##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-K
 þ
    
    Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934.
 For the fiscal year ended September 30, 2009
 o
    
    Transition report under Section 13 or 15(d) of the Exchange Act.
 For the transition period from  to
 Commission file number 000-53039
 FIRST UNITED ETHANOL, LLC
  Georgia
(State or other jurisdiction of 
incorporation or organization)
    
    20-2497196
(I.R.S. Employer Identification No.)4433 Lewis B. Collins Road, Pelham, Georgia
(Address of principal executive offices)
    
    31779
(Zip Code)
 (229) 522-2822
 o Yes þ No
 o Yes þ No
  þ o
 o Yes o No
 þ
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company þ
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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##### 



INDEX
 PagePART I
    
    
    4ITEM 1. BUSINESS
    
    
    4ITEM 1A. RISK FACTORS
    
    
    17ITEM 2. PROPERTIES
    
    
    20ITEM 3. LEGAL PROCEEDINGS
    
    
    20ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    20PART II
    
    
    21ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
    
    
    21ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
    
    
    24ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    37ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    38ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
    
    
    56ITEM 9A(T). CONTROLS AND PROCEDURES
    
    
    56ITEM 9B. OTHER INFORMATION
    
    
    57PART III
    
    
    57ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
    
    
    57ITEM 11. EXECUTIVE COMPENSATION
    
    
    57ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
    
    
    57ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
    
    
    58ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
    
    
    58PART IV
    
    
    58ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
    
    
    58SIGNATURES
    
    
    59Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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FORWARD LOOKING STATEMENTS
    
    
    Changes in our business strategy or capital improvements;
    
    Volatility of corn, natural gas, ethanol, unleaded gasoline, oil, distillers grain
and other commodities prices;
    
    Limitations and restrictions contained in the instruments and agreements governing
our indebtedness;
    
    Our ability to generate sufficient liquidity to fund our operations, debt service
requirements and capital expenditures;
    
    The results of our hedging transactions and other risk management strategies;
    
    Our anticipated inelastic demand for corn, as it is the only available feedstock for
our plant;
    
    Changes in the environmental regulations or in our ability to comply with the
environmental regulations that apply to our plant site and our operations;
    
    The effects of mergers or consolidations in the ethanol industry;
    
    Changes in general economic conditions or the occurrence of certain events causing
an economic impact in the agriculture, oil or automobile industries;
    
    Changes in the availability of credit to support the level of liquidity necessary to
implement our risk management activities;
    
    Changes in or elimination of federal and/or state laws (including the elimination of
any federal and/or state ethanol tax incentives);
    
    Overcapacity within the ethanol industry;
    
    Limitations on the demand for ethanol resulting from the blend wall which limits
the amount of ethanol blended into the national gasoline pool based on current 10
percent blend rate in standard vehicles;
    
    Changes and advances in ethanol production technology that may make it more
difficult for us to compete with other ethanol plants utilizing such technology;
    
    Our reliance on key management personnel;
    
    The development of infrastructure related to the sale and distribution of ethanol;
and
    
    Competition in the ethanol industry and from other alternative fuel additives.
   3




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##### Table of Contents



AVAILABLE INFORMATION
 www.firstunitedethanol.com
 
 PART I
 
 ITEM 1.
    
    BUSINESS.
 Business Development
  Principal Products and Markets
 Ethanol
     4




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##### Table of Contents



Distillers Grains
  Ethanol and Distillers Grains Markets
 Distribution of Principal Products
   Distribution of Principal Products
  Ethanol Distribution
   5




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##### Table of Contents



Distillers Grains Distribution
  New Products and Services
  Governmental Regulation and Federal Ethanol Supports
 Federal Ethanol Supports
      6




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##### Table of Contents



Effect of Governmental Regulation
     Competition
   7




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##### Table of Contents



most
 U.S. FUEL ETHANOL BIOREFINERIES AND PRODUCTION CAPACITY
million gallons per year (mmgy)
 UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)Abengoa Bioenergy Corp. (Total)
    
    
    
    
    
    
    198.0
    
    
    
    168.0
    
    
    
    176.0Abengoa Bioenergy Corp.
    
    Madison, IL
    
    cornAbengoa Bioenergy Corp.
    
    Mt. Vernon, IN
    
    cornAbengoa Bioenergy Corp.
    
    Colwich, KS
    
    corn/miloAbengoa Bioenergy Corp.
    
    Ravenna, NE
    
    CornAbengoa Bioenergy Corp.
    
    York, NE
    
    CornAbengoa Bioenergy Corp.
    
    Portales, NM
    
    cornAbsolute Energy, LLC*
    
    St. Ansgar, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0ACE Ethanol, LLC
    
    Stanley, WI
    
    Corn
    
    
    41.0
    
    
    
    41.0Adkins Energy, LLC*
    
    Lena, IL
    
    Corn
    
    
    40.0
    
    
    
    40.0Advanced Bioenergy, LLC
    
    Fairmont, NE
    
    Corn
    
    
    100.0
    
    
    
    100.0Ag Energy Resources, Inc.
    
    Benton, IL
    
    corn
    
    
    
    
    
    
    
    
    
    
    5.0AGP*
    
    Hastings, NE
    
    Corn
    
    
    52.0
    
    
    
    52.0Agri-Energy, LLC*
    
    Luverne, MN
    
    Corn
    
    
    21.0
    
    
    
    21.0Al-Corn Clean Fuel*
    
    Claremont, MN
    
    Corn
    
    
    42.0
    
    
    
    42.0Alchem Ltd. LLP
    
    Grafton, ND
    
    Corn
    
    
    10.0AltraBiofuels Coshocton Ethanol, LLC
    
    Coshocton, OH
    
    corn
    
    
    60.0AltraBiofuels Indiana, LLC
    
    Cloverdale, IN
    
    corn
    
    
    92.0AltraBiofuels Phoenix Bio Industries, LLC
    
    Goshen, CA
    
    Corn
    
    
    31.5
    
    
    
    31.5Amaizing Energy, LLC*
    
    Atlantic, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Amaizing Energy, LLC*
    
    Denison, IA
    
    Corn
    
    
    55.0
    
    
    
    55.0Appomattox Bio Energy
    
    Hopewell, VA
    
    corn
    
    
    
    
    
    
    
    
    
    
    65.0Archer Daniels Midland (Total)
    
    
    
    
    
    
    1,070.0
    
    
    
    1,070.0
    
    
    
    550.0Archer Daniels Midland
    
    Cedar Rapids, IA
    
    CornArcher Daniels Midland
    
    Clinton, IA
    
    CornArcher Daniels Midland
    
    Decatur, IL
    
    CornArcher Daniels Midland
    
    Peoria, IL
    
    CornArcher Daniels Midland
    
    Marshall, MN
    
    CornArcher Daniels Midland
    
    Wallhalla, ND
    
    Corn/barleyArcher Daniels Midland
    
    Columbus, NE
    
    CornArkalon Energy, LLC
    
    Liberal, KS
    
    Corn
    
    
    110.0
    
    
    
    110.0Aventine Renewable Energy, LLC (Total)
    
    
    
    
    
    
    207.0
    
    
    
    207.0Aventine Renewable Energy, LLC
    
    Pekin, IL
    
    CornAventine Renewable Energy, LLC
    
    Aurora, NE
    
    Corn
  8




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UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)Badger State Ethanol, LLC*
    
    Monroe, WI
    
    Corn
    
    
    48.0
    
    
    
    48.0Big River Resources Galva, LLC
    
    Galva, IL
    
    corn
    
    
    100.0
    
    
    
    100.0Big River Resources, LLC*
    
    West Burlington, IA
    
    Corn
    
    
    100.0
    
    
    
    100.0Big River United Energy
    
    Dyersville, IA
    
    corn
    
    
    110.0BioFuel Energy  Buffalo Lake Energy, LLC
    
    Fairmont, MN
    
    Corn
    
    
    115.0
    
    
    
    115.0BioFuel Energy  Pioneer Trail Energy, LLC
    
    Wood River, NE
    
    Corn
    
    
    115.0
    
    
    
    115.0Bional Clearfield
    
    Clearfield, PA
    
    Corn
    
    
    
    
    
    
    
    
    
    
    110.0Blue Flint Ethanol
    
    Underwood, ND
    
    Corn
    
    
    50.0
    
    
    
    50.0Bonanza Energy, LLC
    
    Garden City, KS
    
    Corn/milo
    
    
    55.0
    
    
    
    55.0Bridgeport Ethanol
    
    Bridgeport, NE
    
    corn
    
    
    54.0
    
    
    
    54.0Bunge-Ergon Vicksburg
    
    Vicksburg, MS
    
    corn
    
    
    54.0
    
    
    
    54.0Bushmills Ethanol, Inc.*
    
    Atwater, MN
    
    Corn
    
    
    50.0
    
    
    
    50.0Calgren Renewable Fuels, LLC
    
    Pixley, CA
    
    Corn
    
    
    55.0Carbon Green Bioenergy
    
    Lake Odessa, MI
    
    Corn
    
    
    50.0Cardinal Ethanol
    
    Union City, IN
    
    Corn
    
    
    100.0
    
    
    
    100.0Cargill, Inc.
    
    Eddyville, IA
    
    Corn
    
    
    35.0
    
    
    
    35.0Cargill, Inc.
    
    Blair, NE
    
    Corn
    
    
    85.0
    
    
    
    85.0Cascade Grain
    
    Clatskanie, OR
    
    Corn
    
    
    108.0Castle Rock Renewable Fuels, LLC
    
    Necedah, WI
    
    Corn
    
    
    50.0
    
    
    
    50.0Center Ethanol Company
    
    Sauget, IL
    
    Corn
    
    
    54.0
    
    
    
    54.0Central Indiana Ethanol, LLC
    
    Marion, IN
    
    Corn
    
    
    40.0
    
    
    
    40.0Central MN Ethanol Coop*
    
    Little Falls, MN
    
    Corn
    
    
    21.5
    
    
    
    21.5Chief Ethanol
    
    Hastings, NE
    
    Corn
    
    
    62.0
    
    
    
    62.0Chippewa Valley Ethanol Co.*
    
    Benson, MN
    
    Corn
    
    
    45.0
    
    
    
    45.0Cilion Ethanol
    
    Keyes, CA
    
    Corn
    
    
    
    
    
    
    
    
    
    
    50.0Clean Burn Fuels, LLC
    
    Raeford, NC
    
    Corn
    
    
    
    
    
    
    
    
    
    
    60.0Commonwealth Agri-Energy, LLC*
    
    Hopkinsville, KY
    
    Corn
    
    
    33.0
    
    
    
    33.0Corn Plus, LLP*
    
    Winnebago, MN
    
    Corn
    
    
    44.0
    
    
    
    44.0Corn, LP*
    
    Goldfield, IA
    
    Corn
    
    
    60.0
    
    
    
    60.0Cornhusker Energy Lexington, LLC
    
    Lexington, NE
    
    Corn
    
    
    40.0
    
    
    
    40.0Dakota Ethanol, LLC*
    
    Wentworth, SD
    
    Corn
    
    
    50.0
    
    
    
    50.0DENCO, LLC
    
    Morris, MN
    
    Corn
    
    
    24.0Didion Ethanol
    
    Cambria, WI
    
    Corn
    
    
    40.0
    
    
    
    40.0E Caruso (Goodland Energy Center)
    
    Goodland, KS
    
    Corn
    
    
    
    
    
    
    
    
    
    
    20.0E Energy Adams, LLC
    
    Adams, NE
    
    Corn
    
    
    50.0
    
    
    
    50.0E3 Biofuels
    
    Mead, NE
    
    corn
    
    
    25.0East Kansas Agri-Energy, LLC*
    
    Garnett, KS
    
    Corn
    
    
    35.0
    
    
    
    35.0
  9




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UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)ESE Alcohol Inc.
    
    Leoti, KS
    
    Seed corn
    
    
    1.5
    
    
    
    1.5Front Range Energy, LLC
    
    Windsor, CO
    
    Corn
    
    
    40.0
    
    
    
    40.0Gateway Ethanol
    
    Pratt, KS
    
    Corn
    
    
    55.0Glacial Lakes Energy, LLC  Mina
    
    Mina, SD
    
    corn
    
    
    107.0
    
    
    
    107.0Glacial Lakes Energy, LLC*
    
    Watertown, SD
    
    Corn
    
    
    100.0
    
    
    
    100.0Global Ethanol/Midwest Grain Processors
    
    Lakota, IA
    
    Corn
    
    
    98.0
    
    
    
    98.0Global Ethanol/Midwest Grain Processors
    
    Riga, MI
    
    Corn
    
    
    57.0
    
    
    
    57.0Golden Cheese Company of California*
    
    Corona, CA
    
    Cheese whey
    
    
    5.0
    
    
    
    5.0Golden Grain Energy, LLC*
    
    Mason City, IA
    
    Corn
    
    
    115.0
    
    
    
    115.0Golden Triangle Energy, LLC*
    
    Craig, MO
    
    Corn
    
    
    20.0
    
    
    
    20.0Grain Processing Corp.
    
    Muscatine, IA
    
    Corn
    
    
    20.0
    
    
    
    20.0Granite Falls Energy, LLC*
    
    Granite Falls, MN
    
    Corn
    
    
    52.0
    
    
    
    52.0Greater Ohio Ethanol, LLC
    
    Lima, OH
    
    Corn
    
    
    54.0Green Plains Renewable Energy
    
    Shenandoah, IA
    
    Corn
    
    
    55.0
    
    
    
    55.0Green Plains Renewable Energy
    
    Superior, IA
    
    Corn
    
    
    55.0
    
    
    
    55.0Green Plains Renewable Energy
    
    Bluffton, IN
    
    Corn
    
    
    110.0
    
    
    
    110.0Green Plains Renewable Energy
    
    Central City, NE
    
    corn
    
    
    100.0
    
    
    
    100.0Green Plains Renewable Energy
    
    Ord, NE
    
    Corn
    
    
    50.0
    
    
    
    50.0Green Plains Renewable Energy
    
    Obion, TN
    
    Corn
    
    
    110.0
    
    
    
    110.0Guardian Energy
    
    Janesville, MN
    
    corn
    
    
    110.0
    
    
    
    110.0Hankinson Renewable Energy, LLC
    
    Hankinson, ND
    
    corn
    
    
    110.0
    
    
    
    110.0Hawkeye Renewables, LLC
    
    Fairbank, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Hawkeye Renewables, LLC
    
    Iowa Falls, IA
    
    Corn
    
    
    90.0
    
    
    
    90.0Hawkeye Renewables, LLC
    
    Menlo, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Hawkeye Renewables, LLC
    
    Shell Rock, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Heartland Corn Products*
    
    Winthrop, MN
    
    Corn
    
    
    100.0
    
    
    
    100.0Heartland Grain Fuels, LP
    
    Aberdeen, SD
    
    Corn
    
    
    50.0
    
    
    
    50.0Heartland Grain Fuels, LP
    
    Huron, SD
    
    Corn
    
    
    32.0
    
    
    
    32.0
    
    
    
    33.0Heron Lake BioEnergy, LLC
    
    Heron Lake, MN
    
    Corn
    
    
    50.0
    
    
    
    50.0Highwater Ethanol LLC
    
    Lamberton, MN
    
    Corn
    
    
    55.0
    
    
    
    55.0Homeland Energy
    
    New Hampton, IA
    
    Corn
    
    
    100.0
    
    
    
    100.0Husker Ag, LLC*
    
    Plainview, NE
    
    Corn
    
    
    75.0
    
    
    
    75.0Idaho Ethanol Processing
    
    Caldwell, ID
    
    Potato Waste
    
    
    4.0
    
    
    
    4.0Illinois River Energy, LLC
    
    Rochelle, IL
    
    Corn
    
    
    100.0
    
    
    
    100.0Iroquois Bio-Energy Company, LLC
    
    Rensselaer, IN
    
    corn
    
    
    40.0
    
    
    
    40.0
  10




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UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)KAAPA Ethanol, LLC*
    
    Minden, NE
    
    Corn
    
    
    40.0
    
    
    
    40.0Kansas Ethanol, LLC
    
    Lyons, KS
    
    Corn
    
    
    55.0
    
    
    
    55.0KL Process Design Group
    
    Upton, WY
    
    Wood waste
    
    
    1.5
    
    
    
    1.5Land O Lakes*
    
    Melrose, MN
    
    Cheese whey
    
    
    2.6
    
    
    
    2.6Levelland/Hockley County Ethanol, LLC
    
    Levelland, TX
    
    Corn
    
    
    40.0
    
    
    
    40.0Lifeline Foods, LLC
    
    St. Joseph, MO
    
    Corn
    
    
    40.0
    
    
    
    40.0Lincolnland Agri-Energy, LLC*
    
    Palestine, IL
    
    Corn
    
    
    48.0
    
    
    
    48.0Lincolnway Energy, LLC*
    
    Nevada, IA
    
    Corn
    
    
    55.0
    
    
    
    55.0Little Sioux Corn Processors, LP*
    
    Marcus, IA
    
    Corn
    
    
    92.0
    
    
    
    92.0Louis Dreyfus Commodities
    
    Grand Junction, IA
    
    corn
    
    
    100.0
    
    
    
    100.0Louis Dreyfus Commodities
    
    Norfolk, NE
    
    Corn
    
    
    45.0
    
    
    
    45.0Marquis Energy, LLC
    
    Hennepin, IL
    
    Corn
    
    
    100.0
    
    
    
    100.0Marysville Ethanol, LLC
    
    Marysville, MI
    
    Corn
    
    
    50.0
    
    
    
    50.0Merrick & Company
    
    Aurora, CO
    
    Waste beer
    
    
    3.0
    
    
    
    3.0Mid America Agri Products/Horizon
    
    Cambridge, NE
    
    Corn
    
    
    44.0Mid America Agri Products/Wheatland
    
    Madrid, NE
    
    Corn
    
    
    44.0
    
    
    
    44.0Mid-Missouri Energy, Inc.*
    
    Malta Bend, MO
    
    Corn
    
    
    50.0
    
    
    
    50.0Midwest Renewable Energy, LLC
    
    Sutherland, NE
    
    Corn
    
    
    25.0
    
    
    
    25.0Minnesota Energy*
    
    Buffalo Lake, MN
    
    Corn
    
    
    18.0
    
    
    
    18.0NEDAK Ethanol
    
    Atkinson, NE
    
    corn
    
    
    44.0
    
    
    
    44.0Nesika Energy, LLC
    
    Scandia, KS
    
    corn
    
    
    10.0
    
    
    
    10.0New Energy Corp.
    
    South Bend, IN
    
    Corn
    
    
    102.0
    
    
    
    102.0North Country Ethanol, LLC*
    
    Rosholt, SD
    
    Corn
    
    
    20.0
    
    
    
    20.0NuGen Energy
    
    Marion, SD
    
    corn
    
    
    110.0
    
    
    
    110.0One Earth Energy
    
    Gibson City, IL
    
    corn
    
    
    100.0
    
    
    
    100.0Otter Tail Ag Enterprises
    
    Fergus Falls, MN
    
    Corn
    
    
    57.5
    
    
    
    57.5Pacific Ethanol
    
    Madera, CA
    
    Corn
    
    
    40.0Pacific Ethanol
    
    Stockton, CA
    
    Corn
    
    
    60.0Pacific Ethanol
    
    Burley, ID
    
    Corn
    
    
    50.0Pacific Ethanol
    
    Boardman, OR
    
    Corn
    
    
    40.0
    
    
    
    40.0Panda Ethanol
    
    Hereford, TX
    
    Corn/milo
    
    
    
    
    
    
    
    
    
    
    115.0Parallel Products
    
    Rancho Cucamonga, CAParallel Products
    
    Louisville, KY
    
    Beverage waste
    
    
    5.4
    
    
    
    5.4Patriot Renewable Fuels, LLC
    
    Annawan, IL
    
    Corn
    
    
    100.0
    
    
    
    100.0Penford Products
    
    Cedar Rapids, IA
    
    Corn
    
    
    45.0
    
    
    
    45.0Pinal Energy, LLC
    
    Maricopa, AZ
    
    Corn
    
    
    55.0
    
    
    
    55.0
  11




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##### Table of Contents



UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)Pine Lake Corn Processors, LLC
    
    Steamboat Rock, IA
    
    corn
    
    
    31.0
    
    
    
    31.0Platinum Ethanol, LLC*
    
    Arthur, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Plymouth Ethanol, LLC*
    
    Merrill, IA
    
    Corn
    
    
    50.0
    
    
    
    50.0POET Biorefining  Alexandria
    
    Alexandria, IN
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Ashton
    
    Ashton, IA
    
    Corn
    
    
    56.0
    
    
    
    56.0POET Biorefining  Big Stone
    
    Big Stone City, SD
    
    Corn
    
    
    79.0
    
    
    
    79.0POET Biorefining  Bingham Lake
    
    Bingham Lake, MN
    
    
    
    
    35.0
    
    
    
    35.0POET Biorefining  Caro
    
    Caro, MI
    
    Corn
    
    
    53.0
    
    
    
    53.0
    
    
    
    5.0POET Biorefining  Chancellor
    
    Chancellor, SD
    
    Corn
    
    
    110.0
    
    
    
    110.0POET Biorefining  Coon Rapids
    
    Coon Rapids, IA
    
    Corn
    
    
    54.0
    
    
    
    54.0POET Biorefining  Corning
    
    Corning, IA
    
    Corn
    
    
    65.0
    
    
    
    65.0POET Biorefining  Emmetsburg
    
    Emmetsburg, IA
    
    Corn
    
    
    55.0
    
    
    
    55.0POET Biorefining  Fostoria
    
    Fostoria, OH
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Glenville
    
    Albert Lea, MN
    
    Corn
    
    
    42.0
    
    
    
    42.0POET Biorefining  Gowrie
    
    Gowrie, IA
    
    Corn
    
    
    69.0
    
    
    
    69.0POET Biorefining  Hanlontown
    
    Hanlontown, IA
    
    Corn
    
    
    56.0
    
    
    
    56.0POET Biorefining  Hudson
    
    Hudson, SD
    
    Corn
    
    
    56.0
    
    
    
    56.0POET Biorefining  Jewell
    
    Jewell, IA
    
    Corn
    
    
    69.0
    
    
    
    69.0POET Biorefining  Laddonia
    
    Laddonia, MO
    
    Corn
    
    
    50.0
    
    
    
    50.0POET Biorefining  Lake Crystal
    
    Lake Crystal, MN
    
    Corn
    
    
    56.0
    
    
    
    56.0POET Biorefining  Leipsic
    
    Leipsic, OH
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Macon
    
    Macon, MO
    
    Corn
    
    
    46.0
    
    
    
    46.0POET Biorefining  Marion
    
    Marion, OH
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Mitchell
    
    Mitchell, SD
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  North Manchester
    
    North Manchester, IN
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Portland
    
    Portland, IN
    
    Corn
    
    
    68.0
    
    
    
    68.0POET Biorefining  Preston
    
    Preston, MN
    
    Corn
    
    
    46.0
    
    
    
    46.0POET Biorefining  Scotland
    
    Scotland, SD
    
    Corn
    
    
    11.0
    
    
    
    11.0POET Biorefining- Groton
    
    Groton, SD
    
    Corn
    
    
    53.0
    
    
    
    53.0Prairie Horizon Agri-Energy, LLC
    
    Phillipsburg, KS
    
    Corn
    
    
    40.0
    
    
    
    40.0Quad-County Corn Processors*
    
    Galva, IA
    
    Corn
    
    
    30.0
    
    
    
    30.0Range Fuels
    
    Soperton, GA
    
    wood and wood waste
    
    
    
    
    
    
    
    
    
    
    100.0Red Trail Energy, LLC
    
    Richardton, ND
    
    Corn
    
    
    50.0
    
    
    
    50.0Redfield Energy, LLC *
    
    Redfield, SD
    
    Corn
    
    
    50.0
    
    
    
    50.0Reeve Agri-Energy
    
    Garden City, KS
    
    Corn/milo
    
    
    12.0
    
    
    
    12.0
  12




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##### Table of Contents



UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)Renew Energy
    
    Jefferson Junction, WI
    
    Corn
    
    
    130.0
    
    
    
    130.0Renova Energy
    
    Torrington, WY
    
    Corn
    
    
    5.0
    
    
    
    5.0Riverland Biofuels
    
    Canton, IL
    
    corn
    
    
    37.0
    
    
    
    37.0Show Me Ethanol
    
    Carrollton, MO
    
    Corn
    
    
    55.0
    
    
    
    55.0Siouxland Energy & Livestock Coop*
    
    Sioux Center, IA
    
    Corn
    
    
    60.0
    
    
    
    60.0Siouxland Ethanol, LLC
    
    Jackson, NE
    
    Corn
    
    
    50.0
    
    
    
    50.0Southwest Georgia Ethanol, LLC
    
    Camilla, GA
    
    Corn
    
    
    100.0
    
    
    
    100.0Southwest Iowa Renewable Energy, LLC *
    
    Council Bluffs, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Sterling Ethanol, LLC
    
    Sterling, CO
    
    Corn
    
    
    42.0
    
    
    
    42.0Sunoco
    
    Volney, NY
    
    Corn
    
    
    114.0Tate & Lyle
    
    Ft. Dodge, IA
    
    Corn
    
    
    
    
    
    
    
    
    
    
    105.0Tate & Lyle
    
    Loudon, TN
    
    Corn
    
    
    67.0
    
    
    
    67.0
    
    
    
    38.0Tharaldson Ethanol
    
    Casselton, ND
    
    Corn
    
    
    110.0
    
    
    
    110.0The Andersons Albion Ethanol LLC
    
    Albion, MI
    
    Corn
    
    
    55.0
    
    
    
    55.0The Andersons Clymers Ethanol, LLC
    
    Clymers, IN
    
    Corn
    
    
    110.0
    
    
    
    110.0The Andersons Marathon Ethanol, LLC
    
    Greenville, OH
    
    Corn
    
    
    110.0
    
    
    
    110.0Trenton Agri Products, LLC
    
    Trenton, NE
    
    Corn
    
    
    40.0
    
    
    
    40.0United Ethanol
    
    Milton, WI
    
    Corn
    
    
    52.0
    
    
    
    52.0United WI Grain Producers, LLC*
    
    Friesland, WI
    
    Corn
    
    
    49.0
    
    
    
    49.0Utica Energy, LLC
    
    Oshkosh, WI
    
    Corn
    
    
    48.0
    
    
    
    48.0Valero Renewable Fuels
    
    Albert City, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Charles City, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Ft. Dodge, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Hartley, IA
    
    Corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Welcome, MN
    
    Corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Albion, NE
    
    corn
    
    
    110.0
    
    
    
    110.0Valero Renewable Fuels
    
    Aurora, SD
    
    Corn
    
    
    120.0
    
    
    
    120.0VeraSun Energy Corp. (Total)
    
    
    
    
    
    
    220.0VeraSun Energy Corp.
    
    Linden, IN
    
    CornVeraSun Energy Corp.
    
    Bloomingburg, OH
    
    cornVerenium
    
    Jennings, LA
    
    Sugar Cane bagasse
    
    
    1.5
    
    
    
    1.5
  13




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##### Table of Contents



UnderOperating
    
    
    Construction/Nameplate
    
    
    Production
    
    
    ExpansionCompany
    
    Location
    
    Feedstock
    
    Capacity (mgy)
    
    
    (mgy)
    
    
    Capacity (mgy)Western New York Energy LLC
    
    Shelby, NY
    
    
    
    
    50.0
    
    
    
    50.0Western Plains Energy, LLC*
    
    Campus, KS
    
    Corn
    
    
    45.0
    
    
    
    45.0Western Wisconsin Renewable Energy, LLC*
    
    Boyceville, WI
    
    Corn
    
    
    40.0
    
    
    
    40.0White Energy
    
    Russell, KS
    
    Milo/wheat starch
    
    
    48.0
    
    
    
    48.0White Energy
    
    Hereford, TX
    
    Corn/Milo
    
    
    100.0
    
    
    
    100.0White Energy
    
    Plainview, TX
    
    Corn
    
    
    110.0
    
    
    
    110.0Wind Gap Farms
    
    Baconton, GA
    
    Brewery waste
    
    
    0.4
    
    
    
    0.4Yuma Ethanol
    
    Yuma, CO
    
    Corn
    
    
    40.0
    
    
    
    40.0TOTALS
    
    
    
    
    
    
    13,138.4
    
    
    
    11,937.4
    
    
    
    1,432.0mgy for 201 nameplate refineries
    
    
    mgy for operating refineries
    
    
    mgy for under
construction/expanding refineries
 *
    
    locally owned  Last updated: December 10, 2009
 Competition from Alternative Fuels
    Distillers Grains Competition
    14




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##### Table of Contents



Sources and Availability of Raw Materials
 Corn Supply
      Utilities
 Natural Gas
  15




---



##### Table of Contents



Electricity
 Water
  Research and Development
  Employees
  Dependence on a Few Major Customers
  Costs and Effects of Compliance with Environmental Laws
  Alcohol Fuel Producers Permit.
 SPCC and RMP.
  16




---



##### Table of Contents



Air Permits.
  
 ITEM 1A.
    
    RISK FACTORS.
 You should carefully read and consider the risks and uncertainties below and the other
information contained in this report. The risks and uncertainties described below are not the only
ones we may face. The following risks, together with additional risks and uncertainties not
currently known to us or that we currently deem immaterial could impair our financial condition and
results of operation.
 Risks Relating to Our Business
 We have a significant amount of debt, and our existing debt financing agreements contain, and
our future debt financing agreements may contain, restrictive covenants that limit distributions
and impose restrictions on the operation of our business.
 We have violated the terms of our credit agreements and financial covenants which could result
in our lender demanding immediate repayment of our loans.
  17




---



##### Table of Contents



Our financial performance is significantly dependent on corn and ethanol prices and generally
we will not be able to pass on increases in input prices to our customers.
 The spread between ethanol and corn prices can vary significantly.
 Risks Related to Ethanol Industry
 Demand for ethanol may not continue to grow unless ethanol can be blended into gasoline in
higher percentage blends for conventional automobiles.
 Technology advances in the commercialization of cellulosic ethanol may decrease demand for
corn based ethanol which may negatively affect our profitability.
 Overcapacity within the ethanol industry could cause an oversupply of ethanol and a decline in
ethanol prices.
  18




---



##### Table of Contents



Risks Related to Regulation and Governmental Action
 Government incentives for ethanol production, including federal tax incentives, may be
eliminated in the future, which could hinder our ability to operate at a profit .
   Changes in environmental regulations or violations of the regulations could be expensive
and reduce our profitability.
 Carbon dioxide may be regulated in the future by the EPA as an air pollutant requiring us to
obtain additional permits and install additional environmental mitigation equipment, which could
adversely affect our financial performance .
  19




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##### Table of Contents



ITEM 2.
    
    PROPERTIES.
  
    
    A process building, which contains processing equipment, laboratories, a control
room and offices;
    
    A water treatment building containing equipment for water supply and treatment;
    
    A grain receiving and shipping building; and
    
    An administrative building, along with furniture and fixtures, office equipment
and computer and telephone systems.
  Item 7  Managements Discussion and Analysis of
Financial Condition and Results of Operations
 
 ITEM 3.
    
    LEGAL PROCEEDINGS.
  
 ITEM 4.
    
    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
    20




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##### Table of Contents



Name
    
    Votes For
    
    
    Term ExpiresMichael W. Harrell
    
    
    35,410
    
    
    
    2010John B. Johnson
    
    
    35,430
    
    
    
    2010Donald Shirah
    
    
    35,430
    
    
    
    2010Miley Adams
    
    
    35,430
    
    
    
    2011Steve Collins
    
    
    35,430
    
    
    
    2011Robert L. Holden, Sr.
    
    
    35,430
    
    
    
    2011Murray Campbell
    
    
    35,410
    
    
    
    2012Thomas H. Dollar, II
    
    
    35,430
    
    
    
    2012Tommy L. Hilliard
    
    
    35,430
    
    
    
    2012Kenneth J. Hunnicutt
    
    
    35,410
    
    
    
    2012
  
 PART II
 
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS ISSUER PURCHASES OF
EQUITY SECURITIES.
     21




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##### Table of Contents



# ofQuarter
    
    Low Price
    
    
    High Price
    
    
    Average Price
    
    
    Units Traded2008 1st
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 4th
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 1st
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 4th
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    
  # ofSellers Quarter
    
    Low Price
    
    
    High Price
    
    
    Average Price
    
    
    Units Listed2008 1st
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 4th
    
    $
    1,050.00
    
    
    $
    1,140.00
    
    
    $
    1,095.00
    
    
    
    1202009 1st
    
    $
    1,000.00
    
    
    $
    1,000.00
    
    
    $
    1,000.00
    
    
    
    502009 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 4th
    
    $
    770.00
    
    
    $
    770.00
    
    
    $
    770.00
    
    
    
    50
 # ofBuyers Quarter
    
    Low Price
    
    
    High Price
    
    
    Average Price
    
    
    Units Listed2008 1st
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2008 4th
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 1st
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 2nd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 3rd
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    2009 4th
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    
   22




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##### Table of Contents



Number of securitiesremaining availablefor future issuanceNumber of securities to
    
    
    Weighted-average
    
    
    under equitybe issued upon exercise
    
    
    exercise price of
    
    
    compensation plansof outstanding options,
    
    
    outstanding options,
    
    
    (excluding securitieswarrants and rights
    
    
    warrants and rights
    
    
    reflected in column (a))(a)
    
    
    (b)
    
    
    (c)Equity compensation
plans approved by
security holders
    
    
    0
    
    
    
    0
    
    
    
    0Equity compensation
plans not approved
by security holders
    
    
    951
    
    
    $
    1,000
    
    
    
    581Total
    
    
    951
    
    
    $
    1,000
    
    
    
    581
  Item 7  Managements Discussion and Analysis of Financial
Condition and Results of Operations.
 ITEM 6.
    
    SELECTED FINANCIAL DATA.
   23




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##### Table of Contents



ITEM 7.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
  Results of Operations
 Comparison of Fiscal Years Ended September 30, 2009 and 2008
 2009
    
    
    2008Income Statement Data
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %Revenues
    
    $
    166,561,773
    
    
    
    100.0
    %
    
    
    
    
    
    
    Cost of Goods Sold
    
    $
    178,695,057
    
    
    
    107.3
    %
    
    
    
    
    
    
    Gross (Loss)
    
    $
    (12,133,284
    )
    
    
    (7.3
    )%
    
    
    
    
    
    
    General and
Administrative
Expenses
    
    $
    5,123,484
    
    
    
    3.1
    %
    
    $
    5,068,196
    
    
    
    Operating (Loss)
    
    $
    (17,256,768
    )
    
    
    (10.4
    )%
    
    $
    (5,068,196
    )
    
    
    Other (Expense)
    
    $
    (11,208,202
    )
    
    
    (6.7
    )%
    
    $
    (5,214,994
    )
    
    
    Net (Loss)
    
    $
    (28,464,970
    )
    
    
    (17.1
    )%
    
    $
    (10,283,190
    )
    
    
    
 Revenues
    Percentage ofRevenue Sources
    
    Amount
    
    
    Total RevenuesEthanol Sales
    
    $
    135,876,057
    
    
    
    81.58
    %Dried Distillers Grains Sales
    
    
    29,947,009
    
    
    
    17.98Wet Distillers Grains Sales
    
    
    370,878
    
    
    
    .23Other
    
    
    367,829
    
    
    
    .21Total Revenues
    
    $
    166,561,773
    
    
    
    100.00
    %
  24




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##### Table of Contents



25




---



##### Table of Contents



Cost of Goods Sold and Gross Loss
    26




---



##### Table of Contents



General and Administrative Expenses
  Other (Expense)
  Net (Loss)
   27




---



##### Table of Contents



Additional Information
  Twelve Months endedSeptember 30, 2009Production:Ethanol sold (gallons)
    
    
    79,537,767Dried distillers grains sold (tons)
    
    
    214,039Wet distillers grains sold (tons)
    
    
    7,342Revenues:Ethanol average price per gallon
    
    
    1.708Dried distillers grains revenue per gallon of ethanol sold
    
    
    .376Wet distillers grains revenue per gallon of ethanol sold
    
    
    .005Other
    
    
    .005Total revenue per gallon of ethanol sold
    
    
    2.094Costs:Corn cost per gallon of ethanol sold (including freight)
    
    
    1.657Overhead and other direct costs per gallon of ethanol sold
    
    
    .589Total cost per gallon of ethanol sold
    
    
    2.246
 Changes in Financial Condition for Fiscal Years Ended September 30, 2009 and 2008
     Trends and Uncertainties Impacting the Ethanol Industry and Our Company
   28




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##### Table of Contents



Economic Downturn
  Corn Prices
    Ethanol Industry Competition
   29




---



##### Table of Contents



Distillers Grains Marketing
   Technology Developments
   Government Legislation and Regulations
  Liquidity and Capital Resources
    30




---



##### Table of Contents



Year ended September 30,2009
    
    
    2008Net cash from (used for) operating activities
    
    $
    (23,157,338
    )
    
    $
    1,823,929Net cash (used for) investing activities
    
    $
    (2,259,314
    )
    
    $
    (91,850,508
    )Net cash from financing activities
    
    $
    17,730,674
    
    
    $
    94,045,126
 Cash Flow From (Used For) Operations
  Cash Flow Used For Investing Activities
  Cash Flow From Financing Activities
  Financial Results
    31




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##### Table of Contents



Senior Credit Facility
       32




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##### Table of Contents



Subordinated Debt
   Other Notes Payable
   West LB Construction Loan, variable interest rates from 4.35% to 7.81%
    
    $
    98,500,000Subordinated Fagen Note, interest rate of 4.0% through June 20, 2010 and 8% thereafter
    
    
    3,977,545Subordinated debt facility, interest rate of 7.5%
    
    
    9,850,000Notes payable John Deere Credit, interest rate of 5.3%
    
    
    202,050112,529,595Less current portion
    
    
    (9,204,578
    )Long-term debt outstanding as of September 30, 2009
    
    $
    103,325,017
 Debt Covenants
  
    
    Carbon Dioxide Agreement Amendment: Section 7.01(x) of our senior credit agreement
requires us to deliver our carbon dioxide agreement with Airgas Carbonic, Inc. to our
lender along with any ancillary documents. As of September 30, 2009 the carbon dioxide
agreement had been negotiated and was in final form, however, Airgas Carbonic, Inc. had not
yet executed the agreement due to concerns about the viability of FUEL. Accordingly, we
have requested and obtained a temporary waiver of the section 2(f) of the Waiver and Third
Amendment to Accounts Agreement and an additional 180 day waiver of section 7.01(x) of our
senior credit agreement. Subsequently, on November 2, 2009, we reached an agreement with
Airgas Carbonic, Inc. (Airgas) with an effective date of May 15, 2009.
  33




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##### Table of Contents




    
    Borrowing Base Certificate: As described above, we are required to repay the amount that
our working capital loan outstanding exceeds our borrowing base. Our borrowing base is 80%
of the value of certain accounts receivable and certain inventory owned by FUEL and is
calculated on a monthly basis. In furtherance of these calculations, section 7.03(n)
requires us to deliver to our lender a borrowing base certificate setting for the data
necessary to make the borrowing base calculations. As a result of our working capital loan
outstanding exceeding our borrowing base, we were not able to deliver an acceptable
borrowing base certificate. Accordingly, we requested a waiver of any required prepayment
arising under section 3.10(d) of the senior credit agreement and a waiver of section
7.03(n), the covenant requiring us to repay the difference between our working capital loan
outstanding and our borrowing base. We obtained a waiver of these covenants through
December 15, 2009 and our lender has indicated its willingness to work with us; however, at
any time our lender could decide not to grant this waiver and we would be in default on our
senior credit agreement.
  Critical Accounting Estimates
  Revenue Recognition
    2009
    
    
    2008Ethanol
    
    $
    135,876,057
    
    
    $
    Distillerss Grain
    
    
    30,317,887
    
    
    
    Other
    
    
    367,829
    
    
    
    Total
    
    $
    166,561,773
    
    
    $
    
   34




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##### Table of Contents



Investment in Commodities Contracts, Derivative Instruments and Hedging Activities
           35




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##### Table of Contents



Balance Sheet
    
    September 30,
    
    
    September 30,Classification
    
    2009
    
    
    2008Futures and options contracts
    
    (Current Liabilities)
    
    $
    (61,325
    )
    
    $
    Futures and options contracts
    
    Current Assets
    
    
    
    
    
    
    593,350Interest rate swap
    
    (Current Liabilities)
    
    
    817,718
    
    
    
    129,739Interest rate swap
    
    (Non-Current  Liabilities)
    
    
    954,004
    
    
    
    501,588
 Statement ofOperations
    
    September 30,
    
    
    September 30,Classification
    
    2009
    
    
    2008Net realized and unrealized gains related to futures and options contracts
    
    Cost of Goods Sold
    
    $
    1,078,187
    
    
    $
    593,350Net realized and unrealized (losses) related to the interest rate swap
    
    Other non-operating (expense)
    
    
    (2,485,401
    )
    
    
    (976,738
    )
 Inventories
  Property and Equipment
  Buildings
    
    20 YearsPlant and Process Equipment
    
    5-20 YearsOffice Furniture and Equipment
    
    3-10 Years
   36




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##### Table of Contents



Fair Value of Financial Instruments
  Employees
   # Full-TimePosition
    
    PersonnelCEO
    
    
    1Communications Director
    
    
    1General Manager
    
    
    1Director of Grains and Marketing
    
    
    1CFO
    
    
    1Production Supervisors
    
    
    4Superintendent
    
    
    1Engineer
    
    
    1Lab
    
    
    2Maintenance
    
    
    10Plant Technicians
    
    
    28Accounting
    
    
    4Operations Assist
    
    
    1Logistics Manager
    
    
    1TOTAL
    
    
    57
 Off-Balance Sheet Arrangements
  
 ITEM 7A.
    
    QUANTITATIVE AND
QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
   37




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ITEM 8.
    
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
  
 
      
  38




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39




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
 September 30, 2009
    
    
    September 30, 2008ASSETSCURRENT ASSETSCash and cash equivalents
    
    $
    
    
    
    $
    7,685,978Trade and other accounts receivable, net of allowance for doubtful
accounts of approximately $53,500 and none, respectively
    
    
    4,080,745
    
    
    
    Due from broker
    
    
    109,700
    
    
    
    Inventory
    
    
    7,619,273
    
    
    
    4,542,099Other assets
    
    
    75,714
    
    
    
    1,242,410Total current assets
    
    
    11,885,432
    
    
    
    13,470,487PROPERTY AND EQUIPMENTOffice building, furniture and equipment
    
    
    808,949
    
    
    
    935,869Land
    
    
    1,000,000
    
    
    
    1,005,000Plant buildings and equipment
    
    
    163,069,329
    
    
    
    Construction in progress
    
    
    
    
    
    
    156,115,623164,878,278
    
    
    
    158,056,492Accumulated depreciation
    
    
    (8,840,707
    )
    
    
    (40,208
    )156,037,571
    
    
    
    158,016,284RESTRICTED CASH AND CERTIFICATES OF DEPOSIT
    
    
    4,269,662
    
    
    
    2,144,094FINANCING COSTS, net of amortization of $1,876,558 and $874,397??
    
    
    4,483,577
    
    
    
    5,485,738TOTAL ASSETS
    
    $
    176,676,242
    
    
    $
    179,116,603LIABILITIES AND MEMBERS EQUITYCURRENT LIABILITIESExcess of outstanding checks over bank balance
    
    $
    81,555
    
    
    $
    Revolving line of credit
    
    
    13,784,129
    
    
    
    11,900,000Current portion of long-term debt
    
    
    9,204,578
    
    
    
    3,212,430Current portion of capital lease obligations
    
    
    1,019,029
    
    
    
    27,420Current portion of interest rate swap liability
    
    
    817,718
    
    
    
    129,739Accounts payable and accrued expenses
    
    
    9,243,647
    
    
    
    12,648,499Accrued interest
    
    
    615,625
    
    
    
    1,680,318Derivative financial instruments
    
    
    61,325
    
    
    
    Total current liabilities
    
    
    34,827,606
    
    
    
    29,598,406DEFERRED GRANT PROCEEDS
    
    
    
    
    
    
    50,000INTEREST RATE SWAP LIABILITY
    
    
    954,004
    
    
    
    501,588CAPITAL LEASE OBLIGATIONS
    
    
    3,073,996
    
    
    
    126,327LONG-TERM DEBT
    
    
    103,325,017
    
    
    
    88,063,418TOTAL LIABILITIES
    
    
    142,180,623
    
    
    
    118,339,739COMMITMENTS AND CONTINGENCIESMEMBERS EQUITYMembership contributions, 81,984 and 76,610 units issued and outstanding
at September 30, 2009 and September 30, 2008, respectively
    
    
    77,226,361
    
    
    
    75,042,636Accumulated deficit
    
    
    (42,730,742
    )
    
    
    (14,265,772
    )Total members equity
    
    
    34,495,619
    
    
    
    60,776,864TOTAL LIABILITIES AND MEMBERS EQUITY
    
    $
    176,676,242
    
    
    $
    179,116,603
   40




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
 Year ending
    
    
    Year endingSeptember 30, 2009
    
    
    September 30, 2008Revenues
    
    $
    166,561,773
    
    
    $
    Cost of goods sold
    
    
    178,695,057
    
    
    
    Gross (loss)
    
    
    (12,133,284
    )
    
    
    General and administrative expenses
    
    
    5,123,484
    
    
    
    5,068,196Operating (loss)
    
    
    (17,256,768
    )
    
    
    (5,068,196
    )Other income (expense)Other income
    
    
    
    
    
    
    426,611Unrealized (loss) on interest
rate swap
    
    
    (1,140,395
    )
    
    
    (631,327
    )Interest expense
    
    
    (10,077,221
    )
    
    
    (5,556,156
    )Interest income
    
    
    9,414
    
    
    
    545,878(11,208,202
    )
    
    
    (5,214,994
    )Net (loss)
    
    $
    (28,464,970
    )
    
    $
    (10,283,190
    )Net (loss) per unit (Basic and Diluted)
    
    $
    (361.82
    )
    
    $
    (134.23
    )Weighted average units outstanding
    
    
    78,671
    
    
    
    76,610
   41




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
 Year ending
    
    
    Year endingSeptember 30, 2009
    
    
    September 30, 2008CASH FLOWS FROM OPERATING ACTIVITIESNet (loss)
    
    $
    (28,464,970
    )
    
    $
    (10,283,190
    )Adjustments to reconcile net (loss) to net
cash provided by (used in) operating activities:Depreciation
    
    
    8,800,499
    
    
    
    34,368Amortization
    
    
    1,002,161
    
    
    
    3,413,306Non-cash compensation expense
    
    
    146,175
    
    
    
    37,296Unrealized loss on interest rate swap
    
    
    1,140,395
    
    
    
    631,327Provision for doubtful receivables
    
    
    53,468
    
    
    
    Changes in assets and liabilities:(Increase) in trade and other accounts receivable
    
    
    (4,134,213
    )
    
    
    (Increase) in due from broker
    
    
    (109,700
    )
    
    
    (Increase) in inventory
    
    
    (3,077,174
    )
    
    
    (4,542,099
    )Decrease in accrued interest receivable
    
    
    
    
    
    
    245,774(Increase) decrease in other assets
    
    
    1,166,696
    
    
    
    (830,751
    )Increase in accounts payable and
accrued expenses
    
    
    572,693
    
    
    
    11,857,025Increase (decrease) in accrued interest payable
    
    
    (314,693
    )
    
    
    1,260,873Increase in derivative financial instruments
    
    
    61,325
    
    
    
    Net cash provided by (used in) operating activities
    
    
    (23,157,338
    )
    
    
    1,823,929CASH FLOWS FROM INVESTING ACTIVITIESPurchase of certificates of deposit
    
    
    
    
    
    
    (200,000
    )Purchase of property and equipment, net of returns
    
    
    (2,259,314
    )
    
    
    (91,650,508
    )Net cash (used in) investing activities
    
    
    (2,259,314
    )
    
    
    (91,850,508
    )CASH FLOWS FROM FINANCING ACTIVITIESProceeds from issuance of long-term debt
    
    
    18,988,632
    
    
    
    81,011,368Repayment of long-term debt and capital lease obligations
    
    
    (2,235,624
    )
    
    
    (8,973
    )Proceeds from revolving line of credit
    
    
    2,384,129
    
    
    
    11,900,000Payments on revolving line of credit
    
    
    (500,000
    )
    
    
    Proceeds received from sale of units
    
    
    2,037,550
    
    
    
    Release (funding) of restricted cash balance
    
    
    (3,025,568
    )
    
    
    7,022,799Excess of outstanding checks over bank balance
    
    
    81,555
    
    
    
    Expenditures for debt financing and equity offering costs
    
    
    
    
    
    
    (5,880,068
    )Net cash provided by financing activities
    
    
    17,730,674
    
    
    
    94,045,126Increase (decrease) in cash and cash equivalents
    
    
    (7,685,978
    )
    
    
    4,018,547Cash and cash equivalents, beginning of period
    
    
    7,685,978
    
    
    
    3,667,431Cash and cash equivalents, end of period
    
    $
    
    
    
    $
    7,685,978SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATIONCash paid for interest
    
    $
    9,389,753
    
    
    $
    4,980,004SUPPLEMENTAL DISCLOSUREs OF NONCASH INVESTING
AND FINANCING ACTIVITIESRepayment of notes and interest payable paid by Bond Trustee
    
    $
    900,000
    
    
    $
    82,500,000Assets acquired under capital lease financing arrangements
    
    $
    4,612,472
    
    
    $
    427,200Accrued expenses reclassed to subordinated debt
    
    $
    3,977,545
    
    
    $
    Deferred revenue applied to property & equipment
    
    $
    50,000
    
    
    $
    
   42




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
STATEMENT OF CHANGES IN MEMBERS EQUITY
 Membership
    
    
    AccumulatedUnits
    
    
    contributions
    
    
    (deficit)
    
    
    TotalBalance, September 30, 2007
    
    
    76,610
    
    
    $
    75,005,340
    
    
    $
    (3,982,582
    )
    
    $
    71,022,758Unit-based compensation expense for unit options to employees
    
    
    
    
    
    
    37,296
    
    
    
    
    
    
    
    37,296Net loss for the year ended September 30, 2008
    
    
    
    
    
    
    
    
    
    
    (10,283,190
    )
    
    
    (10,283,190
    )Balance, September 30, 2008
    
    
    76,610
    
    
    $
    75,042,636
    
    
    $
    (14,265,772
    )
    
    $
    60,776,864Unit-based compensation expense for unit options to employees
    
    
    
    
    
    
    146,175
    
    
    
    
    
    
    
    146,175Membership units issued
    
    
    5,369
    
    
    
    2,032,550
    
    
    
    
    
    
    
    2,032,550Membership unit options exercised
    
    
    5
    
    
    
    5,000
    
    
    
    
    
    
    
    5,000Net loss for the year ended September 30, 2009
    
    
    
    
    
    
    
    
    
    
    (28,464,970
    )
    
    
    (28,464,970
    )Balance, September 30, 2009
    
    
    81,984
    
    
    $
    77,226,361
    
    
    $
    (42,730,742
    )
    
    $
    34,495,619
   43




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
 Nature of Business
   Basis of Presentation
  Principles of Consolidation
  Use of Estimates
  Cash and Cash Equivalents and Restricted Cash and Certificates of Deposit
  Trade Accounts Receivable
  Inventories
  Financing Costs
   44




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 Property and Equipment
  Buildings
    
    20 YearsPlant and Process Equipment
    
    5-20 YearsOffice Furniture and Equipment
    
    3-10 Years
   Investment in Commodities Contracts, Derivative Instruments and Hedging Activities
       45




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
      Balance Sheet
    
    September 30,
    
    
    September 30,Classification
    
    2009
    
    
    2008Futures and options contracts
    
    (Current Liabilities)
    
    $
    (61,325
    )
    
    $
    Futures and options contracts
    
    Current Assets
    
    
    
    
    
    
    593,350Interest rate swap
    
    (Current Liabilities)
    
    
    817,718
    
    
    
    129,739Interest rate swap
    
    (Non-Current  Liabilities)
    
    
    954,004
    
    
    
    501,588Statement ofOperations
    
    September 30,
    
    
    September 30,Classification
    
    2009
    
    
    2008Net realized and
unrealized gains
related to
futures and
options contracts
    
    Cost of Goods Sold
    
    $
    1,078,187
    
    
    $
    593,350Net realized and
unrealized
(losses) related
to the interest
rate swap
    
    Other non-operating (expense)
    
    
    (2,485,401
    )
    
    
    (976,738
    )
  46




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 Revenue Recognition
    2009
    
    
    2008Ethanol
    
    $
    135,876,057
    
    
    $
    Distillerss Grain
    
    
    30,317,887
    
    
    
    Other
    
    
    367,829
    
    
    
    Total
    
    $
    166,561,773
    
    
    $
    
  Net Loss per Membership Unit
  Income taxes
  Fair Value of Financial Instruments
  NOTE 2. INVENTORIES
  September 30,
    
    
    September 30,2009
    
    
    2008Corn
    
    $
    3,958,543
    
    
    $
    4,542,009Denaturant and chemical supplies
    
    
    287,640
    
    
    
    Work in process
    
    
    1,095,000
    
    
    
    Ethanol
    
    
    1,649,895
    
    
    
    Distiller grains
    
    
    628,195
    
    
    
    Total
    
    $
    7,619,273
    
    
    $
    4,542,009
  47




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 NOTE 3. MEMBERS EQUITY
    NOTE 4. RELATED PARTIES
   NOTE 5. UNIT OPTION PLAN
     48




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
   2009
    
    
    2008Expected volatility
    
    
    66
    %
    
    
    66
    %Expected dividends
    
    
    
    
    
    
    Expected term (in years)
    
    
    6
    
    
    
    6Risk-free interest rate
    
    
    2.96
    %
    
    
    3.97
    %
  Weighted-Weighted-
    
    
    AverageAverage
    
    
    RemainingExercise
    
    
    ContractualOptions
    
    Units
    
    
    Price
    
    
    TermOutstanding at October 1, 2007
    
    
    957
    
    
    $
    1,000
    
    
    
    9.25Granted
    
    
    382
    
    
    
    1,000
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited or expired
    
    
    (766
    )
    
    
    1,000Outstanding at September 30, 2008
    
    
    573
    
    
    $
    1,000
    
    
    
    9.25
    
    
    $
    Granted
    
    
    383
    
    
    
    1,000
    
    
    
    10
    
    
    
    Exercised
    
    
    (5
    )
    
    
    1,000Forfeited
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Outstanding at September 30, 2009
    
    
    951
    
    
    
    1,000
    
    
    
    8.80
    
    
    
    Exercisable at September 30, 2009
    
    
    316
    
    
    $
    1,000
    
    
    $
    
    
    
    $
    
  NOTE 6. LEASES
   49




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
   September 30, 2009
    
    
    September 30, 2008De Lage Landen Financial Services, 60 months, interest rate of 7.5%
    
    $
    126,327
    
    
    $
    153,747Georgia Power Substation lease, 36 months, interest rate of 5.85%
    
    
    1,299,364
    
    
    
    Natural Gas Facilities lease, 80 months, interest rate of 6.59%
    
    
    2,667,334
    
    
    
    4,093,025
    
    
    
    153,747Less current portion
    
    
    (1,019,029
    )
    
    
    (27,420
    )$
    3,073,996
    
    
    $
    126,327
  Year ending September 30:2010
    
    $
    1,241,0512011
    
    
    1,241,0512012
    
    
    554,7432013
    
    
    548,4062014
    
    
    516,722Thereafter
    
    
    684,315Total minimum lease payments
    
    
    4,786,288Amounts representing interest
    
    
    (693,263
    )Present value of net minimum lease payments
    
    $
    4,093,025
  50




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
  Year ending September 30:2010
    
    $
    2,469,8002011
    
    
    2,022,8002012
    
    
    1,041,5002013
    
    
    447,0002014
    
    
    447,000Thereafter
    
    
    968,500Total minimum operating lease payments
    
    $
    7,396,600
 NOTE 7. DEBT FINANCING ARRANGEMENTS
  September 30, 2009
    
    
    September 30, 2008West LB Term Loan, variable interest rates from 4.35% to 7.81%,
described below
    
    $
    98,500,000
    
    
    $
    81,011,368Subordinated Fagen note, 4% through June 30, 2010 and 8% thereafter
    
    
    3,977,545
    
    
    
    Subordinated debt facility, interest rate of 7.5%, described below
    
    
    9,850,000
    
    
    
    10,000,000Notes payable John Deere Credit, interest rate of 5.3%, described below
    
    
    202,050
    
    
    
    264,480112,529,595
    
    
    
    91,275,848Less current portion
    
    
    (9,204,578
    )
    
    
    (3,212,430
    )$
    103,325,017
    
    
    $
    88,063,418
  Year ending September 30:2010
    
    $
    9,204,5782011
    
    
    8,843,1382012
    
    
    6,996,8792013
    
    
    6,970,0002014
    
    
    7,015,000Thereafter
    
    
    73,500,000Total
    
    $
    112,529,595
 West LB Credit Arrangement  Senior Debt
    51




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
     
    
    Carbon Dioxide Agreement Amendment: Section 7.01(x) of the Companys senior credit
agreement requires it to deliver the carbon dioxide agreement with Airgas Carbonic, Inc. to
the lender along with any ancillary documents. As of September 30, 2009 the carbon dioxide
agreement had been negotiated and was in final form, however, Airgas Carbonic, Inc. had not
yet executed the agreement due to concerns about the viability of FUEL. Accordingly, we
have requested and obtained a temporary waiver of the section 2(f) of the Waiver and Third
Amendment to Accounts Agreement and an additional 180 day waiver of section 7.01(x) of our
senior credit agreement. Subsequently, on November 2, 2009, we reached an agreement with
Airgas Carbonic, Inc. (Airgas) with an effective date of May 15, 2009.
 
    
    Borrowing Base Certificate: As described above, the Company is required to repay the
amount that its working capital loan outstanding exceeds its borrowing base. The Companys
borrowing base is 80% of the value of certain accounts receivable and certain inventory
owned by FUEL and is calculated on a monthly basis. In furtherance of these calculations,
section 7.03(n) requires the Company to deliver to its lender a borrowing base certificate
setting for the data necessary to make the borrowing base calculations. As a result of the
Companys working capital loan outstanding exceeding its borrowing base, the Company was
not able to deliver an acceptable borrowing base certificate. Accordingly, the Company
requested a waiver of any required prepayment arising under section 3.10(d) of the senior
credit agreement and a waiver of section 7.03(n), the covenant requiring the Company to
repay the difference between its working capital loan outstanding and its borrowing base.
The Company obtained a waiver of these covenants through December 15, 2009 and the lender
has indicated its willingness to work with the Company; however, at any time the Companys
lender could decide not to grant this waiver and the Company would be in default on its
senior credit agreement.
 Subordinated Debt Facility
   52




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 Subordinated Fagen Note
  Other Notes Payable
  NOTE 8. FAIR VALUE MEASUREMENTS
   
    
    Level 1 Observable inputs  unadjusted quoted prices in
active markets for identical assets and liabilities;
    
    Level 2 Observable inputs other than quoted prices included in
Level 1 that are observable for the asset or liability through
corroboration with market data; and
    
    Level 3 Unobservable inputs  includes amounts derived from
valuation models where one or more significant inputs are
unobservable.
   Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalAssets:Investments in
marketable securities,
included in restricted
cash
    
    $
    1,597,109
    
    
    $
    
    
    
    $
    
    
    
    $
    1,597,109Total assets
    
    $
    1,597,109
    
    
    $
    
    
    
    $
    
    
    
    $
    1,597,109Liabilities:Derivative instruments:Commodity positions
    
    $
    61,325
    
    
    
    
    
    
    
    
    
    
    $
    61,325Interest rate swap
    
    $
    
    
    
    $
    1,771,722
    
    
    $
    
    
    
    $
    1,771,722Total liabilities
    
    $
    61,325
    
    
    $
    1,771,722
    
    
    $
    
    
    
    $
    1,833,047
  53




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 NOTE 9. COMMITMENTS AND CONTINGENCIES
 Liquidity
   Commitments and Major Customer
    54




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FIRST UNITED ETHANOL, LLC AND SUBSIDIARY
 NOTE 10. CONTINGENCY
  NOTE 11. SUBSEQUENT EVENTS
    55




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ITEM 9.
    
    CHANGES IN AND
DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
  
 ITEM 9A(T).
    
    CONTROLS AND PROCEDURES.
 Disclosure Controls and Procedures
   Internal Control Over Financial Reporting
 Inherent Limitations Over Internal Controls
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Managements Annual Report on Internal Control Over Financial Reporting
   Changes in Internal Control Over Financial Reporting
  
 ITEM 9B.
    
    OTHER INFORMATION.
  
 PART III
  
 ITEM 10.
    
    DIRECTORS; EXECUTIVE
OFFICERS, AND CORPORATE GOVERNANCE.
  
 ITEM 11.
    
    EXECUTIVE COMPENSATION.
  
 ITEM 12.
    
    SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
   57




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ITEM 13.
    
    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
  
 ITEM 14.
    
    PRINCIPAL ACCOUNTING FEES
AND SERVICES.
  
 PART IV
 
 ITEM 15.
    
    EXHIBITS,
FINANCIAL STATEMENT SCHEDULES.
  Exhibit
    
    
    
    Method ofNo.
    
    Description
    
    Filing10.1
    
    
    Southwest Georgia Ethanol, LLC Subordinated
Promissory Note Due June 30, 2011 payable to Fagen,
Inc. dated June 30, 2009
    
    
    131.1
    
    
    Certificate pursuant to 17 CFR 240 15d-14(a)
    
    
    *31.2
    
    
    Certificate pursuant to 17 CFR 240 15d-14(a)
    
    
    *32.1
    
    
    Certificate pursuant to 18 U.S.C. Section 1350
    
    
    *32.2
    
    
    Certificate pursuant to 18 U.S.C. Section 1350
    
    
    *
 
 (1)
    
    Incorporated by reference to Exhibit of the same number filed with our quarterly report on
Form 10-Q filed with the Securities and Exchange Commission on August 14, 2009.(*)
    
    Filed herewith.  58




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SIGNATURES
  FIRST UNITED ETHANOL, LLCDate:      December 23, 2009
    /s/ Murray CampbellMurray CampbellChief Executive Officer and DirectorDate:      December 23, 2009
    /s/ Lawrence KampLawrence KampChief Financial Officer  Date:    December 23, 2009
    /s/ Murray CampbellMurray CampbellChief Executive Officer and DirectorDate:    December 23, 2009
    /s/ Lawrence KampLawrence KampChief Financial OfficerDate:    December 23, 2009
    /s/ Miley AdamsMiley Adams, DirectorDate:    December 23, 2009
    /s/ Steve CollinsSteve Collins, Treasurer and DirectorDate:    December 23, 2009
    /s/ Michael HarrellMike Harrell, DirectorDate:    December 23, 2009
    /s/ Donald ShirahDonald Shirah, DirectorDate:    December 23, 2009
    /s/ Tommy HilliardTommy Hilliard, Vice Chairman and DirectorDate:    December 23, 2009
    /s/ Thomas H. Dollar, IIThomas H. Dollar, II, Chairman and DirectorDate:    December 23, 2009
    /s/ Robert L. Holden, Sr.Robert L. Holden, Sr., DirectorDate:    December 23, 2009
    /s/ Kenneth Jack HunnicuttKenneth Jack Hunnicutt, Director  59




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNo.
    
    Description31.1
    
    
    Certificate pursuant to 17 CFR 240 15d-14(a)31.2
    
    
    Certificate pursuant to 17 CFR 240 15d-14(a)32.1
    
    
    Certificate pursuant to 18 U.S.C. Section 135032.2
    
    
    Certificate pursuant to 18 U.S.C. Section 1350
  60