**Exhibit 10.31**REMARKETING AGREEMENTby and betweenFIRST UNITED ETHANOL, LLCandW.R. TAYLOR & COMPANY, LLC,Dated as of October 1, 2006
 

 
REMARKETING AGREEMENT     This REMARKETING AGREEMENT, dated as of October 1, 2006 (the “Remarketing Agreement”), is byand between First United Ethanol, LLC (the “Borrower”) and W.R. Taylor & Company, LLC (“Taylor”),as the remarketing agent (the “Remarketing Agent”), and is entered into in connection with$53,500,000 Mitchell County Development Authority Variable Rate Demand Taxable Economic DevelopmentRevenue Bonds (First United Ethanol, LLC Project), Series 2006 (the “Bonds”), issued by theMitchell County Development Authority (the “Issuer”) for the benefit of the Borrower.ARTICLE IDefinitions     Section 1.01. Capitalized Terms.     Capitalized terms used in this Remarketing Agreement, unless otherwise defined herein, shallhave the meanings assigned to them in the Trust Indenture (“Indenture”) dated as of October 1,2006, between the Issuer and Wells Fargo Bank, National Association, as trustee (the “Trustee”).     Section 1.02. Rules of Interpretation.     (a) This Remarketing Agreement shall be interpreted in accordance with and governed by thelaws of the State of Georgia.     (b) The words “herein” and “hereof” and words of similar import, without reference to anyparticular Article, Section or subsection, refer to this Remarketing Agreement as a whole ratherthan to any particular Article, Section or subsection hereof.     (c) The headings of Articles and Sections herein are for convenience only and shall not affectthe construction hereof.ARTICLE IIRemarketing Agent     Section 2.01. Remarketing Agent’s Acceptance and Qualification.     (a) Taylor hereby accepts the appointment pursuant to the Indenture of Taylor to be theRemarketing Agent for the Bonds.     (b) Taylor hereby represents that it is a member of the National Association of SecuritiesDealers, Inc., and is authorized to perform all of the duties of the Remarketing Agent imposed bythe Indenture and this Remarketing Agreement.
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     (c) The Remarketing Agent shall have the right in its sole discretion to refuse to remarketthe Bonds (i) if any Event of Default under the Indenture or the Agreement shall have occurred andbe continuing, (ii) if any Event of Default under the Reimbursement Agreement shall have occurredand be continuing which gives the Bank the right to exercise any of the remedies referred to inArticle 13 of the Reimbursement Agreement, or (iii) if the Bank’s obligations to pay under theLetter of Credit or to purchase or redeem Bonds under the Reimbursement Agreement shall have beensuspended or terminated (or notice of such suspension or termination given) and no Alternate Letterof Credit shall have been issued and delivered to the Trustee and then be in effect, or (iv) if itshall have determined in its sole discretion, after consultation with its counsel, that aDisclosure Statement (as defined in Section 3.01 hereof), or an amendment or supplement thereto, isrequired for distribution to prospective purchasers and that such a Disclosure Statement or anamendment or supplement thereto, is not available, or if available, is not reasonably satisfactoryto it and its counsel in form or substance, or (v) if it shall receive (x) an opinion of itscounsel, after consultation with Bond Counsel, that a substantial legal basis existsupon which the exclusion of interest on the Bonds from gross income of the owner can be challenged,or (y) an opinion of its counsel that a substantial legal basis exists upon which either theexemption from registration of the Bonds, the Reimbursement Agreement or the Letter of Credit,either individually or collectively, under the Securities Act of 1933, as amended, or the exemptionfrom qualification of the Indenture under the Trust Indenture Act of 1939, as amended, can bechallenged.     (d) Nothing contained herein or in the Indenture shall be construed to obligate Taylor topurchase, sell, hold or deal in the Bonds as a principal. Taylor shall not be required to use anyof its own funds, or otherwise incur financial liability, in carrying out its duties hereunder;provided, however, that Taylor may, at its sole discretion, purchase, sell, hold or deal in theBonds for its own account.     Section 2.02. Remarketing Agent’s Obligations.     The Remarketing Agent, shall:     (a) hold all moneys delivered to it as Remarketing Agent for the purchase of Bonds, inremarketing transactions pursuant to the Indenture, as agent and bailee of, and in escrow for thebenefit of, (i) the person or entity which has so delivered those moneys, until the Bonds purchasedwith those moneys have been delivered to or for the account of that person or entity and (ii)thereafter, the person or entity which has so tendered the Bonds for purchase until those moneyshave been delivered to or for the account of that person or entity;     (b) keep such books and records with respect to its activities as Remarketing Agent hereunderas is consistent with prudent industry practice, which books and records shall be available forinspection, upon reasonable notice, by the Trustee and the Borrower;     (c) subject to Section 2.01(c) hereof, use its best efforts to remarket Bonds tendered forpurchase pursuant to the Indenture (whether at the option of the owners thereof or pursuant tomandatory tender for purchase);     (d) (i) determine the Variable Rate in accordance with the provisions therefor in the form ofBond and the Indenture, (ii) determine the Fixed Interest Rate in accordance with the provisionstherefor in Section 4.02 of the Indenture and the form of Bond, and (iii) give notice to the TenderAgent, the Borrower and the Trustee of such rates and the terms in accordance with the provisionstherefor in the form of Bond and the Indenture; and
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     (e) assume all other obligations, duties and rights of the Remarketing Agent in accordancewith the Indenture, including, in particular, Article III, Article IV, Section 10.11, and Section10.12 thereof.ARTICLE IIIDisclosure     Section 3.01. Provision of Disclosure Materials.     If the Remarketing Agent determines that it is necessary or desirable to use a disclosurestatement (a “Disclosure Statement”) in connection with any remarketing of Bonds, the RemarketingAgent will so notify the Borrower. The Borrower agrees to provide for the use of the RemarketingAgent in connection with remarketing of the Bonds a Disclosure Statement reasonably satisfactory tothe Remarketing Agent. The Borrower agrees to supply to the Remarketing Agent such number ofcopies of the Disclosure Statement and documents related thereto as are reasonably requested fromtime to time by the Remarketing Agent and further agrees to amend the Disclosure Statement (and/orany documents incorporated by reference therein) so that at all times the Disclosure Statement anddocuments related thereto will not contain any untrue statement of a material fact relating to theBorrower or the Project or omit to state a material fact relating to the Borrower or the Projectnecessary to make the statements contained therein, in the light of the circumstances under whichthey were made, not misleading. The Borrower agrees to promptly advise the Remarketing Agent ofany information concerning any event with respect to the Borrower which may be required to beincluded in a Disclosure Statement or an amendment or supplement thereto. In addition, theBorrower agrees to take all steps, at their own expense, reasonably requested by the RemarketingAgent to (a) either (i) register the Bonds for sale under the applicable federal or statesecurities laws or to qualify the Indenture under the Trust Indenture Act of 1939, as amended, ifrequired, or (ii) cause the Bonds required to be so registered to cease to be outstanding withinthe meaning of the Indenture and to cause the Indenture required to be so qualified to bedischarged in accordance with its terms, or (b) enable the Remarketing Agent to establish a “duediligence” defense to any action commenced against the Remarketing Agent in respect of a DisclosureStatement.ARTICLE IVGeneral     Section 4.01. Indemnification of Remarketing Agent.     The Borrower agrees to indemnify and hold harmless the Remarketing Agent and each member,trustee, partner, officer, official or employee thereof and any person who controls the RemarketingAgent within the meaning of the Securities Act of 1933, against any and all losses, claims, damagesand liabilities arising out of (i) the failure to provide to the Remarketing Agent informationconcerning the Borrower or the Project which should have been included in a Disclosure Statement orwhich would have caused the Remarketing Agent, in the exercise of its reasonable judgment, torequest that the Borrower prepare a Disclosure Statement, or amend or supplement an existingDisclosure Statement, for use by the
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Remarketing Agent in the remarketing of the Bonds or (ii) any statement or information concerningthe Borrower or the Project contained in the Disclosure Statement provided pursuant to Section 3.01hereof that is untrue in any material respect, or the omission therefrom of any informationconcerning the Borrower or the Project which should be contained therein which is necessary to makethe statements therein, in light of the circumstances under which they are made, not misleading inany material respect, and to the extent of the aggregate amount paid in settlement of anylitigation commenced or threatened arising from a claim based upon any such untrue statement oromission if such settlement is effected with the written consent of the Borrower; provided that,the Borrower shall not be liable in any case if a court of competent jurisdiction has rendered afinal judgment to the effect that the loss, claim, damage or liability has been asserted by aperson who purchased one or more Bonds from the Remarketing Agent and resulted solely from thefailure of the Remarketing Agent to deliver or cause to be delivered to that person the DisclosureStatement or any amendment or supplement thereto that had been timely prepared and was thenavailable to the Remarketing Agent, and that such delivery to such person would have been a validand complete defense to the action from which such loss, claim, damage or liability arose. In caseany claim shall be made or action brought against the Remarketing Agent or any indemnified person(as aforesaid) in respect of which indemnity may be sought against and the Borrower, theRemarketing Agent shall promptly notify the Borrower in writing, setting forth the particulars suchclaim or action, and the Borrower shall assume the defense thereof including the retaining ofcounsel (who shall be reasonably satisfactory to the Remarketing Agent) and the payment, asincurred, of all expenses reasonably incurred by the Remarketing Agent or such other indemnifiedperson; provided, however, that if the Remarketing Agent is advised in an opinion of counsel thatthere may be legal defenses available to the Remarketing Agent which are adverse to or in conflictwith those available to the Borrower, or that the defense of the Borrower should be handled byseparate counsel, the Borrower shall not assume such defense of the Remarketing Agent, the Borrowershall be responsible for the payment, as incurred, of the reasonable fees and expenses of counselretained by the Remarketing Agent in assuming its own defense and for all other expenses reasonablyincurred by the Remarketing Agent in connection with such defense, and provided also that if theBorrower shall have failed to assume the defense of such action or to retain counsel reasonablysatisfactory to the Remarketing Agent within a reasonable time after notice of the commencement ofsuch action, the reasonable fees and expenses of counsel retained by the Remarketing Agent and allother expenses reasonably incurred by the Remarketing Agent in connection with such defense shallbe paid, as incurred, by the Borrower. Notwithstanding, and in addition to, any of the foregoing,the Remarketing Agent or any such indemnified person (as aforesaid) shall have the right to retainseparate counsel in any such action and to participate in the defense thereof, but the fees andexpenses of such counsel shall be at the expense of the party retaining such counsel unless theretaining of such counsel has been specifically authorized by the Borrower in writing. TheRemarketing Agent agrees to indemnify and hold harmless the Borrower and each member, trustee,officer, official or employee thereof and any person who controls the Borrower within the meaningof the Securities Act of 1933, against any and all losses, claims, damages and liabilities arisingout of any statement or information relating to the Remarketing Agent or based upon informationprovided by the Remarketing Agent contained in the Disclosure Statement that is untrue in anymaterial respect, or the omission therefrom of any information relating to the Remarketing Agent orwhich should have been provided by the Remarketing Agent which should be contained therein which isnecessary to make the statements therein, in light of the circumstances under which they are made,not misleading in any material respect, and for any liability arising from failure of theRemarketing Agent to comply with any “blue sky” laws in any jurisdiction (unless such failure tocomply is a result of the unwillingness or inability of the Borrower or the Issuer to provideinformation or to take steps required for such compliance, as reasonably requested by theRemarketing Agent) applicable to the remarketing of Bonds by the Remarketing Agent, but only to theextent that the Borrower or the Issuer also would be liable for such failure in whole or in part insuch
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jurisdiction. The indemnity agreements contained in this Section 4.01 shall remain operative andin full force and effect regardless of any investigation made by or on behalf of the RemarketingAgent (or any controlling person) or the Borrower (or any controlling person) and shall survive thetermination of this Remarketing Agreement.     Section 4.02. Payment of Remarketing Agent.     The Borrower shall pay Taylor for its services as Remarketing Agent for the Bonds (i) duringthe time that interest is borne on the Bonds at the Variable Rate, an annual fee equal to .125% ofthe average aggregate principal amount of Bonds outstanding during the period since the date of theimmediately preceding payment (or the date of the initial delivery of the Bonds) but not less than$2,500 annually, payable as directed by the Remarketing Agent, quarterly in advance, commencing onNovember 30, 2006 and on the first day of each January, April, July and October thereafter throughand including the Conversion Date; and (ii) after the Conversion Date, such fee as shall benegotiated by the Remarketing Agent and the Borrower. Such fee payable pursuant to clause (i) ofthe preceding sentence shall be calculated based on the actual number of days elapsed since theimmediately preceding payment date, with a year of 365 or 366 days, as applicable. The Borroweralso will pay all reasonable expenses in connection with the preparation of any DisclosureStatement and the registration of the Bonds under any state securities laws and will reimburse theRemarketing Agent for all of its reasonable direct out-of-pocket expenses incurred by it asRemarketing Agent under this Remarketing Agreement, including reasonable counsel fees anddisbursements and the costs of notices, mailings and other activities required under thisRemarketing Agreement. The Remarketing Agent acknowledges that it has no legal right or interestunder this Remarketing Agreement to any proceeds received from the remarketing of Bonds other thanthose Bonds which it has purchased for its own account.     Section 4.03. Term.     This Remarketing Agreement will terminate upon the earlier of (i) the effective date of theresignation or removal of Taylor as Remarketing Agent, (ii) 30 days following such date, if any,that all outstanding Bonds first bear interest at the Fixed Interest Rate, or (iii) the first dateon which no Bonds are outstanding. The Borrower may remove Taylor as Remarketing Agent under thisRemarketing Agreement, at any time upon not less than sixty (60) days’ written notice from theBorrower to such removed Remarketing Agent, upon satisfaction of the requirements of the Indenture.Taylor may resign as Remarketing Agent at any time, upon notice to the Borrower, the Issuer, theTrustee and the Bank and provided that the resignation shall not be effective until the earlier of(i) the 30th day following receipt of the notice of resignation, or (ii) either the assumption,subject to the provisions of the Indenture, by the non-resigning Remarketing Agent of soleresponsibility for the performance of all duties and obligations of the Remarketing Agent underthis Remarketing Agreement or the appointment by the Borrower of a successor remarketing agent.Upon the termination of this Remarketing Agreement, the provisions of Section 4.01 hereof willcontinue to remain in effect and any Bonds or moneys then held by the Remarketing Agent will bedelivered to the Tender Agent, who will deliver those Bonds and moneys to the successor RemarketingAgent or, if no successor has been designated, to the Trustee.     Section 4.04. Amendments.     This Remarketing Agreement may not be amended so as to adversely affect the right of theowners of Bonds to tender their Bonds for purchase pursuant to the Indenture, without the priorwritten consent of the Issuer and the Trustee (with notice to the owner of each such Bond soaffected).
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     Section 4.05. Remarketing Agent’s Performance; Duty of Care.     The Remarketing Agent consents and agrees to perform and comply with all of the terms andprovisions on its part to be performed or complied with in this Remarketing Agreement and theIndenture. In performing its duties and obligations hereunder and under the Indenture, theRemarketing Agent shall exercise the same degree of skill and care as a prudent person would useunder the same circumstances in the conduct of his or her own affairs.     The duties and obligations of the Remarketing Agent shall be determined solely by the expressprovisions of this Remarketing Agreement and the Indenture, and the Remarketing Agent shall not beliable except for the performance of such duties and obligations as are specifically set forth inthis Remarketing Agreement and the Indenture, and no implied covenants or obligations shall be readinto this Remarketing Agreement or the Indenture against the Remarketing Agent; and in the absenceof bad faith on the part of the Remarketing Agent, the Remarketing Agent may conclusively rely, asto the truth of the statements expressed therein, upon any notice or document furnished to theRemarketing Agent and conforming to the requirements of this Remarketing Agreement or the Indentureand shall be protected in acting upon any such notice or document reasonably believed by it to begenuine and to have been given, signed or presented by the proper party or parties.     Section 4.06. Notices.     Unless otherwise specified, any notices, requests or other communications given or madehereunder or pursuant hereto shall be made in writing and shall be deemed to have been validlygiven or made when delivered or mailed, registered or certified mail, return receipt requested, andpostage prepaid, addressed as follows:       **if to Borrower:** First United Ethanol, LLC    2 West Broad Street    Camilla, Georgia 31730    Attention: Mr. Murray Campbell    Fax: (229) 522-2824       **if to Remarketing Agent:** W.R. Taylor & Company, LLC    1420 I-85 Parkway    Montgomery, Alabama 36106    Attn: Mr. Robbins Taylor          Section 4.07. Counterparts.          This Remarketing Agreement may be executed in any number of counterparts all of which takentogether shall constitute one and the same instrument.
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          IN WITNESS WHEREOF, the parties hereto have cause this Remarketing Agreement to be executed bytheir duly authorized officers or agents, as the case may be, as of the date first above written.         W.R. TAYLOR & COMPANY, LLC,