Exhibit 10.2


 


THIS INSTRUMENT WAS PREPARED BY:


 


Lindquist & Vennum P.L.L.P. (MCD)


4200 IDS Center


80 South Eighth Street


Minneapolis, MN 55402


(612) 371-3211


 


AMENDED AND RESTATED

FUTURE ADVANCE MORTGAGE

AND

SECURITY AGREEMENT

AND

FIXTURE FINANCING STATEMENT

AND

ASSIGNMENT OF LEASES AND RENTS



MORTGAGE – COLLATERAL REAL ESTATE MORTGAGE


 


THIS INDENTURE
(the “Mortgage”), made and given this 12th day of July, 2005, by
Great Plains Ethanol, LLC, a South Dakota limited liability company (“Borrower”),
whose address is c/o Broin & Associates, Inc., Attention:  Jeffrey S. Broin, 2209 East 57th
Street North, Sioux Falls, South Dakota 57104, to AgCountry Farm Credit
Services, FLCA (“Lender”), whose address is 1749 38th Street
Southwest, Fargo, North Dakota 58108.


 


PRELIMINARY RECITALS:


 


A.                                   The Borrower is the
owner in fee simple of certain real property more fully described on Exhibit A
attached hereto (the “Land”).


 


B.                                     Pursuant to a
certain Credit Agreement between the Borrower and Lender dated June 19,
2002 (“Credit Agreement”), as amended by a First Amendment to the Credit
Agreement dated September 1, 2004, as amended and restated in its entirety
by an Amended and Restated Credit Agreement of even date herewith, the Lender
has agreed to make three loans secured by this Mortgage to the Borrower in the
amount of up to Thirty Three Million Nine Hundred Eighty Four Thousand Eight
Hundred Forty Six and 77/100 Dollars ($33,984,846.77) (collectively, “Loan”).


 


C.                                     The Loan is
evidenced by promissory notes executed and delivered by the Borrower to the
Lender in the aggregate principal sum of Thirty Three Million Nine Hundred
Eighty Four Thousand Eight Hundred Forty Six and 77/100 Dollars
($33,984,846.77) (collectively, the “Note”).


 





















 


D.                                    The Note bears
interest at a per annum rate of interest all as more fully set forth in the
Note (“Interest Rate”) except that during the period of and continuance of a
default under the Note or Credit Agreement or an Event of Default under this
Mortgage, the Note shall bear interest at a per annum rate of interest of 200
basis points (2.0%) greater than the Interest Rate whether or not the Lender
has exercised its option to accelerate the maturity of the Note and declare the
entire unpaid Indebtedness Secured Hereby due and payable as more fully set
forth in the Note (“Default Rate”).


 


E.                                      As a requirement
to making the Loan the Lender requires among other things that the Borrower
execute and deliver this Mortgage on the fee simple title to the Land and the
building, buildings and other improvements located and/or to be constructed
upon the Land.


 


F.                                      The Note is
payable in installments with a final payment of principal and interest due not
later than October 1, 2013 (the
“Maturity Date”).


 


G.                                     As used herein,
the term “Note Rate” shall mean the rate of interest then in effect on the Note
whether the Interest Rate or Default Rate, as the case may be.


 


H.                                    The Borrower is
executing and delivering this Mortgage for the purpose of subjecting and
subordinating all of its right, title and interest in and to the Premises (as
defined below) to the lien of this Mortgage. 
It is expressly understood and agreed by acceptance of this Mortgage by
the Lender that the Borrower has executed this Mortgage for the purpose of
mortgaging, granting, bargaining, selling and conveying to the Lender and
granting to the Lender a security interest in all of its right, title and
interest in the Premises as security for the performance of the obligations
which are secured hereby.


 


NOW,
THEREFORE, in consideration of the debt hereinafter described and the sum of
One and 00/100 Dollars ($1.00) to Borrower in hand paid by Lender, the receipt
whereof is hereby acknowledged, Borrower does hereby GRANT, BARGAIN, SELL,
CONVEY AND CONFIRM, MORTGAGE AND WARRANT unto Lender, its successors and
assigns, AND GRANTS TO LENDER A SECURITY INTEREST IN all of the following
properties now or hereafter owned by the Borrower and hereinafter set forth
(all of the following being hereafter collectively referred to as the “Premises”),
WITH POWER OF SALE, to secure payment of the Note and all amounts owing under
the Note and any documents securing the Note:


 


A

LAND


 


All right,
title and interest in the tracts or parcels of real property lying and being in
the County of Turner, State of South Dakota, all as more fully described in Exhibit A
attached hereto and made a part hereof, together with all the estates and
rights in and to the real property and in and to lands lying in streets, alleys
and roads adjoining the real property and all buildings, structures,
improvements, fixtures and annexations, access rights, easements, rights of way
or use, servitudes, licenses, tenements, hereditaments and appurtenances now or
hereafter belonging or pertaining to the real property, and all water, mineral
and oil rights now or hereafter belonging or pertaining to the Land and all
proceeds and products derived therefrom whether now owned, leased or hereafter
acquired.


 


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B

BUILDINGS


 


All buildings
and improvements now or hereafter built, erected on, or existing on the Land.


 


C

PERSONAL PROPERTY


 


All buildings,
improvements, personal property, fixtures, fittings and furnishings, now or
hereafter attached to, located at, or placed in the improvements on the Land
described herein including, without limitation all machinery, fittings,
fixtures, apparatus, equipment or articles used to supply heating, gas,
electricity, air conditioning, water, light, waste disposal, power,
refrigeration, ventilation, and fire and sprinkler protection; all maintenance
supplies and repair equipment; all draperies, carpeting, floor coverings,
screens, storm windows and window coverings, blinds, awnings, shrubbery and
plants; all elevators, escalators and shafts, motors, machinery, fittings and
supplies necessary for their use; all building materials and supplies now or
hereafter delivered to the Premises (it being understood that the enumeration
of any specific articles of property shall in no way be held to exclude any
items of property not specifically enumerated), as well as renewals,
replacements, proceeds, additions, accessories, increases, parts, fittings,
insurance payments, awards and substitutes thereof, together with all interest
of Borrower in any such items hereafter acquired, as well as the Borrower’s
interest in any lease, or conditional sales agreement under which the same is
acquired, all of which personal property mentioned herein shall be deemed
fixtures and accessory to the freehold and a part of the realty and not
severable in whole or in part without material injury to the Premises.


 


D

RENTS, INCOME, LEASES AND PROFITS


 


All rents,
income, contract rights, leases and profits now due or which may hereafter
become due under or by virtue of any lease, sublease, license or agreement,
whether written or verbal, for the use or occupancy of the Premises or any part
thereof together with all tenant security deposits.


 


E

INSURANCE PROCEEDS


 


All awards,
payments, proceeds now or hereafter payable under any policy of insurance
insuring the Premises including but not limited to the proceeds of casualty
insurance, title insurance, business interruption/rents insurance or other
insurance maintained with respect to the Premises.


 


F

JUDGMENTS AND AWARDS


 


All awards,
compensation and settlements in lieu thereof made as a result of the taking by
power of eminent domain of the whole or any part of the Premises, including any
awards for 


 


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damages sustained to the Premises, for a temporary taking, change of grade
of streets or taking of access.


 


G

INTANGIBLES


 


All contracts,
licenses, permits, management records, files, consents, governmental approvals
and intangibles used, useful or required in the ownership and management of the
Premises together with all soil reports, building permits, variances, licenses,
utility permits and other permits and agreements relating to the construction
or equipping of the improvements on the Premises, or the operation or
maintenance of the Premises, including, without limitation, all warranties and
contract rights.


 


H

CONSTRUCTION CONTRACTS


 


Each contract
or agreement for the design, construction and equipping of the improvements to
be constructed on the Premises, together with all rights, title and interest of
Borrower in and to any existing or future changes, extensions, revisions,
modifications, guarantees or performance, or warranties of any kind thereunder.


 


I

PLANS AND SPECIFICATIONS


 


All plans and
specifications, all surveys, site plans, working drawings and papers, relating
to the Premises and the construction and equipping of the improvements on the
Premises, including without limitation, all architectural and site plans
prepared.


 


J

BUILDING SUPPLIES


 


All building
supplies and materials ordered or purchased for use in connection with the
construction and equipping of the improvements on the Premises.


 


K

SERVICE AGREEMENTS


 


All rights and
interests of Borrower in and under any and all service and other agreements
relating to the operation, maintenance, and repair of the Premises or the
buildings and improvements thereon.


 


It is
specifically understood that the enumeration of any specific articles of
property shall not exclude or be held to exclude any items of property not
specifically mentioned.  All of the
Premises hereinabove described, real, personal and mixed, whether affixed or
annexed or not, and all rights hereby conveyed and secured are intended to be
as a unit and are hereby understood and agreed and declared to be appropriated
to the use of the Premises, and shall for the purposes of this Mortgage be
deemed to be part of the Premises and conveyed and secured hereby.


 


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TO HAVE AND TO
HOLD THE SAME, together with the possession and right of possession of the
Premises, unto the Lender, its successors and assigns, forever.


 


PROVIDED
NEVERTHELESS, that if the Borrower, its successors or assigns, shall:


 


i)                                         pay
to the Lender all amounts owing under the Note and the Loan Documents (as
defined in the Credit Agreement) according to the terms thereof, the terms and
conditions of which are incorporated herein by reference and made a part
hereof, together with any extensions or renewals thereof, due and payable with
interest thereon at the Note Rate, the balance of said principal sum together
with interest thereon being due and payable in any event on the Maturity Date;
and


 


ii)                                      pay
to the Lender, its successors or assigns, at the times demanded and with
interest thereon at the Note Rate, all sums advanced (a) in protecting the
lien of this Mortgage, (b) in payment of taxes on the Premises, (c) in
payment of insurance premiums covering improvements thereon, (d) in
payment of principal and interest on prior liens, in payment of expenses and
attorney’s fees herein provided for and (e) all sums advanced for any
other purpose authorized herein; and


 


iii)                                   keep
and perform all of the covenants and agreements herein contained; and


 


iv)                                  keep
and perform all of the terms and conditions of any instrument given as
collateral for the Loan; and


 


v)                                     keep
and perform all of the terms and conditions of the Credit Agreement;


 


then this
Mortgage shall become null and void, and shall be released at Borrower’s
expense.  The Note, all such sums and all
such obligations, together with interest thereon, are herein collectively
referred to as the “Indebtedness Secured Hereby”.


 


AND IT IS
FURTHER COVENANTED AND AGREED AS FOLLOWS:


 


1.

GENERAL COVENANTS, AGREEMENTS, WARRANTIES


 


1.1                                 Payment of Indebtedness:  Observance of Covenants.  Borrower
shall duly and punctually pay each and every installment of principal and
interest on the Note and all other Indebtedness Secured Hereby, as and when the
same shall become due, and shall duly and punctually perform and observe all of
the covenants, agreements and provisions contained herein, in the Note and any
other instrument given as security for the payment of the Note.


 


1.2                                 Maintenance: 
Repairs.  Borrower shall not abandon the Premises,
shall keep and maintain the Premises in good condition, repair and operating
condition, normal wear and tear excluded, free from any waste or misuse, and
shall promptly repair or restore any buildings, improvements or structures now
or hereafter on the Premises which may become damaged or destroyed to their
condition prior to any such damage or destruction.  Borrower further agrees that excepting the
requirements imposed upon it under the Credit Agreement to complete the


 


5





















 


improvements as defined therein it will not expand any improvements on
the Premises, erect any new improvements or make any material alterations in
any improvements which shall alter the basic structure, adversely affect the
market value or change the existing architectural character of the Premises,
nor remove or demolish any improvements without suitable replacement thereof,
and shall complete within a reasonable time any buildings now or at any time in
the process of remodeling on the Premises; provided nothing herein shall
preclude Borrower from constructing improvements necessary or desirable to the
use of the Premises for Borrower’s business purposes which are non-structural
in nature and which do not constitute material alterations to the Premises or
affect the nature of use, structure or utility of the Premises or decrease the
market value of the Premises.


 


1.3                                 Compliance with Laws. Borrower shall comply with all requirements of
law, municipal ordinances and regulations affecting the Premises, shall comply
with all private restrictions and covenants affecting the Premises and shall
not acquiesce in or seek any rezoning classification affecting the Premises.


 


1.4                                 Payment of Operating Costs: Prior Mortgages and
Liens.  Borrower shall pay all operating costs and
expenses of the Premises, shall keep the Premises free from levy, attachment,
mechanics’, materialmen’s and other liens (“Liens”) and shall pay when due all
indebtedness which may be secured by mortgage, lien or charge on the Premises.


 


1.5                                 Payment of Impositions.  Borrower
shall pay when due (or with respect to real estate taxes, prior to becoming
delinquent) and in any event before any penalty attaches all taxes,
assessments, governmental charges, water charges, sewer charges, and other
fees, taxes, charges and assessments of every kind and nature whatsoever assessed
or charged against or constituting a lien on the Premises or any interest
therein (“Impositions”) and will upon demand furnish to the Lender proof of the
payment of any such Impositions.  In the
event of a court decree or an enactment after the date hereof by any
legislative authority of any law imposing upon a mortgagee the payment of the
whole or any part of the Impositions herein required to be paid by the
Borrower, or changing in any way the laws relating to the taxation of mortgages
or debts secured by mortgages or a lender’s interest in the Premises, so as to
impose such Imposition on the Lender or on the interest of the Lender in the
Premises, then, in any such event, Borrower shall bear and pay the full amount
of such Imposition, provided that if for any reason payment by Borrower of any
such Imposition would be unlawful, or if the payment thereof would constitute
usury or render the Indebtedness Secured Hereby wholly or partially usurious,
Lender, at its option, may declare the whole sum secured by this Mortgage with
interest thereon to be immediately due and payable, without prepayment premium,
or Lender, at its option, may pay that amount or portion of such Imposition as
renders the Indebtedness Secured Hereby unlawful or usurious, in which event
Borrower shall concurrently therewith pay the remaining lawful and non-usurious
portion or balance of said Imposition.


 


1.6                                 Contest of Impositions, Liens and Levies.  Borrower
shall not be required to pay, discharge or remove any Imposition or any Lien so
long as the Borrower shall in good faith contest the same or the validity
thereof by appropriate legal proceedings which shall operate to prevent the
collection of the Lien or Imposition so contested and the sale of the Premises,
or any part thereof, to satisfy the same, provided that the Borrower shall,
prior to the date such Lien or Imposition is due and payable, have given such
reasonable security as may be demanded by the


 


6





















 


Lender to insure such payments plus interest or penalties thereon, and
prevent any sale or forfeiture of the Premises by reason of such
nonpayment.  Any such contest shall be
prosecuted with due diligence and the Borrower shall promptly after final
determination thereof pay the amount of any such Lien or Imposition so
determined, together with all interest and penalties which may be payable in
connection therewith.  Notwithstanding
these provisions Borrower shall (and if Borrower shall fail so to do, Lender,
may but shall not be required to) pay any such Lien or Imposition
notwithstanding such contest if in the reasonable opinion of the Lender, the
Premises shall be in jeopardy or in danger of being forfeited or foreclosed.


 


1.7                                 Protection of Security.  Borrower
shall promptly notify Lender of and appear in and defend any suit, action or
proceeding that affects the Premises or the rights or interest of Lender
hereunder and the Lender may elect to appear in or defend any such action or
proceeding.  Borrower agrees to indemnify
and reimburse Lender from any and all loss, damage, expense or cost arising out
of or incurred in connection with any such suit, action or proceeding,
including costs of evidence of title and reasonable attorney’s fees and such
amounts together with interest thereon at the Note Rate shall become additional
“Indebtedness Secured Hereby” and shall become immediately due and payable.


 


1.8                                 Annual Statements.  Borrower
shall furnish to the Lender the financial statements, and such other
information, as may be required by the Credit Agreement.


 


1.9                                 Additional Assurances.  Borrower
agrees upon reasonable request by the Lender to execute and deliver such
further instruments, deeds and assurances including financing statements under
the Uniform Commercial Code and will do such further acts as may be necessary
or proper to carry out more effectively the purposes of this Mortgage and
without limiting the foregoing, to make subject to the lien hereof any property
agreed to be subjected hereto or covered by the granting clause hereof, or
intended so to be.  Borrower agrees to
pay any recording fees, filing fees, taxes, or other charges arising out of or
incident to the filing or recording of this Mortgage, such further assurances
and instruments and the issuance and delivery of the Note.


 


1.10                           Title.  Borrower is the lawful owner of
and has a good and marketable fee simple absolute title to the Premises and
will warrant and defend its title to the same free of all liens and
encumbrances, other than the Permitted Encumbrances set forth on attached Exhibit B
and has good right and lawful authority to grant, bargain, sell, convey,
mortgage and grant a security interest in the Premises as provided herein.


 


1.11                           Credit Agreement.  This Mortgage secures an
obligation incurred for the construction of an improvement on land and is a “Construction
Mortgage” as that term is used in the Uniform Commercial Code.  This Mortgage is the Mortgage referred to in
and is also given as security for the due and punctual performance, observance
and payment by the Borrower of the terms and conditions set forth in the Credit
Agreement, the terms and conditions of which are incorporated herein by
reference.  In addition to its remedies
hereunder, the Lender may, but shall not be required to, avail itself of any or
all of the rights and remedies available to it under the Credit Agreement, and
any sums expended by the Lender in availing itself of such rights and remedies
shall bear interest thereon at the rate specified in the Credit Agreement and
shall be so much additional Indebtedness Secured Hereby, and shall be payable
to the Lender immediately


 


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upon demand; provided that, no such payment by the Lender shall be
considered as waiving the event of default.


 


2.

UNIFORM COMMERCIAL CODE SECURITY AGREEMENT


 


2.1                                 Security Agreement.  This
Mortgage shall constitute a security agreement as defined in the Uniform
Commercial Code (“Code”) in the items described in the Granting Clauses of this
Mortgage (“Collateral”).  Any Collateral
installed in or used in the Premises are to be used by the Borrower solely for
Borrower’s business purposes or as the equipment and fixtures leased or
furnished by the Borrower, as landlord, to tenants of the Premises and such
Collateral will be kept at the buildings on the Premises and will not be
removed therefrom without the consent of the Lender and may be affixed to such
buildings but will not be affixed to any other real estate.  The remedies of the Lender hereunder are
cumulative and separate, and the exercise of any one or more of the remedies
provided for herein or under the Uniform Commercial Code shall not be construed
as a waiver of any of the other rights of the Lender including having any
Collateral deemed part of the realty upon any foreclosure thereof.  If notice to any party of the intended
disposition of the Collateral is required by law in a particular instance, such
notice shall be deemed commercially reasonable if given at least ten (10) days
prior to such intended disposition and may be given by advertisement in a
newspaper accepted for legal publications either separately or as part of a
notice given to foreclose the real property or may be given by private notice
if such parties are known to Lender. 
Neither the grant of a security interest pursuant to this Mortgage nor
the filing of a financing statement pursuant to the Code shall ever impair the
stated intention of this Mortgage that all Collateral comprising the Premises
and at all times and for all purposes and in all proceedings both legal or
equitable shall be regarded as part of the real property conveyed and secured
hereunder irrespective of whether such item is physically attached to the real
property or any such item is referred to or reflected in a financing statement.  Borrower will on demand deliver all financing
statements that may from time to time be required by Lender to establish,
perfect and continue the priority of Lender’s security interest in the
Collateral and shall pay all expenses incurred by Lender in connection with the
renewal or extensions of any financing statements executed in connection with
the Premises; and shall give advance written notice of any proposed change in
Borrower’s name, identity or structure and will execute and deliver to Lender
prior to or concurrently with such change all additional financing statements
that Lender may require to establish and perfect the priority of Lender’s
security interest.


 


2.2                                 Maintenance of Property.  Subject
to the provisions of this section, in any instance where Borrower in its sound
discretion determines that any Collateral subject to a security interest under
this Mortgage has become inadequate, obsolete, worn out, unsuitable,
undesirable or unnecessary for the operation of the Premises, Borrower may, at
its expense, remove and dispose of it and substitute and install other items
not necessarily having the same function, provided, that such removal and
substitution shall not impair the operating utility and unity of the
Premises.  All substituted items shall
become a part of the Premises and subject to the lien of the Mortgage.  Any amounts received or allowed Borrower upon
the sale or other disposition of the removed items of Collateral shall be
applied first against the cost of acquisition and installation of the
substituted items.  Nothing herein
contained shall be construed to prevent any tenant from removing from the
Premises trade fixtures, furniture and equipment installed by the tenant and 


 


8





















 


removable by the tenant under its terms of the lease, on the condition,
however, that the tenant shall at its own cost and expense, repair any and all
damages to the Premises resulting from or caused by the removal thereof.


 


2.3                                 Fixture Filing.  THIS MORTGAGE SHALL BE EFFECTIVE
AS A FINANCING STATEMENT FILED AS A FIXTURE FILING WITH RESPECT TO ALL GOODS
CONSTITUTING A PART OF THE COLLATERAL WHICH ARE OR ARE TO BECOME FIXTURES
RELATED TO THE PREMISES.  FOR PURPOSES OF
THE UNIFORM COMMERCIAL CODE THE FOLLOWING INFORMATION IS FURNISHED:


 


(a)                                  The name and address of the record owner of the
real estate described in this instrument is:


 


Great Plains
Ethanol, LLC


27716 – 462nd
Avenue


Chancellor,
South Dakota  57015


 


(b)                                 The name and address of the Debtor is:


 


Great Plains Ethanol, LLC


27716 – 462nd Avenue


Chancellor, South Dakota  57015


 


(c)                                  Debtor’s Federal Tax ID No. 46-0459188


 


(d)                                 The name and address of the Secured Party is:


 


AgCountry Farm
Credit Services, FLCA

1749 38th Street Southwest

P.O. Box 6020

Fargo, North Dakota 58108


 


(e)                                  Information concerning the security interest
evidenced by this instrument may be obtained from the Secured Party at its
address above.


 


(f)                                    This document covers goods which are or are to
become fixtures.


 


3.

INSURANCE AND ESCROWS


 


3.1                                 Insurance.  Borrower shall obtain, pay for
and keep in full force and effect during the term of this Mortgage at its sole
cost and expense the following policies of insurance:


 


(a)                                  All risk/open perils special form property
insurance with extended coverages including any building contents, sprinkler
coverage, Ordinance of Law coverage (including demolition cost, loss to
undamaged portions of any buildings and increased cost of construction) with
limits of 100% replacement cost and with no


 


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co-insurance
provision or if the insurance carrier requires, co-insurance provisions with an
agreed amount endorsement in amount acceptable to Lender;


 


(b)                                 Insurance against loss or damage from (i) leakage
of sprinkler systems and (ii) explosion of steam boilers, air conditioning
equipment, high pressure piping, machinery and equipment, pressure vessels or
similar apparatus now or hereafter installed in any improvements on the
Premises and including broad form boiler and machinery insurance (without
exclusion for explosion) covering all boilers or other pressure vessels,
machinery and equipment (including electrical equipment, sprinkler systems,
heating and air conditioning equipment, refrigeration equipment and piping)
located in, on or about the Premises and any improvements thereon in an amount
at least equal to the full replacement cost of such equipment and the building
or buildings housing the same;


 


(c)                                  Flood insurance if any part of the Premises now
(or subsequently determined to be) is located in an area identified by the
Federal Emergency Management Agency as an area having special flood hazards and
in which flood insurance has been made available under the National Flood
Insurance Act of 1968 (and amendment or successor act thereto) in an amount at
least equal to the lesser of the full replacement cost of all buildings and
equipment on the Premises, the outstanding principal amount of the Note or the
maximum limits of coverage available with respect to the buildings and equipment
under said Act;


 


(d)                                 Sinkhole insurance, if available in the area where
the Premises are located, in an amount at least equal to principal balance of
the Note or the maximum limit of coverage available, whichever is less;


 


(e)                                  Rents Loss or Business Interruption insurance
covering risk of loss due to the occurrence of any hazards insured against
under the required fire and extended coverage insurance in an meant equal to
one (1) year’s loss of income as such income may change from time to time
due to changes in income from the Premises;


 


(f)                                    Commercial general public liability insurance
(including product liability, completed operations, contractual liability, host
liquor liability, broad form property damage, and personal injuries, including
death resulting therefrom) and with single limit coverage for personal and
bodily injury and property damage of at least $5,000,000.00 for each
occurrence;


 


(g)                                 Such other coverages appropriate to the Premises,
its location and use as Lender may from time to time require such as
earthquake, mine subsidence, sinkhole, personal property supplemental
liability, or coverages of other property - specific risks.


 


and while any
improvements are in the process of construction on the Premises:


 


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aa)                                Builder’s Risk
Insurance written on a completed value basis in an amount equal to the full
replacement cost of the Improvements at the date of completion with coverage
available on the so-called non-reporting “all risk” form of  policy, including coverage against collapse
and water damage, with standard non-contributing mortgagee clauses, such
insurance to be in such amounts and form and written by such companies as shall
be approved by Lender, and the originals of such policies (together with
appropriate endorsement thereto, evidence of payment of premiums thereon and
written agreements by the insurer or insurers therein to give Lender ten (10) days’
prior written notice of any intention to cancel).


 


bb)                              Contractor’s
Comprehensive General Liability Insurance including operations, product
liability, contingent liability operations, operations of subcontractors,
completed operations, contractual liability insurance and comprehensive
automobile liability insurance (including hired and non-owned liability) and
with single limit coverage for personal and bodily injury and property damage
of at least $5,000,000.00 for each occurrence.


 


cc)                                Statutory workmen’s
compensation coverage in the required amounts.


 


Such insurance
policies shall be written on forms and with insurance companies satisfactory to
Lender, shall be in amounts sufficient to prevent the Borrower from becoming a
co-insurer of any loss thereunder, and shall bear a satisfactory mortgagee
clause in favor of the Lender with loss proceeds under any such policies to be
made payable to the Lender.  Blanket
policies must include limits by property location.  All required policies of insurance or
acceptable certificates thereof together with evidence of the payment of
current premiums therefore shall be delivered to and be held by the
Lender.  The Borrower shall, within
thirty (30) days prior to the expiration of any such policy, deliver other
original policies or certificates of the insurer evidencing the renewal of such
insurance together with evidence of the payment of current premiums
therefor.  In the event of a foreclosure
of this Mortgage or any acquisition of the Premises by the Lender all such
policies and any proceeds payable therefrom, whether payable before or after a
foreclosure sale, or during the period of redemption, if any, shall become the
absolute property of the Lender to be utilized at its discretion.  In the event of foreclosure or the failure to
obtain and keep any required insurance the Borrower empowers the Lender to
effect the above insurance upon the Premises at Borrower’s expense and for the
benefit of the Lender in the amounts and types aforesaid for a period of time
covering the time of redemption from foreclosure sale, and if necessary
therefor, to cancel any or all existing insurance policies.  Borrower agrees to pay Lender such fees as
may be permitted under applicable law for the costs incurred by Lender in
determining, from time to time, whether the Premises are located within an area
having special flood hazards.  Such fees
shall include the fees charged by any organization providing for such services.


 


3.2                                 Escrows.  Upon demand, Borrower shall
deposit with the Lender, or at Lender’s request, with its servicing agent, on
the first day of each and every month hereafter as a deposit to pay the costs
of taxes, assessments and insurance premiums next due (“Charges”):


 


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(a)                                  Initially a sum such that the amounts to be
deposited pursuant to (b) next and such initial sum shall equal the
estimated Charges for the next due payment; and


 


(b)                                 Thereafter an amount equal to one-twelfth (1/12th)
of the estimated annual Charges due on the Premises.


 


Lender will,
upon the presentation to the Lender by the Borrower of the bills therefor, pay
the Charges from such deposits or will upon presentation of receipted bills
therefor, reimburse the Borrower for such payments made by the Borrower.  In the event the deposits on hand shall not be
sufficient to pay all of the estimated Charges when the same shall become due
from time to time, or the prior deposits shall be less than the currently
estimated monthly amounts, then the Borrower shall pay to the Lender on demand
any amount necessary to make up the deficiency. 
The excess of any such deposits shall be credited to subsequent payments
to be made for such items.  If a default
or an event of default shall occur under the terms of this Mortgage the Lender
may, at its option, without being required so to do, apply any deposits on hand
to the Indebtedness Secured Hereby, in such order and manner as the Lender may
elect.  When the Indebtedness Secured
Hereby has been fully paid any remaining deposits shall be returned to the
Borrower as its interest may appear.  All
deposits are hereby pledged as additional security for the Indebtedness Secured
Hereby, shall be held for the purposes for which made as herein provided, may
be held by Lender or its servicing agent and may be commingled with other funds
of the Lender, or its servicing agent, shall be held without any allowance of
interest thereon and shall not be subject to the decision or control of the
Borrower.  Neither Lender nor its
servicing agent shall be liable for any act or omission made or taken in good
faith.  In making any payments, Lender or
its servicing agent may rely on any statement, bill or estimate procured from
or issued by the payee without inquiry into the validity or accuracy of the
same.  If the taxes shown in the tax
statement shall be levied on property more extensive than the Premises, then
the amounts escrowed shall be based on the entire tax bill and Borrower shall
have no right to require an apportionment and Lender or its servicing agent may
pay the entire tax bill notwithstanding that such taxes pertain in part to
other property and the Lender shall be under no duty to seek a tax division or
apportionment of the tax bill.


 


4.

APPLICATION OF INSURANCE AND AWARDS


 


4.1                                 Damage or Destruction of the Premises.  Borrower
shall give the Lender prompt notice of any damage to or destruction of the
Premises and in case of loss covered by policies of insurance the Lender is
hereby authorized at its option to settle and adjust any claim arising out of
such policies and collect and receipt for the proceeds payable therefrom; provided,
that the Borrower may itself adjust and collect for any losses arising out of a
single occurrence aggregating not in excess of Twenty-five Thousand and 00/100
($25,000.00) Dollars.  Any expense
incurred by the Lender in the adjustment and collection of insurance proceeds
(including the cost of any independent appraisal of the loss or damage on
behalf of Lender) shall be reimbursed to the Lender first out of any
proceeds.  The proceeds or any part
thereof shall be applied to reduction of the Indebtedness Secured Hereby then
most remotely to be paid, whether due or not, without the application of any
prepayment premium, or to the restoration or repair of the Premises, the choice
of application to be solely at the discretion of Lender.


 


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4.2                                 Condemnation.  Borrower shall give the Lender
prompt notice of any actual or threatened condemnation or eminent domain
proceedings affecting the Premises and hereby assigns, transfers, and sets over
to the Lender the entire proceeds of any award or claim for damages or
settlement in lieu thereof for all or any part of the Premises taken or damaged
under such eminent domain or condemnation proceedings, the Lender being hereby
authorized to intervene in any such action and to collect and receive from the
condemning authorities and give proper receipts and acquittances for such
proceeds.  Borrower will not enter into
any agreements with the condemning authority permitting or consenting to the
taking of the Premises or agreeing to a settlement unless prior written consent
of Lender is obtained.  Any expenses
incurred by the Lender in intervening in such action or collecting such
proceeds, including reasonable attorney’s fees, shall be reimbursed to the
Lender first out of the proceeds.  The
proceeds or any part thereof shall be applied upon or in reduction of the
Indebtedness Secured Hereby then most remotely to be paid, whether due or not,
without the application of any prepayment premium, or to the restoration or
repair of the Premises, the choice of application to be solely at the
discretion of Lender.


 


4.3                                 Disbursement of Insurance and Condemnation
Proceeds.  Any restoration or repair shall be done under
the supervision of an architect acceptable to Lender and pursuant to plans and
specifications approved by the Lender. 
In any case where Lender may elect to apply the proceeds to repair or
restoration or permit the Borrower to so apply the proceeds they shall be held
by Lender for such purposes and will from time to time be disbursed by Lender
to defray the costs of such restoration or repair under such safeguards and
controls as Lender may establish to assure completion in accordance with the
approved plans and specifications and free of liens or claims.  Borrower shall on demand deposit with Lender
any sums necessary to make up any deficits between the actual cost of the work
and the proceeds and provide such lien waivers and completion bonds as Lender
may reasonably require.  Any surplus
which may remain after payment of all costs of restoration or repair may at the
option of the Lender be applied on account of the Indebtedness Secured Hereby
then most remotely to be paid, whether due or not, without application of any
prepayment premium or shall be returned to Borrower as its interest may appear,
the choice of application to be solely at the discretion of Lender.


 


5.

LEASES AND RENTS


 


5.1                                 Borrower to Comply with Leases.  Borrower
will, at its own cost and expense:


 


(a)                                  Provide the Lender copies of all lease(s) of the
Premises (whenever the term “lease” is used herein in the context where
Borrower is the lessor/sublessor, the term “lease” includes any sublease);


 


(b)                                 Faithfully abide by, perform and discharge each
and every obligation, covenant and agreement under any lease(s) to be performed
by the lessor/sublessor thereunder;


 


(c)                                  Enforce or secure the performance of each and
every material obligation, covenant, condition and agreement of said lease(s)
by the tenants thereunder to be performed;


 


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(d)                                 Not borrow against, pledge or further assign any
rents due under said lease(s);


 


(e)                                  Not permit the prepayment of any rents for more
than the next accruing installment of Rents, nor anticipate, discount,
compromise, forgive or waive any Rents;


 


(f)                                    Not consent to a subordination of any lease(s) to
any party other than Lender and then only if specifically required by the
Lender; and


 


(g)                                 Not permit any tenant to assign or sublet its
interest in its lease unless required to do so by the terms of its lease.


 


5.2                                 Lender’s Right to Perform Under Leases.  Should
the Borrower fail to perform, comply with or discharge any obligations of
Borrower under any lease or should the Lender become aware of or be notified by
any tenant under any lease of a failure on the part of Borrower to so perform,
comply with or discharge its obligations under said lease, Lender may, but
shall not be obligated to, and without further demand upon the Borrower, and
without waiving or releasing Borrower from any obligation in this Mortgage
contained, remedy such failure, and the Borrower agrees to repay upon demand
all sums incurred by the Lender in remedying any such failure together with
interest at the then rate in effect on the Note.  All such sums, together with interest as
aforesaid shall become so much additional Indebtedness Secured Hereby, but no
such advance shall be deemed to relieve the Borrower from any default
hereunder.


 


5.3                                 Assignment of Leases and Rents.  To
further secure the Indebtedness Secured Hereby the Borrower does hereby sell,
assign and transfer unto Lender all of the leases, rents, income and profits
now due and which may hereafter become due under or by virtue of any lease,
whether written or verbal, or any agreement for the use or occupancy of the
Premises, it being the intention of this Mortgage to establish an absolute
transfer and assignment of all such leases and agreements and all of the rents,
income and profits from the Premises unto the Lender and the Borrower does
hereby appoint irrevocably the Lender its true and lawful attorney in its name
and stead, which appointment is coupled with an interest, to collect all of
said rents, income and profits; provided, Lender grants the Borrower the
privilege, revocable, to collect and retain such rents, income, and profits
unless and until an Event of Default exists under this Mortgage.  Upon an Event of Default and whether before
or after the institution of legal proceedings to sell the Premises or to foreclose
the lien hereof or before or after sale of the Premises or during any period of
redemption the Lender, and without regard to waste, adequacy of the security or
solvency of the Borrower, may revoke the licenses granted Borrower hereunder
and may, at its option, without notice:


 


(a)                                  in person or by agent, with or without taking
possession of or entering the Premises, with or without bringing any action or
proceeding, give, or require Borrower to give, notice to any or all tenants
under any lease authorizing and directing the tenant to pay such rents and
profits to Lender; collect all of the rents, income and profits; enforce the
payment thereof and exercise all of the rights of the landlord under any lease
and all of the rights of Lender hereunder; may enter upon, take possession of,
manage and operate said Premises, or any part thereof, may cancel, enforce or
modify any leases, and fix or modify rents, and do any acts


 


14





















 


which the
Lender deems proper to protect the security hereof with or without taking
possession of said Premises; or


 


(b)                                 apply for the appointment of a receiver in
accordance with the statutes and law made and provided for, which receivership
Borrower hereby consents to, who shall collect the rents, profits and all other
income of any kind; manage the Premises so as to prevent waste; execute leases
within or beyond the period of receivership, and apply the rents, profits and
income in the following order:


 


(i)                                     to payment of all reasonable fees of any receiver
appointed hereunder,


 


(ii)                                  to application of tenant’s security deposits as
may be required by law,


 


(iii)                               to payment when due of prior or current real estate taxes or special
assessments with respect to the Premises or, if the Mortgage so requires, to
the periodic escrow for payment of the taxes or special assessments then due,


 


(iv)                              to payment when due of premiums for insurance of the type required by the
Mortgage or, if the Mortgage so requires, to the periodic escrow for the
payment of premiums then due,


 


(v)                                 to payment of all expenses for normal maintenance
of the Premises,


 


(vi)                              if received prior to a foreclosure sale to the Indebtedness Secured
Hereby; provided, if the Premises shall be foreclosed and sold pursuant to a
foreclosure sale, then during the period of redemption from such foreclosure
sale:


 


(aa)                            If the Lender is the
purchaser at the foreclosure sale, the rents shall be paid to the Lender to be
applied to the extent of any deficiency remaining after the sale, the balance
to be retained by the Lender, and if the Premises be redeemed by the Borrower
or any other party entitled to redeem, to be applied as a credit against the
redemption price provided, if the Premises not be redeemed, any remaining
excess rents to belong to the Lender, whether or not a deficiency exists; or


 


(bb)                          If the Lender is not the
purchaser at the foreclosure sale, the rents shall be paid to the Lender to be
applied, to the extent of any deficiency remaining after the sale, and the
balance, if any, to the Purchaser to be applied as a credit against the
redemption price provided, if the Premises not be redeemed any remaining excess
rents shall be paid to the purchaser.


 


The entering
upon and taking possession of the Premises, the collection of such rents and
profits and the application thereof as aforesaid shall not cure or waive any
defaults under this Mortgage


 


15





















 


nor in any way
operate to prevent the Lender from pursuing any other remedy which it may now
or hereafter have under the terms of this Mortgage nor shall it in any way be
deemed to constitute the Lender a mortgagee-in-possession.  The rights and powers of the Lender hereunder
shall remain in full force and effect both prior to and after any foreclosure
of the Mortgage and any sale pursuant thereto and until expiration of the
period of redemption from said sale, regardless of whether a deficiency remains
from said sale.  The purchaser at any
foreclosure sale, including the Lender, shall have the right, at any time and
without limitation, to advance money to any receiver appointed hereunder to pay
any part or all of the items which the receiver would otherwise be authorized
to pay if cash were available from the Premises and the sum so advanced, with
interest at the rate then in effect in the Note, or if the Note has been
extinguished, at the highest rate set forth in the Note, shall be a part of the
sum required to be paid to redeem from any foreclosure sale.  The rights hereunder shall in no way be
dependent upon and shall apply without regard to whether the Premises are in
danger of being lost, materially injured or damaged or whether the Premises are
adequate to discharge the Indebtedness Secured Hereby.  The rights contained herein are in addition
to and shall be cumulative with the rights given in any separate instrument, if
any, assigning any leases, rents and profits of the Premises and shall not
amend or modify the rights in any such separate agreement.


 


5.4                                 Present Assignment and License.  The
assignment of the rents and leases contained herein is a perfected, absolute
and present assignment of the rents and lease(s), provided the Lender grants to
the Borrower a revocable license to:


 


(a)                                  collect, but not prior to accrual, the rents, and
to retain, use and enjoy the same; and


 


(b)                                 take “in the ordinary course of business” Leasing
Actions (as defined below) provided prompt notification is given to the Lender
of any such Leasing Action.


 


As used herein
the term “in the ordinary course of business” means acting as a prudent and
responsible landlord would under similar circumstances with due regard for the
maintenance of the income stream provided by the lease(s).  As used herein the term “Leasing Actions”
shall mean all of the following rights of the Borrower:


 


(i)                                     the right to waive, excuse, condone or in any
manner release or discharge the tenants of or from the obligations, covenants,
conditions and agreements by any tenant to be performed under the lease(s);


 


(ii)                                  the right to terminate any lease(s);


 


(iii)                               the right to amend or modify any lease(s) or alter the obligations of the
parties thereunder without the consent of the Lender;


 


(iv)                              the right to accept a surrender of any lease(s) prior to its expiration
date; and


 


(v)                                 the right to exercise the remedies of the landlord
under the lease(s) by reason of any default by the tenant(s) thereunder.


 


16





















 


The Lender at
its sole election may revoke any such licenses granted to Borrower upon the
occurrence of a Event of Default.  In the
event this Mortgage is foreclosed, by action or advertisement, Borrower agrees
to immediately forfeit, surrender and deliver to Lender all rights of
possession of the Premises and shall deliver to Lender all rents and profits
accruing  from the Premises


 


6.

RIGHTS OF LENDER


 


6.1                                 Right to Cure Default.  If the
Borrower shall fail to comply with any of the covenants or obligations of this
Mortgage, the Lender may, but shall not be obligated to, without further notice
to Borrower, and without waiving or releasing Borrower from any obligation in
this Mortgage contained, remedy such failure, and the Borrower agrees to repay
upon demand all sums incurred by the Lender in remedying any such failure
together with interest at the then rate in effect on the Note.  All such sums, together with interest as
aforesaid shall become so much additional Indebtedness Secured Hereby, but no
such advance shall be deemed to relieve the Borrower from any failure
hereunder.


 


6.2                                 No Claim Against the Lender.  Nothing
contained in this Mortgage shall constitute any consent or request by the
Lender, express or implied, for the performance of any labor or services or for
the furnishing of any materials or other property in respect of the Premises or
any part thereof, nor as giving the Borrower or any party in interest with
Borrower any right, power or authority to contract for or permit the
performance of any labor or services or the furnishing of any materials or
other property in such fashion as would create any personal liability against
the Lender in respect thereof or would permit the making of any claim that any
lien based on the performance of such labor or services or the furnishing of
any such materials or other property is prior to the lien of this Mortgage.


 


6.3                                 Inspection.  Borrower will permit the Lender’s
authorized representatives to enter the Premises at reasonable times for the
purpose of inspecting the same; provided the Lender shall have no duty to make
such inspections and shall not incur any liability or obligation for making or
not making any such inspections.


 


6.4                                 Waivers; Releases; 
Resort to Other Security, Etc.  Without affecting the liability of
any party liable for payment of any Indebtedness Secured Hereby or performance
of any obligation contained herein, and without affecting the rights of the
Lender with respect to any security not expressly released in writing, the
Lender may, at any time, and without notice to or the consent of the Borrower
or any party in interest with the Premises or the Note:


 


(a)                                  release any person liable for payment of all or
any part of the Indebtedness Secured Hereby or for performance of any
obligation herein;


 


(b)                                 make any agreement extending the time or otherwise
altering the terms of payment of all or any part of the Indebtedness Secured Hereby
or modifying or waiving any obligation, or subordinating, modifying or
otherwise dealing with the lien or charge hereof;


 


17





















 


(c)                                  accept any additional security;


 


(d)                                 release or otherwise deal with any property, real
or personal, including any or all of the Premises, including making partial
releases of the Premises; or


 


(e)                                  resort to any security agreements, pledges,
contracts of guarantee, assignments of rents and leases or other securities,
and exhaust any one or more of said securities and the security hereunder,
either concurrently or independently and in such order as it may determine.


 


6.5                                 Waiver of Appraisement, Homestead, Marshaling.  Borrower
hereby waives to the full extent lawfully allowed the benefit of any homestead,
appraisement, evaluation, stay and extension laws now or hereinafter in
force.  Borrower hereby waives any rights
available with respect to marshaling of assets so as to require the separate
sales of any portions of the Premises, or so as to require Lender to exhaust
its remedies against a specific portion of the Premises before proceeding
against other portions of the Premises, or so as to require Lender to exhaust
its remedies against the Premises or any other real property or personal
property securing the Note (whether located in the State of South Dakota or any
other state) before proceeding against the Premises or any such other real
property or personal property securing the Note.  Borrower does hereby expressly consent to and
authorize the sale of the Premises or any part thereof as a single unit or
parcel.  Borrower also hereby waives any
and all rights of reinstatement and redemption from sale under any order or
decree of  foreclosure pursuant to rights
herein granted, on behalf of Borrower, and each and every person acquiring any
interest in, or title to the Premises described herein subsequent to the date
of this Mortgage, and on behalf of all other persons to the extent permitted by
applicable law.  Borrower specifically consents
to Lender’s foreclosure of this Mortgage and of any other mortgages, deeds of
trust, and instruments securing the Note, whether by advertisement, by judicial
action in one or more courts, or by any other manner provided by law, and such
foreclosures may occur simultaneously or in any order that Lender may determine
in its sole discretion.


 


6.6                                 Business Loan Representation.  Borrower
represents and warrants to Lender that the Indebtedness evidenced by the Note
is a business loan transacted solely for the purpose of carrying on the
business of Borrower and not a consumer transaction and that the Premises do
not constitute the homestead of Borrower.


 


7.

EVENTS OF DEFAULT AND REMEDIES


 


7.1                                 Events of Default.  It shall
be an event of default (“Event of Default”) under this Mortgage upon the
happening of any of the following:


 


(a)                                  failure to make any payment on the Note whether
principal, interest, premium or late charge, when and as the same becomes due
(whether at the stated maturity or at a date fixed for any installment payment
or any accelerated payment date or otherwise) and such failure shall continue
for a period of ten (10) days; or


 


18





















 


(b)                                 a “Default” as defined therein shall occur under
the Credit Agreement or Note and shall not have been cured within the time
permitted therein to cure; or


 


(c)                                  failure to pay, perform or comply with when due
any other Indebtedness Secured Hereby and such failure shall continue for a
period of ten (10) days after notice thereof to the Borrower; or


 


(d)                                 failure to comply with or perform any of the other
terms, conditions or covenants of this Mortgage and such failure shall continue
for a period of thirty (30) days after notice thereof to Borrower; provided, if
the same is not susceptible of cure within said time limits and the same may be
cured within a reasonable period of time thereafter the time period shall be
extended for such additional time as is reasonably necessary to effectuate such
cure provided such curative action is promptly taken in good faith and
diligently prosecuted to completion and the security afforded hereby and the
interest of the Lender is not in jeopardy or be subject to forfeiture; or


 


(e)                                  Borrower shall fail to pay its debts as they
become due, make an assignment for the benefit of its creditors, or shall admit
in writing its inability to pay its debts as they become due, or shall file a
petition under any chapter of the Federal Bankruptcy Code or any similar law,
state or federal, now or hereafter existing, or shall become “insolvent”
as  that term is generally defined under
the Federal Bankruptcy Code, or shall in any involuntary bankruptcy case
commenced against it file an answer admitting insolvency or inability to pay
its debts as they become due, or shall fail to obtain a dismissal of such case
within sixty (60) days after its commencement or convert the case from one
chapter of the Federal Bankruptcy Code to another chapter, or be the subject of
an order for relief in such bankruptcy case, or be adjudged a bankrupt or
insolvent, or shall have a custodian, trustee or receiver appointed for, or
have any court take jurisdiction of its property, or any part thereof, in any
proceeding for the purpose of reorganization, arrangement, dissolution or
liquidation, and such custodian, trustee or receiver shall not be discharged,
or such jurisdiction shall not be relinquished, vacated or stayed within sixty
(60) days of the appointment; or


 


(f)                                    an event of default shall occur under any other
instrument issued by Borrower in connection with the Credit Agreement or Note
and shall not have been cured within the time permitted therein to cure; or


 


(g)                                 a judgment, writ or warrant of attachment or
execution, or similar process shall be entered and become a lien or be issued
or levied against the Premises and shall not be released or fully bonded within
forty-five (45) days after its entry, issue or levy; or


 


(h)                                 any representation or warranty made by Borrower
herein, in the Credit Agreement or in any other instrument issued by Borrower
in connection therewith shall be false, materially breached or dishonored; or


 


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(i)                                     the Borrower shall be dissolved, liquidated or
wound up or shall fail to maintain its existence as a going concern in good
standing.


 


7.2                                 Lender’s Right to Accelerate.  If an
Event of Default shall occur the Lender may declare the entire unpaid principal
balance of the Note together with all other Indebtedness Secured Hereby to be
immediately due and payable and thereupon all such unpaid principal balance of
the Note together with all secured interest thereon at the Default Rate and all
other Indebtedness Secured Hereby shall be and become immediately due and
payable.


 


7.3                                 Remedies of Lender and Right to Foreclose.  Upon the
occurrence of an Event of Default, Borrower hereby authorizes and fully
empowers Lender to invoke the power of sale, foreclose this Mortgage by action
or advertisement by judicial or non-judicial proceedings, or obtain any other
remedy permitted by applicable law. 
Lender shall be entitled to collect all expenses incurred in pursuing
the remedies provided in this paragraph 7.3, including but not limited to
attorneys’ fees and costs of title evidence.


 


If Lender
invokes the power of sale, Lender shall give notice of the sale to Borrower in
the manner required by law.  Lender shall
publish the notice of sale, and the Premises shall be sold in the manner
prescribed by law.  Lender shall sell the
Premises in one or more parcels and in any order Lender determines.  Lender or its designee may purchase the
Premises at any sale.  The proceeds of
the sale shall be applied in the following order:  (a) to all expenses of the sale,
including, but not limited to, attorneys’ fees; (b) to all sums secured by
this Mortgage; and (c) any excess to the clerk of the court subject to the
order of the court.


 


No remedy
granted or conferred by this Mortgage is intended to be exclusive of any other
remedy or remedies and each and every remedy shall be cumulative and shall be
in addition to every remedy given hereunder or now or hereafter existing at law
or in equity or by statute.  No delay or omission of Lender to exercise
any right or power accruing upon an Event of Default shall impair any such
right or power or shall be construed to be a waiver of any such Event of
Default or any acquiescence therein and every right, power and remedy given by
this Mortgage or now or hereafter existing at law or in equity or by statute
may be exercised from time to time and as often as may be deemed expedient by
the Lender.


 


7.4                                 Receiver.  If an Event of Default shall
occur, the Lender shall be entitled as a matter of right without notice and
without giving bond and without regard to the solvency or insolvency of the
Borrower, or waste of the Premises or adequacy of the security of the Premises,
to apply for the appointment of a Receiver, (a) under SDCL § 21-21-2,
or any successor or supplementary statute thereto who shall have all the
rights, powers and remedies as provided by such statute and who shall apply the
rents, income and profits as provided by statute and thereafter to all expenses
for maintenance of the Premises and to the costs and expenses of the
receivership, including reasonable attorneys fees and to the repayment of the
Indebtedness Secured Hereby or (b) pursuant to the Assignment of Rents
executed by the Borrower to the Lender given contemporaneously with this
Mortgage who shall in addition to the rights, powers and remedies as provided
by statute have such rights, powers and remedies as provided in such Assignment
of Rents and who shall apply the rents, income and profits as provided therein.


 


20





















 


7.5                                 Rights Under Uniform Commercial Code.  In
addition to the rights available to a mortgagee of real property Lender shall
also have all the rights, remedies and recourse available to a secured party
under the Uniform Commercial Code including the right to proceed under the
provisions of the Uniform Commercial Code governing default as to any property
which is subject to the security interest created by the Mortgage or to proceed
as to such personal property in accordance with the procedures and remedies
available pursuant to a foreclosure of real estate.


 


7.6                                 Due on Sale or Mortgaging, Etc.  In the
event of a Transfer (as defined below) without the written consent of the
Lender being first obtained, whether voluntarily, involuntarily, or by
operation of law, then at the sole option of the Lender, the Lender may upon
notice to the Borrower declare the entire Principal Balance together with
accrued interest, due and payable in full. 
Any such payment shall be subject to the requirements, if any, in the
Note providing for the payment of a prepayment premium in the event of a non-permitted
Transfer.  A consent by the Lender as to
any one Transfer shall not be deemed to be a waiver of the right to require
consent to a future Transfer.  As used
herein, the term “Transfer” shall include any sale, pledge, assignment,
Mortgage, encumbrance, security interest, consensual lien, hypothecation,
transfer or divesture or otherwise of or in i) the Borrower’s legal or
equitable interest in the Premises or ii) the Borrower, either directly or
indirectly, including an interest taken as security; whether or not of record
and whether or not for consideration shall be deemed a Transfer.


 


7.7                                 Rights Cumulative.  Each
right, power or remedy herein conferred upon the Lender is cumulative and in
addition to every other right, power or remedy, express or implied, now or
hereafter arising, available to Lender, at law or in equity, or under any other
agreement, and each and every right, power and remedy herein set forth or
otherwise so existing may be exercised from time to time as often and in such
order as may be deemed expedient by the Lender and shall not be a waiver of the
right to exercise at any time thereafter any other right, power or remedy.  No delay or omission by the Lender in the
exercise of any right, power or remedy arising hereunder or arising otherwise
shall impair any such right, power or remedy or the right of the Lender to
resort thereto at a later date or be construed to be a waiver of any default or
event of default under this Mortgage or the Note.


 


7.8                                 Right to Discontinue Proceedings.  In the
event Lender shall have proceeded to invoke any right, remedy or recourse
permitted under this Mortgage and shall thereafter elect to discontinue or
abandon the same for any reason, Lender shall have the unqualified right to do
so and in such event Borrower and Lender shall be restored to their former
positions with respect to the Indebtedness Secured Hereby.  This Mortgage, the Premises and all rights,
remedies and recourse of the Lender shall continue as if the same had not been
invoked.


 


7.9                                 Acknowledgment of Waiver of Hearing Before Sale.  Borrower
understands and agrees that if any Event of Default is made under the terms of
this Mortgage, Lender has the right, inter
alia, to foreclose this Mortgage pursuant to SDCL chapters 21-47, 21-48
and 21-48A, as hereafter amended, or pursuant to any similar or replacement
statute hereafter enacted; that if the Lender elects to foreclose by power of
sale, the Lender may cause the Premises, or any part thereof, to be sold at
public auction; that notice of such sale must be published as required by law
and that a notice specified by law may not be required to be served upon
Borrower.  Borrower further understands
that in the event of such Event of Default the Lender may also elect its rights
under the Uniform Commercial Code and take possession of the Personal Property
(as defined in


 


21





















 


this Mortgage) and dispose of the same by sale or otherwise in one or
more parcels provided that at least ten (10) days’ prior notice of such
disposition must be given, all as provided for by the Uniform Commercial Code,
as hereafter amended or by any similar or replacement statute hereafter
enacted.  Borrower further understands
that under the Constitution of the United States and the Constitution of the
State of South Dakota it may have the right to notice and hearing before the
Premises may be sold and that the procedure for foreclosure described above
does not insure that notice will be given to the Borrower and neither said
procedure for foreclosure nor the Uniform Commercial Code requires any hearing
or other judicial proceeding.  BORROWER
HEREBY EXPRESSLY CONSENTS AND AGREES 
THAT THE PREMISES MAY BE FORECLOSED AND THAT THE PERSONAL PROPERTY MAY BE
DISPOSED OF PURSUANT TO THE UNIFORM COMMERCIAL CODE WITHOUT NOTICE TO
BORROWER, ALL AS DESCRIBED ABOVE. 
BORROWER ACKNOWLEDGES THAT IT IS REPRESENTED BY LEGAL COUNSEL; THAT
BEFORE SIGNING THIS DOCUMENT THIS PARAGRAPH AND BORROWER’S CONSTITUTIONAL
RIGHTS WERE FULLY EXPLAINED BY SUCH COUNSEL AND THAT BORROWER UNDERSTANDS THE
NATURE AND EXTENT OF THE RIGHTS WAIVED HEREBY AND THE EFFECT OF SUCH WAIVER.


 


8.

HAZARDOUS MATERIALS


 


8.1                                 Definitions.  As used herein, the following
definition shall apply:


 


(a)                                  “Hazardous Substance” shall mean any hazardous or
toxic material, substance or waste, pollutant or contaminant which is regulated
under any statute, law, ordinance, rate or regulation of any local, state,
regional or Federal authority having jurisdiction over the property of the
Borrower, or its use, including but not limited to any material, substance or
waste which is (a) defined as a hazardous substance under any
Environmental Laws; (b) a petroleum hydrocarbon, including crude oil or
any fraction thereof and all petroleum products; (c) polychlorinated
biphenyls; (d) lead; (e) urea formaldehyde; (f) asbestos; (g) flammable
explosives; (h) infectious materials; (i) radioactive materials; or
(j) defined or regulated as a hazardous substance or hazardous waste under any rules or
regulations promulgated under any of the foregoing Environmental Laws.


 


(b)                                 “Environmental Laws” shall mean any international,
federal, state or local statute, law, regulation, order, consent, decree,
judgment, permit, license, code, covenant, deed restriction, common law,
treaty, convention, ordinance or other requirement relating to public health,
safety or the environment, including, without limitation, those relating to
releases, discharges or emissions to air, water, land or groundwater, to the
withdrawal or use of groundwater, to the use and handling of polychlorinated
biphenyls or asbestos, to the disposal, treatment, storage or management of
hazardous or solid waste, or Hazardous Substances or crude oil, or any fraction
thereof, or to exposure to toxic or hazardous materials to the handling,
transportation, discharge or release of gaseous or liquid Hazardous Substances
and any regulation, order, notice or demand issued pursuant to such law,
statute or ordinance, in each case applicable to the property of the Borrower


 


22





















 


or its
affiliates, if any, including without limitation the following:  the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended by the Superfund Amendments
and Reauthorization Act of 1986, the Solid Waste Disposal Act, as amended by
the Resource Conservation and Recovery Act of 1976 and the Hazardous and Solid
Waste Amendments of 1984, the Hazardous Materials Transportation Act, as
amended, the Federal Water Pollution Control Act, as amended by the Clean Water
Act of 1976, the Safe Drinking Water Act, the Clean Air Act, as amended, the
Toxic Substances Control Act of 1976, the Occupational Safety and Health Act of
1977, as amended, the Emergency Planning and Community Right-to-Know Act of
1986, the National Environmental Policy Act of 1975, the Oil Pollution Act of
1990, and any similar or implementing state law, and any state statute and any
further amendments to these laws providing for financial responsibility for
cleanup or other actions with respect to the release or threatened release of
Hazardous Substances or crude oil, or any fraction thereof and all rules and
regulations promulgated thereunder.


 


8.2                                 Covenants of Borrower.  Borrower
hereby covenants to Lender that Borrower shall (a) comply and shall cause
all occupants of the Premises to comply with all federal, state and local laws,
rules, regulations and orders with respect to the discharge, generation,
removal, transportation, storage and handling of Hazardous Substances; (b) remove
any Hazardous Substances released into the environment immediately upon
discovery of same, in accordance with applicable laws, ordinances and orders of
governmental authorities having jurisdiction thereof; (c) pay or cause to
be paid all costs associated with such removal; (d) prevent the migration
of Hazardous Substances from or through the Premises onto or under other
properties; (e) keep the Premises free of any lien imposed pursuant to any
state or federal law, rule, regulation or order in connection with the
existence of Hazardous Substances on the Premises; (f) not install or
permit to be incorporated into any improvements in the Premises or to exist in
or on the Premises any asbestos, asbestos-containing materials, area formaldehyde
insulation or any other chemical or substance which has been determined to be a
hazard to health and environment; (g) not cause or permit to exist, as a
result of an intentional or unintentional act or omission on the part of
Borrower or any occupant of the Premises, a releasing, spilling, leaking,
pumping, emitting, pouring, emptying or dumping of any Hazardous Substances
onto the Premises or into water or other lands; and (h) give all
notifications and prepare all reports required by Environmental Laws or any
other law with respect to Hazardous Substances existing on, released from or
emitted from the Premises.


 


8.3                                 Representations of Borrower.  The
Borrower represents that (i) the Premises has been and is free from
contamination by Hazardous Substances but including neither (A) immaterial
quantities of automotive motor oil leaked inadvertently from vehicles in the
ordinary course of the operation of the Premises and cleaned up in accordance
with reasonable property management procedures and any applicable law nor (B) immaterial
quantities of substances customarily and prudently used in the cleaning and
maintenance of the Premises in accordance with any applicable law, (ii) no
release of any such Hazardous Substance has occurred on or about the Premises, (iii) that
the Premises currently complies, and will comply based on its anticipated use,
with all current Environmental Laws, (iv) that, in connection with the
operation and use of the Premises, all necessary notices have been filed and
all required permits, licenses


 


23





















 


and other authorizations have been obtained, including those relating
to the generation, treatment, storage, disposal or use of Hazardous Substances,
(v) that there is no present, past or threatened investigation, inquiry or
proceeding relating to the environmental condition of, or to events on or
about, the Premises, and (vi) there are no underground storage tanks
currently existing and to the extent such underground storage tanks are
existing they are registered under the required Environmental Laws and do not
contain any leakages, and (vii) Borrower has not received any summons,
citation, directive, letter or other communication, written or oral, from any
local, state or federal governmental agency concerning (A) the existence
of Hazardous Substances on the Premises or in the immediate vicinity, (B) the
releasing, spilling, leaking, pumping, pouring, emitting, emptying, or dumping
of Hazardous Substances onto the Premises or into water or other lands or (C) violation
of Environmental Laws.


 


8.4                                 Environmental Indemnification, The Borrower indemnifies and holds harmless the
Lender, its officers, directors, employees, agents, contractors,
subcontractors, licensees, invitees, successors and assigns (“Indemnified
Parties”) from and against any and all claims, losses, liabilities (including
without limitation strict liability), suits, obligations, fines, damages,
judgments, injuries, administrative orders, consent agreements and orders, penalties,
actions, causes of action, charges, costs and expenses, including without
limitation attorneys’ fees and consultants’ fees (i) arising out of the
inclusion in the Premises of Hazardous Substances or the presence on, the
release from, the generation, manufacture, refining, treatment, storage,
handling or disposal on, in or from the Premises of any Hazardous Substances,
or any underground or above ground storage tanks containing Hazardous
Substances and the cost of removal and remediation of the foregoing, or (ii) arising
out of the transportation, discharge or removal from the Premises of any
Hazardous Substance, or (iii) arising out of the inclusion in any product
manufactured on the Premises of a Hazardous Substance; or (iv) arising out
of the failure to perform the removal or abatement of or to institute a safe,
effective and environmentally approved control plan for any Hazardous Substance
or the replacement or removal of any soil, water, surface water, or ground
water containing Hazardous Substance in accordance with Environmental Laws; or (v) arising
out of the existence of any environmental lien against the Premises pursuant to
any Environmental Laws; or (vi) arising out of any violation or claim of
violation of Environmental Laws with respect to the Premises; or (vii) arising
out of any breach of any of the representations and covenants contained herein
relating to Hazardous Substances and Environmental Laws (collectively the “Indemnified
Loss”).  Borrower shall bear, pay and
discharge such Indemnified Loss as and when the same becomes due and payable.


 


8.5                                 Run with Land.  These covenants, representations,
warranties and indemnities shall be deemed continuing covenants,
representations, warranties and indemnities running with the Land for the benefit
of the Lender, and any successors and assigns of the Lender, including any
purchaser at a mortgage foreclosure sale, any transferee of the title of the
Lender or any subsequent purchaser at a foreclosure sale, and any subsequent
owner of the Premises claiming through or under the title of Lender and shall
survive any foreclosure of this Mortgage and any acquisition of title of
Lender.  The amount of all such
indemnified loss, damage, expense or cost, shall bear interest thereon at the
Default Rate interest and shall become so much additional Indebtedness Secured
Hereby and shall become immediately due and payable in full on demand of the
Lender, its successors or assigns.  The
indemnification contained herein shall be a personal monetary obligation of the
Borrower notwithstanding any provisions of this Mortgage to the


 


24





















 


contrary that limit or exculp the personal liability of the Borrower
and/or require the Lender to look solely to the security of the Premises.


 


9.

MISCELLANEOUS


 


9.1                                 Release of Mortgage.  When all
Indebtedness Secured Hereby has been paid, this Mortgage and all assignments
herein contained shall be void and this Mortgage shall be released by the
Lender at the cost and expense of the Borrower, otherwise to remain in full
force and effect.


 


9.2                                 Choice of Law.  Notwithstanding the place of
execution of this instrument, the parties to this instrument have contracted
for North Dakota law to govern this instrument and it is controllingly agreed
that this instrument is made pursuant to and shall be construed and governed by
the laws of the State of North Dakota without regard to the principles of
conflicts of law.  However, to the extent
necessary for Lender to pursue remedies, South Dakota law shall govern and
apply.


 


9.3                                 Successors and Assigns.  This
Mortgage and each and every covenant, agreement and other provision hereof
shall be binding upon the Borrower and its successor and assigns including
without limitation each and every from time to time the owner of the Premises
or any other person having an interest therein, shall ran with the land and
shall inure to the benefit of the Lender and its successor and assigns.  As used herein the words “successors and
assigns” shall also be deemed to include the heirs, representatives,
administrator and executors of any natural person who is or becomes a party to
this Mortgage.  In the event that the
ownership of the Premises becomes vested in a person or persons other than the
Borrower, the Lender shall not have any obligation to deal with such successor
or successor in interest unless such transfer is permitted by this Mortgage and
then only upon being notified in writing of such change of ownership.  Upon such notification, the Lender may
thereafter deal with such successor in place of Borrower without any obligation
to thereafter deal with Borrower and without waiving any liability of Borrower
hereunder or under the Note.  No change
of ownership of the Premises shall in any way operate to release or discharge
the liability of the Borrower hereunder unless such release or discharge is
expressly agreed to in writing by the Lender.


 


9.4                                 Unenforceability of Certain Clauses.  The
unenforceability or invalidity of any provisions hereof shall not render any
other provision or provisions herein contained unenforceable or invalid.


 


9.5                                 Captions and Headings.  The
captions and headings of the various sections of this Mortgage are for
convenience only and are not to be construed as confining or limiting in any
way the scope or intent of the provisions hereof.  Whenever the context requires or permits the
singular shall include the plural, the plural shall include the singular and
the masculine, feminine and neuter shall be freely interchangeable.


 


9.6                                 Savings Clause.  It is expressly stipulated and
agreed to be the intent of Borrower, and Lender at all times to comply with
applicable state law or applicable United States federal law (to the extent
that it permits the Lender to contract for, charge, take, reserve, or receive a
greater


 


25





















 


amount of interest than under state law) and that this section shall
control every other covenant and agreement in the Note, this Mortgage and any
other loan documents delivered in connection with this instrument (“Loan
Documents”).  If the applicable law is
ever judicially interpreted so as to render usurious any amount called for
under the Note, this Mortgage or under any of the other Loan Documents, or
contracted for, charged, taken, reserved, or received with respect to the
indebtedness by the Note (“Indebtedness”), or if the Lender’s exercise of the
option to accelerate the maturity of the Note, or if any prepayment by Borrower
results in Borrower having paid any interest in excess of that permitted by
applicable law, then it is Borrower’s and Lender’s express intent that all
excess amounts theretofore collected by Lender shall be credited on the
principal balance of the Note and all other Indebtedness (or, if the Note and
all other indebtedness have been or would thereby be paid in full, refunded to
Borrower), and the provisions of the Note and this Mortgage and the other Loan
Documents immediately be deemed reformed and the amounts thereafter collectible
hereunder and thereunder reduced, without the necessity of the execution of any
new documents, so as to comply with the applicable law, but so as to permit the
recovery of the fullest amount otherwise called for hereunder or
thereunder.  All sums paid or agreed to
be paid to Lender for the use, forbearance, or detention of the Indebtedness
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full stated term of the Indebtedness until
payment in full so that the rate or amount of interest on account of the
Indebtedness does not exceed the maximum lawful rate from time to time in
effect and applicable to the Indebtedness for so long as the Indebtedness is
outstanding.  Notwithstanding anything to
the contrary contained herein or in any of the other Loan Documents, it is not
the intention of the Lender to accelerate the maturity of any interest that is
not secured by this Mortgage at the time of such acceleration or to collect
unearned interest at the time of such acceleration.


 


9.7                                 Notices.  Any notices and other
communications permitted or required by the provisions of this Mortgage (except
for telephonic notices expressly permitted) shall be in writing and shall be
deemed to have been properly given or served by depositing the same with the
United States Postal Service, or any official successor thereto, designated as
Certified Mail, Return Receipt Requested, bearing adequate postage, or
deposited with reputable private courier or overnight delivery service, and
addressed as hereinafter provided.  Each
such notice shall be effective upon being deposited as aforesaid.  The time period within which a response to
any such notice must be given, however, shall commence to run from the date of
receipt of the notice by the addressee thereof. 
Rejection or other refusal to accept or the inability to deliver because
of changed address of which no notice was given shall be deemed to be receipt
of the notice sent.  By giving to the
other party hereto at least ten (10) days’ notice thereof, either party
hereto shall have the right from time to time to change its address and shall
have the right to specify as its address any other address within the United
States of America.


 


Each notice to
Lender shall be addressed as follows:


 


AgCountry Farm
Credit Services, FCLA

1749 38th Street Southwest

P. O. Box 6020

Fargo, North Dakota 58108

Attn:  Randolph L. Aberle, Vice President


 


26





















 


Each notice to
Borrower shall be addressed as follows:


 


Great Plains
Ethanol, LLC

c/o Broin & Associates, Inc.

Attn: Jeffrey S. Broin

2209 East 57th Street North

Sioux Falls, South Dakota  57104


 


With a copy to:


 


James M.
Wiederrich, Esq.

Woods, Fuller, Shultz & Smith P.C.

300 South Phillips Avenue

Sioux Falls, South Dakota  57117


 


9.8                                 Amendment.  Amendment to, waiver of, or
modification of any provision of this Mortgage must be made in writing.  No oral waiver, amendment, or modification
may be implied.


 


9.9                                 Use of Premises.  During the entire term of the
Note and this Mortgage, Borrower agrees not to convert the Premises to any use
other than as an dry mill ethanol facility. 
Any other use of the Premises shall constitute an Event of Default.


 


9.10                           Priority of Future Advances.  Any
advance or further agreement made between Lender and Borrower pursuant to this
Mortgage shall be superior to the rights of the holder of any intervening lien
or encumbrance.  This Mortgage secures
all future advances by Lender to Borrower and all future obligations of Borrower
to Lender pursuant to the Note up to and including the stated principal
indebtedness of $33,984,846.77.  THE
PARTIES AGREE THAT THIS MORTGAGE CONSTITUTES A COLLATERAL REAL ESTATE MORTGAGE
PURSUANT TO SDCL § 44-8-26.


 


9.11                           Adjustable Rate Note.  The Note
secured by this Mortgage provides for adjustments in its interest rate from
time to time in accordance with its terms. 
Reference is made to the Note for the times, terms and conditions of the
adjustment in the interest rate.  Such
times, terms and conditions are incorporated herein by reference.


 


9.12                           Entire Agreement.  The parties acknowledge that the
written terms of the Note, this Mortgage, and the other documents issued in
connection with the Loan, accurately reflect the mutual understanding of
Borrower and Lender, as to all matters addressed therein, and Borrower further
represents and warrants that there are no other agreements or understandings,
written or oral, which exist between Borrower and Lender relating to the
matters addressed in said documents.


 


9.13                           Lender’s Expense.  Should Lender make any payments
hereunder or under the Note or under any other loan document, or incur any
liability, loss or damage under or by reason of this Mortgage, the Note or any
other loan document, or in the defense of any claims or demands, the amount
thereof, and all costs and expenses, including all filing, recording, and title


 


27





















 


fees and any other expenses relating to the Indebtedness Secured
Hereby, including without limitation filing fees for UCC continuation
statements and any expense involving modification thereto, attorneys’ fees, and
any and all costs and expenses incurred in connection with making, performing,
or collecting the Indebtedness or exercising any of Lender’s rights under the
Note, this Mortgage or any other loan document, including attorneys’ fees, the
cost of appraisals and the cost of any environmental inspections in connection
therewith, and all claims for brokerage and finder’s fees which may be made in
connection with the making of the loan, together with interest thereon, at the
Default Rate, shall become part of the Indebtedness Secured Hereby and shall be
secured by this Mortgage and the other loan document and Borrower hereby agrees
to reimburse Lender therefor immediately upon demand.  Such sums, costs and expenses shall be, until
so paid, part of the Indebtedness Secured Hereby and Lender shall be entitled,
to the extent permitted by law, to receive and retain the full amount of the Indebtedness
Secured Hereby in any action for redemption by Borrower, for an accounting for
the proceeds of a foreclosure sale or of insurance proceeds or for
apportionment of an eminent domain damage award.


 


9.14                           Lender’s Right to Counsel.  If Lender
retains attorneys to enforce any of the terms hereof or the Note or of any
other loan Document or because of the breach by Borrower of any of the terms
hereof or other loan document or the Lease, or for the recovery of any
Indebtedness Secured Hereby, Borrower shall pay to Lender attorneys’ fees and
all costs and expenses, whether or not an action is actually commenced and the
right to such attorneys’ fees and all costs and expenses shall be deemed to
have accrued on the date such attorneys are retained, shall include fees and
costs in connection with litigation, arbitration, mediation, bankruptcy and/or
administrative proceedings, and shall be enforceable whether or not such action
is prosecuted to judgment and shall include all appeals.  Attorneys’ fee and expenses shall for
purposes of this Mortgage include all paralegal, electronic research, legal
specialists and all other costs in connection with that performance of Lender’s
attorneys.


 


If Lender is,
by reason of being the holder of this Mortgage, made a party defendant in any
litigation concerning this Mortgage or the Premises or any part thereof or
therein, or the construction, maintenance, operation or the occupancy or use
thereof by Borrower, then Borrower shall indemnify, defend and hold Lender
harmless from and against all liability by reason of said litigation, including
attorneys’ fees and all costs and expenses incurred by Lender in any such
litigation or other proceedings, whether or not any such litigation or other
proceedings is prosecuted to judgment or other determination.


 


9.15                           Other Representations and Warranties.  All
statements contained in any loan application, certificate or other instrument
delivered by or on behalf of Borrower to Lender or Lender’s representatives in
connection with the Indebtedness Secured Hereby shall constitute
representations and warranties made by Borrower hereunder.  Such representation and warranties made
hereunder and thereunder shall survive the delivery of this Mortgage, and any
misrepresentations thereunder shall be deemed as misrepresentations hereunder.


 


9.16                           Time of the Essence.  Borrower
agrees that time is of the essence with respect to all of the covenants,
agreements and representations under this Mortgage.


 


9.17                           Survival of Representations, Warranties and
Covenants.  All representations covenants and warranties
contained herein, or in any of the other Loan Documents shall survive


 


28





















 


the delivery of the Note, this Mortgage and all other Loan Documents
and the provisions hereof shall continue to inure to the benefit of Lender, its
successors and assigns.


 


9.18                           Waiver of Jury Trial.  No party
to this Mortgage or any assignee, successor, heir or personal representative of
a party shall seek a jury trial in any lawsuit, proceeding, counterclaim, or
any other litigation proceedings based upon or arising out of this Mortgage,
any related agreement or instrument, any other collateral for the Indebtedness
or the dealings or the relationship between or among the parties, or any of
them.  No party will seek to consolidate
any such action, in which a jury trial has been waived, with any other action
in which a jury trial cannot or has not been waived.  The provisions of this paragraph have been
fully discussed by the parties hereto, and these provisions shall be subject to
no exceptions.  No party has in any way
agreed with or represented to any other party that the provisions of this
paragraph will not be fully enforced in all instances.


 


9.19                           Minimum Requirement.  Borrower
recognizes that the requirements imposed upon Borrower hereunder, including,
without limitation, insurance requirements, are minimum requirements as
determined by Lender and do not constitute a representation that the
requirements are complete or adequate. 
Borrower understands that it is Borrower’s duty and responsibility to
act prudently and responsibly at all times for Borrower’s protection and for
the protection of the Premises.


 


[Signature Page Follows]


 


29





















 


IN WITNESS
WHEREOF, the Borrower has caused these presents to be executed as of the date
first above written.


 


	
   

  	
  GREAT PLAINS ETHANOL, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Darrin
  Ihnen

  	
   

  
	
   

  	
   

  	
   

  	
  Darrin Ihnen

  
	
   

  	
   

  	
  Its:

  	
  President

  
	
   

  	
   

  
	
   

  	
  Tax Identification No. 46-0459188

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  STATE OF SOUTH DAKOTA

  	
   

  	
  )

  	
   

  
	
   

  	
   

  	
  ) ss.

  	
   

  
	
  COUNTY OF MINNEHAHA

  	
   

  	
  )

  	
   

  
							



 


On this 8th
day of July, 2005, before me personally appeared Darrin Ihnen, to me
known, who being by me duly sworn, did say that he is the President of Great
Plains Ethanol, LLC, a South Dakota limited liability company, that said instrument
was signed on behalf of said limited liability company, and acknowledged said
instrument to be the free act and deed of said limited liability company.


 


IN WITNESS
WHEREOF, I have hereunto set my hand and affixed my notarial seal the day and
year last above written.


 


	
   

  	
  /s/ Diane C.
  Bonertz

  	
   

  
	
   

  	
  Print Name: 

  	
  Diane C.
  Bonertz

  	
   

  
	
   

  	
  Notary Public in and for said County and
  State

  
	
   

  	
   

  
	
  My Commission Expires:

  	
   

  
	
   

  	
   

  
	
  January 30, 2009

  	
   

  	
   

  
					



 


30





















 


EXHIBIT A


 


Legal Description


 


Parcel 1:  The Northwest Quarter (NW 1⁄4) less Plucker’s
Tract 1 in the South Half of the Northwest Quarter (S 1⁄2 NW 1⁄4) and except
Substation Addition in Northwest Quarter (NW 1⁄4) and except the South Dakota
Central Railroad Right-of-Way and except Lot H-1, all in Section Twenty-Six
(26), Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota.


 


Parcel 2:  Tract 1 in the Northeast Quarter (NE 1⁄4) of Section Twenty-Six
(26), Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota, according to the recorded plat thereof.


 


Parcel 3:  Tract 3 in the Southeast Quarter (SE 1⁄4) of Section Twenty-Six
(26), Township Ninety-Nine (99) North, Range Fifty-Two (52) West of the 5th P.M.,
Turner County, South Dakota, according to the recorded plat thereof.


 


A-1





















 


EXHIBIT B


 


Permitted Encumbrances


 


-None-


 


B-1