Exhibit
10.20


 


LETTER
AGREEMENT


 


March 15, 2004


 


	
  LENDER:

  AgStar Financial Services, PCA

  1921 Premier Drive

  Mankato, MN  56002

  	
   

  	
  BORROWER:

  United Wisconsin Grain Producers, LLC

  100 Richland Street

  Friesland, WI  53935

  



 


Gentlemen:


 


This letter agreement memorializes certain matters relating to the
Construction and Revolving Loan Agreement in the amount of $33,024,200.00 (the
“Loan”) being made by AgStar Financial Services, PCA to United Wisconsin Grain
Producers, LLC (the “Borrower”) in accordance with the loan agreement (the
“Loan Agreement”), promissory note, and other documents and agreements dated
February 26, 2004 related to the Loan (the “Loan Documents”).  Capitalized terms used and not defined in
this letter agreement shall have the meanings assigned to them in the Loan
Agreement.


 


We have discussed the fact that some of the
conditions and requirements of the Loan and Loan Documents remained outstanding
at the time the Loan Documents were executed. 
These items include, but are not limited to, the following:


 


1.                                       Intercreditor and Subordination Agreement
with Fagen, Inc., before any Advances are made under the Loan, if subordinated
debt is used;


 


2.                                       Executed Agreement with WPS Energy Services,
Inc.;


 


3.                                       Executed Agreement with Wisconsin Power
& Light Company;


 


4.                                       Copy of building permit as soon as
available;


 


5.                                       Copy of Tier II Stormwater Permit, as soon
as available;


 


6.                                       Copy of Stormwater PPP Permit, as soon as
available;


 


7.                                       Copy of BATF Permit, as soon as available;


 


8.                                       Update on EIS as soon as available;


 


9.                                       Procurement Agreements when available, if
any, and a Collateral Assignment of each such agreement;


 


10.                                 Ethanol Marketing Agreements when available,
if any, and a Collateral Assignment of each such agreement;


 

















 


11.                                 DDGS Marketing Agreements when available, if
any, and a Collateral Assignment of each such agreement;


 


In accordance with Borrower’s requests,
Lender agreed to sign and deliver the Loan Documents on February 26,
2004.  Signature and delivery of the
Loan Documents by the Lender is not and shall not be deemed a waiver by the
Lender of any term, condition or requirement contained in the Loan Documents
for purposes of:  (i) any advance under
the Loan Documents; or (ii) constituting an event of default under the terms of
the Loan Documents.  That is,
notwithstanding the signature and delivery by the Lender of the Loan Documents,
all of the terms, conditions and requirements of the Loan Documents must be
satisfied prior to any advance of Loan proceeds being made under the Loan
Documents; and the Lender is not waiving or forgiving any event of default
under the Loan Documents constituted by the above referenced outstanding
conditions and requirements, and Lender expressly reserves the right to
exercise all remedies contained in the Loan Documents if, in its sole
discretion, such outstanding conditions and requirements are not complied with
in a timely and satisfactory fashion.


 


The Borrower understands and acknowledges
that the Lender’s signature and delivery of the Loan Documents is subject to the
production and/or execution of the above listed items.  Except for items 5, 6 and 7, to which
Borrower does not expect permits to be issued until after operations begin,
Borrower further acknowledges that Lender will be under no obligation to
advance any funds pursuant to the Loan Documents until Borrower meets the above
conditions to the satisfaction of Lender.


 


The undersigned agree to be bound to the terms and conditions of the
above letter, and have executed this letter as of the 15th day of
March, 2004.


 


	
  LENDER:

  	
   

  	
  BORROWER:

  
	
  AgStar Financial Services, PCA

  	
   

  	
  United Wisconsin Grain Producers, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Mark Schmidt

  	
   

  	
    /s/ Kevin Roche

  
	
  By Mark Schmidt

  	
   

  	
  By Kevin Roche

  
	
  Its Vice President

  	
   

  	
  Its President