Exhibit 10.26


 


AGREEMENT TO COMPENSATE GUARANTORS


 


THIS
AGREEMENT is made and entered into effective this 28th day of February, 2005,
by and between Great Plains Ethanol, LLC (the “Company”) and Robert Broin, Jeff
Broin, Todd Broin, Duane Sather, Fred Thurman, and Dennis Schrag (collectively
the “Guarantors”).


 


RECITALS:


 


A.                                   The Company entered into a Natural Gas
Distribution Delivery Agreement dated September 2, 2002, with NorthWestern
Energy Corporation (“NEC”).


 


B.                                     In connection with the Natural Gas Distribution
Delivery Agreement, Home Federal Bank issued an Irrevocable Standby Letter of
Credit dated February 28, 2003, in the amount of $1,600,000.00 (the “Letter
of Credit”) in favor of NEC.


 


C.                                     In consideration for the Letter of Credit,
the Company executed a Promissory Note dated February 28, 2003, in the
amount of $1,600,000.00 in favor of Home Federal Bank (the “2003 Note”).


 


D.                                    The Letter of Credit was modified and
restated pursuant to a First Amended and Restated Irrevocable Standby Letter of
Credit dated May 28, 2003.


 


E.                                      The Letter of Credit was further modified and
restated pursuant to a Second Amended and Restated Irrevocable Standby Letter
of Credit dated February 25, 2004, in the amount of $1,250,000.00.  In consideration for the Second Amended and
Restated Letter of Credit, the Company entered into a Promissory Note
Modification Agreement with Home Federal Bank dated February 25, 2004,
reducing the maximum loan amount to $1,250,000.00 (the “2004 Note”).


 


F.                                      The Letter of Credit was further modified and
restated pursuant to a Third Amended and Restated Irrevocable Standby Letter of
Credit dated February 28, 2005, in the amount of $1,125,000.00.  In consideration for the Third Amended and
Restated Irrevocable Standby Letter of Credit, the Company entered into a
Promissory Note Modification Agreement with Home Federal Bank dated February 28,
2005, reducing the maximum loan amount to $1,125,000.00 (the “2005 Note”).


 


G.                                     The Guarantors are each willing to personally
guarantee the 2005 Note in part.


 


H.                                    The Company wishes to provide certain
compensation to the Guarantors in


 





















 


consideration
for their agreement to enter into the guarantees.


 


NOW,
THEREFORE, the parties agree as follows:


 


1.                                       In consideration for each Guarantor’s
agreement to provide his personal guarantee to Home Federal Bank in connection
with the 2005 Note in the amount set forth below, the Company agrees to
compensate each Guarantor in an amount equal to two percent (2%) per annum of
his respective guarantee amount, so long as he continues to guarantee the
Letter of Credit issued by Home Federal Bank. 
The amounts of the individual guarantees related to the 2005 Note are as
follows:


 


	
  Robert
  Broin

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  Jeff
  Broin

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  Todd
  Broin

  	
   

  	
  $

  	
  250,000.00

  	
   

  
	
  Duane
  Sather

  	
   

  	
  $

  	
  125,000.00

  	
   

  
	
  Fred
  Thurman

  	
   

  	
  $

  	
  125,000.00

  	
   

  
	
  Dennis
  Schrag

  	
   

  	
  $

  	
  125,000.00

  	
   

  



 


2.                                       Payment will be made by the Company to the
Guarantors on or before March 31 of each year in which the guarantees are
executed, renewed, replaced or extended.


 


3.                                       This Agreement constitutes the entire
agreement among the parties with respect to compensation to be paid by the
Company to the Guarantors for their guarantees. 
This Agreement supercedes any prior negotiations, agreements, or understandings
between the parties with respect to compensation to be paid by the Company to
the Guarantors for their guarantees.


 


	
  GREAT
  PLAINS ETHANOL, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   /s/
  Darrin Ihnen

  	
   

  	
   

  
	
  Its: President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Robert Broin

  	
   

  	
  /s/
  Jeff Broin

  	
   

  
	
  Robert
  Broin

  	
  Jeff
  Broin

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Todd Broin

  	
   

  	
  /s/
  Duane Sather

  	
   

  
	
  Todd
  Broin

  	
  Duane
  Sather

  
								



 


2





















 


	
  /s/
  Fred Thurman

  	
   

  	
  /s/
  Dennis Schrag

  	
   

  
	
  Fred
  Thurman

  	
  Dennis
  Schrag

  



 


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