exv10w3



 






Exhibit 10.3




[Handwritten: scan # 636]




CONSULTING AGREEMENT




     This Consulting Agreement (the “Agreement") is made this 19 day of
August , 2005 (the “Effective Date”), by and between BioEnergy Capital Consultants, LLC, a
South Dakota limited liability company, with an address of 44095 212th Street, Lake
Preston, South Dakota 57249 (“BioEnergy”), and Mitchell County Research Group, LLC, a Georgia
limited liability company, with an address of P.O. Box 107, Camilla, Mitchell County, Georgia 31730
(“Client”).



RECITALS:





	 	A.	 	Client intends to develop, finance and construct an ethanol plant in or near
[Handwritten: Camilla, GA] (the “Project”).
	 
	 	B.	 	BioEnergy has a background in the development of value-added agriculture
projects and is willing to provide services to Client based on this background.






	 	NOW, THEREFORE, in consideration of the mutual promises and agreements contained herein,
Client engages BioEnergy, and BioEnergy accepts engagement, upon the terms and conditions
hereinafter set forth.






	 	1.	 	Term. BioEnergy’s engagement with Client shall commence as of the
Effective Date and shall continue at least through the first day after the Loan
Closing Date (as defined in section 3), unless properly terminated as provided herein.
BioEnergy may terminate this Agreement with or without cause upon fourteen (14) days
prior written notice to Client. Client may terminate BioEnergy’s services, with or
without “Cause” upon fourteen (14) days prior written notice to BioEnergy. For
purposes of this Agreement, “Cause” for termination by BioEnergy means the Client’s
failure to timely pay BioEnergy compensation pursuant to the terms of this Agreement.
For purposes of this Agreement, “Cause” for termination by Client means BioEnergy’s
gross negligence or intentional misconduct in the performance of its duties under this
Agreement, a known violation of the law, or a material breach of this Agreement by
BioEnergy.






	 	Upon termination, neither Client nor BioEnergy shall have any further rights or obligations
under the terms of this Agreement other than delivery of payments for services and/or bonus
payments to which BioEnergy may be entitled through the date of termination.






	 	2.	 	Services. BioEnergy shall serve as Client’s Project consultant.
BioEnergy’s service providers (described in section 7 of this Agreement) shall perform
the following duties incident to that service subject to Client’s approval:





 









 











	 	a.	 	Assist negotiations of contracts with various service and product
providers;






	 	b.	 	Assist the planning of the Clients’ equity marketing effort,
including, without limitation, preparation of written and visual equity
marketing materials (including, but not limited to, a power point
presentation), and training Client’s officers and directors to conduct Client’s
equity marketing effort;






	 	c.	 	Assist the securing of debt financing for the commencement of
construction of the Project;






	 	d.	 	Assist the education of local lenders including, without
limitation, the preparation of a “banker’s book” tailored to the
Project; and






	 	e.	 	Perform such other reasonably necessary duties as Client may
request for the timely and successful securing of debt financing and
commencement of construction of the Project, including without limitation,
cooperating with the Client’s personnel similarly engaged. Notwithstanding the
forgoing, neither BioEnergy, its members, managers, officers, employees, nor
agents shall itself or themselves be asked to, or actually, solicit an offer to
buy, or accept an offer to sell, any equity security to be issued by Client.




For purposes of this Agreement, the parties agree that the figures set forth in Schedule A to this
Agreement represent the equity goal and debt financing goal of Client for the Project. Client may
adjust the equity goal and debt financing goal downward upon notice to BioEnergy. Any increase in
the equity goal and debt financing goal is subject to the mutual written consent of both parties.



Subject to Client’s approval, BioEnergy shall determine the manner in which the services are to be
performed and the specific hours to be worked by BioEnergy. BioEnergy shall work as many hours as
are reasonably necessary to fulfill BioEnergy’s commitments under this Agreement.





	 	3.	Payment.






	 	a.	 	Client shall pay to BioEnergy a one-time commitment fee of
Fifty Thousand Dollars ($50,000.00) on the Effective Date.






	 	b.	 	Client shall pay to BioEnergy One Thousand Five Hundred Dollars
($1,500.00) per week as payment for services, during the period commencing upon
the Effective Date and continuing through the first date after Client’s equity
drive for the Project has been closed and the parties mutually agree that all
administrative details related thereto have been concluded (the “Equity Drive
Closing Date”), for each week or partial week that Paul Casper or other
BioEnergy personnel assist, through personal attendance in Camilla, Georgia and
the relevant surrounding 




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	 	 	 	communities with the preparation and facilitation of
equity drive meetings conducted in Camilla and the relevant surrounding
communities. The Equity Drive Closing Date shall be at least two full weeks
following the end of the week in which Client receives the subscription
agreement that achieves the equity goal necessary for the successful completion
of the Project, as set forth in Schedule A.






	 	c.	 	After the Equity Drive Closing Date and continuing through the
first date after Client closes a loan transaction to finance construction of
the Project (the “Loan Closing Date”), Client shall pay BioEnergy Three Hundred
Seventy Five Dollars ($375.00) per day for specifically identified services
rendered on certain days, not to exceed One Thousand Five Hundred Dollars
($1,500.00) per week (Sunday through Saturday). Payments shall be payable
within fourteen (14) days of Client’s receipt of a detailed invoice from
BioEnergy which outlines the services provided during the pay period. Upon
termination of this Agreement, payments under this subsection shall cease;
provided, however, that BioEnergy shall be entitled to payments for periods or
partial periods that occurred prior to the date of termination for which
BioEnergy has not been paid, and for any bonus payment or portion thereof due
to Client pursuant to subsection 3d of this Agreement.






	 	d.	 	Client shall pay to BioEnergy a one-time conditional bonus of
Six Hundred Fifty Thousand Dollars ($650,000.00) (the “Bonus”) on the Loan
Closing Date. In the event of an early termination of this Agreement, the
following shall apply with respect to the Bonus:






	 	(i)	 	If (a) Client terminates this Agreement for
Cause at any time, or (b) BioEnergy terminates this Agreement without
Cause at any time, Client shall pay to BioEnergy only those fees set
forth in Sections 3b and 3c above earned through the date of
termination plus that portion of the Bonus calculated by multiplying
the Bonus by a percentage equal to the percentage of the Equity Goal
that has been subscribed to as of the date of termination.






	 	(ii)	 	If (a) at any time, Client terminates this
Agreement without Cause, or (b) BioEnergy terminates this Agreement for
Cause, Client shall pay BioEnergy those fees set forth in Sections 3b
and 3c above earned through the date of termination and 100% of the
Bonus on the Loan Closing Date.




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Notwithstanding the foregoing, Client shall have sole discretion in determining whether to accept a
loan commitment or close a loan such that a Loan Closing Date would occur, and Client shall not
become liable to pay the Bonus, or any portion thereof, if it elects in good faith to not accept a
loan commitment or close a loan.





	4.	 	Expenses. Client shall reimburse BioEnergy for all reasonable, ordinary and necessary
expenses incurred by BioEnergy in performance of its duties hereunder, including without
limitation, reimbursement for automobile mileage at the rate periodically set by the Internal
Revenue Service. However, in no case shall any such expense reimbursements exceed two thousand
five hundred dollars ($2,500) in any single week without the prior written consent of the
Client.






	5.	 	Support Services. Client shall provide the following support services for the benefit
of BioEnergy, as approved by Client: office space, secretarial support, and office supplies.






	6.	 	Relationship of the Parties. The parties understand that BioEnergy is an independent
contractor with respect to Client, and not an employee of Client. Client will not provide
fringe benefits, including health insurance benefits, paid vacation, or any other employee
benefits for the benefit of BioEnergy






	7.	 	Service Providers. Paul Casper shall provide the majority of BioEnergy’ s services
under this Agreement. Paul Casper’s duties shall include assisting in the development of the
Project and the organization of investor meetings. Notwithstanding the foregoing, BioEnergy
may substitute its other personnel to provide BioEnergy’s services under this Agreement on a
limited basis as needed, with Client’s consent. BioEnergy’s employees, members, or agents who
perform services for Client under this Agreement shall be bound by the terms of this
Agreement.






	8.	 	Insurance. BioEnergy and Client shall each obtain, maintain and keep in full force
and effect during the term of this Agreement the following insurance coverages






	 	a.	Commercial general liability insurance with policy limits that have a combined
single limit of One Million Dollars ($1,000,000.00); and






	 	b.	Business automobile liability insurance, covering owned, non-owned and hired
vehicles with a combined single limit of One Million Dollars ($1,000,000.00).




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All insurance provided for in this section 8 shall be effective under valid and enforceable
policies issued by insurers of recognized responsibility, licensed to do business in states where
the respective parties currently conduct business. Each party shall name the other as an additional
insured with respect to each policy. Each party shall furnish the other with proof of the payment
of all premiums due on said policies of insurance and that the policies of insurance are in full
force and effect. Each policy or certificate of insurance shall contain an agreement by the insurer
that coverages shall not be cancelled for any reason without at least 30 days prior written notice
to the other party.






	9.	 	Indemnification. Client shall indemnify and defend BioEnergy and its employees,
members, managers, officers, and agents against expenses actually and reasonably incurred in
connection with the defense of any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative, arbitrative or investigative (a
“Proceeding”), in which BioEnergy and/or its employees, members, managers, officers or agents
are made a party by reason of performing services for Client or acting in any manner pursuant
to this Agreement, except that Client shall have no obligation to indemnify and defend
BioEnergy and/or its employees, members or agents for its and/or their act or omission that
involve gross negligence, intentional misconduct or a known violation of the law. BioEnergy
shall indemnify and defend Client and its employees, members, directors, officers and agents
against expenses actually and reasonably incurred in connection with the defense of any
Proceeding in which Client and/or its employees, members, directors, officers or agents are
made a party by reason of BioEnergy and/or its employees, members, managers, officers or
agents commit an act or omission that involves gross negligence, intentional misconduct or a
known violation of the law.
	 
	10.	 	Licenses. BioEnergy represents and warrants to Client that it has all licenses and
qualifications that it may be required to have by applicable law or any governmental entity in
order to perform the services hereunder.
	 
	11.	 	Taxes. Client shall be solely responsible for payment of all taxes and charges, now
or hereafter imposed (whether by federal, state, municipal or other public authority), by
reason of this Agreement or its performance, including but not limited to, sales or use taxes,
but excluding any income tax imposed upon the net profits of BioEnergy.
	 
	12.	 	Copyright License. BioEnergy will author written and visual equity marketing
materials, Power Point presentations, advertisements, “banker’s book”, training materials and
other literary works and audio visual works (the “Proprietary Information”) in fulfillment of
its duties hereunder. BioEnergy hereby grants Client a non-exclusive, perpetual right and
license, royalty free, to use the Proprietary Information for the development, financing and
construction of the Project only. Client shall not have or acquire any proprietary or other
right whatsoever in the Proprietary Information, except as provided herein, all of which
rights belong exclusively to BioEnergy. Client shall not use the Proprietary Information for
any purpose other than the development, financing and construction of the Project. Client
shall not without BioEnergy’s prior written consent use the Proprietary Information for the
development, financing and/or construction of additional ethanol plants. Client shall not
sell, assign, gift, sublicense or otherwise transfer to any third party any rights in the
Proprietary Information without the prior written consent of BioEnergy,





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	 	 	 	with the granting of
said consent to be in BioEnergy’s sole discretion.






	13.	 	Successors and Assigns. This Agreement shall be binding upon Client and BioEnergy,
their respective heirs, executors, administrators, successors in interest or assigns,
including without limitation any partnership, corporation or other entity into which Client
may be merged or by which it may be acquired (whether directly, indirectly or by operation of
law) or to which it may assign its rights under this Agreement. Notwithstanding the
foregoing, any assignment by BioEnergy of this Agreement or of any interest herein, or of any
money due to or to become due by reason of the terms hereof without the prior written consent
of Client shall be void, unless such assignment is made to Paul Casper or Jack Porter, or any
entity in which either Paul Casper, Jack Porter or BioEnergy own a majority ownership
interest.
	 
	14.	 	Waiver. The waiver by either party of its rights under this Agreement or the failure
of a party to promptly enforce any provision hereof shall not be construed as a waiver of any
subsequent breach of the same or any other covenant, term or provision.
	 
	15.	 	Notices. Any notice required to be given hereunder shall be in writing
and shall be deemed to be sufficiently served by either party on the other party if such
notice is delivered personally or is sent by certified or first class mail addressed as
follows, or such substitute street addresses as the parties may provide in writing:





	 	 	 	 	 
	 

	 	To BioEnergy:
	 	BioEnergy Capital Consultants, LLC
	 

	 	 	 	Attn: Paul Casper
	 

	 	 	 	44095 212th Street
	 

	 	 	 	Lake Preston, SD 57249
	 
	 	 	 	 
	 

	 	To Client:
	 	Mitchell County Research Group, LLC
	 

	 	 	 	P.O. Box 107
	 

	 	 	 	Mitchell County
	 

	 	 	 	Camilla, GA 31730







	16.	 	Applicable Law. This Agreement and all obligations created hereunder or
required to be created hereby shall be governed by and construed and enforced in accordance
with the laws of the State of Georgia, and the parties hereby consent to and agree that
jurisdiction and venue of any disputes relating to this Agreement shall be in a state or
federal court with proper jurisdiction in or nearest to Mitchell County, Georgia.
	 
	17.	 	Defaults. In the event of the failure of either of the parties to comply with any of
the terms and provisions of this Agreement, or in the event either party has violated any of
the warranties and representations made herein by that party, then such party shall be deemed
to be in default hereunder and the other party shall be given written notice of such
noncompliance and shall give the defaulting party seven (7) days from the date of such notice
within which to correct such noncompliance. If such default has not been corrected, or an
arrangement satisfactory to the complaining party has not been made by the end of the notice
period, then the complaining party may take whatever action is necessary, and exercise all
remedies available in order to protect the complaining party’s




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	 	 	rights under the terms and
conditions of this Agreement. The parties agree that the remedies set forth in this section 15
shall not be exclusive, but they shall be cumulative with all other rights and remedies
available, at law or in equity, to the parties. In the event of any dispute between the
parties resulting from this Agreement or any provisions hereunder, the prevailing party in any
such dispute shall be entitled to recover reasonable attorneys’ fees and such other costs
incurred therewith.






	18	 	Severability. In the event that any term, condition, or provision of this Agreement
is held to be invalid by any court of competent jurisdiction, such holding or holdings shall
not invalidate or make unenforceable any other term, condition or provision of this Agreement.
The remaining terms, conditions and provisions shall be fully severable, and shall be
construed and enforced as if such invalid term, condition or provision had never been inserted
in this Agreement initially.






	19.	 	Entire Agreement. This Agreement constitutes the entire Agreement between the parties
hereto with regard to the subject matter hereof, and there are no agreements, understandings,
specific restrictions, warranties or representations relating to said subject matter between
the parties other than those set forth herein or herein provided for. No amendment or
modification of this Agreement shall be valid or binding unless in writing and signed by the
party against whom such amendment or modification is to be enforced.






	20.	 	Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be considered an original document, but all of which shall be considered one and
the same agreement and shall become binding when one or more counterparts have been signed by
each of the parties.





(Signature Page Follows)



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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the Effective Date.




	 	 	 	 	 	 	 
	 

	 	 	 	[Handwritten: Mitchell County Research Group]	 
	 

	 	BIOENERGY CAPITAL
	 	           (Company Name)        
	 
	 

	 	CONSULTANTS, LLC	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By /s/ Paul Casper
	 	 	By /s/ Illegible Signature	 
	 

	 	 
	 	 	 	 
	 

	 	Paul Casper, Member
	 	 	Its [Illegible]	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	And	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	John T. Porter, Member	 	 	 	 






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SCHEDULE A




	 	 	 	 	 
	Equity goal
	 	$	58,950,000.00	 
	 
	 	 	 	 
	Debt financing goal
	 	$	71,900,790.00	 
	 
	 	 	 	 
	Total project goal
	 	$	130,850,790.00	 







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