Exhibit 10.1





Exhibit 10.1




THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFEREED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED OR
ENCUMBERED UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL
OR OTHERWISE TRANSFER SUCH SECURITY ONLY (A) TO THE ISSUER OF THIS SECURITY OR AN AFFILIATE OF THE
ISSUER, OR (B) IF THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”) TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER”
AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A.



NOTWITHSTANDING ANYTHING IN THIS NOTE TO THE CONTRARY, ANY RIGHT TO PAYMENT HEREUNDER, THE LIEN OR
SECURITY INTEREST GRANTED TO THE HOLDER, THE EXERCISE OF ANY RIGHT OR REMEDY BY THE DESIGN-BUILDER
HEREUNDER, AND EACH PROVISION OF THIS NOTE ARE SUBJECT TO THE PROVISIONS OF THE SUBORDINATION
AGREEMENT, DATED ON OR ABOUT THE DATE HEREOF, AMONG THE HOLDER, THE OBLIGOR AND WESTLB AG, NEW YORK
BRANCH (THE “SUBORDINATION AGREEMENT’). IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF
THE SUBORDINATION AGREEMENT AND THIS NOTE, THE TERMS OF SUBORDINATION AGREEMENT SHALL GOVERN AND
CONTROL.



SOUTHWEST GEORGIA ETHANOL, LLC




SUBORDINATED PROMISSORY NOTE DUE JUNE 30, 2011




			
	 
	 	 
	$3,977,544.83
	 	June 30, 2009






FOR VALUE RECEIVED, the undersigned, SOUTHWEST GEORGIA ETHANOL, LLC, a Georgia limited liability
company (the “Obligor”), hereby promises to pay to the order of FAGEN, INC., a Minnesota
corporation, or its permitted assigns (as the case may be, the “Holder”), the principal sum
of THREE MILLION NINE HUNDRED SEVENTY-SEVEN THOUSAND FIVE HUNDRED FORTY-FOUR DOLLARS AND
EIGHTY-THREE CENTS ($3,977,544.83), with interest on the outstanding principal amount as provided
below.



Principal Payments.





(i) The Obligor will make a principal payment in the amount of five hundred thousand
dollars ($500,000) not later than the date that is ninety (90) days after the date first set
forth above.




(ii) The Obligor will make additional payments of principal on the dates and in the
amounts provided in Schedule B attached hereto.


 


 









 






(iii) All remaining unpaid principal (if any) and accrued and unpaid interest due
hereunder shall be payable on or prior to June 30, 2011 (the “Maturity Date”).



Interest. The Obligor promises to pay to the order of the Holder cash interest on the
principal amount hereof at a rate per annum equal to four percent (4%) through June 30, 2010, and
at a rate per annum equal to eight percent (8%) thereafter. Interest shall be payable in arrears on
a quarterly basis on the dates provided in Schedule A attached hereto and shall be
calculated on the basis of a year of 365 days and for the number of days actually elapsed.



Prepayment. The Obligor shall have the right to pay the principal hereof in whole or in
part without penalty at any time prior to the Maturity Date.



No Waiver. No failure or delay by the Holder in exercising any right, power or privilege
under this Note shall operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law. No course of dealing between the Obligor and the Holder shall
operate as a waiver of any rights by the Holder.



Waiver of Presentment and Notice of Dishonor. The Obligor and all endorsers, guarantors
and other parties that may be liable under this Note hereby waive presentment, dishonor, demand,
protest and notice of presentment, notice of protest and notice of dishonor of any of the
obligations created under this Note and each and every notice of any kind in connection with the
delivery, acceptance, performance and enforcement of this Note, and, to the fullest extent
permitted by law, all rights to assert any statute of limitations to an action hereunder.



Place of Payment. All payments of principal of this Note and the interest due thereon
shall be made by wire transfer in accordance with the Holder’s wire transfer instructions to be
delivered by the. Holder to the Obligor in advance of the time of payment or at such other place
and by such other means as the Holder may from time to time designate in writing to the Obligor.



Events of Default. The entire unpaid principal amount of this Note and the interest due
thereon shall, at the option of the Holder exercised by written notice to the Obligor, forthwith
become and be due and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived, if any one or more of the following events (herein called
“Events of Default”) shall have occurred (for any reason whatsoever and whether such
happening shall be voluntary or involuntary or come about or be effected by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body) and be continuing at the time of such
notice:




(i) the Obligor’s failure to pay any principal or interest on this Note when
such principal or interest becomes due and payable;




(ii) the Obligor’s failure to pay, or an admission in writing of its inability or
unwillingness to pay, debts as they become due;


 


 









 






(iii) the Obligor’s application for, consent to, or acquiescence in, the appointment of
a trustee, receiver, sequestrator or other custodian for the Obligor or a substantial
portion of the Obligor’s property, or the Obligor’s making a general assignment for the
benefit of creditors;




(iv) the Obligor’s permitting or suffering to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any bankruptcy or
insolvency law concerning the Obligor or any of its assets, or any dissolution, winding up
or liquidation proceeding concerning the Obligor or any of its assets; or




(v) the Obligor’s taking any action authorizing, or in furtherance of, any of the
foregoing.



Remedies. In case any one or more of the Events of Default specified above shall have
occurred and be continuing, the Holder may proceed to protect and enforce its rights either by suit
in equity and/or by action at law, whether for the specific performance of any covenant or
agreement contained in this Note or in aid of the exercise of any power granted in this Note, or
the Holder may proceed to enforce the payment of all sums due upon this Note or to enforce any
other legal or equitable right of the Holder.



All rights and remedies of the Holder under this Note are in addition to all rights and remedies
given to the Holder contained in any other agreement, instrument or document or available to the
Holder at law or in equity. All such rights and remedies are cumulative and not exclusive or
exhaustive and may be exercised successively or concurrently. No exercise of any right or remedy
shall be deemed an election of remedies and preclude exercise of any other right or remedy.



Severability. In the event that one or more of the provisions of this Note shall for any
reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Note, but this Note shall be
construed as if such invalid, illegal or unenforceable provision had never been contained herein.



Governing Law. This Note and the rights and obligations of the Obligor and the Holder shall
be governed by and construed in accordance with the laws of the State of Georgia without reference
to any rules of conflict of laws that would require the application of any law other than Georgia
law.



Waiver of Trial by Jury. THE OBLIGOR AND THE HOLDER, AS BETWEEN THEM, WAIVE ANY RIGHTS THEY
MAY HAVE TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED ON OR ARISING FROM THIS NOTE, ANY
TRANSACTION CONTEMPLATED HEREBY OR EFFECTED PURSUANT HERETO, ANY DEALINGS OR COURSE OF DEALING
AMONG THEM RELATING IN ANY WAY TO THE SUBJECT MATTER OF THIS NOTE OR ANY STATEMENTS OR ACTIONS OF
ANY OF THEM OR THEIR AFFILIATES. Each of the parties acknowledges and agrees that this waiver is a
material inducement to enter into the business relationship contemplated by this Note and that each
has relied on this waiver in entering into this Note and will continue to rely on this waiver in
its future dealings with the other parties. The scope of this waiver is intended to be
all-encompassing, and this waiver will apply to all claims, of any nature whatsoever, whether
deriving from contract, arising by law, based on tort or otherwise. THE OBLIGOR AND THE HOLDER HAVE
MADE THIS WAIVER KNOWINGLY AND VOLUNTARILY, AND THIS WAIVER WILL BE IRREVOCABLE. THIS WAIVER WILL
ALSO APPLY TO ALL AMENDMENTS, SUPPLEMENTS, RESTATEMENTS, EXTENSIONS AND MODIFICATIONS OF THIS NOTE.
In the event of litigation, the relevant portions of this Note may be filed as a written consent to
a trial by the court.


 


 









 





No
Set-Off. The Obligor will not be entitled to offset against any of its financial
obligations to the Holder under this Note, any obligation owed to it or any of its affiliates by or
for the Holder or any affiliate of the Holder.



Assignment. The Obligor shall not assign its obligations under this Note without the prior
written consent of the Holder.



[signature page follows]




 


 









 







IN WITNESS WHEREOF, the undersigned has caused this Note to be executed and delivered on the
date first set above.



	 	 	 	 	 
	 	SOUTHWEST GEORGIA ETHANOL, LLC

 	 
	 	By 	/s/ Lawrence A. Kamp
 	 
	 	 	Name: 	Lawrence A. Kamp 	 
	 	 	Title: 	Chief Financial Officer 	 



 


 









 





	 	 	 	 	 



SCHEDULE A




QUARTERLY INTEREST PAYMENT DATES




	 	 	 
	Quarterly Payment	 	Date
	1
	 	September 30, 2009
	2
	 	December 31, 2009
	3
	 	March 31, 2010
	4
	 	June 30, 2010
	5
	 	September 30, 2010
	6
	 	December 31, 2010
	7
	 	March 31, 2011
	8
	 	June 30, 2011






 


 









 





SCHEDULE B




ANNUAL PRINCIPAL INSTALLMENT PAYMENTS




	 	 	 	 	 
	Annual Principal Installment	 	Amount	 	Date
	1
	 	$1,738,772.41
	 	June 30, 2010
	2
	 	$1,738,722.42
	 	June 30, 2011