EXIBIT 10.2 TO SOY ENERGY, LLC FORM 10-Q FOR THE QUARTER ENDED 04-30-2010



Exhibit 10.2


LOAN AGREEMENT


          This
Agreement is made as of April 2, 2010, by and between SOY ENERGY, LLC, an Iowa
limited liability company (the “Borrower”), and OSM-REO FF, LLC, a Minnesota
limited liability company (the “Lender”).


RECITALS


          A.          The Borrower
intends to acquire a biodiesel facility located in Mason City, Iowa along with
certain other tangible and intangible assets pursuant to the provisions of that
certain Asset Purchase Agreement dated of even date herewith by and among the
Borrower and OSM-REO FF, LLC, as the seller,
the “Acquisition Agreement” (the acquisition under the Acquisition Agreement
is the “Acquisition”).


          B.          The
Borrower has requested loans from the Lender for the purpose of financing a portion of the Acquisition and expenses related
thereto and the Lender has agreed to provide such financing upon the
terms and subject to the conditions of this Agreement.


          NOW,
THEREFORE, in consideration of the premises and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged, the Borrower and the Lender agree as
follows:


ARTICLE I

DEFINITIONS


          Section
1.01 Defined Terms. As used in this Agreement, the following terms shall
have the meanings set out respectively after each (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):


          “Acquisition”
- As defined in the first recital above.

          “Acquisition
Agreement” - As defined in the first recital above.

          “Acquisition
Documents” – The Acquisition Agreement, the Holdback Reserve Agreement and any other agreements, instruments or
documents executed and delivered in connection with the Acquisition.


          “Acquisition
Loan” – The loan in the amount of the Commitment to be made by the
Lender pursuant to the terms of this Agreement.


          “Acquisition
Note” – The Promissory Note of the Borrower, in form and substance
acceptable to Lender, evidencing the Acquisition Loan to be made hereunder,
together with any amendment thereto.






          “Additional
Improvements” – The improvements to be constructed on the Land in accordance with the Plans and Specifications and
the Construction Contract for the purpose of allowing the Project to
accept varied feedstock.


          “Additional
Improvements Escrow” – An amount equal to not less than $8,000,000 to be deposited by Borrower with Title
and disbursed in accordance with the Additional Improvements Escrow
Agreement to pay Project Costs.


          “Additional
Improvements Escrow Agreement” – The Additional Improvements Escrow Agreement in form and substance acceptable
to Lender among the Borrower, the Lender and Title providing for the deposit
into escrow of not less than $8,000,000 for the purpose of funding
construction of the Additional Improvements.


          “Affiliate”
– of any Person shall mean (a) any Person which, directly or indirectly, is in control of, is controlled by,
or is under common control with such Person, or (b) any Person who is a
director or officer (i) of such Person, (ii) of any subsidiary of such Person
or (iii) of any Person described in clause (a) above. For purposes of this definition, control of a Person shall mean the
power, direct or indirect, (x) to vote 50% or more of the securities having ordinary voting power for the election of
directors of such Person, or (y) to direct or cause the direction of the
management and policies of such Person whether by contract or otherwise.


          “Agreement”
– This Loan Agreement as it may be amended, modified, supplemented, restated or
replaced from time to time.


          
“Anti-Terrorism Laws” – any Laws relating to terrorism or money laundering,
including Executive Order No. 13224, the USA Patriot Act, the Laws comprising
or implementing the Bank Secrecy Act, and the Laws administered by the United
States Treasury Department’s Office of
Foreign Assets Control (as any of the foregoing Laws may from time to
time be amended, renewed, extended, or replaced).


          “Appraisal”
– An appraisal of the market value of the completed Project (a) addressed to
the Lender, (b) prepared by an appraiser approved by the Lender, and (c) conforming to all laws applicable to the Lender and
otherwise in a form satisfactory to the
Lender, and (d) concluding that, upon completion of the Additional Improvements
the market value of the Project will be not less than $12,000,000.


          “Assignment
of Construction Contract” – The Assignment of Construction Contract,
in form and substance acceptable to Lender, which assigns to the Lender, as additional security for repayment of the Note, the
Borrower’s interest in the Construction Contract, together with any
amendment thereto.


          “Assignment
of Project Engineer’s Contract” – The Assignment of Project Engineer’s Contract,
in form and substance acceptable to Lender, which assigns to the Lender, as
additional security for payment of the Note, the Borrower’s interest in the
Architect’s Contract and the Plans and Specifications, together with any
amendment thereto.






          “Borrowed
Money Indebtedness” - (a) the Obligations; (b) Subordinated Loan; (c) Working Capital Loan; and (d) other Indebtedness
for borrowed money, which collectively,
with all other Borrowed Money Indebtedness shall not to exceed $16,000,000
at any time outstanding in the aggregate.


           “Blocked
Person” - As defined in Section 4.24 hereof.


          “Business
Day” – Any day other than Saturday or Sunday or a legal holiday on which
commercial banks are authorized or required by law to be closed for business in
Mason City, Iowa.


           “Borrower”
– Soy Energy, LLC, an Iowa limited liability company.


          “CERCLA” –
The Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. § § 9601 et seq.


          “City”
– The City of Mason City, Iowa. 


          “Closing
Date” – As defined by Section 2.02.


          “Code”
– The Internal Revenue Code of 1986, as amended from time to time and the
regulations promulgated thereunder.


          “Collateral”
– All property that is pledged as collateral for the Loans pursuant to any
of the Security Documents.


          “Commitment”
– The commitment of the Lender hereunder to make the Acquisition
Loan in a maximum principal amount of Six Million and 00/100 Dollars ($6,000,000).


          “Commitment
Termination Date” – July 21, 2010, or the date of the termination of
the Commitment pursuant to Article VII hereof, whichever date occurs earlier.


          “Commencement
Date” – The date that is 180 days after the Closing Date. 


          “Completion
Date” – July 31, 2011.


          “Consent”
– All filings and all licenses, permits, consents, approvals, authorizations, qualifications and orders of
Governmental Bodies and other third parties, domestic or foreign,
necessary to carry on the Borrower’s business, including, without limitation, any Consents required under all
applicable federal, state or other applicable law.


          
“Contractor” – Any person, including the General Contractor and all Subcontractors,
who shall be engaged to work on, or to furnish materials and supplies for, the
Additional Improvements.






          “Construction
Contract” – The construction contract to be executed between the Borrower and the General Contractor, pursuant to
which the General Contractor shall be obligated to construct the
Additional Improvements in accordance with the Plans and Specifications for a
fixed price or maximum cost, not to exceed $8,000,000.


          “Debt
Service Reserve” – An amount equal to not less than $150,000 to be funded with proceeds of the Acquisition Loan, deposited
with Lender and disbursed in accordance with the Debt Service Reserve
Agreement.


          “Debt
Service Reserve Agreement” – The Debt Service Reserve and Security Agreement
in form and substance acceptable to Lender between Borrower and Lender.


          “Debt
to Equity Ratio” – With respect to any fiscal period, the ratio of (i) Indebtedness
to (ii) Equity.


          “Default” –
An event which with notice, lapse of time, or both would become an Event of
Default.


          “Default
Rate” – As defined in the Note.


          “Depository
Institution” – Farmers State Bank of Marcus, Iowa, or such other financial
institution as may be approved by Lender from time to time.


          “Dollar”
and the sign “$” shall mean the lawful money of the United States of America.


          “Earnings
Before Interest and Taxes” – For any period the sum of (i) net income (or loss)
of the Borrower for such period (excluding extraordinary gains [and losses]),
plus (ii) all interest expense of the
Borrower for such period, plus, (iii) all charges against income of the
Borrower for such period for federal, state and local taxes actually paid, all
as determined in accordance with GAAP.


          “EBITDA”
– For any period the sum of (i) Earnings Before Interest and Taxes for such period, plus (ii) depreciation expenses for
such period, plus (iii) amortization expenses for such period, all as
determined in accordance with GAAP.


          “Effective
Date” – the “Effective Date” as defined in the Acquisition Agreement. 


          “Environmental
Complaint” – As defined in Section 5.09(d) hereof.


          “Environmental
Indemnity” – The Environmental Indemnification Agreement, in form and substance acceptable to Lender, from the
Borrower to the Lender, together with any amendment thereto.






          “Environmental
Laws” – All federal, state and local environmental, land use, zoning, health,
chemical use, safety and sanitation laws, statutes, ordinances and codes relating to the protection of the environment
and/or governing the use, storage, treatment, generation,
transportation, processing, handling, production or disposal of Hazardous Substances and the rules, regulations, policies,
guidelines, interpretations, decisions, orders and directives of federal, state and local governmental agencies
and authorities with respect thereto.


          “Equity”
- The sum of the unrestricted and unencumbered (other than to the Lender) cash and unencumbered (other than to the
Lender) readily marketable securities of the Borrower, less overdrafts.


          “ERISA” –
The Employee Retirement Income Security Act of 1974, as amended from time to
time and the rules and regulations promulgated thereunder.


          “Event of
Default” – One of the events of default specified in Section 7.01 hereof.


          “Executive
Order No. 13224” – The Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001, as the same has been, or shall hereafter be,
renewed, extended, amended or replaced.


          “Financing
Statements” – UCC financing statements naming the Borrower as debtor
and the Lender as secured party and describing the Collateral as the personal
property and fixtures described as Collateral for the Loans in any of the
Security Documents.


          “Fixed
Charge Coverage Ratio” – With respect to any fiscal period, the ratio of (a)
Borrower EBITDA to (b) payments required to be made with respect to any
Indebtedness.


          “GAAP” –
Generally accepted accounting principles in the United States of America in
effect from time to time.


          “General
Contractor” – Ball Industrial Services, LLC, the general contractor hired by
Borrower to complete the Additional Improvements pursuant to the Construction Contract, or such other General Contractor
approved by Lender, provided that Lender shall not unreasonably withhold
condition or delay such approval.


          “Governmental
Body” – Any nation or government, any state or other political subdivision
thereof or any entity exercising the legislative, judicial, regulatory or
administrative functions of or pertaining to a government, including the City.


          “Hazardous
Discharge” – As defined in Section 5.09(d).


          “Hazardous
Substance” – Any flammable explosives, radon, radioactive materials,
asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls,
petroleum and petroleum products, methane, hazardous materials, Hazardous
Wastes, hazardous or Toxic Substances or
related materials as defined in CERCLA, the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Sections 1801, et seq.), RCRA or any other applicable Environmental Law and
in the regulations adopted pursuant thereto.






          “Hazardous
Wastes” - All waste materials subject to regulation under CERCLA, RCRA or applicable state law, and any other
applicable federal and state laws now in force or hereafter enacted
relating to hazardous waste disposal.


          “Holdback
Reserve Agreement” – The Holdback Reserve Agreement executed by and
among the Borrower and OSM-REO FF, LLC in connection with the Acquisition.


          “Improvements”
– all improvements located or to be constructed on the Land, including but not limited to the existing biodiesel
facility and the Additional Improvements.


          “Indebtedness”
of a Person at a particular date shall mean all obligations of such Person
which in accordance with GAAP would be classified upon a balance sheet as liabilities (except capital stock and surplus
earned or otherwise) and in any event, without limitation by reason of
enumeration, shall include all indebtedness, debt and other similar monetary obligations of such Person whether direct
or guaranteed, and all premiums, if any,
due at the required prepayment dates of such indebtedness, and all other indebtedness
secured by a Lien on assets owned by such Person, whether or not such indebtedness actually shall have been created,
assumed or incurred by such Person. Any indebtedness of such Person
resulting from the acquisition by such Person of any assets subject to any Lien
shall be deemed, for the purposes hereof, to be the equivalent of the creation,
assumption and incurring of the indebtedness secured thereby, whether or not
actually so created, assumed or incurred.


          “Initial
Loan” – The loan in the original principal amount of $77,595 deemed made
by Lender to Borrower as of the Closing Date and evidenced by the Initial Note.


          “Initial
Note” – The Promissory Note to be made by the Borrower in favor of Lender as of the Closing Date, in form and
substance acceptable to Lender, in the original principal amount of
$77,595.


          “Inspecting
Architect/Engineer” – The architectural or engineering firm selected by
Lender from time to time to act as the Inspecting Architect/Engineer under this
Agreement.


          “Land”
– The land in Cerro Gordo County, Iowa, on which the Project is located, which
is legally described in the Mortgage.


          “Lender” –
OSM-REO FF, LLC, a Minnesota limited liability company.


          “Lien”
– Any mortgage, deed of trust, pledge, hypothecation, assignment, security interest, lien (whether statutory or otherwise),
charge, claim or encumbrance, or preference,
priority or other security agreement or preferential arrangement held or asserted in respect of any asset of any kind or
nature whatsoever including, without limitation, any conditional sale or
other title retention agreement, any lease having substantially the same
economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement under the Uniform Commercial Code or comparable
law of any jurisdiction.


          “Loans” –
The Initial Loan and the Acquisition Loan.






          “Loan
Documents” – This Agreement, the Initial Note, the Acquisition Note, the
Security Documents and any other documents at any time evidencing or securing
one or both of the Loans, as amended.


          “Material
Adverse Effect” A material adverse effect (a) the condition, operations, assets, business or prospects of the applicable
Person or Persons, (b) the Borrower’s ability to pay the Obligations in
accordance with the terms thereof, (c) the value of the Collateral, or the Lender’s Liens on the Collateral or the priority of
any such Lien, or (d) the practical
realization of the benefits of the Lender’s rights and remedies under this Agreement
and the other Loan Documents.


          “Maturity
Date” – As defined in the Acquisition Note.


          “Mortgage”
– The Combination Mortgage, Assignment of Rents, Security Agreement and Fixture Financing Statement, in
form and substance acceptable to Lender, from the Borrower as Mortgagor
to the Lender as Mortgagee, creating a first lien on the Project and a security interest in all of the
personal property located thereon as security for payment of the Note,
together with any amendment thereto.


          “Notes” –
The Initial Note and the Acquisition Note.


          “Obligations”
Any and all loans, advances, debts, liabilities, obligations, covenants and duties owing by the Borrower to the
Lender or to any other direct or indirect
subsidiary or affiliate of the Lender of any kind or nature, present or future (including,
without limitation, any interest accruing thereon after maturity, or after the
filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding relating to the
Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), whether or not evidenced by any note, guaranty or other instrument, whether arising
under any agreement, instrument or
document, (including, without limitation, this Agreement and the other Loan Documents) whether or not for the
payment of money, whether arising by reason of an extension of credit,
opening a letter of credit, loan, equipment lease or guarantee, under any interest or currency swap, future, option or other
similar agreement, or in any other
manner, whether arising out of overdrafts or deposit or other accounts or electronic funds transfers (whether through
automated clearing houses or otherwise) or out of the Lender’s non-receipt of or inability to collect funds or
otherwise not being made whole in connection with depository transfer
check or other similar arrangements, whether
direct or indirect (including those acquired by assignment or participation), absolute
or contingent, joint or several, due or to become due, now existing or
hereafter arising, contractual or tortuous, liquidated or unliquidated,
regardless of how such indebtedness or
liabilities arise or by what agreement or instrument they may be evidenced or
whether evidenced by any agreement or instrument, including, but not limited
to, any and all of the Borrower’s Indebtedness and/or liabilities under this Agreement, the other Loan Documents or under any
other agreement between the Lender and
the Borrower and any amendments, extensions, renewals or increases and all
costs and expenses of the Lender incurred in the documentation,
negotiation, modification, enforcement, collection or otherwise in connection
with any of the foregoing, including but not limited to reasonable attorneys’
fees and expenses and all obligations of the Borrower to the Lender to perform
acts or refrain from taking any action.






          “Organizational
Documents” – The following documents:


	
  

 	
 

	
  

 	
  

 	
  

 
	
  

 	
  

	
  

 	
 (i)

 	
 a copy of the Borrower’s Articles of Organization, duly certified as
 of a current date by the Secretary of State of the State of
 Iowa;

 
	
  

 	
  

	
  

 	
  

 	
  

 
	
  

 	
  

	
  

 	
 (ii)

 	
 a copy of the Borrower’s Operating Agreement, duly certified as of a current
 date by an officer or manager of the Borrower;

 
	
  

 	
  

	
  

 	
  

 	
  

 
	
  

 	
  


	
  

 	
 (iii)

 	
 a Certificate of Existence of the Borrower, duly issued as of a
 current date by the Secretary of State of the State of Iowa;
 and

 
	
  

 	
  

	
  

 	
  

 	
  

 
	
  

 	
  

	
  

 	
 (iv)

 	
 a copy of the resolutions of the Borrower’s board of directors
 authorizing execution, delivery and performance of the Loan
 Documents and the transactions contemplated thereby, duly certified by an
 officer or manager of the Borrower.

 


          “Participant”
Each Person who shall be granted the right by the Lender to participate in the Loans and who shall have
entered into a participation agreement in form and substance
satisfactory to the Lender.


          “Permitted
Indebtedness” – means (a) Borrowed Money Indebtedness, provided that
(i) the Working Capital Loan shall not be deemed Permitted Indebtedness unless subject to the Working Capital Intercreditor
Agreement and (ii) the Subordinated Loan shall not be deemed Permitted Indebtedness unless subject to the
Subordinated Intercreditor Agreement;
(b) current liabilities, other than for borrowed money, incurred in the ordinary course of business; (c) Guarantees
permitted pursuant to Section 6.10; (d) Indebtedness secured by
Permitted Liens; (e) Indebtedness incurred in respect of netting services and
overdraft protection in connection with deposit accounts; (f) Indebtedness incurred in connection with the financing of
insurance premiums in the ordinary course of business; (g) Indebtedness in respect of taxes, assessments or
governmental charges to the extent that payment thereof shall not at the
time be required to be made.


          “Permitted
Lien” – means (a) Liens in favor of the Lender; (b) Liens in favor of the
Subordinate Lender which are subordinate in all respects to any Liens in favor
of Lender; (c) Liens in favor of the Working
Capital Lender, provided that no such Liens in favor of the Working Capital Lender shall be permitted on property which
constitutes Collateral for the Loans; (d) Liens for taxes, assessments
or other governmental charges not delinquent or being contested in good faith
and by appropriate proceedings and with respect
to which proper reserves have been taken by the Borrower; provided, that the Lien
shall have no effect on the priority of the Liens in favor of the Lender or the
value of the assets in which the Lender has
such a Lien and a stay of enforcement of any such Lien shall be in effect; (e)
Liens disclosed in the financial statements referred to in Section 4.06, the existence of which the Lender
has consented to in writing; (f) deposits or pledges to secure
obligations under worker’s compensation, social security or similar laws, or
under unemployment insurance; (g) deposits or pledges to secure bids, tenders,
contracts (other than contracts for the payment of money), leases, statutory
obligations, surety and appeal bonds and
other obligations of like nature arising in the ordinary course of the Borrower’s business; (h) Liens placed upon
fixed assets hereafter acquired to secure a portion of the purchase
price thereof, provided that (x) any such lien shall not encumber any other property of the Borrower and (y)
the aggregate amount of Indebtedness
secured by such Liens incurred as a result of such purchases during any fiscal year shall not exceed the amount provided
for in Section 6.17; (i) other Liens incidental to the conduct of the
Borrower’s business or ownership of its property and assets which were not incurred in connection with
the borrowing of money or the obtaining
of advances or credit, and which do not in the aggregate materially detract
from the Lender’s rights in and to the
Collateral or the value of the Borrower’s property or assets or which do not materially impair the use
thereof in the operation of the Borrower’s
business; and (j) subject to the terms of this Agreement, any Lien on property that
is not Collateral.






          “Person” –
Any individual, sole proprietorship, partnership, corporation, business trust, joint stock company, trust, unincorporated
organization, association, limited liability company, institution,
public benefit corporation, joint venture, entity or government (whether federal, state, county, city, municipal or
otherwise, including any instrumentality, division, agency, body or
department thereof).


          “Plan” – As
defined in Section 4.08 hereof.


          “Plans and
Specifications” – The plans and specifications for the Additional Improvements
prepared and signed by the Project Engineer and approved by the Lender and the
Inspecting Architect/Engineer.


          “Project” –
The Land and the Improvements as they may at any time exist.


          “Project
Costs” – The costs shown on the Total Project Cost Statement prepared in
connection with the Additional Improvements.


          “Project
Engineer” – Ball Engineering, LLC, the engineer retained by the Borrower to design the Plans and Specifications
for the Additional Improvements or such other Project Engineer approved by Lender, provided that Lender shall
not unreasonably withhold condition or delay such approval.


           “Project
Engineer’s Contract” – The agreement between the Borrower and the Architect as
to preparation of the Plans and Specifications and construction of the
Additional Improvements.


          “RCRA”
– The Resource Conservation and Recovery Act, 42 U.S.C. § § 6901 et seq.,
as same may be amended from time to time.


          “Repair
and Replacement Plan” – The plans and specifications, including scopes of work, time schedules and budgets, for the
repairs to the Project and the corrective actions with regard to the environmental conditions identified in the
Reports, which plans and specifications are required under the
Acquisition Agreement.






          “Reports”
shall mean the environmental reports delivered to the Lender and identified
on Schedule 4.09.


          “Security
Agreement” – The Security Agreement in form and substance acceptable
to Lender between Borrower and Lender.


          “Security
Documents” – The Mortgage, Security Agreement, Additional Improvements Escrow Agreement, Debt Service Reserve
Agreement, Financing Statements,
Environmental Indemnity, Assignment of Construction Contract, Assignment of
Architect’s Contract, and any other documents securing the Loans.


          “Subcontractor”
– Any person who contracts with the General Contractor to perform any of the
work or supply any of the materials necessary to complete the Additional
Improvements.


          “Subcontract”
– Any contract between the General Contractor and a Subcontractor.


          “Subordinated Loan Documents” – The documents
evidencing any Subordinated Loan.


          “Subordinated
Intercreditor Agreement” - An Intercreditor and Subordination Agreement among
the Lender, the Borrower and the Subordinated Lender, in form and substance
satisfactory to the Lender in its sole discretion.


          “Subordinated
Loan” – Any Indebtedness of the Borrower to the Subordinated Lender
now existing or hereafter created, incurred or arising, which is subject to the
Subordinated Intercreditor Agreement, which
loan may include, without limitation, a loan from the Small Business Administration; provided that the maximum
principal amount of the Subordinated Loan shall not exceed $4,000,000.


          “Subordinated
Lender” – Any Person providing the Subordinated Loan, which may
include, without limitation, the Small Business Administration.


          “Sworn
Construction Statement” – A sworn construction statement duly executed by the Borrower and the General Contractor showing
all Contractors having contracts or subcontracts for specific portions
of the work on the Additional Improvements and the amounts due or to become due each such Contractor, and including all
so-called “hard” costs of any kind
incurred and to be incurred in constructing the Additional Improvements and fulfilling the obligations of the
General Contractor under the terms of the Construction Contract.


          “Title” –
First American Title Insurance Company.






          “Total
Project Cost Statement” – A total project cost statement duly executed by the
Borrower incorporating the Sworn Construction Statement and setting forth all
costs and expenses of any kind incurred or
to be incurred by the Borrower in connection with the completion of the
Additional Improvements, including all so-called “hard” and “soft” costs.


          “Toxic
Substance” – Any material present on the Land which has been shown to have significant adverse effect on human health or
which is subject to regulation under the Toxic Substances Control Act (TSCA),
15 U.S.C. § § 2601 et seq., applicable state law, or any other applicable federal or state laws now in force or
hereafter enacted relating to toxic substances. “Toxic Substance”
includes but is not limited to asbestos, polychlorinated biphenyls (PCBs) and
lead-based paints.


          “USA
Patriot Act” - The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed, extended,
amended or replaced.


          “Working
Capital Documents” – The documents evidencing the Working Capital Loan.


          “Working
Capital Lender” – Any Person providing the Working Capital Loan.


          “Working
Capital Loan” – Any Indebtedness of the Borrower to the Working Capital Lender now existing or hereafter created
which is subject to the Working Capital Intercreditor Agreement, which loans may include, without limitation, a
loan from the Small Business Administration.


          “Working
Capital Intercreditor Agreement” - An Intercreditor Agreement among the Lender,
the Borrower and the Working Capital Lender, in form and substance satisfactory to the Lender, which Intercreditor
Agreement shall only provide for the specific requirements set forth on
Schedule 1.01 attached hereto.


          Section
1.02 Certain Matters of Construction. The terms “herein”, “hereof” and “hereunder” and other words of similar import
refer to this Agreement as a whole and not to any particular section,
paragraph or subdivision. Any pronoun used shall be deemed to cover all
genders. Wherever appropriate in the context, terms used herein in the singular
also include the plural and vice versa. All references to statutes and related
regulations shall include any amendments of
same and any successor statutes and regulations. Unless otherwise provided, all
references to any instruments or agreements to which the Lender is a
party, including, without limitation,
references to any of the other Loan Documents, shall include any and all modifications
or amendments thereto and any and all extensions or renewals thereof.






ARTICLE II


COMMITMENT TO MAKE LOANS


Section 2.01 The Loans.


                    (a)     Initial Loan. Subject to and on the Closing Date, borrower
shall execute and deliver to Lender the Initial Note, evidencing Borrower’s
obligation to repay the Initial Loan, which Initial Loan shall be deemed fully
advanced and disbursed as of Closing Date without further action on the part of
Lender. The Initial Note contains terms relating to maturity, interest rate,
payments, acceleration and other matters.


                    (b)     Acquisition Loan. The Lender agrees, on the terms and
subject to the conditions hereinafter set
forth, to make the Acquisition Loan to the Borrower on or before the Commitment
Termination Date in a aggregate principal amount of up to and including the
maximum amount of the Commitment. Lender shall have no obligation to make the
Acquisition Loan after the Commitment
Termination Date. The proceeds of the Acquisition Loan shall be used by the Borrower to pay a portion of cost the
Acquisition of the Project pursuant to the Acquisition Agreement. The
obligation of the Borrower to repay the Acquisition Loan shall be evidenced by
the Acquisition Note which contains terms relating to maturity, interest rate,
payments, acceleration and other matters. Interest shall be payable at the rate
provided therein only on such portions of the Acquisition Loan proceeds as
actually have been disbursed pursuant to this Agreement.


          Section
2.02 Single Advance. The Acquisition Loan shall be advanced in a single advance to Borrower upon satisfaction of the
conditions precedent described in Article III of this Agreement, subject to the terms and conditions of
this Agreement. The date on which the advance is made is sometimes
referred to herein as the “Closing Date.”


          Section
2.03 Note. Against delivery to the Borrower of Six Million Dollars ($6,000,000.00),
the Borrower shall execute and deliver the Acquisition Note to the Lender to
evidence the Borrower’s obligations under the Acquisition Loan. The Acquisition
Note shall represent the Obligations of the
Borrower to pay the Lender the outstanding principal amount of the
Acquisition Loan, plus interest accrued thereon, as set forth in the Note. The
Borrower irrevocably authorizes the Lender
to make or cause to be made a notation on the Lender’s books and
records, at or about the time of the Lender’s receipt of any interest or
principal payment on the Note, an
appropriate notation on the books and records reflecting such payment. The aggregate unpaid amount set forth on the Lender’s
books and records shall be prima facie evidence of the interest or
principal amount thereof owing and unpaid to the Lender, but the failure to record, or any error in so recording
any such amount shall not affect the Obligations of the Borrower hereunder or
under the Note to make payments of principal of and interest on the Note
when due.


          Section
2.04 Voluntary Prepayments. The
Borrower may prepay the Loans in whole or in part at any time, without
premium or penalty.


          Section
2.05 Business Days. If the date for any payment or prepayment hereunder
falls on a day which is not a Business Day, then for all purposes
of this Agreement the payment shall be due on the preceding Business Day.


          Section
2.06 Use of Proceeds. The Borrower shall apply the proceeds of the Loans
to fund the Acquisition and other related expenses.






          Section
2.07 Maturity Date. The Loans will terminate on the Maturity Date unless
terminated earlier pursuant to this Agreement
or the terms of the Initial Note or Acquisition Note, and all principal and interest then outstanding under the Loans
shall be due and payable on such date.


ARTICLE III


CONDITIONS TO ACQUISITION LOAN


          Section
3.01 Conditions Precedent to Acquisition Loan. The obligation of the
Lender to make the Acquisition Loan shall be subject to the
condition precedent that the Lender shall have
received on or before the date of the Acquisition Loan the following, each to
be satisfactory to the Lender in form and substance:


	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (a)     Note. The Note duly executed by the Borrower;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (b)     Additional Improvements Escrow
 Documents. The Additional Improvements Escrow Agreement, duly executed by
 the Borrower, Title and the Lender, including acknowledgement by Title that
 the Additional Improvements Escrow has been funded;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (c)    
 Mortgage. The Mortgage duly executed by the Borrower.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (d)   
 Security Documents. The Security Documents, duly executed by each party thereto (other than the Assignment of
 Construction Contract and the Assignment of Project Engineer’s
 Contract, which shall be delivered pursuant to Section 5.22).

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (e)    
 Appraisal. The Appraisal.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (f)     Equity. Evidence satisfactory to the Lender that the
 Borrower has available for use in
 connection with the operation of the Project not less than $19,000,000 of
 Equity.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (g)     ALTA Mortgagee’s Policy of Title
 Insurance. An extended coverage
 ALTA Mortgagee’s Policy of Title Insurance issued by Title (Form 1970
 or Form 1996 with the exclusion for
 creditors rights and arbitration requirements deleted) and containing
 such endorsements as Lender may require including ALTA Form 9
 (Comprehensive), ALTA Form 6.2 (Variable Rate), Survey, Separate Tax Parcel, Subdivision Compliance, and ALTA Form 3.1
 (Zoning). Such Policy shall be in an amount
 equal to the maximum amount of the Commitment, and shall insure the Mortgage as a first lien on a good and marketable fee
 simple title to the Project, subject only to such Permitted Encumbrances (as defined in the
 Acquisition Agreement) and encumbrances that have not been objected to by Borrower (or which objection has
 been cured by Lender or waived by
 Borrower) pursuant to the terms of the Acquisition Agreement. Without limiting the generality of the foregoing, such
 Policy shall insure the Lender against claims for mechanics’ liens,
 rights of parties in possession and matters which would be disclosed by a
 comprehensive survey of the Land.

 













	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (h)     Survey. A survey of the Land dated within ninety (90)
 days of the date of this Agreement prepared and certified by a licensed or
 registered surveyor to the Lender in
 accordance with Minimum Standard Detail Requirements for ALTA/ACSM Land Title
 Surveys (as adopted by the ALTA
 and NSPS in 2005) including Items Nos. 1, 2, 3, 4, 6, 7(a), 8, 9, 10,
 11(b) and 13 of Table A thereof and such other items as the Lender may reasonably require, acceptable to Lender in
 Lender’s sole discretion, which survey shall be “spotted” to show the
 proposed Additional Improvements according to the site plan prepared by the Project Engineer. Upon
 completion of the Additional Improvements the survey shall be
 recertified “as-built.”

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (i)     UCC, Judgment and Other Lien Searches. Appropriate searches conducted
 in the offices required by Lender showing no tax liens, bankruptcies,
 judgments or other liens affecting the Borrower or the Project, and Uniform
 Commercial Code searches disclosing no security interests existing against
 the Project including the equipment, fixtures and personality, except
 Permitted Liens.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
           (j)     Phase I. A Phase I Environmental Site
 Assessment certified within ninety (90) days of the date of this
 Agreement, addressed and certified to the Borrower and the Lender and
 performed by Geotechnical Services, Inc. or such other qualified licensed
 engineer in strict conformance with the Standard Practice for Environmental
 Site Assessment Process, ASTM Standard
 E1527-2005 and a findings and conclusions section consistent with
 Section 11.6.1 thereof and any additional investigations and analysis necessary for the consultant to conclude there
 are no Recognized Environmental Conditions (as such term is used in
 Standard E1527) associated with the Project, or such have been remediated in accordance with applicable law, except as
 described in the Reports.

 
	
  

 	
  

 
	
  

 	
           (k)    
 Legal Opinion. A signed copy of a favorable opinion of counsel
 to the Borrower in form and substance acceptable to Lender in Lender’s
 sole discretion.

 
	
  

 	
  

 
	
  

 	
           (l)    
 Acquisition Documents. The Lender shall have received final executed copies
 of the Acquisition Documents as in effect on the Closing Date.

 
	
  

 	
  

 
	
  

 	
           (m)   
 Certificates. The Lender shall have received a copy of the Articles of
 Organization of the Borrower, and all amendments thereto, certified by the
 Secretary of State or other appropriate
 official of its jurisdiction of formation together with copies of its
 Operating Agreement and all agreements of the Borrower’s members certified as
 accurate and complete by the Secretary of the Borrower.

 
	
  

 	
  

 
	
  

 	
           (n)    
 Proceedings of Borrower. The Lender shall have received a copy of the
 resolutions in form and substance reasonably satisfactory to the Lender, of
 the Board of Directors of the Borrower
 authorizing the execution, delivery and performance of this Agreement and the other Loan Documents certified
 by the Secretary of the Borrower; and, such certificate shall state that the
 resolutions thereby ratified have not been amended, modified, revoked
 or rescinded as of the date of such certificate.

 













	
  

 	
  

 	
  

 
	
  

 	
           (o)     
 Incumbency Certificates of the Borrower. The Lender shall have
 received a certificate of
 the Secretary of the Borrower, dated the Closing Date, as to the incumbency and signature of the officers of the
 Borrower executing this Agreement, any certificate or other documents to be delivered by it pursuant hereto,
 together with evidence of the incumbency of such Secretary.

 
	
  

 	
  

 
	
  

 	
           (p)     
 Certificate of Existence. The Lender shall have received a certificate
 of existence for the Borrower dated not more than thirty (30) days prior to
 the Closing Date, issued by the Secretary
 of State or other appropriate official of the Borrower’s jurisdiction of formation and each jurisdiction
 where the conduct of the Borrower’s business activities or the
 ownership of its properties necessitates qualification.

 
	
  

 	
  

 
	
  

 	
           (q)     
 Repair and Replacement Plan. The Repair and Replacement Plan related to the corrective actions with regard to the
 environmental conditions identified in the Reports, mutually
 acceptable to Borrower and Lender pursuant to the terms of the Acquisition
 Agreement.

 
	
  

 	
  

 
	
  

 	
           (r)     
 Closing Certificate. The Lender shall have received a closing
 certificate signed by the President or
 Chairman of the Borrower dated as of the date hereof, stating that (i) all representations and warranties set
 forth in this Agreement and the other Loan Documents are true and correct on and as of such date, (ii) the
 Borrower is on such date in compliance with all the terms and
 provisions set forth in this Agreement and the other Loan Documents and (iii) on such date no Default or Event of Default
 has occurred or is continuing.

 
	
  

 	
  

 
	
  

 	
           (s)     
 Plans and Specifications. The Plans and Specifications, acceptable to Lender
 in Lender’s sole discretion.

 
	
  

 	
  

 
	
  

 	
           (t)     
 Inspecting Architect/Engineer Report. A report of the Inspecting Architect/Engineer approving the Plans and
 Specifications, the Construction Contract and the Sworn Construction
 Statement, acceptable to Lender in Lender’s sole discretion.

 
	
  

 	
  

 
	
  

 	
           (u)     
 Construction Contracts. The Construction Contract and the Project Engineer’s
 Contract, acceptable to Lender in Lender’s sole discretion.

 
	
  

 	
  

 
	
  

 	
           (v)     
 Subcontracts. Copies of such Subcontracts as the Lender may request, together with a letter from each Contractor under
 such Subcontracts permitting the Lender,
 upon its election to complete the Additional Improvements in accordance with the
 provisions of Section 7.02(d) hereof, to acquire the interest of the
 Contractor under such Subcontracts.

 













	
  

 	
  

 
	
  

 	
           (w)     
 Assignments. The Assignment of Construction Contract and Assignment of Project Engineer’s Contract, duly executed by
 Borrower and acknowledged by any other party to the Construction
 Contract or the Project Engineer’s Contract.

 
	
  

 	
  

 
	
  

 	
           (x)     
 Contractor Guaranty. A completion guaranty duly executed
 by General Contractor in favor of Lender
 guarantying completion of the Additional Improvements, in form and
 substance acceptable to Lender.

 
	
  

 	
  

 
	
  

 	
           (y)     
 Sworn Construction Statement. The Sworn Construction
 Statement.

 
	
  

 	
  

 
	
  

 	
           (z)     
 Total Project Cost Statement. The Total Project Cost
 Statement.

 
	
  

 	
  

 
	
  

 	
           (aa)    Site
 Plan. The site plan prepared by the Project Engineer showing the proposed
 Additional Improvements, acceptable to Lender.

 
	
  

 	
  

 
	
  

 	
           (bb)   Contractors. If requested by the Lender, the Lender shall be furnished
 with a statement of the
 Borrower and of any Contractor, in form and substance required by the Lender, setting forth the names, addresses
 and amounts due or to become due as well as the amounts previously
 paid to every Contractor, subcontractor, person, firm or corporation furnishing materials or performing
 labor in connection with the construction of any part of the
 Additional Improvements.

 
	
  

 	
  

 
	
  

 	
           (cc)   Marketing
 Agreement. An agreement between Borrower and a biodiesel marketer pursuant to which the marketer agrees
 to market and sell biodiesel produced at the Project, in form and
 substance acceptable to Lender.

 
	
  

 	
  

 
	
  

 	
           (dd)   Hedging Plan. Evidence of a risk management plan for hedging against fluctuating
 commodities prices, in form and substance acceptable to Lender.

 
	
  

 	
  

 
	
  

 	
           (ee)   No Default. No Default or Event of Default hereunder shall have
 occurred and be continuing and all representations and warranties made by the
 Borrower herein shall continue to be true and correct as of
 such date.

 
	
  

 	
  

 
	
  

 	
           (ff)    Additional Matters. Such additional documents and information
 regarding the Borrower, the
 Borrower’s business and the Project as Lender shall reasonably request, and
 which shall be in form and substance acceptable to Lender.

 


          Section
3.02 No Waiver. The making of the Acquisition Loan prior to fulfillment
of any condition thereof shall not be construed as a waiver of
such condition, and the Lender reserves the right to require fulfillment of any
and all such conditions at any time before or after the date of the Acquisition
Loan.






ARTICLE IV


REPRESENTATIONS AND WARRANTIES


          To induce
the Lender to enter into this Agreement and to make Loans hereunder, the Borrower
represents and warrants to the Lender:


          Section
4.01 Formation, Standing, Etc. The Borrower is a limited liability
company duly organized and validly existing under the laws of
Iowa and has all requisite power and authority to carry on its business as now
conducted, to enter into the Loan Documents to which it is a party, to perform
its obligations under such Loan Documents, to operate the Project and to construct the Additional Improvements. The Borrower
is duly qualified and in good standing as a foreign limited liability
company in each jurisdiction in which the character of the properties owned, leased or operated by it or the business
conducted by it makes such qualification necessary. The Borrower has delivered
to the Lender true and complete copies of its Organizational Documents and will promptly notify the Lender of any
amendment or changes thereto. The Borrower’s organizational
identification number is 320840.


          Section
4.02 Authorization and Validity. The execution, delivery and performance
by the Borrower of the Loan
Documents has been duly authorized by all necessary company action by the Borrower, and such Loan Documents
constitute the legal, valid and binding obligations of the Borrower, enforceable against the Borrower in
accordance with their respective terms, subject to limitations as to
enforceability which might result from bankruptcy, insolvency, moratorium and
other similar laws affecting creditors’ rights generally and subject to
limitations on the availability of equitable remedies.


          Section
4.03 Company Name. The Borrower has not been known by any other company
name in the past five (5) years nor has the Borrower been the surviving company
of a merger or consolidation or acquired all
or substantially all of the assets of any Person during the preceding
five (5) years, except in connection the Acquisition.


          Section
4.04 No Conflict; No Default. The execution, delivery and performance by
the Borrower of the Loan Documents to which it is a party, and the operation of
the Project and construction of the
Additional Improvements, will not (a) violate any provision of any law,
statute, rule or regulation or any order, writ, judgment, injunction, decree,
determination or award of any court, governmental agency, arbitrator or
other Governmental Body presently in effect having applicability to the
Borrower, (b) violate or contravene any provisions of the Organizational
Documents, (c) result in a breach of or constitute a default under any
indenture, loan or credit agreement or any other agreement, lease or instrument
to which the Borrower is a party or by which
it or any of its properties may be bound, or (d) result in the creation of any
Lien on any asset of the Borrower except for a Permitted Lien. The Borrower is
not in default under or in violation
of any such law, statute, rule or regulation, order, writ, judgment, injunction, decree, determination or award or any
such indenture, loan or credit agreement or other agreement, lease or
instrument.





          Section
4.05 Government Consent; Compliance With Laws. No order, Consent, approval, license, authorization or validation of,
or filing, recording or registration with, or exemption by, any Governmental Body is required in connection with the
execution, delivery and performance of, or the legality, validity,
binding effect or enforceability of, the Loan Documents. The use of the Project
complies with all applicable zoning and environmental ordinances, regulations
and restrictive covenants affecting the Project and all requirements for such
use have been satisfied.


Section 4.06 Financial Statements and Condition; Solvency.


          (a)     
The Borrower’s financial statements, as heretofore furnished to the Lender,
have been prepared in accordance with GAAP on a consistent basis and fairly
present the financial condition of the Borrower as at such dates and the
results of their operations and changes in financial position for the
respective periods then ended. The Borrower has no obligation, contingent liability, liability for taxes or long
term lease obligation which is not reflected in such financial
statements or in the notes thereto.


          (b)     
As of the date hereof, and immediately prior
to and after giving effect to the Loans
hereunder and the use of the proceeds thereof, (a) the fair value of the
Borrower’s assets is greater than the
amount of its liabilities (including disputed, contingent and unliquidated liabilities)
as such value is established and liabilities evaluated as required under the
Section 548 of the United Stated Bankruptcy Code, as amended, (b) the present
fair saleable value of the Borrower’s assets is not less than the amount that
will be required to pay the probable liability on its debts as they become absolute and matured, (c) the Borrower is able
to realize upon its assets and pay its debts and other liabilities
(including disputed, contingent and unliquidated liabilities) as they mature in the normal course of business,
(d) the Borrower does not intend to, nor believes that it will, incur debts or liabilities beyond
its ability to pay as such debts and liabilities mature, and (e) the
Borrower is not engaged in business or a transaction, and is not about to
engage in business or a transaction, for which its property would constitute
unreasonably small capital.


          Section
4.07 Litigation. There are no actions, suits or proceedings pending or,
to the knowledge of the Borrower, threatened against or affecting the Borrower,
or any of its property before any court or arbitrator, or any governmental
department, board, agency or other Governmental Body.


          Section
4.08 ERISA. (a) the Borrower does not have an employee benefit plan as defined in Section 3(1) of ERISA, whether or not
subject to ERISA (“Plan”); (b) no assets of the Borrower constitute
assets of any such plan under ERISA regulations or rulings; (c) with respect to any such plan that the Borrower sponsors,
participates in or has fiduciary duties with respect to, the Borrower
has materially complied with all federal and state laws, plan documents and funding requirements; (d) the Borrower does not
sponsor, participate in, or have fiduciary duties with respect to any
defined benefit pension plan subject to Title IV of ERISA or any multi-employer pension plan as defined in Section
3(37)(A) of ERISA or any plan providing medical or other welfare benefits to
retirees or other former employees (except as required by federal or state
law); and (e) the Borrower is not (and has not ever been) a member of a group
of trades or businesses (whether or not
incorporated) that is treated as a single employer under Section 414 of the
Internal Revenue Code.






Section 4.09 O.S.H.A. and Environmental Compliance.


                    (a)     
The Borrower has duly complied with, and its facilities, business, assets, property, leaseholds and equipment are in
compliance in all material respects with, the provisions of the Federal Occupational Safety and Health Act, the
Environmental Protection Act, RCRA and all other Environmental Laws;
there have been no outstanding citations, notices or orders of non-compliance
issued to the Borrower or relating to its business, assets, property,
leaseholds or equipment under any such laws, rules or regulations.


                    (b)     
The Borrower has been issued all federal,
state and local licenses, certificates
or permits relating to all applicable Environmental Laws that Borrower is required
to have as of the date of this Agreement.


                    (c)     
Except as specifically disclosed to the Lender in the Reports as identified on Schedule 4.09(c), to Borrower’s knowledge (i)
there are no releases, spills, discharges, leaks or disposal (collectively
referred to as “Releases”) of Hazardous Substances at, upon, under or within
the Land or any premises owned or leased by the Borrower; (ii) there are no
underground storage tanks or polychlorinated
biphenyls on the Land or any premises owned or leased by the Borrower, (iii) neither the Land nor any premise
owned or leased by the Borrower has ever been used as a treatment,
storage or disposal facility of Hazardous Waste; and (iv) no Hazardous Substances are present on the Land or any premises
owned or leased by the Borrower, excepting such quantities as are handled in accordance with all applicable
manufacturer’s instructions and governmental regulations and in proper
storage containers and as are necessary for the operation of the commercial
business of the Borrower or of its tenants.


          Section
4.10 Regulation U. The Borrower is not engaged in the business of
extending credit for the purpose of purchasing or carrying margin
stock (as defined in Regulation U of the Board
of Governors of the Federal Reserve System) and no part of the proceeds of the
Loans will be used to purchase or
carry margin stock or for any other purpose which would violate any of the
margin requirements of the Board of Governors of the Federal Reserve System.


          Section
4.11 Ownership of Property; Liens. Upon the closing of the Acquisition Agreement,
the Borrower will be the owner of the Land and the Project in fee simple and of
all personal property described in the Mortgage delivered herewith, and has no
knowledge of any unrecorded claims, liens, or encumbrances against the Property
or such personal property other than Permitted Liens.


          Section
4.12 Utilities. To Borrower’s knowledge, all utility services necessary
for the proper operation of the Project for
its intended purpose are available at the Project or will be made available to the Project prior to completion
of construction of the Additional Improvements at standard utility rates and hook-up charges, including without
limitation water supply, storm and sanitary sewer facilities, energy and
communications facilities.





          Section
4.13 Taxes. The Borrower’s federal tax identification number is
20-402-6473. The Borrower has
filed all federal, state and local tax returns and other reports required to be
filed and has paid or made provision for the payment of all taxes due and
payable pursuant to such returns and pursuant to any assessments made
against it or any of its property and all other taxes, fees and other charges
imposed on it or any of its property by any Governmental Body (other than taxes, fees or charges the amount or
validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in accordance with
GAAP have been provided on the books of the Borrower). No tax Liens have been
filed and no material claims are being
asserted with respect to any such taxes, fees or charges. The provision for taxes on the books of the Borrower are
adequate for all years not closed by applicable statutes, and for its current fiscal year, and the Borrower has no
knowledge of any deficiency or additional assessment in connection
therewith no provided for on its books.


          Section
4.14 Trademarks, Patents, Etc. To Borrower’s knowledge, all patents, patent
applications, trademarks, trademark applications, service marks,
service mark applications, copyrights, copyright applications, design rights,
tradenames, assumed names, trade secrets and licenses
owned or utilized by the Borrower are valid and have been duly registered or
filed with the appropriate Governmental Bodies and constitute all of the
intellectual property rights which are necessary for the operation of its
business; to Borrower’s knowledge, there is no objection to or pending
challenge to the validity of any such patent, trademark, copyright, design
right, tradename, trade secret or license and
the Borrower is not aware of any grounds for any challenge. To Borrower’s knowledge, each patent, patent application,
patent license, trademark, trademark application, trademark license,
service mark, service mark application, service mark license, design right, copyright, copyright application and copyright
license owned or held by the Borrower and all trade secrets use by the
Borrower consist of original material or property developed by such Borrower or
was lawfully acquired by such Borrower from the proper and lawful owner
thereof.


          Section
4.15 Investment Company Act. The Borrower is not an “investment company”
or a company “controlled” by an investment company within the
meaning of the Investment Company Act of 1940, as amended.


          Section
4.16 Partnerships and Joint Ventures. The Borrower is not a party to any
partnership or joint venture.


          Section
4.17 Insurance. The Borrower currently maintains the insurance coverages
required to be maintained
under Section 5.03 hereof. The Borrower does not participate in any retrospective
rating plan, fronting arrangement or other self-insurance or risk assumption
arrangement.


          Section
4.18 Indebtedness. The Borrower has no Indebtedness other than Permitted
Indebtedness.


          Section
4.19 Labor Matters. (a) on the date of this Agreement the Borrower is
not a party to any labor
dispute and there are no strikes, slowdowns, stoppages or walkouts relating to any
labor contracts to which the Borrower is subject; and (b) there is no unfair
labor practice complaint pending against the Borrower or, to the best knowledge
of the Borrower, threatened against the
Borrower, before the National Labor Relations Board or similar foreign entity,
and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so pending against the Borrower or, to the best
knowledge of the Borrower, threatened against the Borrower.





          Section
4.20 Agricultural Lien Matters. No processing, packaging or other work
is performed by any party with respect to inventory of the
Borrower which could give rise to a Lien in favor of such party for amounts due
for the processing, packaging or other work performed. Borrower has not received written notice from any unpaid seller,
supplier, cooperative or agent of such party’s intent to preserve the
benefits of any trust created under any statute, law or regulation (or other mandatory provision of state or local law) that
could either (a) create or give rise
to an agricultural lien (as defined in the Uniform Commercial Code), or (b)
create a Lien against, or impose a trust upon, some portion of
Borrower’s inventory (and/or the accounts receivable
derived therefrom) for the benefit of unpaid sellers, any broker acting on
behalf of any seller, or any
cooperative. Borrower is not a “dealer” or a “broker” as defined in any
agricultural lien statute, and, as such, Borrower does not maintain a
license as a “dealer” or “broker” under any such statute.


          Section
4.21 Material Contracts. Except for the agreements set forth on Schedule
4.21, attached hereto, copies of which have been delivered to Lender, and the
Acquisition Documents, there are no (a)
employment agreements covering the management of the Borrower, (b) collective bargaining agreements or other
similar labor agreements covering any employees of the Borrower, (c)
agreements for managerial, consulting or similar services to which the Borrower is a party or by which it is bound, (d)
agreements regarding the Borrower, its assets or operations or any investment
therein to which any of its equity holders is a party or by which it is bound,
(e) real estate leases, intellectual property licenses or other lease or
license agreements to which the Borrower is a party, either as lessor or
lessee, or as licensor or licensee (other than licenses arising from the purchasing by the Borrower of “off the shelf”
products), (f) customer, distribution, marketing or supply agreements to
which the Borrower is a party, (g) third party billing arrangements to which
the Borrower is a party, or (i) any other agreements or instruments to which the Borrower is a party, and the breach,
nonperformance or cancellation of which, or the failure of which to renew, could reasonably be expected to have a
material adverse effect on the Borrower (collectively “Material
Contracts”). Promptly upon execution of any Material Contract, Borrower
shall provide Lender a copy of such Material Contract.


          Section
4.22 Subsidiaries. The Borrower does not own any stock, partnership
interest, limited liability company interests or other equity securities or
ownership in any other business entity.


          Section 4.23
Anti-Terrorism Laws.


	
  

 	
  

 
	
  

 	
           (a)     General. Neither the Borrower nor any Affiliate of the Borrower, is in
 violation of any Anti-Terrorism Law or
 engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or
 avoiding, or attempts to violate, any of the prohibitions set forth in
 any Anti-Terrorism Law.

 













	
  

 	
  

 
	
  

 	
           (b)      
 Executive Order No. 13224.

 






	
  

 	
  

 	
  

 
	
  

 	
  

 	
           (i)
 Neither the Borrower nor any Affiliate of the Borrower, or their respective agents acting or benefiting in any
 capacity in connection with the Loans or other transactions hereunder,
 is any of the following (each a “Blocked Person”):

 




	
  

 	
  

 	
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  


	
  

 	
 (x)

 	
 a Person that is listed in the annex to, or
 is otherwise subject to the
 provisions of, the Executive Order No. 13224;

 
	
  

 
	
  

 	
  

 	
  

	
  

 	
 (xi)

 	
 a Person owned or controlled by, or acting
 for or on behalf of, any Person that is listed in the annex to, or is otherwise subject
 to the provisions of, the Executive Order No. 13224;

 
	
  

 
	
  

 	
  

 	
  

	
  

 	
 (xii)

 	
 a Person or entity with which the Lender is
 prohibited from dealing or otherwise engaging in any
 transaction by any Anti-Terrorism Law;

 
	
  

 
	
  

 	
  

 	
  

	
  

 	
 (xiii)

 	
 a Person or entity that commits, threatens or conspires to commit or supports “terrorism” as defined in the
 Executive Order No. 13224;

 
	
  

 
	
  

 	
  

 	
  

	
  

 	
 (xiv)

 	
 a Person or entity that is named as a “specially designated national”
 on the most current list published by the U.S. Treasury Department Office of Foreign Asset Control at its official
 website or any replacement website or other replacement official publication
 of such list, or

 
	
  

 
	
  

 	
  

 	
	
  

 	
 (xv)

 	
 a Person or entity who is affiliated or
 associated with a Person or entity listed above.

 





	
  

 	
  

 	
  

 
	
  

 	
  

 	
           (ii)
 The Borrower, or to the knowledge of the Borrower, none of its agents
 acting in any capacity in connection with the Loans or other transactions
 hereunder (i) conducts any business or engages in making or receiving any contribution of funds, goods or
 services to or for the benefit of any Blocked Person, or (ii) deals
 in, or otherwise engages in any transaction
 relating to, any property or interests in property blocked pursuant to
 the Executive Order No. 13224.

 


          Section
4.24 Conflicting Agreements. No provision of any mortgage, indenture, contract, agreement, judgment, decree or order
binding on the Borrower or affecting the Collateral conflicts with, or
requires any Consent which has not already been obtained to, or would in any way prevent the execution, delivery
or performance of, the terms of this Agreement or the other Loan
Documents.


          Section
4.25 Application of Certain Laws and Regulations. Neither the Borrower
nor any Affiliate of Borrower is subject to any statute, rule or regulation
which regulates the incurrence of any Indebtedness, including
without limitation, statutes or regulations relative to common or interstate
carriers or to the sale of electricity, gas, steam, water, telephone, telegraph
or other public utility services.






          Section
4.26 Delivery of Acquisition Documents. The Lender has received complete
copies of the Acquisition Documents (including all exhibits,
schedules and disclosure letters referred to therein or delivered pursuant
thereto, if any) and all amendments thereto, waivers relating thereto and other
side letters or agreements affecting the terms thereof. None of such documents and agreements has been amended or
supplemented, nor have any of the provisions thereof been waived, except
pursuant to a written agreement or instrument which has heretofore been
delivered to the Lender.


          Section
4.27 True and Complete Disclosure. All factual information (taken as a
whole) heretofore or contemporaneously
furnished by or on behalf of the Borrower to the Lender (including,
without limitation, all information contained in the Loan Documents) for
purposes of or in connection with this Agreement or any transactions
contemplated herein is, and all other such
factual information (taken as a whole) furnished by or on behalf of the
Borrower to the Lender after the date hereof will be, true and accurate
in all material respects on the date as of which
such information is dated or certified and not incomplete by omitting to state
any material fact necessary to make such information, taken as a whole, not
misleading at such time in light of the circumstances under which such
information was provided. There is no fact known to the Borrower which materially and adversely affects the business, operations,
property, assets, nature of assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower, taken as a whole, which has not been
disclosed herein or in such other documents, certificates and written statements furnished to the Bank for use
in connection with the transactions contemplated hereby.


ARTICLE V


AFFIRMATIVE COVENANTS


          From the
date of this Agreement and thereafter until all obligations of the Borrower to
the Lender have been paid in full, the Borrower will do all of
the following:


5.01 Financial Statements and Reports. Furnish to the Lender:


          (a)     
As soon as available and in any event within 120 days after the end of each fiscal year of the Borrower, the annual
financial statements of the Borrower prepared
in conformity with GAAP, consisting of at least statements of income, cash flow, changes in financial position and member
equity, and a consolidated balance sheet as at the end of such year,
setting forth in each case in comparative form corresponding figures from the
previous annual financial statements audited by independent certified public accountants of recognized standing
selected by the Borrower and reasonably acceptable to the Lender, together with any management letters,
management reports or other
supplementary comments or reports to the Borrower or its board of directors furnished
by such accountants.


          (b)     
As soon as available and in
any event within 30 days after the end of each calendar month, a copy of the unaudited financial statement of the
Borrower prepared in the same manner as the financial statements
referred to in Section 5.01(a), signed by the Borrower’s
chief financial officer or other officer of similar position, consisting of at
least consolidated statements of income, cash flow, changes in financial
position and member equity for the Borrower
for such month and for the period from the beginning of the current
fiscal year to the end of such month, and a consolidated balance sheet of the
Borrower as at the end of such month.





          (c)     
Immediately upon becoming aware of any Default or Event of Default, a notice
describing the nature thereof and what action the Borrower proposes to take
with respect thereto.


          (d)     
Immediately upon becoming
aware of the occurrence thereof, notice of the institution of any litigation,
arbitration or governmental proceeding, or the rendering of a judgment or decision in such litigation or
proceeding, which is material to the Borrower


          (e)     Immediately upon becoming aware of the occurrence
thereof, notice of any breach or default by the Borrower or any other
party under any Material Contract.


          (f)     
As soon as available and in
any event within 30 days after the end of each calendar month, a report
of any and all commodities transactions, including commodities hedging
transactions engaged in by the Borrower during such calendar month.


          (g)     
Promptly upon the mailing or
filing thereof, copies of all reports (including the final form of any
financial statements and reports) and proxy statements mailed to the Borrower’s
members generally, and copies of all registration statements, periodic reports and other documents filed with
the Securities and Exchange Commission (or any successor thereto) or any
national securities exchange.


          (h)     From time to time, such other information regarding
the business, operation and financial condition of the Borrower, as the
Lender may reasonably request.


          Section
5.02 Organizational Existence. Maintain its limited liability company
existence under the laws of
its jurisdiction of organization and its qualification to transact business in
each jurisdiction in which the
character of the properties owned, leased or operated by it or the business
conducted by it makes such qualification necessary.


          Section
5.03 Insurance. Maintain with financially sound and reputable insurance companies such insurance as set forth on Exhibit A
attached hereto, and such other insurance in such amounts and against such hazards as is customary in the case of
reputable companies engaged in the same or similar business and
similarly situated or as the Lender may reasonably request from time to time.


          Section
5.04 Payment of Taxes and Claims. File all tax returns and reports which
are required by law to be filed by it and
pay before they become delinquent all taxes, assessments and governmental charges and levies imposed upon it
or its property and all claims or demands of any kind (including,
without limitation, those of suppliers, mechanics, carriers, warehouses,
landlords and other like Persons); provided that the foregoing items
need not be paid if they are being contested
in good faith by appropriate proceedings, and as long as the Borrower’s title
to its property is not materially adversely affected, its use of such
property in the ordinary course of its
business is not materially interfered with and adequate reserves with respect
thereto have been set aside on the Borrower’s books in accordance with
GAAP.





          Section
5.05 Inspection. Permit Lender or Lender’s agent to visit and inspect
any of its properties, company books and financial records, to examine and to
make copies of its books of accounts and other financial records, and to
discuss the affairs, finances and accounts of the Borrower with, and to be
advised as to the same by, its officers at such reasonable times and intervals as Lender may designate from time to
time. The inspections under this Section 5.05 shall be at the expense of
Lender; provided, however, if the Borrower is in Default, the costs of the
inspections under this Section 5.05 shall be at Borrower’s sole cost and
expense.


          Section
5.06 Maintenance of Properties. Maintain its properties used or useful
in the conduct of its business in good condition, repair and working order, and
supplied with all necessary
equipment, and make all necessary repairs, renewals, replacements, betterments
and improvements thereto, all as may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times.


          Section
5.07 Books and Records. Keep adequate and proper records and books of account
in which full and correct entries will be made of its dealings, business and
affairs.


          Section
5.08 Compliance. Comply with all laws, rules, regulations, orders,
writs, judgments, injunctions,
decrees or awards to which it may be subject and not be or become subject
at any time to any law, regulation, or list of any government agency
(including, without limitation, the U.S. Office of Foreign Asset Control list)
that prohibits or limits Lender from making
any advance or extension of credit to the Borrower or from otherwise conducting
business with the Borrower.


          Section
5.09 Environmental Matters.


                                  (a)     
The Borrower shall ensure the Land remains in compliance with all Environmental
Laws and it shall not place or permit to be placed any Hazardous Substances on the Land except as permitted by applicable laws
or appropriate law or appropriate Governmental Bodies.


                                  (b)     
Borrower shall establish and maintain a system to assure and monitor compliance with all applicable
Environmental Laws which systems shall include periodic reviews of such
compliance.


                                  (c)     
The Borrower shall (i) employ in connection with the use of the Land appropriate technology necessary to maintain
compliance with any applicable Environmental Laws and (ii) dispose of
any and all Hazardous Waste generated at the Land only at facilities and with carriers that maintain valid permits under RCRA
and any other applicable Environmental
Laws. The Borrower shall use its best efforts to obtain certificates of
disposal, such as hazardous waste manifest receipts, from all treatment,
transport, storage or disposal facilities or operators employed by the
Borrower in connection with the transport or disposal of any Hazardous Waste
generated at the Land.






                                  (d)     
In the event that the Borrower obtains,
gives or receives notice of any
Release or threat of Release of a reportable quantity of any Hazardous
Substances at the Land (any such event being hereinafter referred to as
a “Hazardous Discharge”) or receives any notice of violation, request for
information or notification that it is potentially responsible for investigation or cleanup of environmental
conditions at the Land, demand letter or complaint, order, citation, or other written notice with
regard to any Hazardous Discharge or violation of Environmental Laws
affecting the Land or any of the Borrower’s interest therein (any of the
foregoing is referred to herein as an “Environmental Complaint”) from any
Person, including any state agency
responsible in whole or in part for environmental matters in the state in which
the Land is located or the United
States Environmental Protection Agency (any such Person or entity hereinafter the “Authority”), then the Borrower
shall, within five (5) Business Days, give written notice of same to the
Lender detailing facts and circumstances of which the Borrower is aware giving
rise to the Hazardous Discharge or Environmental Complaint. Such information is
to be provided to allow the Lender to protect its security interest in the Land
and the Collateral and is not intended to create nor shall it create any
obligation upon the Lender with respect thereto.


                                  (e)     
The Borrower shall promptly forward to the Lender copies of any request for
information, notification or potential liability, demand letter relating to
potential responsibility with respect to the investigation or cleanup of
Hazardous Substances at any other site owned, operated or used by the Borrower
to dispose of Hazardous Substances and shall continue to forward copies of
correspondence between the Borrower and the Authority regarding such claims to
the Lender until the claim is settled. The Borrower shall promptly forward to
the Lender copies of all documents and reports concerning a Hazardous Discharge
at the Land that the Borrower is required to
file under any Environmental Laws. Such information is to be provided solely to allow the Lender to protect the
Lender’s security interest in the Land and the Collateral.


                                  (f)     
The Borrower shall respond promptly to any
Hazardous Discharge or Environmental
Complaint and take all necessary action in order to safeguard the health of any
Person and to avoid subjecting the Collateral or Land to any Lien. If
the Borrower shall fail to respond promptly
to any Hazardous Discharge or Environmental Complaint or the Borrower shall fail to comply with any of the requirements
of any Environmental Laws, the Lender may, but without the obligation to do so, for the sole purpose of protecting
Lender’s interest in Collateral: (A)
give such notices or (B) enter onto the Land (or authorize third parties to
enter on the Land) and take such actions as the Lender (or such third
parties as directed by the Lender) deem
reasonably necessary or advisable, to clean up, remove, mitigate or otherwise
deal with any such Hazardous Discharge or Environmental Complaint. All
reasonable costs and expenses incurred by the Lender (or such third parties) in
the exercise of any such rights, including any sums paid in connection with any judicial or administrative
investigation or proceedings, fines and penalties, together with
interest thereon from the date expended at the Default Rate shall be paid upon
demand by the Borrower, and until paid shall be added to and become a part of
the Obligations secured by the Liens created
by the terms of this Agreement, the Security Documents or any other
agreement between the Lender and the Borrower.






                                  (g)     
Promptly upon the written request of the Lender after a Hazardous
Discharge or Environmental Complaint, the
Borrower shall provide the Lender, at the Borrower’s expense, with an
environmental site assessment or environmental audit report prepared by an
environmental engineering firm acceptable in the reasonable opinion of the Lender,
to assess with a reasonable degree of certainty the existence of a Hazardous
Discharge and the potential costs in connection with abatement, cleanup and
removal of any Hazardous Substances found on,
under, at or within the Land. Any report or investigation of such Hazardous
Discharge proposed and acceptable to an appropriate Authority that is charged
to oversee the cleanup of such Hazardous Discharge shall be acceptable to the
Lender. If such estimates, individually or in the aggregate, exceed $100,000,
the Lender shall have the right to require
the Borrower to post a bond, letter of credit or other security reasonably
satisfactory to the Lender to secure payment of these costs and
expenses.


                                  (h)     
The Borrower shall complete all actions set forth in the Holdback Reserve Agreement in compliance with the time
schedules and other requirements established in said such agreement, all applicable laws and regulations, and the
appropriate requirements of any Governmental Bodies.


                                  (i)     
The Borrower shall defend and indemnify the Lender and hold the Lender and its respective employees, agents,
directors and officers harmless from and against all loss, liability,
damage and expense, claims, costs fines and penalties, including attorneys’
fees, suffered or incurred by the Lender under or on account of any
Environmental Laws, including, without
limitation, the assertion of any Lien thereunder, with respect to any Hazardous
Discharge, the presence of any
Hazardous Substances affecting the Land, whether or not the same originates or emerges from the Land or any
contiguous real estate, including any loss of value of the Land as a result of the foregoing except to the extent such
loss, liability, damage and expense
is attributable to any Hazardous Discharge resulting from actions on the part
of the Lender, provided that this indemnity shall not be applicable to
the presence of any Hazardous Substance on
the Land to the extent that (1) such Hazardous Substance is disclosed in the Reports
at Closing and (2) the Borrower takes all necessary action to clean up, remove,
mitigate or otherwise deal with any such
Hazardous Substances in compliance with the requirements of this Agreement, all applicable laws and
regulations, and the requirements of Governmental Bodies. The Borrower’s obligations under this
Section 5.09 shall arise upon the discovery of the presence of any
Hazardous Substances at the Land, whether or not any federal, state or local environmental agency has taken or threatened any
action in connection with the presence of any Hazardous Substances. The Borrower’s obligation and the indemnifications
hereunder shall survive the termination of this Agreement.


          Section
5.10 Construction of Additional Improvements. (a) Commence construction
of the Additional Improvements
on or before the Commencement Date, (b) diligently proceed with construction
of the Additional Improvements according to the Plans and Specifications and in
accordance with all applicable laws and
ordinances, (c) cause the Additional Improvements to be completed by the
Completion Date, (d) require each Contractor to comply with all rules,
regulations, ordinances and laws bearing on its conduct of work on the Project.


          Section
5.11 Accounts. Maintain all operating accounts (i.e., accounts for
depositing revenues and paying expenses) with the Depository Institution until
all amounts owing to the Lender under this Agreement, the Note and the Security
Documents have been fully repaid.





          Section
5.12 Appraisal. Within forty-five (45) days after written request from
the Lender, provide Lender an updated appraisal of the Project,
the cost of which shall be born by Borrower if at the time of Lender’s notice
there exists any Default or Event of Default.


          Section
5.13 Intentionally Deleted.


          Section
5.14 Conduct of Business and Maintenance of Existence and Assets. (a)
Conduct continuously and operate actively
its business according to good business practices and maintain all of its properties useful or necessary in its
business in good working order and condition (reasonable wear and tear
excepted and except as may be disposed of in accordance with the terms of this Agreement), including, without limitation, all
licenses, patents, copyrights, design rights, tradenames, trade secrets and trademarks and take all actions necessary
to enforce and protect the validity
of any intellectual property right or other right included in the Collateral;
(b) keep in full force and effect
its existence and comply in all material respects with the laws and regulations
governing the conduct of its business
where the failure to do so could reasonably be expected to have a Material Adverse Effect on the Borrower;
and (c) make all such reports and pay all such franchise and other taxes and
license fees and do all such other acts and things as may be lawfully required to maintain its rights, licenses,
leases, powers and franchises under the laws of the United States or any
political subdivision thereof.


          Section
5.15 Violations. Promptly notify the Lender in writing of any violation
of any law, statute, regulation
or ordinance of any Governmental Body, or of any agency thereof, applicable
to the Borrower which could reasonably be expected to have a Material Adverse
Effect on the Borrower.


          Section
5.16 Execution of Supplemental Instruments. Execute and deliver to the
Lender from time to time, upon
demand, such supplemental agreements, statements, assignments and transfers, or instructions or documents relating
to the Collateral, and such other instruments as the Lender may request, in order that the full intent
of this Agreement may be carried into effect.


          Section
5.17 Payment of Indebtedness. Pay, discharge or otherwise satisfy at or
before maturity (subject,
where applicable, to specified grace periods and, in the case of the trade
payables, to normal payment
practices) all of its obligations and liabilities of whatever nature, except
when the failure to do so could not
reasonably be expected to have a Material Adverse Effect or when the amount or validity thereof is currently being
contested in good faith by appropriate proceedings and the Borrower shall have provided for such reserves
as the Lender may reasonably deem proper and necessary, subject at all times to
any applicable subordination agreement in favor of the Lender, the Subordinated
Intercreditor Agreement, and the Working Capital Intercreditor Agreement.


          Section
5.18 Holdback Reserve. Comply at all times with the terms and conditions
of the Holdback Reserve Agreement.


          Section
5.19 Debt Service Reserve. Maintain at all times the Debt Service
Reserve, pursuant to the Debt Service Reserve and Security Agreement and
perform all of Borrower’s obligations under the Debt Service Reserve and
Security Agreement.





          Section
5.20 Additional Improvements Escrow. Maintain at all times the
Additional Improvements Escrow, pursuant to the terms and
conditions of the Additional Improvements Escrow
Agreement and perform all of Borrower’s obligations under the Additional
Improvements Escrow Agreement.


          Section
5.21 Debt to Equity Ratio. Maintain at all times a Debt to Equity Ratio
of 1.0 to 1.0.


          Section
5.22 Additional Deliveries. The Borrower shall deliver to Lender each of
the following, on or before
the earlier of (i) the date that is ninety (90) days after the Closing Date, or
(ii) the date Borrower commences construction of the Additional
Improvements:


          (a)     
Permits. Copies of all building permits and such other licenses and permits
as may be required by any Governmental Body to construct the Additional
Improvements and operate the Project.


          (b)      Builder’s Risk Insurance. Copies of the policies of builder’s risk insurance (including business interruption
insurance) and comprehensive general liability insurance and a certificate of the worker’s compensation insurance as
required under Section 5.03 of this Agreement, with all such insurance
in full force and effect.


          (c)     
Repair and Replacement Plan. The Repair and Replacement Plan related to
the repair of the Project as set forth on Schedule 8.6(a) of the Acquisition
Agreement, mutually acceptable to Borrower
and Lender pursuant to the terms of the Acquisition Agreement.


ARTICLE VI


NEGATIVE COVENANTS


The Borrower agrees that, subject to the terms and conditions of this
Agreement, without the prior written consent of the Lender, it
shall not:


          Section
6.01 Transfers. Voluntarily, involuntarily or by operation of law agree
to, cause, suffer or permit
(i) any sale, transfer, lease, sublease or conveyance of any interest of the Borrower,
legal or equitable, in the Project; (ii) any sale, transfer or encumbrance of
any of the member interests in the Borrower, except for sales, transfers or
encumbrances when aggregated with all other
sales, transfers or encumbrances of membership interests of Borrower during the
previous three months will not result
in the sale, transfer or encumbrance of more than a majority of the outstanding membership interests of
Borrower during such three month period; or (iii) any mortgage, pledge,
encumbrance or Lien to be outstanding against the Project or any portion thereof,
or any security interest to exist therein, except for Permitted Liens. If the
Borrower breaches the foregoing covenant, the
Lender may, at its election, declare all amounts owing under this Agreement, the Note and the Security
Documents to be immediately due and payable, without notice to the
Borrower (which notice the Borrower hereby expressly waives), and upon such declaration all such amounts shall be
immediately due and payable. No transfer, conveyance, lease, sale or
other disposition shall relieve the Borrower from personal liability for its obligations hereunder or under the Note,
whether or not the transferee assumes such obligations. The Lender may, without notice to the Borrower, deal with
any successor owner of all or any portion of the Project in the same
manner as with the Borrower, without in any way discharging the liability of
the Borrower hereunder or under the Note.





          Section
6.02 Modifications to Material Contracts. Without the prior written
consent of the Lender, which
consent shall not be unreasonably withheld, agree or consent to any change in the
terms of any Material Contract.


          Section
6.03 Liens. Not create, incur or suffer to exist any Lien, except for
Permitted Liens.


          Section
6.04 Indebtedness. Not incur, create, assume, permit or suffer to exist,
any Indebtedness except Permitted Indebtedness. Prior to obtaining any Working
Capital Loan Borrower shall deliver to Lender a fully executed copy of the
Working Capital Intercreditor Agreement. Prior to obtaining any Subordinated
Loan Borrower shall deliver to Lender a fully executed copy of the Subordinated
Intercreditor Agreement.


          Section
6.05 Mergers and Acquisitions. Not consolidate with or merge into any
other Person, or permit any other Person to merge into it, or acquire (in a
transaction analogous in purpose or effect
to a consolidation or merger) all or substantially all of the assets or stock
of any other Person.


          Section
6.06 Transactions With Affiliates. Directly or indirectly, purchase,
acquire or lease any property from, or sell, transfer or lease
any property to, or otherwise deal with any Affiliate,
except transactions in the ordinary course of business, on an arm’s length
basis on terms no less favorable than
terms which would have been obtainable from a Person other than an
Affiliate.


          Section
6.07 Fixed Charge Coverage Ratio. Commencing with the calendar month ending on December 31, 2012, allow the Fixed
Charge Coverage Ratio to be less than 1.15 to 1.0, as determined on the last day of each calendar
month both (i) for such calendar month and (ii) for the immediately
preceding twelve month period.


          Section
6.08 Distributions. Make any distributions to members of the Borrower,
or otherwise permit any redemption or return of capital to any member of the
Borrower, except as expressly permitted
pursuant in this Section 6.08. The Borrower may make periodic distributions to
members of the Borrower provided that (i) such distributions are made solely
from earnings of the Borrower and do not constitute a redemption of a member’s
equity interest or return of capital, (ii) immediately prior to and
immediately after such distribution there exists no Default or Event of Default and (iii) immediately prior to and immediately
after such distribution, a minimum of $150,000 remains on deposit in the
Debt Service Reserve.





          Section
6.09 Anti-Terrorism Laws. The Borrower and its Affiliates and agents
shall not (i) conduct any
business or engage in any transaction or dealing with any Blocked Person,
including the making or receiving any contribution of funds, goods or
services to or for the benefit of any Blocked Person, (ii) deal in, or
otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to
Executive Order No. 13224; or (iii) engage in or conspire to engage in
any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempts to violate, any of the
prohibitions set forth in Executive Order No. 13224, the USA Patriot Act or any other Anti-Terrorism Law. The Borrower
shall deliver to the Lender any certificates or other evidence requested
from time to time by the Lender in its sole discretion, confirming the
Borrower’s compliance with this Section 6.09.


          Section
6.10 Guarantees. Become liable upon the obligations of any Person by assumption, endorsement or guaranty thereof or
otherwise (other than to the Lender) except (a) guarantees made in the ordinary course of business up to an aggregate
amount of $100,000, and (b) the endorsement of checks in the ordinary
course of business.


          Section
6.11 Investments. Except as otherwise specifically consented to in
writing by the Lender,
purchase or acquire obligations or stock of, or any other interest in, any
Person, except (a) obligations issued
or guaranteed by the United States of America or any agency thereof, (b) commercial paper with maturities of not more than
180 days and a published rating of not less than A-1 or P-1 (or the equivalent
rating), (c) certificates of time deposit and bankers’ acceptances having maturities of not more than 180 days and
repurchase agreements backed by United States government securities of a commercial bank if (i) such bank has a
combined capital and surplus of at
least $500,000,000 or such certificates of deposits do not exceed FDIC limits,
or (ii) its debt obligations, or
those of a holding company of which it is a Subsidiary, are rated not less than
A (or the equivalent rating) by a nationally recognized investment
rating agency, and (d) U.S. money market
funds that invest solely in obligations issued or guaranteed by the United
States of America or an agency thereof.


          Section
6.12 Plans. The Borrower will not permit any event to occur or condition
to exist which would permit any Plan to
terminate under any circumstances which would cause the Lien provided for in Section 4068 of ERISA to attach to
any assets of the Borrower; and the Borrower will not permit, as of the most recent valuation date for any Plan
subject to Title IV of ERISA, the present value (determined on the basis
of reasonable assumptions employed by the independent actuary for such Plan and previously furnished in writing to the
Lender) of such Plan’s projected benefit obligations to exceed the fair
market value of such Plan’s assets.


          Section
6.13 Change in Nature of Business. The Borrower will not engage in any material line of business substantially different
from those lines of business carried on by it on the date hereof or any business similarly related to
or which constitutes a reasonable extension thereof.


          Section
6.14 Subsidiaries. The Borrower shall not form any Subsidiary or enter
into any partnership, joint venture or similar arrangement.


          Section
6.15 Negative Pledges. The Borrower will not enter into any agreement,
bond, note or other instrument with or for the benefit of any
Person other than the Lender which would (i)
prohibit the Borrower from granting, or otherwise limit the ability of the
Borrower to grant, to the Lender any Lien on any assets or properties of
the Borrower, or (ii) require the Borrower to grant
a Lien to any other Person if the Borrower grants any Lien to the Lender other
than, in each case, (a) in connection with any document or instrument
governing capital leases and purchase money
expenditures or other Indebtedness permitted by this Agreement, provided that
any such restriction contained
therein relates only to the asset or assets that are the subject thereof and (b)
licenses and contracts providing that
the granting of such Lien in the right, title or interest of the Borrowers
therein would be prohibited and would, in and of itself, cause or result in a
default hereunder enabling another Person party to such license or contract to
enforce any remedy with respect thereto.





          Section
6.16 Fiscal Year and Accounting Changes. Change its fiscal year from an October 31 fiscal year end or make any change (i)
in accounting treatment and reporting practices except as required by
GAAP or (ii) in tax reporting treatment except as required by law.


          Section
6.17 Capital Expenditures. Except for the Additional Improvements,
contract for, purchase or make
any expenditure or commitments for fixed or capital assets (including
capitalized leases) in any fiscal year in an aggregate amount in excess
of $1,000,000.


          Section
6.18 Amendment of Organizational Documents. Amend, modify or waive any term
or material provision of its Organizational Documents unless required by law;
provided, however, the Lender’s consent to
any amendment, modification or waiver shall not be unreasonably withheld.


          Section
6.19 Prepayment of Indebtedness. Except as otherwise permitted pursuant
to Section 6.20, at any time,
directly or indirectly, prepay any Indebtedness (other than to Lender), or repurchase,
redeem, retire or otherwise acquire any Indebtedness of the Borrower.


          Section
6.20 Indebtedness. After and during the continuance of an Event of
Default, directly or indirectly, pay, prepay, repurchase, redeem,
retire or otherwise acquire, or make any payment on account of any principal
of, interest on or premium payable in connection with the repayment or
redemption of the Subordinated Loan, the Working Capital Loan or any other
Permitted Indebtedness.


          Section
6.21 Loans. Make advances, loans or extensions of credit to any Person, including without limitation, any parent,
Subsidiary or Affiliate except, subject to the terms and conditions of
this Agreement (a) with respect to the extension of commercial trade credit in connection with the sale of inventory in the
ordinary course of its business and (b) loans made to ethanol producers to finance the installation of
corn oil extraction units, provided that the maximum principal amount of such loans described in this
subparagraph (b) shall not exceed $6,000,000.


ARTICLE VII


EVENTS OF DEFAULT AND RIGHTS AND REMEDIES


          Section
7.01 Events of Default. Each of the following shall constitute an Event of Default.









	
  

 	
  

 	
  

 
	
  

 	
           (a)     The Borrower shall fail to pay any interest or principal on the Obligations when due, whether at maturity or by reason of
 acceleration pursuant to the terms of this Agreement or the Note;

 
	
  

 	
  

 	
  

 
	
  

 	
           (b)     Any representation or warranty made by the Borrower herein, in
 the Security Documents or in any financial
 statement, certificate or report furnished at any time pursuant to
 this Agreement or the Security Documents shall prove to have been misleading or untrue in any material respect as
 of the time such representation or warranty was made;

 
	
  

 	
  

 	
  

 
	
  

 	
           (c)     The Borrower shall be in default under Sections
 5.19, 5.20, 5.22 or any provision of Article 6 of this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
           (d)     The Borrower shall be in default under the Holdback Reserve Agreement.

 
	
  

 	
  

 	
  

 
	
  

 	
           (e)     The Borrower shall fail to (i) furnish financial information when due or when
 requested which is unremedied for a period of fifteen (15) days, or (ii)
 permit the inspection of its books and records;

 
	
  

 	
  

 	
  

 
	
  

 	
           (f)     The Borrower shall fail or neglect to duly observe or perform,
 any of the terms, conditions, covenants or
 agreements required to be observed or performed by the Borrower
 hereunder (other than terms, conditions, covenants or agreements otherwise
 specifically dealt with in this Article VII), except for a failure or neglect
 of the Borrower to perform, keep or observe any term, provision, condition or
 covenant which is cured within thirty (30) days from the occurrence of such
 failure or neglect;

 
	
  

 	
  

 	
  

 
	
  

 	
           (g)     The Borrower shall be in
 default under or in breach of any of the covenants contained in any of the Security Documents and such default
 or breach shall not be cured or
 waived within the period or periods of grace, if any, applicable thereto;

 
	
  

 	
  

 	
  

 
	
  

 	
           (h)     The Project shall be materially damaged or destroyed by fire or
 other casualty and the loss, in the reasonable judgment of the Lender, shall
 not be adequately covered by insurance actually collected or in the process
 of collection or by other funds available to the Borrower;

 
	
  

 	
  

 	
  

 
	
  

 	
           (i)     
 There shall have been a cessation of the making of the Additional Improvements
 for any period after the date of commencement of the making of the Additional
 Improvements in excess of twenty (20) successive calendar days, unless the
 conditions of each of subparagraphs (1) and (2) below shall have been
 satisfied:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
           (1)     the
 cessation of the making of the Additional Improvements shall have been caused
 by conditions beyond the control of the Borrower, including, without limitation, acts of God or the elements,
 fire, strikes, labor disputes, delays in delivery of any material;

 













	
  

 	
  

 	
  

 
	
  

 	
  

 	
           (2)     from time to time upon the Lender’s request
 therefor during any such cessation of the making of the Additional
 Improvements, the Borrower shall furnish to
 the Lender satisfactory evidence that (notwithstanding such cessation of the making
 of the Additional Improvements) the completion of the Additional Improvements
 can be accomplished on or before the Completion Date plus an extension for
 the number of days of the cessation.

 
	
  

 	
  

 	
  

 
	
  

 	
           (j)     The Borrower shall fail to comply with any requirement of any Governmental Body within thirty (30) days after
 notice in writing of such requirement shall be given to the Borrower by such Governmental Body, subject to any
 rights of the Borrower to contest such requirement as provided in the
 Mortgage or this Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
           (k)     Any judgment or judgments are
 rendered or judgment Liens filed against the Borrower for an aggregate amount in excess of $150,000 which within
 thirty (30) days of such rendering or filing is not either satisfied,
 stayed or discharged of record; provided,
 however, it will not be a default if the judgment is being contested in good
 faith by appropriate proceedings or
 if adequate reserves with respect thereto have been set aside on the
 Borrower’s books in accordance with GAAP;

 
	
  

 	
  

 	
  

 
	
  

 	
           (l)     A petition in bankruptcy or for reorganization or for an arrangement under any
 bankruptcy or insolvency law or for a custodian, receiver or trustee for any
 of its property shall be filed by the
 Borrower, or a petition in bankruptcy or for reorganization or for an arrangement under any bankruptcy or
 insolvency law or for a custodian, receiver or trustee of any of the
 Borrower’s property shall be filed against the Borrower and shall not be
 dismissed within sixty (60) days, or a custodian, receiver or trustee of any
 property of the Borrower shall be appointed and shall not be discharged within
 sixty (60) days, or the Borrower shall make an assignment for the benefit of
 creditors or generally shall not pay its debts as they become due, or the Borrower shall be adjudged insolvent
 by any state or federal court of
 competent jurisdiction, or an attachment or execution shall be levied against
 any substantial portion of the property of the Borrower and shall not
 be discharged within sixty (60) days;

 
	
  

 	
  

 	
  

 
	
  

 	
           (m)    The Borrower shall admit in writing its inability, or be generally unable, to
 pay its debts as they become due or cease operations of its
 present business;

 
	
  

 	
  

 	
  

 
	
  

 	
           (n)     The Borrower shall be in default under any Material Contract
 and, in the Lender’s reasonable opinion,
 such default cannot be remedied within the grace periods (if any) afforded the Borrower under such documents,
 and, in the Lender’s reasonable opinion, such default will have a
 material adverse effect on the Borrower;

 
	
  

 	
  

 	
  

 
	
  

 	
           (o)     The Borrower shall be dissolved or terminated;

 
	
  

 	
  

 	
  

 
	
  

 	
           (p)     The Borrower, any of its Affiliates shall be in default under
 any other agreement with the Lender
 (whether in connection with the Loans or otherwise) and any required notice
 shall have been given and any time in which to cure the default shall have elapsed.

 













	
  

 	
  

 	
  

 
	
  

 	
           (q)     Any Lien created by the
 Mortgage or any other Security Document for any reason ceases to be or
 is not a valid and perfected Lien having a first priority security interest
 (except as may be otherwise determined by an intercreditor or subordination
 agreement)

 
	
  

 	
  

 	
  

 
	
  

 	
           (r)     An event of default caused
 by or related to Borrower has occurred and been declared under the
 Acquisition Documents which default shall not have been cured or waived
 within any applicable grace period.

 
	
  

 	
  

 	
  

 
	
  

 	
           (s)     Any material provision of
 this Agreement shall, for any reason, cease to be valid and binding on the Borrower, or the
 Borrower shall so claim in writing to the Lender.

 
	
  

 	
  

 	
  

 
	
  

 	
           (t) (i) Any Governmental Body shall (A) revoke, terminate, suspend or adversely modify any license, permit, patent,
 trademark or tradename of the Borrower, the continuation of which is material
 to the continuation of the Borrower’s business or (B) commence
 proceedings to suspend, revoke, terminate or adversely modify any such
 license, permit, trademark, tradename or patent and such proceedings shall
 not be dismissed or discharged within sixty
 (60) days, or (C) schedule or conduct a hearing on the renewal of any
 license, permit, trademark, tradename or patent necessary for the continuation of the Borrower’s business and the
 staff of such Governmental Body issues a report recommending the
 termination, revocation, suspension or material, adverse modification of such
 license, permit, trademark, tradename or patent; (ii) any agreement which is necessary or material to the operation
 of the Borrower’s business shall be revoked or terminated and not
 replaced by a substitute acceptable to the Lender within thirty (30) days
 after the date of such revocation or termination, and such revocation or termination and non-replacement would reasonably
 be expected to have a Material Adverse Effect on the Borrower.

 













	
  

 	
  

 	
  

 
	
  

 	
           (u)     Any
 portion of the Collateral or the Land shall be seized or taken by a Governmental Body, or the Borrower or the title
 and rights of the Borrower which is the owner of any material portion
 of the Collateral or the Land shall have become the subject matter of litigation which might, in the
 opinion of the Lender, upon final determination, result in impairment or loss of the security
 provided by this Agreement or any other Loan Document.

 
	
  

 	
  

 	
  

 
	
  

 	
           (v)     A
 default by Borrower with respect to any Indebtedness of the Borrower other
 than the Obligations.

 
	
  

 	
  

 	
  

 
	
           Section
 7.02 Rights and Remedies. Upon the occurrence of a Default or an Event
 of Default and at any time
 thereafter, the Lender may refuse to make the Acquisition Loan hereunder
 (but the Lender may make the Acquisition Loan after the occurrence of a
 Default or an Event of Default without
 thereby waiving its rights and remedies hereunder). In addition, upon the
 occurrence of an Event of Default the Lender may, at its option, exercise any
 and all of the following rights and remedies (and any other rights and
 remedies available to it):

 
	
  

 	
  

 	
  

 
	
  

 	
           (a)     The
 Lender may terminate the Commitment.

 
	
  

 	
  

 	
  

 
	
  

 	
           (b)     The
 Lender may, by written notice to the Borrower, declare immediately due and payable all unpaid principal of and
 accrued interest on the Note, together with all other sums payable
 hereunder, and the same shall thereupon be immediately due and payable without presentment or other demand,
 protest, notice of dishonor or any other notice of any kind, all of which are hereby expressly waived;
 provided, however, that upon the filing of a petition commencing a
 case naming the Borrower as debtor under the United States Bankruptcy Code, the principal of and all accrued
 interest on the Note shall be
 automatically due and payable without any notice to or demand on the Borrower
 or any other party.

 
	
  

 	
  

 	
  

 
	
  

 	
           (c)     The Lender shall have the right, in addition to
 any other rights provided by law, to enforce its rights and remedies
 under the Security Documents.

 
	
  

 	
  

 	
  

 












	
  

 	
  

 	
  

 
	
  

 	
           (d)     The Lender may enter upon the Land and take
 possession thereof, together with
 the Improvements, and proceed either in its own name or in the name of the
 Borrower, as the attorney-in-fact of the Borrower (which authority is coupled
 with an interest and is irrevocable by the Borrower) to complete or
 cause to be completed the Additional Improvements,
 at the cost and expense of the Borrower. If the Lender elects to complete or cause to be completed the
 Additional Improvements, it may do so according to the Plans and
 Specifications or according to such changes, alterations or modifications in
 and to the Plans and Specifications as the Lender may deem reasonable and
 appropriate; and the Lender may enforce or cancel all contracts let by the
 Borrower relating to construction of the
 Additional Improvements, and/or let other contracts which in the
 Lender’s sole judgment may seem advisable; and the Borrower shall forthwith
 turn over and duly assign to the Lender,
 as the Lender may from time to time require, contracts not already
 assigned to the Lender relating to construction of the Additional Improvements, blueprints, shop drawings, bonds,
 building permits, bills and statements of accounts pertaining to the Additional Improvements, whether paid or
 not, and any other instruments or
 records in the possession of the Borrower pertaining to the Project. The
 Borrower shall be liable under this Agreement to pay to the Lender, on
 demand, any amount or amounts expended by
 the Lender in so completing the Additional Improvements, together with
 any costs, charges, or expense incident thereto or resulting therefrom, all
 of which shall be secured by the Security Documents. In the event that a proceeding is instituted against the Borrower for
 recovery and reimbursement of any moneys expended by the Lender in
 connection with the completion of the Additional Improvements, a statement of such expenditures, verified by the
 affidavit of an officer of the
 Lender, shall be prima facie evidence of the amounts so expended and of the propriety of and necessity for such expenditures;
 and the burden of proving to the contrary shall be upon the Borrower.
 The Lender shall have the right to apply any funds which it agrees to advance hereunder and any funds which the Borrower
 has then on deposit with Title pursuant to the Additional Improvements
 Escrow Agreement to bring about the completion of the Additional Improvements
 and to pay the costs thereof; and if such
 moneys so agreed to be advanced and funds of the Borrower then on deposit
 with Title are insufficient, in the sole judgment of the Lender, to
 complete the Additional Improvements, the
 Borrower agrees to promptly deliver and pay to the Lender such sum or
 sums of money as the Lender may from time to time demand for the purpose of
 completing the Additional Improvements or of paying any liability, charge or
 expense which may have been incurred or
 assumed by the Lender under or in performance of this Agreement, or for the purpose of completing the
 Additional Improvements. It is expressly
 understood and agreed that in no event shall the Lender be obligated or
 liable in any way to complete the Additional Improvements or to pay
 for the costs of construction thereof.

 




          Section
7.03 Assignment and Setoff. The Borrower grants the Lender a lien and security
interest in all of the Borrower’s present and future property now or hereafter
in the possession, control or custody of, or
in transit to, the Lender for any purpose, and the balance of every
present and future account of the Borrower with the Lender, and each present
and future claim of the Borrower against the Lender. Such lien and security
interest secures all present and future
debts, obligations and liabilities of the Borrower to the Lender. In addition
to all other rights and remedies,
when or at any time after an Event of Default has occurred, the Lender may foreclose such lien and security interest, and the
Lender may offset or charge all or any part of the aggregate amount of such debts, obligations and liabilities against
any such property, accounts and claims
without notice, regardless of whether such debts, obligations or liabilities are
matured or unmatured.






ARTICLE VIII


MISCELLANEOUS


          Section
8.01 Inspections. The Borrower and the Project Engineer shall be
responsible for making
inspections of the Additional Improvements during the course of construction and
shall determine to their own satisfaction that the work done or
materials supplied by the Contractors to whom payment is to be made has been
properly done or supplied in accordance with the Construction Contract and the
other applicable contracts with the Contractors. If any work done or materials
supplied by a Contractor are not satisfactory to the Borrower and/or the
Project Engineer and the same is not remedied within fifteen (15) days of the
discovery thereof, the Borrower will
immediately notify the Lender in writing of such fact. It is expressly understood and agreed that the Lender and the
Inspecting Architect/Engineer may conduct such inspections of the Project as either may deem necessary for the
protection of the Lender’s interest,
and that any inspections which may be made of the Project by the Lender or the Inspecting
Architect/Engineer will be made, and all certificates issued by the Inspecting Architect/Engineer will be issued, solely for the
benefit and protection of the Lender, and that the Borrower will not
rely thereon.


          Section
8.02 Indemnification by the Borrower. The Borrower shall bear all loss, expense (including attorneys’ fees) and damage in
connection with, and agrees to indemnify and hold harmless the Lender,
its agents, servants and employees from all claims, demands and judgments made or recovered against the Lender,
its agents, servants and employees, because of bodily injuries,
including death at any time resulting therefrom, and/or because of damages to property of the Lender or otherwise (including
loss of use) from any cause whatsoever, arising out of, incidental to,
or in connection with the Project or the construction of the Additional Improvements, whether or not due to any act of
omission or commission, including negligence of the Borrower or any Contractor of its or their employees, servants or
agents, and whether or not due to any act of omission or commission of the
Lender, its employees, servants or agents except for the gross
negligence and willful misconduct of Lender, its employees, servents and
agents.. The Borrower’s liability hereunder shall not be limited to the extent
of insurance carried by or provided by the
Borrower or subject to any exclusions from coverage in any insurance policy. The
obligations of the Borrower under this Section shall survive the payment of the
Note.


          Section
8.03 Fees and Expenses.


	
  

 	
  

 
	
  

 	
           (a)     Whether or not the Acquisition Loan shall be made hereunder, the Borrower
 agrees to pay all fees of Title and the Inspecting Architect/Engineer,
 appraisal fees, survey fees, recording
 fees, license and permit fees, title insurance and other insurance premiums, and agrees to reimburse the
 Lender upon demand for all reasonable out-of-pocket expenses actually
 incurred by the Lender, including but not limited to reasonably legal expenses and attorneys’ fees incurred in connection
 with the preparation of this
 Agreement and the other documents and instruments contemplated hereby; provided,
 however, the fees and expenses to be paid by Borrower under this paragraph
 8.03(a) shall not exceed $100,000.

 













	
  

 	
  

 
	
  

 	
           (b)     Borrower shall pay or reimburse Lender for all any and all costs and expenses,
 including but not limited to reasonable legal expenses and attorneys’ fees,
 incurred or sustained by the Lender in the exercise of any right or remedy
 available to it under this Agreement or
 otherwise by law or equity (whether or not suit is commenced).

 


          Section
8.04 Notices. All notices or other communications which are required or permitted
hereunder shall be in writing and sufficient if (a) delivered personally or
sent by telecopier, (b) sent by nationally
recognized overnight courier or (c) sent by certified mail, postage
prepaid, return receipt requested, addressed as follows:


	
  

 	
  

 	
  

 
	
 (a)

 	
 If to the
 Lender at:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 OSM—REO FF,
 LLC

 
	
  

 	
  

 	
 225 South Sixth Street, Suite 2800

 
	
  

 	
  

 	
 Minneapolis,
 MN 55402

 
	
  

 	
  

 	
 Attn: Steph
 Lunde

 
	
  

 	
  

 	
 Telephone:
 (612) 376-1486

 
	
  

 	
  

 	
 Facsimile:
 (612) 692-5107

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 with a copy
 (which shall not constitute notice) to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Leonard,
 Street and Deinard

 
	
  

 	
  

 	
 150 South Fifth Street, Suite 2300

 
	
  

 	
  

 	
 Minneapolis,
 MN 55402

 
	
  

 	
  

 	
 Attn:
 Timothy Ring, Esq.

 
	
  

 	
  

 	
 Facsimile:
 (612)335-1657

 
	
  

 	
  

 	
  

 
	
 (b)

 	
 If to the
 Borrower at:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Soy Energy,
 LLC

 
	
  

 	
  

 	
 Attn: Chuck
 Sand

 
	
  

 	
  

 	
 222 North
 Main Street

 
	
  

 	
  

 	
 Marcus, Iowa
 50135

 
	
  

 	
  

 	
 Telephone:
 (712) 376-2081

 
	
  

 	
  

 	
  

 
	
 with a copy
 (which shall not constitute notice) to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 BrownWinick

 
	
  

 	
  

 	
 666 Grand Avenue, Suite 2000

 
	
  

 	
  

 	
 Des Moines,
 IA 50309

 
	
  

 	
  

 	
 Attn: Thomas
 Johnson, Esq.

 
	
  

 	
  

 	
 Facsimile:
 (515) 323-8514

 










or to such other addresses as the party to whom notice
is to be given may have furnished to each other party in writing in accordance
herewith. Any such communication shall be deemed to have been given (i) when delivered if personally
delivered or sent by telecopier during a business day, (ii) on the business day
after dispatch if sent by nationally recognized, overnight courier or if sent by telecopier on other than during a business
day, and (iii) on the third day after dispatch, if sent by mail.


          Section
8.05 Time of Essence. Time is of the essence in the performance of this Agreement.


          Section
8.06 Binding Effect and Assignment. This Agreement shall be binding upon
and inure to the benefit of the
Borrower and the Lender and their respective successors and assigns, except that the Borrower may not
transfer or assign its rights hereunder without the prior written
consent of the Lender.


          Section
8.07 Waivers. No waiver by the Lender of any default hereunder shall
operate as a waiver of any other default or of the same default on a
future occasion. No delay on the part of the Lender in exercising any right or
remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude other
or future exercise thereof or the exercise of any other right or remedy.


          Section
8.08 The Lender’s Remedies Cumulative. The rights and remedies hereby specified
are cumulative and not exclusive of any rights or remedies which the Lender
would otherwise have.


          Section
8.09 Governing Law and Entire Agreement. This Agreement shall be
governed by the laws of the State of Minnesota without regard to
conflict of laws principles. This Agreement, the Notes and the Security
Documents contain the entire agreement of the parties regarding the Loans.


          Section
8.10 Counterparts. This Agreement may be executed in any number of counterparts,
each of which, when so executed and delivered, shall be an original, but such
counterparts shall together constitute one and the same instrument.


          Section
8.11 Inconsistency. In the event that any of the terms and provisions of
this Agreement are inconsistent with any of the terms and provisions of
the Note or Security Documents, the terms and provisions of this Agreement
shall govern.


          Section
8.12 Conditions of Acquisition Loan. All conditions of the obligation of
the Lender to make the Acquisition Loan hereunder are imposed solely and
exclusively for the benefit of the Lender,
and no other Person shall have standing to require satisfaction of such
conditions in accordance with their terms or be entitled to assume that
the Lender will refuse to make the Acquisition
Loan in the absence of strict compliance with any or all thereof, and no other
Person shall, under any circumstances, be deemed to be a beneficiary of
such conditions, any or all of which may be
freely waived in whole or in part by the Lender at any time if the Lender, in
its sole discretion, deems it advisable to do so.





          Section
8.13 Amendments. This Agreement and the Loan Documents may not be amended or modified, nor may any of their terms
(including, without limitation, terms affecting the maturity of or rate
of interest on the Note) be modified or waived, except by written instruments signed by the Lender and the Borrower. In any
instance where the consent or approval of the Lender may be given or is required, or where any determination,
judgment or decision is to be rendered
by the Lender under this Agreement or under any Loan Document, the granting, withholding or denial of such consent or approval
and the rendering of such determination, judgment or decision shall be made or exercised by the Lender in its
sole and absolute discretion.


          Section
8.14 Jurisdiction. The Borrower hereby irrevocably agrees that any legal
action or proceedings against it
with respect to this Agreement or any of the Loan Documents (other than the Mortgage) may be brought exclusively in the
courts of the State of Minnesota, or in any United States District Court in the State of Minnesota,
and by the execution and delivery of this Agreement, the Borrower hereby
irrevocably submits to the jurisdiction of each such court and hereby
irrevocably waives any and all objections that the Borrower may have as to
jurisdiction or venue in any of such courts.
The Borrower acknowledges that it has received sufficient consideration for any
inconvenience which may be caused by any legal action brought in the
State of Minnesota, and agrees that the
enforcement of the provisions of this paragraph against the Borrower would not
be unreasonable or unfair under all the circumstances of the Loans or
this Agreement.


          Section
8.15 WAIVER OF JURY TRIAL. THE LENDER AND THE BORROWER HEREBY
VOLUNTARILY, KNOWINGLY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING UNDER
THIS AGREEMENT, REGARDLESS OF WHETHER SUCH ACTION OR PROCEEDING CONCERNS ANY
CONTRACTUAL OR TORTIOUS OR OTHER CLAIM. THE BORROWER ACKNOWLEDGES THAT THIS
WAIVER OF JURY TRIAL IS A MATERIAL INDUCEMENT TO THE LENDER IN EXTENDING CREDIT
TO THE BORROWER, THAT THE LENDER WOULD NOT HAVE EXTENDED SUCH CREDIT WITHOUT
THIS JURY TRIAL WAIVER, AND THAT THE BORROWER HAS BEEN REPRESENTED BY AN ATTORNEY
OR HAS HAD AN OPPORTUNITY TO CONSULT WITH AN ATTORNEY IN CONNECTION WITH THIS
JURY TRIAL WAIVER AND UNDERSTANDS THE LEGAL EFFECT OF THIS WAIVER.


          Section
8.16 Participations. The Lender may, in its sole discretion, sell in
whole or in part, assign and convey
to one or more Participants undivided participation interests in and to the Loans and the Loan Documents and the Borrower
hereby consents to the same, and the disclosure of all financial
information of the Borrower reasonably necessary to effectuate the same.





          Section
8.17 Rules of Construction. Where any provision of this Agreement refers
to action to be taken by a Person,
or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
Except as otherwise indicated, all agreements or instruments herein defined
shall mean agreements as the same may from time to time be supplemented or
amended or the terms thereof waived or modified to the extent permitted, and in
accordance with, the terms thereof. Each representation, covenant and warranty contained in this Agreement shall be
construed (absent an express contrary provision therein) as being independent
of each other representation, covenant and warranty contained herein and
compliance with any one representation, covenant or warranty shall not (absent
such an express contrary provision) be deemed to excuse compliance with any or
all representations, covenants or warranties.


          [The
remainder of this page has been left blank intentionally.]





          IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed
as of the day and year first above written.


	
  

 	
  

 	
  

 
	
  

 	
 BORROWER:

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 SOY ENERGY, LLC, an Iowa limited liability 

 
	
  

 	
 Company

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 By: /s/ Charles Sand

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 Name: Charles Sand

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 Its: Chairman

 	
  

 
	
  

 	

 


 	
  

 






	
  

 	
  

 	
  

 
	
  

 	
 LENDER:

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 OSM-REO FF, LLC, a Minnesota
 limited 

 
	
  

 	
 liability company

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 By: /s/ Stephanie Lunde

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 Name: Stephanie Lunde

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
 Its: Vice President