Exhibit 10.7


 


MULTIPURPOSE
NOTE AND SECURITY AGREEMENT


 


	
   

  	
   

  	
  Officer No. 

  	
  073             C

  
	
  Barrower: “I”,
  “Me” and “My” Means Each Borrower Below Jointly and Severally

  	
  Lender: “You”
  and “Your” Means The Lender, its Successors and Assigns

  	
  Customer No.

  Loan No. 

  	
   

  95200

  
	
   

  	
   

  	
  Renewal of

  	
   

  
	
  Ethanol
  Grain Processors LLC

  	
  First
  Citizens National Bank

  	
  Date 

  	
  August 23,
  2005

  
	
   

  	
   

  	
  Loan Amount 

  	
  $1,000,000.00

  
	
  1918 McDonald Rd

  	
  100 W.
  Washington Avenue

  	
  Maturity
  Date 

  	
  August 25,
  2006

  
	
  Rives, TN 38253

  	
  Union City,
  TN 38261

  	
   

  	
   

  
	
   

  	
  (731)-895-2300

  	
   

  	
   

  



 


NOTE:  I promise to pay to you, or your order, at
your address above, the principal sum of:


One Million and 00/100 Dollars ($1,000,000.00)
together with interest at the rate of interest provided for hereinafter.


o    Single Advance:           I have received all of
this principal sum. No additional advances will be made under this note.


ý            Multiple Advance:       The
principal sum shown above is the maximum amount of principal I can borrow under
this note. As of this date I have received the amount of
                         
and future principal advances are contemplated.


ý    Conditions:   The
conditions for future advances are 2,800.00 MINIMUM DRAWS


ý            Open-End Credit:         You
and I agree that I can borrow up to the maximum amount of principal more than
one time. This option is subject to all other conditions and expirers no later
than August 25, 2006


o            Closed-End Credit:       You
and I agree that I may borrow up to the maximum only one time (and subject to
all other conditions).


THE PURPOSE OF THE LOAN IS:  Working Capital


 


INTEREST:  Interest accrues on a Actual/360 Day basis.


 


I agree to pay interest on the
principal balance owing from time to time as stated below.


o  Fixed
Rate:  I agree to pay interest at the
fixed, simple rate of
          % per year, from
          until paid in full.


ý 
Variable Rate:  I agree to pay
interest from 08/23/2005 at the initial simple rate of 5.850% per year. This
rate may change as stated below.


THE FUTURE RATE WILL BE .650 %
BELOW Wall Street Journal Prime Rate (“the Index”) as published in The Money
Tables of the Wall Street Journal.


THE INTEREST RATE ON THE NOTE
MAY CHANGE AS OFTEN AS daily (ASSUMING THERE IS A CHANGE IN THE INDEX).


A CHANGE IN THE INTEREST RATE
WILL TAKE EFFECT 1st business day after change date.


AN INCREASE IN THE INTEREST
RATE WILL CAUSE AN INCREASE IN THE PAYMENT AMOUNT.


 


 


Post-Maturity
Interest 
Interest will accrue after maturity on the unpaid balance of this note
on the same basis as interest accrues prior to maturity, unless a specific
post-maturity interest rate is agreed to in the next sentence.


o  If
checked, interest will accrue at the rate of           
% per year on the balance of this note not paid at maturity, including maturity
by acceleration.


o  If
checked, I agree to pay a minimum FINANCE CHARGE of $          .
If I pay this loan before you have carried that much in FINANCE CHARGES.


Delinquency and Default:  I agree to pay the costs you incur to collect
this note in the event of my default, including your attorney fees.


IF MY PAYMENT IS MORE THAN 15
DAYS LATE, I WILL PAY A LATE CHARGE EQUAL TO 5,000 % OF THE PAYMENT AMOUNT UP
TO $250.00.


o 
Additional Charges:  In addition
to interest. I o have paid o
agree to pay the following additional charges.
                         


 


 


Payments:  I agree to pay this note as follows:


THIS NOTE IS DUE ON DEMAND, IF
NO DEMAND THEN:


  This note is payable in 11 payments of all
accrued interest monthly beginning September 25, 2005, a final payment of
$1,002,518.75 a plus all accrued interest shall be due and payable on August 25,
2006, a means estimated


 


Additional
Terms: 
                                                                                


 


o  If checked this is a purchase money loan. You
may include the name of the seller on the check or draft for this loan.


Security:        I give you a
security interest in the following:


(1)  any property of mine,
whether I own is now or in the future, which is in your possession (This
includes, but is not limited to, property I give you for safekeeping,
collection or exchange, and all dividends and distributions from properly.);


(2)  the property described
below, together which all parts, accessories, repairs, improvements and
accessions to the property, and all proceeds and products from the property.


 


 


ý  If checked, this name is secured by a
separate GUARANTIES DATED 08-23-05


Description of
real estate if the above property is crops, timer, minerals (including oil or
gas) or futures:


 


	
  Name of record owner, if not me:

  o  If
  checked, this security agreement should be filed

  in the real estate records.

  	
   

  	
  Any person
  who signs within this box does so to give you a security interest in the
  property described above. This person does not promise to pay the note.

  
	
   

  	
   

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


	
  BORROWER - I
  ACKNOWLEDGE RECEIPT OF A COPY OF THIS NOTE AND AGREE TO THE TERMS AND
  CONDITIONS CONTAINED ON THIS PAGE AND ON PAGE 2 OF THIS NOTE.

  
	
  CO-SIGNER - UNDERSTAND
  AND THAT I HAVE FULL LIABILITY AND RESPONSIBILITY TO PAY THIS CONTRACT. YOU
  DON’T HAVE TO MAKE ANY DEMANDS ON ANY OTHER PERSON SIGNING THIS CONTRACT OR
  TAKE STEPS TO REPOSSESS ANY COLLATERAL BEFORE YOU ASK ME TO REPAY. I HAVE
  READ AND UNDERSTAND AND THIS ENTIRE CONTRACT.

  



 


	
   BORROWER
  Ethanol Grain Processors LLC

  	
   

  	
  DATE

  	
   

  	
    BORROWER

  	
   

  	
  DATE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   BY:  JAMES
  K. PATTERSON, Chief Executive 

  	
   

  	
  08-23-05

  	
   

  	
   

  	
   

  	
  DATE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   BORROWER
  Ethanol Grain Processors LLC 

  	
   

  	
  DATE

  	
   

  	
    BORROWER

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   BY:  MIKE
  MILLER, Treasurer

  	
   

  	
  08-23-05

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   CO-SIGNER

  	
   

  	
  DATE

  	
   

  	
    CO-SIGNER

  	
   

  	
  DATE

  
											



 





















 


ADDITIONAL TERMS OF THE SECURITY AGREEMENT


 


I also agree and promise as
follows:


1. ADDITIONAL
SECURITY AND INDEBTEDNESS: In addition to the collateral described on the page
1 hereof, this note is secured by any additions, replacements, accessions,
produces or proceeds, including proceeds of any Insurance payable as a result
of loss or damage to the collateral, and any similar after-acquired collateral.
However, the security interest shall not attach to household goods not purchased
with the proceeds of this loan or to other after-acquired consumer goods, with
the exception of accessions, unless such after-acquired consumer goods are
acquired within ten (10) days after you make this loan. Unless the collateral consists
of household goods, the security interest created hereby secures the prompt
repayment of all my present and future obligations to you, including, but not
limited to, any obligations arising as a result of any future advances,
overdrafts, or guarantees, or any expenses or costs incurred by you in
accordance with this note, the security agreement contained herein, or any other
agreement I have entered into with you guarantees, or any, expenses or costs
incurred by you in accordance with this note, the security agreement contained
herein, or any other agreement, I have entered into with you.


2. WARRANTY OF
RESIDENCY/LEGAL STATUS: [Check One] o
I warrant that I am an individual and a resident of the state of
                                  ,
ý I warrant that Borrower is a Corporation duly
organized, validly existing and in good standing under the laws of this state
of Tennessee. 


3. WARRANTY OF
TITLE: I warrant to you that I own the collateral free and clear of all liens
or security interests, other than the security interest created hereunder and
that I will defend the collateral against any asserted claims or demands by other
parties.


4.
PRESERVATION OF COLLATERAL: I will preserve and maintain the collateral and
keep the collateral in good condition and repair and will allow you to inspect
the collateral at any time.


5. TAXES,
ETC.: I will pay all taxes and other encumbrances on the collateral promptly,
and I will otherwise maintain the collateral free and clear of any liens, encumbrances
or other security interests.


6. SALE, ETC.
OF COLLATERAL: I will not sell, convey, lease or otherwise transfer the
collateral or any part of it without first obtaining written consent from you.
Any waiver of your right to object to an unauthorized sale or transfer shall
not constitute a waiver with respect to any subsequent unauthorized sale or
transfer.


7. INSURANCE:
I agree to maintain insurance on the collateral [ILLEGIBLE] and with companies
acceptable to you. You will be designated as loss payee on all insurance
policies, and I will promptly furnish you with insurance certificates or
policies which show your insured interests, I will be in default if I fail to
provide this insurance coverage, and you are hereby authorized, in such event,
to obtain sufficient insurance to cover the balance of my indebtedness to you
and add the expense of such insurance to the total of my obligation to you which
resulting amount shall then earn interest at the rate of interest then in
effect under this note. At your discretion, this increased amount may be
divided into installments, and I agree to make increased installment payments
upon the [ILLEGIBLE] payment interval required by this agreement. Your exercise
of this right, with the subsequent increase in my payment, shall not constitute
a new obligation or nullify or replace my original obligation, but shall be
simply a continuation of my obligations hereunder. You are not obligated to pay
any insurance premiums or to carry any form of insurance coverage on the
collateral. I hereby appoint you as my attorney-in-fact to endorse any
insurance proceeds or refund checks in order to collect the amount due on those
checks.


8. ACCOUNTS AS
COLLATERAL: If I have given you a security interest in my accounts receivable,
I agree not to settle or compromise any account for less than the full amount
of that account without first obtaining your written consent.


I agree to collect
my accounts receivable only until you instruct me to do otherwise, I agree to
keep the proceeds of all accounts receivable and any goods returned to me in
trust for your benefit, and I agree not to commingle them with any other
accounts or property of mine. Upon your request, I agree to remit those
proceeds to you.


9.  INVENTORY AS COLLATERAL:  If I have given you a security interest in my
Inventory, I agree to dispose of it only in the ordinary course of business for
the fair market value of the property, or for some other price that we have
mutually agreed upon.


10.  FARM PRODUCTS AS COLLATERAL:  If I have given you a security interest in my
farm products, I agree to provide you with a written list of the buyers,
commission merchants or selling agents to or through whom I may sell those farm
products. The terms used in this paragraph shall have the meaning attributed to
them under the Food Security Act of 1965.


11.  REMEDIES UNDER THE SECURITY AGREEMENT:  You have the following rights under this Security
Agreement:


(1)   You may notify account
debtors of your security interest in my accounts receivable and direct the
account debtor to remit to you or someone else that you designate, rather than
to me; you may endorse any checks or other items received from those account
debtors;


(2)   You may note the fact of
your security interest in the collateral on the face of any chanel paper or
[ILLEGIBLE] covered by this or any other security agreement I have signed with
you;


(3)   With respect to any collateral
covered hereby, you may demand, collect, endorse, receive, give receipt for,
compromise, settle and handle any suits or other proceedings involving the
collateral in my name;


(4)   You may take any steps you
feel necessary in order to take possession of or protect the collateral,
including performing any part of a contract or endorsing that contract in my
name; and 


(5)   You may make any necessary entries
to my business records showing the existence of the security interest.


12.  PAYMENTS MADE BY YOU:  If I fail to pay any charges that I am
obligated to pay to preserve or protect the collateral, you are authorised to
make those payments on my behalf and treat those payments as advances made
under the terms of this note and add the total of those advances to the unpaid
principal balance of this note, the total of which will then be secured by the
collateral.


13. PURCHASE
MONEY SECURITY INTEREST:  With respect to
purchase money security interest arising under this security agreement:


(1)   Payments made on
non-purchase money loans secured by this agreement will not be deemed
applicable to any purchase money loans, and 


(2)   Payments made on any
purchase money loan will be applied first to any non-purchase money portion of
said loan, with the remaining balance to be applied to the purchase money
obligations in the order in which the items of collateral were acquired. A
purchase money loan means a loan used in whole or in part to acquire the
collateral which secures the loan and any execution, renewal, consolidation of
refinancing of such loans.


14.  REMEDIES UNDER THE SECURITY AGREEMENT:  I will be in default under the terms of the
security agreement if I default under the terms of any note that this agreement
secures or if I fail to keep any promise contained in this agreement. If I
default, you shall have all of the rights and remedies available to a secured
creditor under the Tennessee Uniform Commercial Code. I will be obligated to
make the property available to you at a reasonably convenient place and time.  I agree that you are then authorised to take
possession of the collateral and sell it as provided under the terms of the Tennessee
Uniform Commercial Code. I agree that written notice sent to my address on the
face of the note by first class mail ten (10) days in advance of any such sale
will be reasonable notice.


 


15. FILING: I authorize you to file financing statements describing the
collateral and/or any agricultural liens or other statutory liens held by you,
and I agree that a carbon, photographic, or other reproduction of this
agreement may be used as a financing statement.


 


ADDITIONAL TERMS OF THE NOTE


 


I also agree and promise as
follows:


1. PAYMENTS:
Each payment that I make under the terms of this note will be applied to
collection costs, late charges, fees, other costs or expenses that I must pay
under this note or other loan documents, accrued interest and principal in an
order determined in accordance with applicable law.


2. RENEWALS OR
EXTENSIONS: I agree that you may renew or extend the maturity of this note one
or more times, in your sole discretion, without affecting my liability or that
of any other party responsible for the repayment of this note, and I further
agree that you may renew or extend the maturity of this note without in any way
affecting your right to or lien upon any property given as collateral for this
note.


3. INDEX RATE:
If the interest rate on this note is established at a rate which varies with
respect to an index rate you establish, that index rate will determine the rate
on this note.  I understand that the
index rate is not necessarily the lowest rate that you charge on your
loans.  I also understand that under no
circumstances will the interest rate charged on this note exceed the maximum
rate allowed by law.


4. SINGLE
ADVANCE LOANS: If this loan is made as a single advance, that one advance is
the only advance anticipated.  However,
you may add any amounts to this principal balance of this note to the extent
that those amounts represent payments made as provided in the paragraph above
entitled “PAYMENTS MADE BY YOU” or as otherwise provided for herein or in any
other agreement I have made with you.


5. MULTIPLE
ADVANCE LOAN: If the loan is to be made in multiple advances, you and I anticipate
that more than one advance will be made.


On extensions
of closed-end credit, repayments of a portion on the principal balance of the
note will not enable me to obtain additional credit.


On extensions
of open-end credit, repayment of a portion on the principal balance of the note
will entitle me to obtain additional credit, unless the open-end credit
commitment evidenced by this note has expired or has been terminated by
you.  You will not be obligated to make
an advance to the extent that such an advance would cause the unpaid principal
balance of the note to exceed the maximum face amount of the note.  You have no obligation to make such an
advance, even if you occasionally choose to do so.


6. INTEREST:
Each advance made under the terms of this note will earn interest only from the
date that I receive the advance.  The
Interest rate provided for in this note at any point in time will apply to the entire
principal balance outstanding at the time.


7. POST
MATURITY RATE:  For purposes of this note
the term “maturity” shall mean the following:


(1) If the note is a “demand” note, the date you make your demand or
the date that payment of the note is accelerated by you, whichever is earlier.


(2) If the note is a “demand” note, with a stated alternate maturity
date, the date of you demand or the alternative maturity date or the date that
you accelerate payment of the note, whichever date is earlier; or


(3) In all other cases, the date set for the last regularly scheduled
payment of principal or the date that you accelerate payment of the note,
whichever date is earlier.


8. SET-OFF:
You have the right to set-off my deposit accounts and any other rights that I
may have to receive the payment of money from you. You may exercise your right
of set-off without notice to me and without regard to the type or value of collateral
or the existence of any guaranty for or other agreement to pay this note. You
will not be responsible for the dishonor of any check when that dishonor occurs
as a result of your exercise of the right of set-off against my account.


9. DEFAULT: I
will be in default if any of the following events occurs:


(1)   I fail to make a required
payment when due;


(2)   I breach any promise I have
made to you under the terms of this note, the security agreement (if
applicable) or any other loan or agreement with you;


(3) Any representation, warranty, promise or statement that I have made
to you proves to be (or at the time it was made or given was) materially false
or incorrect;


(4) I die, become insolvent, or initiate bankruptcy or similar
proceedings, or am adjudged a bankrupt.


(5) Any of my property in which you have a lien or security interest is
attached or otherwise taken by another creditor, including any garnishment of my
accounts with you;


(6) I fail to maintain insurance covering the collateral;


(7) The maturity of any indebtedness I owe to others is accelerated as
a result of the occurrence of a default under this or any other agreement;


(8) You at any time believe that the prospect for repayment of any
portions of the indebtedness secured hereby is significantly impaired.


10. LENDER’S REMEDIES: Upon default, you may at your option, do one or
more of the following:


(1) You may, without notice, accelerate the maturity of this note and
require that all unpaid charges, interest and principal balances be immediately
due and payable;


(2) You may exercise your right of set-off against any right I have to
receive payment of money from you;


(3) You may exercise any rights or remedies you have under any other
agreement which secures this note;


(4) You may demand additional security or obligors to insure repayment
of this note;


(5) You may exercise all the rights of a secured party under the
Tennessee Uniform Commercial Code, and you may make use of any other remedy
available to you under any other state or federal statute.


11. WAIVER: I
hereby waive presentment, demand for payment, protest and notice of dishonor,
and I consent to any extension you may grant either before or after maturity of
this note. I consent to any substitution, release or non-perfection of security
interest in the collateral and to release or covenant not to sue of any co-signer
or guarantor. No waiver of a default shall be deemed a waiver of any other or later
default. If under the terms of this security agreement a lien would be created
in a principal dwelling used by me or any other persons as a home, you waive
the security interest so created unless you have given an appropriate
opportunity to rescind and the owner of the property has not exercised that
right.


12. ATTORNEY’S
FEES: If this note is placed in the hands of an attorney for collection, I
agree to pay all attorney’s fees, court costs and other legal expenses.


13. GOVERNING
LAW: This note shall be governed by the laws of the State of Tennessee.


 


“NOTICE TO COSIGNER: See attached Notice to Consignor”.


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  JAMES K PATTERSON

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  308 WINDEMERE WOODS DR

  	
   

  	
   

  
	
  NASHVILLE, TN 37215

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED NOTES/AGREEMENTS:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall be limited to the following described
promissory notes and agreements between Borrower and Lender evidencing the
indebtedness, together with all interest and all of Lender’s expenses and costs
(including, but not limited to, attorney’s fees and other costs incurred by
Lender to collect the indebtedness and/or to protect, maintain, or operate any
collateral given as security for the indebtedness, or preserve the priority of
Lender’s lien thereon or security Interest therein) incurred in connection with
indebtedness including any amendments, extensions, modifications, renewals,
replacements or substitutions thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  JAMES K PATTERSON

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY.  Guarantor’s
Obligations are absolute and continuing and shall not be affected or impaired
if Lender repeatedly and unconditionally amends, renews, extends, compromises,
exchanges, falls to exercise, or perfects rights in, impairs or releases any
collateral or any of the indebtedness owed by any Borrower, co-guarantor, or
any third party (event if such Impairs Guarantor’s right of subrogation) or any
of Lender’s rights against any Borrower, co-guarantor, third party, or
collateral. In addition, the Obligations shall not be affected or impaired by
the discharge (including, but not limited to, any inability to collect a
deficiency judgment against Borrower, Guarantor or a third party) death,
Incompetency, termination, dissolution, Insolvency, business cassation, or
other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY.  Guarantor’s Obligations under this Guaranty
are direct and unconditional and may be enforced without requiring Lender to
exercise, enforce, or exhaust any right or remedy against any Borrower,
co-guarantor, third party, or collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT. Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION. The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender and
immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION. Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree that
time is of the essence to the performance of any, and all, of the Guarantor,
Obligations under the Guaranty. This is a guaranty of payment and not of
collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  Flavius
  Barker

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  EASY VALLEY ROAD, P O
  BOX 55

  	
   

  	
   

  
	
  DUNLAP, TN 37237

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s
liabilities and obligations under this Guaranty (“Obligations”) shall be
limited to the following described promissory notes and agreements between
Borrower and Lender evidencing the indebtedness, together with all interest and
all of Lender’s expenses and costs (including, but not limited to, attorney’s
fees and other costs incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
Interest therein) incurred in connection with indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  FLAVIUS BARKER

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive notice
of the acceptance of this Guaranty; notice of present and future extensions of
credit and other financial accommodations by Lender to any Borrower; notice of
presentment for payment, demand, protest, dishonor, default, and nonpayment pertaining
to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any monies,
instruments, of other remittances to be applied against Borrower’s obligations
to Guarantor, Guarantor will hold these funds in trust for Lender and
immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities, including
contingent, subordinate and unliquidated liabilities, that Guarantor has
sufficient cash flow to meet debts as they mature, and is paying its debts as
they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  TOM W
  WADE, JR

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  2022 STONEWALL OR

  	
   

  	
   

  
	
  UNION CITY, TN 382615724

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s
liabilities and obligations under this Guaranty (“Obligations”) shall be
limited to the following described promissory notes and agreements between
Borrower and Lender evidencing the indebtedness, together with all interest and
all of Lender’s expenses and costs (including, but not limited to, attorney’s
fees and other costs incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
Interest therein) incurred in connection with indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES GUARANTOR
HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS GUARANTY
INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS EXECUTED
THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY FAILURE
BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  TOM W WADE, JR

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender
and immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  JAMES BYFORD

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  922 RALSTON ROAD

  	
   

  	
   

  
	
  MARTIN, TN 38237

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s
liabilities and obligations under this Guaranty (“Obligations”) shall be
limited to the following described promissory notes and agreements between
Borrower and Lender evidencing the indebtedness, together with all interest and
all of Lender’s expenses and costs (including, but not limited to, attorney’s
fees and other costs incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
Interest therein) incurred in connection with indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  JAMES BYFORD

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender
and immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the Guarantor,
Obligations under the Guaranty. This is a guaranty of payment and not of
collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations existing
prior to the time of actual receipt of such notice by Lender, any extensions or
renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  BAXTER
  SANDERS

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  1034 TROY HICKMAN RD

  	
   

  	
   

  
	
  TROY, TN 382603625

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s
liabilities and obligations under this Guaranty (“Obligations”) shall be
limited to the following described promissory notes and agreements between Borrower
and Lender evidencing the indebtedness, together with all interest and all of
Lender’s expenses and costs (including, but not limited to, attorney’s fees and
other costs incurred by Lender to collect the indebtedness and/or to protect,
maintain, or operate any collateral given as security for the indebtedness, or
preserve the priority of Lender’s lien thereon or security Interest therein)
incurred in connection with indebtedness including any amendments, extensions,
modifications, renewals, replacements or substitutions thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  BAXTER SANDERS

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future extensions
of credit and other financial accommodations by Lender to any Borrower; notice
of presentment for payment, demand, protest, dishonor, default, and nonpayment pertaining
to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s obligations
to Guarantor, Guarantor will hold these funds in trust for Lender and
immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  PHILLIP
  PINION

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  726 NELSON SY

  	
   

  	
   

  
	
  UNION CITY, TN 38261

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different purposes)
including, but not limited to, the promissory notes and agreements described
below evidencing the indebtedness together with all interest and all of Lender’s
expenses and costs (including, but not limited to, attorney’s fees and other
coats incurred by Lender to collect the indebtedness and/or to protect,
maintain, or operate any collateral given as security for the indebtedness, or
preserve the priority of Lender’s lien thereon or security interest therein)
incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s liabilities
and obligations under this Guaranty (“Obligations”) shall be limited to the
following described promissory notes and agreements between Borrower and Lender
evidencing the indebtedness, together with all interest and all of Lender’s
expenses and costs (including, but not limited to, attorney’s fees and other
costs incurred by Lender to collect the indebtedness and/or to protect,
maintain, or operate any collateral given as security for the indebtedness, or
preserve the priority of Lender’s lien thereon or security Interest therein)
incurred in connection with indebtedness including any amendments, extensions,
modifications, renewals, replacements or substitutions thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  PHILLIP PINION

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without resorting
to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender
and immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and releases
the Borrower from all “claims” (as defined in Section 101(5) of the
Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  MIKE
  MILLER

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  516 N 7TH ST

  	
   

  	
   

  
	
  OBION, TN 382404800

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the indebtedness,
or preserve the priority of Lender’s lien thereon or security interest therein)
incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and costs
incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED
NOTES/AGREEMENTS:  Guarantor’s
liabilities and obligations under this Guaranty (“Obligations”) shall be
limited to the following described promissory notes and agreements between
Borrower and Lender evidencing the indebtedness, together with all interest and
all of Lender’s expenses and costs (including, but not limited to, attorney’s
fees and other costs incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
Interest therein) incurred in connection with indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the same
  collection methods against you that can be used against the Borrower, such as
  using you, garnishing your wages, etc. If this debt is ever in default, that
  fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  MIKE MILLER

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender
and immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or similar
right against the Borrower, any co-guarantor, any third party or any collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS:


 





















 


First Citizens National Bank


 


100 W. Washington Avenue


Union City, TN 38261


 


CONTINUING GUARANTY


 


	
  GUARANTOR:

  	
   

  	
  BORROWER

  
	
  WILLIAM
  LATIMER

  	
   

  	
  Ethanol
  Grain Processors LLC

  
	
   

  	
   

  	
   

  
	
  1312 HONEYSUCKLE DRIVE

  	
   

  	
   

  
	
  UNION CITY, TN 38261

  	
   

  	
  1918 McDonald Rd

  
	
   

  	
   

  	
  Rives, TN 38253

  



 


1.     CONSIDERATION.  This
Guaranty is being executed to induce Lender indicated above to enter into one
or more loans or other financial accommodations with or on behalf of Borrower.


 


2.     GUARANTY. 
Guarantor hereby unconditionally guarantees the prompt and full payment
and performance and promises to pay all of Borrower’s present and future, joint
and /or several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants (cumulatively “Indebtedness”)
to Lender as follows:


 


o    UNLIMITED: 
Guarantor’s liabilities and obligations under this Guaranty (“Obligations”)
shall be unlimited and shall include, all present and future written agreements
between Borrower and Lender (whether executed for the same or different
purposes) including, but not limited to, the promissory notes and agreements
described below evidencing the indebtedness together with all interest and all
of Lender’s expenses and costs (including, but not limited to, attorney’s fees
and other coats incurred by Lender to collect the indebtedness and/or to
protect, maintain, or operate any collateral given as security for the
indebtedness, or preserve the priority of Lender’s lien thereon or security
interest therein) incurred in connection with the indebtedness including any
amendments, extensions, modifications, renewals, replacements or substitutions
thereto.


 


ý    LIMITED TO AN AMOUNT:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall include all present and future written
agreements between Borrower and Lender (whether executed for the same or
different purposes) including, but not limited to, the promissory notes and
agreements described below evidencing the indebtedness, but shall be limited to
the principal amount of ONE HUNDRED TWENTY-FIVE THOUSAND DOLLARS Dollars
($125,000,00), together with all interest and all of Lender’s expenses and
costs incurred in connection with the indebtedness including any amendments,
extensions, modifications, renewals, replacements or substitutions thereto.
This limitation on the liability of Guarantor shall not apply to any costs
(including, but not limited to, attorney’s fees) incurred by Lender pursuant to
paragraph 21.


 


ý    LIMITED TO THE FOLLOWING DESCRIBED NOTES/AGREEMENTS:  Guarantor’s liabilities and obligations under
this Guaranty (“Obligations”) shall be limited to the following described
promissory notes and agreements between Borrower and Lender evidencing the
indebtedness, together with all interest and all of Lender’s expenses and costs
(including, but not limited to, attorney’s fees and other costs incurred by
Lender to collect the indebtedness and/or to protect, maintain, or operate any
collateral given as security for the indebtedness, or preserve the priority of
Lender’s lien thereon or security Interest therein) incurred in connection with
indebtedness including any amendments, extensions, modifications, renewals,
replacements or substitutions thereto:


 


	
  INTEREST

  RATE

  	
   

  	
  PRINCIPAL AMOUNT/

  CREDIT LIMIT

  	
   

  	
  FUNDING

  DATE

  	
   

  	
  MATURITY

  DATE

  	
   

  	
  CUSTOMER

  NUMBER

  	
   

  	
  LOAN

  NUMBER

  	
   

  
	
  5.850

  	
   

  	
  1,000,000.00

  	
   

  	
  08/23/2005

  	
   

  	
  08/25/2006

  	
   

  	
   

  	
   

  	
  95200

  	
   

  



 




	
  NOTICE TO GUARANTOR

  
	
   

  
	
  You are being asked to guarantee this debt.
  Think carefully before you do so. If the Borrower doesn’t pay the debt, you
  will have to. Be sure you can afford to pay if you have to, and that you want
  to accept this responsibility.

  
	
   

  
	
  You may have to pay up to the full amount
  of the debt if the Borrower does not pay. You may also have to pay late fees
  or collections costs, which increases this amount.

  
	
   

  
	
  The Lender can collect this debt from you
  without first trying to collect from the Borrower. The Lender can use the
  same collection methods against you that can be used against the Borrower,
  such as using you, garnishing your wages, etc. If this debt is ever in
  default, that fact may become a part of your credit record.

  
	
   

  
	
  This notice is not the contract that makes
  you liable for this debt.

  






 


GUARANTOR ACKNOWLEDGES
GUARANTOR HAS READ, UNDERSTANDS, AND AGREES TO THE TERMS AND CONDITIONS OF THIS
GUARANTY INCLUDING THE TERMS AND CONDITIONS ON THE REVERSE SIDE, GUARANTOR HAS
EXECUTED THIS GUARANTY WITH THE INTENT TO BE LEGALLY SOUND NOTWITHSTANDING ANY
FAILURE BY ANY OTHER PERSON TO SIGN THIS GUARANTY.


 


 


	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  08-23-05            

  	
   

  	
        

  
	
  WILLIAM LATIMER

  	
  Date      

  	
   

  	
  Date      

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GUARANTOR:

  	
   

  	
  GUARANTOR:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date      

  	
   

  	
  Date      

  
				



 





















 


3.     ABSOLUTE
AND CONTINUING NATURE OF GUARANTY. 
Guarantor’s Obligations are absolute and continuing and shall not be
affected or impaired if Lender repeatedly and unconditionally amends, renews,
extends, compromises, exchanges, falls to exercise, or perfects rights in,
impairs or releases any collateral or any of the indebtedness owed by any Borrower,
co-guarantor, or any third party (event if such Impairs Guarantor’s right of
subrogation) or any of Lender’s rights against any Borrower, co-guarantor,
third party, or collateral. In addition, the Obligations shall not be affected
or impaired by the discharge (including, but not limited to, any inability to
collect a deficiency judgment against Borrower, Guarantor or a third party)
death, Incompetency, termination, dissolution, Insolvency, business cassation,
or other financial deterioration of any Borrower, Guarantor, or third party.


 


4.     DIRECT
AND UNCONDITIONAL NATURE OF GUARANTY. 
Guarantor’s Obligations under this Guaranty are direct and unconditional
and may be enforced without requiring Lender to exercise, enforce, or exhaust
any right or remedy against any Borrower, co-guarantor, third party, or
collateral.


 


5.     WAIVER
OF NOTICE.  Guarantor hereby waive
notice of the acceptance of this Guaranty; notice of present and future
extensions of credit and other financial accommodations by Lender to any
Borrower; notice of presentment for payment, demand, protest, dishonor, default,
and nonpayment pertaining to the Indebtedness and this Guaranty.


 


6.     DEFAULT.  Guarantor will be in default under this
Guaranty in the event that any Guarantor:


(a)   fails
to make any payment under this Guaranty or any other obligation to Lender when
due (whether such amount is due at maturity, by acceleration, or otherwise);


(b)   fails
to perform any obligation or breaches any warranty or covenant to Lender
contained in any loan document or this Guaranty or any other present or future
promissory note or written agreement;


(c)   provides
or causes any false or misleading signature or representation to be provided to
Lender;


(d)   has
a garnishment, judgment, tax levy, attachment or lien entered or served against
any Guarantor, or any of their property;


(e)   dies,
becomes legally incompetent, is dissolved or terminated, ceases to operate its
business, becomes insolvent, makes an assignment for the benefit of creditors,
or becomes the subject of any bankruptcy, insolvency or debtor rehabilitation
proceedings; or


(f)    causes
Lender, in good faith, to believe the prospect of payment or performance is
impaired.


 


7.     RIGHTS
OF LENDER ON DEFAULT.  If there is a
default under this Guaranty, Lender shall be entitled to exercise one or more
of the following remedies without notice or demand (except as required by law):


(a)   to
declare Guarantor’s Obligations under this Guaranty immediately due and payable
in full;


(b)   to
collect the outstanding Obligations under this Guaranty with or without
resorting to Judicial process;


(c)   to
set off Guarantor’s Obligations against any amounts due to Guarantor, including,
but not limited to monies, instruments, and deposit accounts maintained with
Lender; and 


(d)   to
exercise all other rights available to Lender under any other written agreement
or applicable law.


Lender’s rights are cumulative and may be exercised together, separately,
and in any order, Lender’s remedies under this paragraph are in addition to those
available at common law, including, but not limited to, the right to set-off.


 


8.     SUBORDINATION.  The payment of any present or future
Indebtedness of Borrower to Guarantor will be postponed and subordinated to the
payment in full of any present on future indebtedness of Borrower to Lender
during the term of this Agreement. In the event the Guarantor receives any
monies, instruments, of other remittances to be applied against Borrower’s
obligations to Guarantor, Guarantor will hold these funds in trust for Lender
and immediately endorse or assign (if necessary) and deliver these monies,
instruments and other remittances to Lender, Guarantor agrees that Lender shall
be preferred to Guarantor in any assignment for the benefit of creditors in any
bankruptcy, insolvency, liquidation, or reorganization proceeding commenced by
or against Borrower in any federal or state court.


 


9.     INDEPENDENT
INVESTIGATION.  Guarantor’s execution
and delivery to Lender of this Guaranty is based solely upon Guarantor’s
Independent Investigation of Borrower’s financial condition and not upon any
written or oral representation of Lender in any manner, Guarantor assumes full
responsibility for obtaining and additional Information regarding Borrower’s
financial condition and Lender shall not be required to furnish Guarantor with
any information of any kind regarding Borrower’s financial condition.


 


10.  ACCEPTANCE
OF RISKS.  Guarantor acknowledges the
absolute and continuing nature of this Guaranty and voluntarily accepts the
full range of risks associated herewith including, but not limited to, the risk
that Borrower’s financial condition shall deteriorate or, if this Guaranty is
unlimited, the risk that Borrower shall incur additional indebtedness to Lender
in the future.


 


11.  SUBROGATION.  Guarantor hereby irrevocably waives and
releases the Borrower from all “claims” (as defined in Section 101(5) of
the Bankruptcy Code) to which Guarantor is or would, at any time be entitled by
virtue of its obligations under this Guaranty, including, without limitation,
any right of subrogation (whether contracted, under Section 509 of the
Bankruptcy Code or otherwise), reimbursement, contribution, exoneration or
similar right against the Borrower, any co-guarantor, any third party or any
collateral.


 


12.  APPLICATION
OF PAYMENTS.  Lender will be entitled
to apply any payments or other monies received from Borrower, any third party,
or any collateral against Borrower’s present or future indebtedness in any
order.


 


13.  ESSENCE
OF TIME.  Guarantor and Lender agree
that time is of the essence to the performance of any, and all, of the
Guarantor, Obligations under the Guaranty. This is a guaranty of payment and
not of collection.


 


14.  TERMINATION.  This Guaranty shall remain in full force
and effect until Lender executes and delivers to Guarantor a written release
thereof, Notwithstanding the foregoing, Guarantor shall be entitled to
terminate any unlimited guaranty of Borrower’s future indebtedness to Lender
following any anniversary of this Guaranty by providing Lender with sixty (60)
or more days’ written notice of such termination by hand-delivery or certified
mail. Notice shall be deemed given when received by Lender, Such notice of
termination shall not affect or impair any of the agreements and Obligations of
the Guarantor under this Guaranty with respect to any of the Obligations
existing prior to the time of actual receipt of such notice by Lender, any
extensions or renewals thereof, and any interest on any of the foregoing.


 


15.  ASSIGNMENT.  Guarantor agrees not to assign any of
Guarantor’s rights or Obligations described in this Guaranty without Lender’s
proper written consent which may be withheld by Lender in its sole discretion.
Guarantor agrees that Lender is entitled to assign some or all of its rights
and remedies described in this Guaranty without notice to or the prior consent
of Guarantor in any manner. Unless the Lender shall otherwise consent in
writing, the Lender shall have an unimpaired right prior and superior to that
of any assignee, to enforce this Guaranty for the benefit of the Lender, as to
those Obligations that the Lender has not assigned.


 


16.  MODIFICATION
AND WAIVER.  The modification or
waiver of any of Guarantor’s Obligations or Lender’s rights under this Guaranty
must be contained in a writing signed by Lender, Lender may delay in exercising
or fail to exercise any of its rights without causing a waiver of those rights.
A waiver on one occasion shall not constitute a waiver on any other occasion.


 


17.  SUCCESSORS
AND ASSIGNS.  This Guaranty shall be
binding upon and inure to the benefit of Guarantor and Lender and their
respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees, and devisers.


 


18.  NOTICE.  Any notice or other communication to be
provided under this Guaranty shall be in writing and sent to the parties at the
addresses described in this Guaranty or such other addresses as the parties may
designate in writing from time to time.


 


19.  SEVERABILITY.  If any provision of this Guaranty is
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.


 


20.  APPLICABLE
LAW.  This Guaranty shall be governed
by the laws of the state indicated in Lender’s address. Unless applicable law
provides otherwise, Guarantor consents to the jurisdiction and venue of any
court located in such state selected by Lender, in its discretion, in the event
of any legal proceeding under this Guaranty.


 


21.  COLLECTION
COSTS.  To the extent permitted by
law, Guarantor agrees to pay Lender’s reasonable fees and costs, including, but
not limited to, fees and costs of attorneys and other agents (including without
limitation paralegals, clerks and consultants) whether or not any attorney or
agent is an employee of Lender, which are incurred by Lender in collecting any
amount due or enforcing any right or remedy under this Agreement, including,
but not limited to, all fees and costs incurred on appeal, in bankruptcy, and
for post-judgment collection actions, and whether or not suit is brought.


 


22.  REPRESENTATIONS
OF GUARANTOR.  Guarantor acknowledges
receipt of reasonably equivalent value in consideration for the execution of
this Guaranty and represents that, after giving effect to this Guaranty, the
fair market value of Guarantor’s assets exceeds Guarantor’s total liabilities,
including contingent, subordinate and unliquidated liabilities, that Guarantor
has sufficient cash flow to meet debts as they mature, and is paying its debts
as they mature, and that Guarantor does not have unreasonably small capital.


 


23.  MISCELLANEOUS.  Guarantor will provide Lender with a
current financial statement upon request. All references to Guarantor in this
Guaranty shall include all persons signing this Guaranty, if there is more than
one Guarantor, their obligations under this Guaranty shall be joint and
several. This Guaranty represents the complete and integrated understanding
between Guarantor and Lender regarding the terms hereof.


 


24.  JURY
TRIAL WAIVER.  LENDER AND GUARANTOR
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY CIVIL ACTION ARISING OUT OF,
OR BASED UPON, THIS GUARANTY.


 


25.  ADDITIONAL
TERMS: