that distribution an amount equal to
the reasonable value of the Deferred Work as reasonably determined by Owner.


22.3     Prior to
Substantial Completion, the Owner, with concurrence of the Contractor, may use
any completed or substantially completed portions of the Work. Such use shall
not constitute an acceptance of such portions of the Work.


22.4     The
Owner shall have the right to enter the Project site for the purpose of doing
Work not covered by the Contract Documents. This provision shall not be
construed as relieving the Contractor of the sole responsibility for the care
and protection of the Work, or the restoration of any damaged Work except such
as may be caused by agents or employees of the Owner or other Contractors of
Owner.


22.5     Upon
completion and acceptance of the Work, the Owner shall issue a certificate
attached to the final payment request that the Work has been accepted by it
under the conditions of the Contract Documents. The entire balance found to be
due the Contractor shall be paid to the Contractor within thirty (30) days of
completion and acceptance of the Work.


22.6     The
Contractor will indemnify, defend and save the Owner and its lenders, successor
and assigns and the Project site harmless from all claims growing out of the
lawful demands of Subcontractors, laborers, workmen, mechanics, materialmen,
and furnishers of machinery and parts thereof, equipment, tools, and all
supplies incurred in the furtherance of the performance of the Work. The
Contractor shall, at the Owner’s request, furnish satisfactory evidence that
all obligations of the nature designated above have been paid, discharged, or
waived.


22.7     The
Contract is based on a unit price bid. The estimated quantities provided by the
Owner are estimates. Payment shall be based on actual quantities. The items of
Work to be measured and the units of measurement shall be as set forth in the
bid sheets attached hereto as Exhibits A and B respectfully, or in other Contract
Documents including applicable change orders. Estimates of quantity for roadway
aggregate shall be paid according to delivery weight tickets.



 11
 








23.          Insurance


23.1     The
Contractor shall purchase and maintain the following insurance coverage:


The limits of liability
for the insurance maintained shall provide coverage for not less than the
following amounts or greater where required by Laws and Regulations:


1.          Workers’ Compensation and related coverage as follows:




	
  a.

  	
   

  	
  State

  	
   

  	
  Statutory

  
	
  b.

  	
   

  	
  Employer’s Liability

  	
   

  	
  $100,000/$500,000/$100,000

  






 


2.          Contractor’s General Liability which shall include
completed product and operations coverage, and contractual liability coverage.




	
  a.

  	
   

  	
  General Aggregate

  	
   

  	
  $2,000,000

  
	
  b.

  	
   

  	
  Products-Completed

  Operations Aggregate

  	
   

  	
  $1,000,000

  
	
  c.

  	
   

  	
  Personal & Advertising

  	
   

  	
  $1,000,000

  
	
  d.

  	
   

  	
  Each Occurrence (Bodily

  Injury & Property Damage)
 	
   

  	
  $1,000,000

  
	
  e.

  	
   

  	
  Property Damage liability insurance will provide
  Explosion, Collapse and Underground coverage where applicable.

  	
   

  	
   

  
	
  f.

  	
   

  	
  Excess & Umbrella Liability

  	
   

  	
  $2,000,000 each occurrence $1,000,000 aggregate

  






 


3.          Automobile Liability:




	
  a.

  	
   

  	
  Combined Single Limit
  Each Accident for Bodily Injury & Property Damage

  	
   

  	
  $1,000,000

  






 


4.          Other
persons or entities to be included on policy as additional insureds:




	
   

  	
   

  	
  Ethanol Grain Processors, LLC

  	
   

  	
   

  






 


5.          Railroad
Protective Liability Insurance is not required.


23.2     The
insurance required by this section shall be written for not less than limits of
liability specified in the Contract Documents or required by law, whichever
coverage is greater. Coverages, whether written on an occurrence or claims-made
basis, shall be maintained without interruption from the date of commencement
of the Work until date of final payment and termination of any coverage
required to be maintained after final payment. Certificates of Insurance
acceptable to the Owner shall be filed with the Owner prior to commencement of
the Work. These Certificates and the insurance policies required by this Section 23
shall contain a provision that coverages afforded under the policies will not
be canceled or allowed to expire until at least thirty (30) days prior written
notice has been given to Owner. If any of the foregoing, insurance coverages
are required to remain in force after final payment and are reasonably
available, an additional certificate evidencing continuation of such coverage
shall be submitted with the final application for payment as required herein. Contractor
shall furnish information concerning 



 12
 








reduction of coverage with
reasonable promptness in accordance with the Contractor’s information and belief.


23.3     Owner
shall maintain in effect at all times commercial liability coverage applicable to
the Project in amounts not less than Five Million Dollars ($5,000,000.00).


24.          Assignments


24.1     Neither
Contractor nor Owner shall sell, transfer, assign, or otherwise dispose of the
Contract or any portion thereof, or of its right, title or interest therein, or
its obligations thereunder, without the written consent of the other party.
Notwithstanding the forgoing, Owner may, without Contractor’s consent (a) assign
its rights under this Contract to an affiliate or a related party to Owner or
to an entity with common ownership with Owner and (b) assign the Contract
to any other part provided such party specifically assumes in writing the
obligations of Owner hereunder for the benefit of Contractor. Notwithstanding
the foregoing, any assignment by Owner without Contractor’s written consent
shall not release Owner from its obligations hereunder.


24.2     Contractor
hereby collaterally assigns to Owner all of Contractor’s right, title and
interest in and to all subcontracts executed by the Contractor with respect to
the Project, which assignment is effective and perfected as of the date hereof
but Owner shall defer from exercising its rights under such assignment until
and unless Contractor defaults hereunder. Thereupon, Owner shall determine by
notice in writing to Contractor and Subcontractors which, if any, subcontracts
Owner elects to accept.


24.3     Contractor
consents to the collateral assignment of this Contract by Owner to its
construction and/or permanent lenders and Contractor shall execute such
customary consents and similar instruments requested by Owner’s lenders.


25.          Indemnification


25.1     To the
fullest extent permitted by law, Contractor shall indemnify and hold harmless
the Owner and Owner’s Parties and any of them from and against claims, damages,
losses and expenses, including but not limited to attorneys’ fees, arising out
of or resulting from performance of Work, provided that such claim, damage,
loss or expense is attributable to bodily injury, sickness, disease or death,
or to injury to or destruction of tangible property (other than the Work
itself) including loss of use resulting therefrom, caused in whole or in part
by negligent acts or omissions of the Contractor, a Subcontractor, anyone
directly or indirectly employed by them or anyone for whose acts they may be
liable, to the extent such claim, damage, loss or expense is not caused in part
by a party indemnified hereunder. Such obligation shall not be construed to
negate, abridge, or reduce other rights or obligations of indemnity which would
otherwise exist as to a party or person described in this Section 25.
Notwithstanding any language in this contract to the contrary, Contractor has
no obligation to indemnify and hold harmless Owner or the Owner’s Parties for
the actions of third parties who are not directly or indirectly employed by
Contractor, Subcontractors or suppliers unless the damages or injuries arising
from the actions of such third parties can be attributed to the negligent acts
or omissions of Contractor, Subcontractors, suppliers or any person or entity
directly or indirectly employed by them.


25.2     In
claims against any person or entity indemnified under this Section 25 by
an employee of the Contractor, a Subcontractor, anyone directly or indirectly
employed by them or anyone for whose acts they may be liable, the
indemnification obligation under this Section 25 shall not be limited by a
limitation on amount or type of damages, compensation or benefits payable by or
for the Contractor or a Subcontractor under Workers’ compensation acts,
disability benefit acts or other employee benefit acts.


25.3     Contractor
shall procure, maintain and pay for such general liability, contractual
liability and employer’s liability insurances (including endorsements) as will
insure the provisions of this Section 25 and 



 13
 








any other contractual
indemnities assumed by Contractor in the Contract Documents, to the fullest
extent insurable.


25.4     Owner
will and does hereby indemnify and hold harmless the Contractor and its agents,
officers and employees from and against all claims, damages, losses, and
expenses including attorney’s fees arising out of or resulting from the
performance of the Work, provided that any such claims, damage, loss, or
expense is attributable to bodily injury, sickness, disease, or death, or to
injury to or destruction of tangible property; and is caused in whole or in
part by any negligent or willful act or omission of the Owner or and Owner’s
Parties.


26.          Separate
Contracts


The Owner reserves the right to let other Contracts in
connection with this project. The Contractor shall afford other Contractors
reasonable opportunity for the introduction and storage of their materials and
the execution of their Work, and shall properly connect and coordinate its Work
with theirs. If the proper execution or results of any part of the Contractor’s
Work depends on the Work of any other Contractor, the Contractor shall inspect
and promptly report to the Owner any defects in such Work that render it
unsuitable for such proper execution and results.


27.          Subcontracting


27.1     The
Contractor may utilize the services of specialty Subcontractors on those parts
of the Work which, under normal Contracting practices, are performed by
specialty Subcontractors.


27.2     Nothing
contained in this Contract shall create any Contractual relation between any
Subcontractor and Owner.


27.3     Contractor
shall give its personal attention to the fulfillment of the Contract and shall
at all times keep the Work under its control.


27.4     The
Contractor shall carefully inspect all Work performed by Subcontractors for
compliance with these Contract Documents and law.


28.          Owner’s
Representative


28.1     The
Owner may designate a representative (Owner’s Representative) who shall decide
questions which may arise as to quality and acceptability of materials
furnished and Work performed. He shall interpret the intent of the Contract
Documents in a fair and unbiased manner. The Owner’s Representative may make
visits to the site and determine if the Work is proceeding in accordance with
the Contract Documents.


28.2     The
Contractor shall perform all of the Work herein specified under the general
direction, and to the satisfaction, approval, and acceptance of the Owner’s
Representative. The Owner’s Representative shall act for the Owner as to all
questions relating to measurements of quantities and the character of the Work
performed. All questions as to the meaning of the specifications will be
decided by the Owner’s Representative.


28.3     The
Owner’s Representative shall promptly make decisions relative to interpretation
of the Contract Documents.


28.4     The
Contractor may request written instructions from the Owner upon any important
items which lie within the inspector’s jurisdiction.



 14
 








29.          Land
and Rights-of-Way


29.1     Prior to
issuance of Notice to Proceed, the Owner shall obtain all land and
rights-of-way necessary for carrying out and for the completion of the Work to
be performed pursuant to the Contract Documents, unless otherwise mutually
agreed.


29.2     The
Owner shall provide to the Contractor information which delineates and describe
the lands owned and rights-of-way acquired.


29.3     Should
the Owner be prevented or enjoined from proceeding with the Work, or from
authorizing its prosecution, either before or after the commencement, by reason
of any litigation, or by reason of its inability to procure any lands or
rights-of-way for the Work, the Contractor shall be entitled to a reasonable
extension in time for completion for the Work and shall be reimbursed for any
costs attributable to such delay.


30.          Contract
Provisions Required by Law


It is understood and agreed that each and every
provision and clauses required by local, state, and federal laws to be inserted
in these Contract Documents shall be deemed to be inserted herein in their
entirety, and the Contract Documents shall be read and enforced as though they
were included herein. If through mistake or otherwise any such provision or
clause is not inserted or is not correctly inserted, these Contract Documents
shall forthwith be physically amended to make such insertion or correction upon
the application of either party of the Contract.


31.          Waiver


31.1     It is
expressly understood and agreed that any waiver granted by the Contractor or
the Owner of any term, provision, or covenant of this Contract shall not constitute
a precedent nor breach of the same or of any other terms, provisions, or
covenants of this Contract.


31.2     Neither
the acceptance of the Work by the Owner nor the payment of all or any part of
the Contract price due the Contractor hereunder shall constitute a waiver by
either party of any claim which either may have under the Contract or
otherwise.


32.          Cooperation
with Public Utilities


32.1     The
Contractor shall notify the owners of adjacent utilities when the prosecution
of the Work may affect the utility facilities or operation. The Contractor
shall perform and carry on the Work so as not to interfere with or damage
utility facilities in the vicinity of the Work. The Contractor shall take
reasonable precaution to properly protect and preserve the utility facility
from damage, injury, or displacement. Contractor shall be entitled to rely on
location of such utilities by authorized locators and in the event the Work is
delayed due to causes attributable to the utility owners or their
representatives or authorized locator services, Contractor shall be entitled to
a corresponding extension of time.


32.2     The
Contractor shall be solely responsible for contacting the appropriate owner or
authority for locating all existing underground facilities, including service
connections, in advance of excavating, trenching, or other Work; however,
Contractor shall not be responsible for any failure of such authority or owner
to accurately locate same or to do so in a timely manner.


32.3     In the
event of accidental damage to or disruption of utilities by the Contractor or
any of his Subcontractors or agents, the Contractor shall take all reasonable
steps to replace any pieces of damaged equipment and all damaged materials,
make all repairs, and restore all services.



 15
 








33.          Modifications
to Contract Documents


The following
modifications shall apply to Work described in the Contract Documents:


33.1     Intentionally
omitted.


33.2     No
liquidated damages shall apply to either Phase I or Phase II of the Contract.


33.3     Addendum
No. 1 dated November 10, 2006 (Exhibit C) shall apply to Phase
II subject to any conflicting provision herein which shall take precedence.


33.4     In
regard to Phase II Work, upon notice to Owner, the Contractor shall allow seven
days for Railroad to inspect the Work. The Work shall not be deemed acceptable
until the Work has been inspected, approved and accepted by Railroad. Costs of
inspection by Railroad shall be borne by Owner. Rejection of the Work by
Railroad shall require the Contractor to remedy the defects making the Work
acceptable to Railroad; provided, however, remedy of any defects attributable
to instruction by Owner, plans, drawings or specifications shall be by change
order with appropriate adjustments in Contract price and time.


33.5     In
addition to the items specified on the bid sheet for Phase I, Contractor will,
when necessary, provide soil cement (5% cement) to a 12 inch depth at a price
of $6.50 per square yard.


34.          Dispute
Resolution.


34.1     All
claims, disputes, and other matters in question involving amounts in dispute of
less than $75,000 between any of the Contractor, Owner, Subcontractors, sub
Subcontractors, material suppliers arising out of, or relating to, agreements
to which two or more of said parties are bound, or the Contract Documents or the
breach thereof shall be decided by arbitration in accordance with the
Construction Industry Arbitration Rules of the American Arbitration
Association then obtaining, as modified herein, unless the parties mutually
agree otherwise. Claims, disputes and other maters in question involving
amounts in dispute of $75,000 or more may be submitted to arbitration only with
the Owner’s specific written consent. Any other parties who have an interest in
the dispute shall be joined as parties to any such arbitration or lawsuit. The
Owner’s contract with the general contract shall also permit the joinder of
Contractor in actions arising therefrom but which may involve the Contractor. The
arbitrator shall have authority to decide all issues between the parties
including, but not limited to, claims for extras, delay and liquidated damages,
maters involving defects in the Work, rights to payment, and whether the
necessary procedures for arbitration have been followed. The award rendered by
the arbitrator shall be final, and judgment may be entered upon it in
accordance with applicable law in any court having jurisdiction thereof.


34.2     Notice
of the demand for arbitration shall be filed in writing with the other party to
the arbitration and with the American Arbitration Association. The demand for
arbitration shall be made within a reasonable time after the claim, dispute or
other matter in question has arisen, and in no event shall it be made after the
date when institution of legal or equitable proceedings based on such claim,
dispute or other matter in question would be barred by the applicable statute
of limitation.


34.3     Unless
otherwise agreed in writing, all parties shall carry on the Work and perform
their duties during any arbitration proceedings, and the Owner shall continue
to make payments as required by agreements and the Contract Documents.


34.4     If any
proceeding is brought to contest the right to arbitrate and it is determined
that such right exists, the losing party shall pay all costs and attorneys’
fees incurred by the prevailing party.


34.5     In the
event of any litigation or arbitration between the parties hereunder, the
prevailing party shall be entitled to recover their costs and attorneys’ fees.



 16
 








34.6     The Contract
shall be governed by the laws of the State of Tennessee.


In
Witness Whereof, the parties affix their signatures below:


	
  ETHANOL GRAIN
  PROCESSORS, LLC

  	
   

  	
  HAROLD
  COFFEY CONSTRUCTION, INC.

  
	
  By:

  	
  /s/ JAMES K. PATTERSON, CEO

  	
   

  	
  By:

  	
  /s/ HAROLD COFFEY
  V/P

  
					



 



 17