Exhibit 10.4





Exhibit 10.4




CORN OIL EXTRACTION TERM NOTE




	 	 	 	 	 
	Note Date: April 8, 2009

	 	$	3,600,000.00	 
	Maturity Date: April 8, 2014
	 	 	 	 






FOR VALUE RECEIVED, CARDINAL ETHANOL, LLC, an Indiana limited liability company (“BORROWER”),
promises to pay to the order of FIRST NATIONAL BANK OF OMAHA (“BANK”), at its principal office or
such other address as BANK or holder may designate from time to time, the principal sum of Three
Million Six Hundred Thousand and 00/100 Dollars ($3,600,000.00), or the amount shown on BANK’s
records to be outstanding, plus interest (calculated on the basis of actual days elapsed in a
360-day year) accruing each day on the unpaid principal balance at the annual interest rates
defined below. Absent manifest error, BANK’s records shall be conclusive evidence of the principal
and accrued interest owing hereunder.



This CORN OIL EXTRACTION TERM NOTE is executed pursuant to a Construction Loan Agreement between
BORROWER and BANK dated as of December 19, 2006, (the Construction Loan Agreement, together with
all amendments, modifications and supplements thereto and all restatements and replacements thereof
is called the “AGREEMENT”). All capitalized terms not otherwise defined in this note shall have the
meanings provided in the AGREEMENT.



INTEREST ACCRUAL. Interest on the principal amount outstanding shall accrue until maturity or the
occurrence of an EVENT OF DEFAULT based on the greater of (i) the three month LIBOR RATE plus 300
basis points or (ii) five percent (5%) as provided for in the AGREEMENT, and at a rate equal to the
three month LIBOR RATE plus 900 basis points from time to time after maturity or the occurrence of
an EVENT OF DEFAULT, whether by acceleration or otherwise. Interest shall be calculated on the
basis of a 360-day year, counting the actual number of days elapsed.



INCENTIVE PRICING. The interest rate applicable to this CORN OIL EXTRACTION TERM NOTE is subject to
reduction after a date six months subsequent to the CONSTRUCTION LOAN TERMINATION DATE, as provided
for in Section 2.15 of the AGREEMENT.



REPAYMENT TERMS. Interest and principal shall be due and payable at the times, in the amounts and
applied in the manner provided for in Section 2.4 of the AGREEMENT, as amended by that certain
Fourth Amendment of Construction Loan Agreement dated December 17, 2008. Any remaining principal
balance, plus any accrued but unpaid interest, shall be fully due and payable on the Maturity Date
listed above, if not sooner paid.



PREPAYMENT. BORROWER may prepay this CORN OIL EXTRACTION TERM NOTE in full or in part as may be
permitted and provided for in the AGREEMENT, provided, however, that any prepayment fees provided
for in the AGREEMENT and interest rate breakage fees shall be due at the time of any such
prepayment. Any prepayment may be applied in inverse order of maturity or as BANK in its sole
discretion may deem appropriate. Such prepayment shall not
excuse BORROWER from making subsequent payments each quarter until the indebtedness is paid in
full.


 


 









 





ADDITIONAL TERMS AND CONDITIONS. This CORN OIL EXTRACTION TERM NOTE is executed pursuant to the
AGREEMENT. The AGREEMENT, and any amendments or substitutions thereof or thereto, contains
additional terms and conditions, including default and acceleration provisions, which are
incorporated into this CORN OIL EXTRACTION TERM NOTE by reference.



The aggregate unpaid principal amount hereof plus interest shall become immediately due and payable
without demand or further action on the part of BANK upon the occurrence of an EVENT OF DEFAULT as
set forth under the AGREEMENT or any other LOAN DOCUMENT. If the maturity date of this CORN OIL
EXTRACTION TERM NOTE is accelerated as a consequence of an EVENT OF DEFAULT, then BANK shall have
all the rights and remedies provided for in the AGREEMENT, the other LOAN DOCUMENTS or otherwise
available at law or in equity. The rights, powers, privileges, options and remedies of BANK
provided in the AGREEMENT, the other LOAN DOCUMENTS or otherwise available at law or in equity
shall be cumulative and concurrent, and may be pursued singly, successively or together at the sole
discretion of BANK, and may be exercised as often as occasion therefor shall occur. No delay or
discontinuance in the exercise of any right, power, privilege, option or remedy shall be deemed a
waiver of such right, power, privilege, option or remedy, nor shall the exercise of any right,
power, privilege, option or remedy be deemed an election of remedies or a waiver of any other
right, power, privilege, option or remedy. Without limiting the generality of the foregoing, BANK’s
waiver of an EVENT OF DEFAULT shall not constitute a waiver of acceleration in connection with any
future EVENT OF DEFAULT. BANK may rescind any acceleration of this CORN OIL EXTRACTION TERM NOTE
without in any way waiving or affecting any acceleration of this CORN OIL EXTRACTION TERM NOTE in
the future as a consequence of an EVENT OF DEFAULT. BANK’s acceptance of partial payment or partial
performance shall not in any way affect or rescind any acceleration of this CORN OIL EXTRACTION
TERM NOTE made by BANK.



Unless prohibited by law, BORROWER will pay on demand all reasonable costs of collection,
reasonable legal expenses and reasonable attorneys’ fees and costs incurred or paid by BANK in
collecting and/or enforcing this CORN OIL EXTRACTION TERM NOTE. Furthermore, BANK reserves the
right to offset without notice all funds held by BANK against debts owing to BANK by BORROWER.



WAIVER OF PRESENTMENT AND NOTICE OF DISHONOR. BORROWER and any other person who signs, guarantees
or endorses this CORN OIL EXTRACTION TERM NOTE, to the extent allowed by law, hereby waives
presentment, demand for payment, notice of dishonor, protest, and any notice relating to the
acceleration of the maturity of this CORN OIL EXTRACTION TERM NOTE.



[SIGNATURE PAGE FOLLOWS]



 


 









 






Executed as of the Note Date first above written.



	 	 	 	 	 	 	 
	 	 	CARDINAL ETHANOL, LLC, an

Indiana limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Troy Prescott	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Its Chairman
	 	 






	 	 	 	 	 	 	 
	STATE OF Indiana

	 	 	)	 	 	 
	 

	 	 	)	 	 	ss.
	COUNTY OF Grant

	 	 	)	 	 	 






Before me, a Notary Public in and for said County and State, personally appeared Troy
Prescott, known to me to be the President of Cardinal Ethanol, LLC, an Indiana limited liability
company, and acknowledged the execution of the foregoing for and on behalf of such limited
liability company.



	 	 	 	 	 
	 

	 	/s/ Techia K. Brewer	 	 
	 

	 	 	 	 
	 

	 	Notary Public — Signature	 	 
	 
	 	 	 	 
	 

	 	Techia K. Brewer	 	 
	 

	 	 	 	 
	 

	 	Notary Public — Printed Name	 	 
	 
	 	 	 	 
	 

	 	Date: 4-8-2009
	 	 






My commission expires:



12-27-2009



My County of Residence: Grant County, Indiana