Exhibit 10.8


 


Third Amendment to Construction Loan
Agreement


 


This Third Amendment to Construction Loan Agreement is dated as of the 23rd day of June, 2003, and is by and
between LSCP, L.P., an Iowa limited partnership (“BORROWER”) and FIRST NATIONAL
BANK OF OMAHA (“BANK”), a national banking association established at Omaha, Nebraska.


 


WHEREAS, the BANK and BORROWER executed a written Construction Loan
Agreement dated as of July 25, 2002, which, together will all amendments thereto,
is collectively called the “AGREEMENT”.


 


Now, Therefore, in consideration of the AGREEMENT, and their mutual
promises made herein, BANK and BORROWER agree as follows:


 


1.                                       Terms
which are typed herein as all
capitalized words and are not defined herein shall have same meanings as when
described in the AGREEMENT.


 


2.                                       Section 1,
Paragraph 1.3 of the AGREEMENT is hereby amended, effective immediately, to
read:


 


1.3                                 “BANKING
DAY” means a day on which the BANK is open for substantially all of its business. “EURODOLLAR BUSINESS DAY”
means a BANKING DAY on which commercial banks are open for international
business (including dealings in dollar deposits) in London, England.


 


3.                                       Section 1,
Paragraph 1.16 of the AGREEMENT is hereby amended to read as follows, effective
immediately:


 


1.16                           “INDEBTEDNESS”
means all indebtedness for borrowed money including long-term debt, short-term
debt, SWAP CONTRACTS, and capital leases.


 


4.                                       Section 1,
Paragraph 1.19 (i) of the AGREEMENT
is hereby amended to read as follows, effective immediately:


 


(i) as to the REVOLVING NOTE, July 24, 2003, as to TERM NOTE 2,
TERM NOTE 3 and TERM NOTE 4, June 1, 2008.


 


5.                                       Section 1,
Paragraph 1.31 of the AGREEMENT is hereby amended to read as follows, effective
immediately:


 


1.31                           “TERM
NOTE” means that promissory note of BORROWER to BANK which evidences permanent
financing to pay the CONSTRUCTION NOTE as described in Sections 2.5 of this
AGREEMENT, its renewals, modifications and extensions.  TERM NOTE 2, TERM NOTE 3, and TERM NOTE 4 refer
to three promissory notes which
hereafter will replace the TERM NOTE.


 

















 


6.                                       Section 1,
Paragraph 1.32 of the AGREEMENT is hereby amended to read as follows, effective
immediately:


 


1.32                           “WORKING
CAPITAL” means current assets (less investments in or other amounts due from
any member, employee or any person or entity related to or affiliated with the
BORROWER and prepayments) plus the amount available to BORROWER for drawing
under TERM NOTE 4, less current liabilities (less any portion of such current
liabilities that constitute debt that is expressly subordinated to the BANK in
a writing acceptable to the BANK).


 


7.                                       The
AGREEMENT is hereby amended, effective immediately, by the addition of the
following new sections 1.33, 1.34, 1.35, 1.36, 1.37, and 1.38:


 


1.33                           “INTEREST
PERIOD” means initially, the period commencing on the date of the LOAN and, for
TERM NOTE 2 and TERM NOTE 3 ending three months later, and for TERM NOTE 4 and
REVOLVING NOTE ending one month later; and thereafter, each period commencing
on the first day immediately following the last day of the immediately
preceding INTEREST PERIOD and, for TERM NOTE 2 and TERM NOTE 3 ending three
months thereafter, and for TERM NOTE 4 and REVOLVING NOTE ending one month
thereafter; provided that.


 


A                                      subject to clauses B and C below, any INTEREST
PERIOD which would otherwise end on a day which is not a EURODOLLAR
BUSINESS DAY shall be extended to the next succeeding EURODOLLAR BUSINESS DAY
unless such EURODOLLAR BUSINESS DAY falls in another calendar month, in which
case such INTEREST PERIOD shall end on the immediately preceding EURODOLLAR
BUSINESS DAY;


 


B.                                     subject to clause
C below, any INTEREST PERIOD which begins on the last EURODOLLAR BUSINESS DAY
of a calendar month (or a day for which there is no numerically corresponding
day in the calendar month at the end of such INTEREST PERIOD) shall end on the
last EURODOLLAR BUSINESS DAY of a calendar month; and


 


C.                                     no INTEREST PERIOD shall extend beyond the LOAN
TERMINATION DATE.


 


1.34                           “LIBOR
BASE RATE” shall mean, with respect to the applicable INTEREST PERIOD, (a) the
LIBOR INDEX RATE for such INTEREST PERIOD, if such rate is available or (b) if
the LIBOR INDEX RATE cannot be determined, the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the respective rates per annum of
interest at which deposits in dollars are offered to BANK in the London
interbank market by two (2) Eurodollar dealers of recognized standing, selected
by BANK in its sole discretion, at such time on the date two (2) Eurodollar
Business Days before the first day of such


 

















 


INTEREST PERIOD as BANK in its sole discretion elects, for delivery on the first day of the applicable
INTEREST PERIOD for a number of days comparable to the number of days in such
INTEREST PERIOD and in an amount approximately equal to the principal amount of
the OBLIGATIONS.


 


1.35                           “LIBOR
INDEX RATE” shall mean, with respect to the applicable INTEREST PERIOD, the
rate per annum (rounded upwards, if necessary, to the next higher 1/100 of 1%)
for deposits in U.S. Dollars for a period equal
to such INTEREST PERIOD, which appears on the BANK’s information vendor
as of 9:00 a.m. (Omaha time) on the day two (2) Eurodollar Business Days before
the first day of such INTEREST PERIOD. 
The term “BANK’s information vendor” means the Bloomberg service or such
other vendor chosen by BANK for the purpose
of displaying British Bankers’ Association Interest Settlement Rates for U.S.
Dollar Deposits.


 


1.36                           “LIBOR
RATE” shall mean (a) the quotient of the (i) LIBOR BASE RATE divided by (ii)
one minus the applicable LIBOR RESERVE PERCENTAGE plus (b) 280 basis
points in the case of the TERM NOTE 2, or 380 basis points in the case of TERM
NOTE 3, TERM NOTE 4, and REVOLVING NOTE. 
The LIBOR RATE shall be adjusted automatically on and as of the
effective date of any change in the LIBOR RESERVE; PERCENTAGE.


 


1.37                           “LIBOR
RESERVE PERCENTAGE” shall mean for any day that percentage (expressed as a
decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal Reserve
System (or any successor), for determining the maximum reserve requirement for
a member bank of the Federal Reserve System with respect to “Eurocurrency
liabilities” (or in respect of
any other category of liabilities which
includes deposits by reference to which the interest rate on LIBOR loans
is determined or any category of extensions of credit or other assets which
include loans by a non-United States office of any bank to United States
residents). The LIBOR RATE shall be adjusted automatically on and as of the
effective date of any change in the LIBOR RESERVE PERCENTAGE.


 


1.38                           “SWAP
CONTRACT” or “SWAP CONTRACTS” means (a)
any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options,
forward commodity contracts, equity or equity index swaps or options, bond or
bond price or bond index swaps or options or forward bond or forward bond price
or forward bond index transactions, interest rate options, forward foreign
exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter
into any of the foregoing), whether or not
any such transaction is governed by or subject to any master agreement, and (b)
any and all transactions of any kind, and the related confirmations, which are


 

















 


subject to the terms and conditions of, or governed by, any form of
master agreement published by the International Swaps and Derivatives Association, Inc.
Provided, however, the term SWAP CONTRACT shall
not, for the purposes of this AGREEMENT, include commodity hedging or
commodity risk management contracts. 
Commodity includes grain, natural gas and other traded commodities.


 


8.                                       Section 2,
Paragraph 2.11 of the AGREEMENT is hereby amended, effective immediately to
read:


 


2.11                           Fees.  At COMPLETION DATE, and on each annual
anniversary of COMPLETION DATE for five years subsequent to COMPLETION DATE,
the BORROWER shall pay to the BANK an Annual
Servicing Fee of $50,000.00, which fee BORROWER agrees and acknowledges has been earned by BANK; provided, however, an
Annual Servicing Fee shall not be due and payable on the LOAN TERMINATION
DATE.  BORROWER agrees to pay BANK an
unused commitment fee equal to 12.5 basis points of the average unused portion
of the REVOLVING LOAN, calculated and payable on a quarterly basis in arrears;
provided, however, the unused commitment fee shall not apply and be payable by
the BORROWER until such time as the BORROWER has requested, and the BANK has
deposited, the initial advance of the REVOLVING LOAN into the BORROWER’s
deposit account with BANK.  BORROWER
shall pay BANK an unused commitment fee of thirty-seven and one-half (37.5bps)
basis points, assessed quarterly in arrears, as to the unused portion of TERM
NOTE 4, which BANK will share with its participants.


 


9.                                       Section 2,
Paragraph 2.13 of the AGREEMENT is hereby amended, effective immediately, to
read:


 


2.13                           Incentive
Pricing.  The interest rate
applicable to certain of the NOTES may be subject to reduced interest rates,
based on the business results of BORROWER. 
In such cases the NOTES will reflect
such potential for reduction of rates.


 


10.                                 Section 2,
Paragraph 2.6 of the AGREEMENT is hereby amended, effective immediately, to
read:


 


2.6                                 Interest
on TERM NOTES.  Interest on TERM
NOTE 2, TERM NOTE 3, and TERM NOTE 4 shall accrue at the LIBOR RATE prior to
acceleration or maturity, and six hundred basis points in excess of the LIBOR
RATE in effect from time to time after maturity, whether by acceleration or
otherwise.  The NOTE may also provide
for reductions in such interest rates based upon BORROWER’s performance.


 


11.                                 Section 2, Paragraph 2.9 of the AGREEMENT is hereby amended, effective
immediately, to read:


 

















 


2.9                                 INTEREST
ON THE REVOLVING NOTE.  Interest on
the REVOLVING NOTE shall accrue at the LIBOR RATE prior to acceleration or
maturity, and six hundred basis points in excess of the LIBOR RATE in effect
from time to time after maturity, whether by acceleration or otherwise.  Interest on the REVOLVING LOAN shall be
payable every three months.  The NOTE
may also provide for reductions in such interest rates based upon ‘BORROWER’s
performance.


 


12.                                 Section 6,
Paragraph 6.2.3 of the AGREEMENT is hereby amended, effective immediately, to
read:


 


6.2.3                        BORROWER
shall determine, at each fiscal year end, the amount of its EXCESS CASH FLOW
for said fiscal year, and within one hundred twenty days following such fiscal
year end, pay twenty percent (20%) of such sum to BANK, to be applied to the
outstanding principal amount of TERM NOTE 3, and after TERM NOTE 3 is repaid,
to TERM NOTE 4 and thereafter, TERM NOTE 2. Such annual payment shall not
release BORROWER from making any payment of principal or interest otherwise
required by this AGREEMENT.  No payment
of EXCESS CASH FLOW shall be the cause of a payment to BANK for interest rate
breakage fees or otherwise result in any prepayment fee.


 


13.                                 Section 6
of the AGREEMENT is hereby amended, effective immediately, by adding an
additional paragraph, denominated 6.4.17, as follows:


 


6.4.17                  BORROWER
shall not cancel, repudiate, terminate, or breach any SWAP CONTRACT without
prior written consent of BANK.


 


14.                                 The
existing balance on the TERM NOTE is 31,465,000.00. On execution hereof, the
TERM NOTE will be replaced and said balance will be paid by three new
promissory notes, hereafter called “TERM NOTE 2”, “TERM NOTE 3”, and “TERM NOTE
4” in the forms attached hereto as Exhibits 3-1, 3-2, and 3-3, respectively,
and are by this reference made a part hereof.


 


Payments on such NOTES shall be as follows:


 


On the first day of each quarter, commencing September 1, 2003,
BORROWER shall pay to BANK the scheduled principal payment shown in
Schedule I, attached hereto and by this reference made a part hereof, plus
accrued interest on TERM NOTE 2.


In addition, on the first day of each quarter, commencing
September 1, 2003, BORROWER shall pay $506,588.01 to BANK, which shall be
allocated as follows:


a.               first to accrued interest on TERM NOTE
4;


b.              next to accrued interest on TERM NOTE 3;


c.               next to principal on TERM NOTE 3;


After TERM NOTE 3 has been fully paid, such quarterly payments shall be
allocated first to accrued interest on TERM NOTE 4, and thence to
principal.  All unpaid principal and
accrued interest shall be due and payable on LOAN TERMINATION DATE, if not
sooner paid.


 

















 


15.                                 As
the result of the parties’ agreement to change the rate of interest accrual on
the REVOLVING NOTE, BORROWER shall execute and deliver to BANK a replacement
NOTE in the form of Exhibit 3-4, attached hereto and by this reference made a
part hereof.


 


16.                                 In
the event that the BORROWER pre-pays part or all of its debt where the rate is
fixed in excess of one month, including that associated with SWAP CONTRACTS,
and except as to such payments as required by this AGREEMENT, the BORROWER
shall pay BANK a breakage fee sufficient to make BANK whole for any expenses
related to breaking fixed interest rates, which BANK shall apportion among its
participants.  Provided, however, no
payment of EXCESS CASH FLOW shall be the cause of a payment to BANK for
interest rate breakage fees or otherwise result in any prepayment fee.


 


17.                                 BORROWER
certifies by its execution hereof that the representations and warranties set
forth in Section 5 of the AGREEMENT are true as of this date, and that no
EVENT OF DEFAULT under the AGREEMENT, and no event which, with the giving of
notice or passage of time or both, would become such an EVENT OF DEFAULT, has
occurred as of this date.


 


18.                                 Except
as amended hereby the parties ratify and confirm as binding upon them all of
the terms of the AGREEMENT.


 


In witness whereof the parties set their hands as of the date first
written above.


 


 


	
  First National Bank of Omaha

  	
   

  	
  LSCP, L.P., an Iowa Limited Partnership 

  
	
   

  	
   

  	
  By Little Sioux Corn Processors, L.L.C., Its 

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Omer Sagheer

  	
   

  	
   

  	
  By:

  	
  /s/ Daryl J. Haack

  	
   

  
	
   

  	
  Omer Sagheer,

  	
   

  	
   

  	
  Daryl J. Haack, President of Little

  
	
   

  	
  Commercial Loan Officer

  	
   

  	
   

  	
  Sioux Corn Processors, L.L.C.

  
							



 

















 


Exhibit 3-1


TERM NOTE 2


 


	
  Note Date:

  	
  June 23, 2003

  	
   

  	
  $15,732,500.00

  
	
  Maturity Date: 

  	
    June 1, 2008

  	
   

  	
   

  



 


FOR
VALUE RECEIVED, LSCP, L.P., an Iowa limited partnership (“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 Fifteen Million Seven Hundred Thirty-Two
Thousand Five Hundred and No/100 Dollars ($15,732,500.00), or the amount shown
on the 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, the BANK’s records shall be conclusive evidence of the principal and
accrued interest owing hereunder.


 


This
promissory note is executed pursuant to a Construction Loan Agreement
(“CONSTRUCTION LOAN AGREEMENT”) between BORROWER and BANK dated as of
July 25, 2002, which, together will all amendments thereto, is
collectively called the “AGREEMENT”. 
All capitalized terms not otherwise defined in this note shall have the
meanings provided in the CONSTRUCTION LOAN AGREEMENT.


 


INTEREST ACCRUAL.  Interest on the principal amount
outstanding shall accrue based on a three month LIBOR +280 bps.  Interest shall be calculated on the basis of
a 360-day year, counting the actual number of days elapsed.


 


REPAYMENT
TERMS.  Interest
on the outstanding principal balance shall be due and payable quarterly, in
arrears, with the first payment commencing on September 1, 2003. Principal
shall be due and payable in the
amounts and on the dates set forth in attached Schedule I, which is
incorporated herein by reference.  In
all events, the entire outstanding principal balance, together with all accrued
and unpaid interest, shall be immediately due and payable in full on
June 1, 2008.


 


PREPAYMENT.  The BORROWER may
prepay this promissory note in full or in part at any time.  Provided, however, a condition of any
prepayment is that a fee shall be paid to BANK sufficient to make BANK whole
for any expenses related to breaking fixed interest rates.  Each prepayment may be applied in inverse order
of maturity or as the BANK in its sole discretion may deem appropriate.  Such prepayment shall not excuse the
BORROWER from making subsequent payments each quarter until the indebtedness is
paid in full.  No payment of EXCESS CASH
FLOW shall be the cause of a payment
to BANK for interest rate breakage fees or otherwise result in any prepayment
fee.


 


ADDITIONAL
TERMS AND CONDITIONS.  The
LOAN AGREEMENT, and any amendments or substitutions, contains additional terms
and conditions, including default and acceleration provisions, which are
incorporated into this promissory note by reference.  The BORROWER agrees to pay all costs of collection, including
reasonable attorneys fees and legal


 

















 


expenses incurred by the BANK if this promissory note is not paid as
provided above.  This  promissory note shall be governed
by the substantive laws of the State of Nebraska.


 


WAIVER OF PRESENTMENT AND NOTICE OF
DISHONOR.  BORROWER
and any other person who signs, guarantees or endorses this promissory 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 promissory note.


 


 


	
   

  	
   

  	
  LSCP, L.P., an Iowa Limited Partnership 

  
	
   

  	
   

  	
  By Little Sioux Corn Processors, L.L.C., Its 

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Daryl J. Haack

  	
   

  
	
   

  	
   

  	
   

  	
  Daryl J. Haack, President of Little

  
	
   

  	
   

  	
   

  	
  Sioux Corn Processors, L.L.C.

  



 


 


	
  STATE
  OF IOWA

  	
  )

  
	
   

  	
  )
  ss.

  
	
  COUNTY
  OF  CHEROKEE

  	
  )

  



 


On this 20 day of June, 2003, before me, the undersigned, a Notary
Public, personally appeared Daryl J. Haack, President of Little Sioux Corn
Processors, L.L.C., General Partner of LSCP, L.P., on behalf of said entity,
who executed the foregoing instrument, and acknowledged that he executed the
same as his voluntary act and deed.


 


 


	
   

  	
  /s/ Becky J. Nothem

  	
   

  
	
   

  	
  Notary Public

  



 

















 


Exhibit 3-2


TERM NOTE 3(variable rate)


 


	
  Note Date:

  	
  June 23, 2003

  	
   

  	
  $10,732,500.00

  
	
  Maturity Date: 

  	
    June 1, 2008

  	
   

  	
   

  



 


FOR VALUE RECEIVED, LSCP, L.P., an
Iowa limited partnership (“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 Ten
Million Seven Hundred Thirty-Two Thousand Five Hundred and No/100 Dollars
($10,732,500.00), or the amount shown on the 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, the BANK’s records shall be conclusive evidence of the principal and
accrued interest owing hereunder.


 


This promissory note is executed pursuant to a Construction Loan
Agreement (“CONSTRUCTION LOAN AGREEMENT”) between BORROWER and BANK dated as of
July 25, 2002, which, together will all amendments thereto, is
collectively called the “AGREEMENT”. 
All capitalized terms not otherwise defined in this note shall have the
meanings provided in the CONSTRUCTION LOAN AGREEMENT.


 


INTEREST ACCRUAL.  Interest on the principal amount
outstanding shall accrue based on a three month LIBOR +380 bps.  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
promissory note is subject to reduction after a date six months subsequent to
CONSTRUCTION COMPLETION DATE, based on the
business results of BORROWER.  In the
event that BORROWER maintains the following ratios, measured monthly, the interest
rates will adjust accordingly:


 


	
  If INDEBTEDNESS to NET WORTH

  is:

  	
   

  	
  Interest rate will be:

  
	
   

  	
   

  	
   

  
	
  Greater than 1.30 : 1.00

  	
   

  	
  three month LIBOR plus 380 basis points 

  
	
  Greater than 1.10 : 1.00, but less than or equal to 1.30 : 1.00

  	
   

  	
  three month LIBOR plus 355 basis points

  
	
  Greater than .90 : 1.00, but less than or equal to 1.10 : 1.00

  	
   

  	
  three month LIBOR plus 330 basis points 

  
	
  Greater than .70 : 1.00, but less than or equal to .90 : 1.00

  	
   

  	
  three month LIBOR plus 305 basis points 

  
	
  Less than or equal to .70 : 1:00

  	
   

  	
  three month LIBOR plus 280 basis points

  



 


REPAYMENT TERMS.  Interest and Principal shall be due and
payable in the amounts described in the AGREEMENT, which will be applied to
this Note and an additional Note, in the manner described in the AGREEMENT.  Any remaining principal balance, plus any
accrued but unpaid interest, shall be fully due and payable on June 1,
2008, if not sooner paid


 

















 


PREPAYMENT. 
The BORROWER may prepay this promissory note in
full or in part at any time.  Provided,
however, a condition of any prepayment is that a fee shall be paid to BANK sufficient to make BANK whole for any
expenses related to breaking fixed interest rates.  Each prepayment may be
applied in inverse order of
maturity or as the BANK in its sole discretion may deem appropriate.  Such prepayment shall not excuse the
BORROWER from making subsequent payments each quarter until the indebtedness is
paid in full.  No payment of EXCESS CASH
FLOW shall be the cause of a payment to BANK for interest rate breakage fees or
otherwise result in any prepayment fee.


 


ADDITIONAL TERMS AND CONDITIONS.  The LOAN AGREEMENT,
and any amendments or substitutions, contains additional terms and conditions, including default and
acceleration provisions, which are incorporated into this promissory note by
reference.  The BORROWER agrees to pay all costs of collection, including
reasonable attorneys fees and legal expenses incurred by the BANK if this
promissory note is not paid as provided above. 
This promissory note shall be governed by the substantive laws of the
State of Nebraska.


 


WAIVER OF PRESENTMENT AND NOTICE OF
DISHONOR.  BORROWER
and any other person who signs, guarantees or endorses this promissory 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 promissory note.


 


 


	
   

  	
   

  	
  LSCP, L.P., an Iowa Limited Partnership 

  
	
   

  	
   

  	
  by Little Sioux Corn Processors, L.L.C., Its 

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Daryl J. Haack

  	
   

  
	
   

  	
   

  	
   

  	
  Daryl J. Haack, President of Little

  
	
   

  	
   

  	
   

  	
  Sioux Corn Processors, L.L.C.

  



 


 


	
  STATE
  OF IOWA

  	
  )

  
	
   

  	
  )
  ss.

  
	
  COUNTY
  OF IOWA

  	
  )

  



 


On this 20 day of June, 2003, before me, the undersigned, a Notary Public, personally appeared
Daryl J. Haack, President of Little Sioux Corn Processors, L.L.C., General
Partner of LSCP, L.P., on behalf of said entity, who executed the foregoing
instrument, and acknowledged that he executed the same as his voluntary act and
deed.


 


 


	
   

  	
  /s/ Becky J. Nothem

  	
   

  
	
   

  	
  Notary Public

  



 

















 


Exhibit 3-3


TERM NOTE 4 (with reducing revolver feature)


 


	
  Note Date:

  	
  June 23, 2003

  	
   

  	
  $5,000,000.00 

  
	
  Maturity Date: 

  	
    June 1, 2008

  	
   

  	
   

  



 


FOR VALUE RECEIVED, LSCP, L.P., an
Iowa limited partnership (“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 Five
Million and No/100 Dollars ($5,000,000.00), or the amount shown on the 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, the
BANK’s records shall be conclusive evidence of the principal and accrued
interest owing hereunder.


 


This promissory note is executed pursuant to a Construction Loan
Agreement (“CONSTRUCTION LOAN AGREEMENT”) between BORROWER and BANK dated as of
July 25, 2002, which, together will all amendments thereto, is collectively
called the “AGREEMENT”. All capitalized terms not otherwise defined in this
note shall have the meanings provided in the CONSTRUCTION LOAN AGREEMENT.


 


INTEREST ACCRUAL.  Interest on the principal amount
outstanding shall accrue based on a one month LIBOR +380 bps.  Interest shall be calculated on the basis of
a 360-day year, counting the actual number of days elapsed.


 


REVOLVING FEATURE.  The BORROWER may reborrow, on a
revolving basis, that principal amount repaid on this promissory note which
remains at a variable interest rate. 
Pursuant to this revolving loan feature the BANK will lend the BORROWER,
from time to time until maturity of this note such sums in integral multiples
of $10,000.00 as the BORROWER may request by reasonable same day notice to the
BANK, received by the BANK not later than 11:00 A.M. on Friday, or the next
BUSINESS DAY thereafter, each week but which shall not exceed in the aggregate
principal amount at any one time outstanding, $5,000,000.00.  The BORROWER may borrow, repay and reborrow
hereunder, from the date of this AGREEMENT until the maturity of this note,
said amount or any lesser sum which is $10,000.00 or an integral multiple
thereof.


 


INCENTIVE PRICING.  The interest rate applicable to this
promissory note is subject to reduction after a date six months subsequent to
CONSTRUCTION COMPLETION DATE, based on the business results of BORROWER.  In the event that BORROWER maintains the
following ratios, measured monthly, the interest rates will adjust accordingly:


 

















 


	
  If INDEBTEDNESS to NET WORTH is:

  	
   

  	
  Interest rate will be:

  
	
   

  	
   

  	
   

  
	
  Greater than 1.30 : 1.00

  	
   

  	
  one month LIBOR plus 380 basis points 

  
	
  Greater than 1.10 : 1.00, but less than or equal to 1.30 : 1.00

  	
   

  	
  one month LIBOR plus 355 basis points

  
	
  Greater than .90 : 1.00, but less than or equal to 1.10 : 1.00

  	
   

  	
  one month LIBOR plus 330 basis points 

  
	
  Greater than .70 : 1.00, but less than or equal to .90 : 1.00

  	
   

  	
  one month LIBOR plus 305 basis points 

  
	
  Less than or equal to .70 : 1:00

  	
   

  	
  one month LIBOR plus 280 basis points

  



 


Following repayment of TERM NOTE 3, when regular quarterly principal
payments are applied to this note, the amount available to be borrowed under
the revolving loan feature will be correspondingly reduced, so that the maximum
amount outstanding under this promissory note will decrease accordingly.


 


REPAYMENT TERMS.  Interest and Principal shall be due and
payable in the amounts described in the AGREEMENT, which will be applied to
this Note and an additional Note, in the manner described in the
AGREEMENT.  Any remaining principal
balance, plus any accrued but unpaid interest, shall be fully due and payable
on June 1, 2008, if not sooner paid.


 


PREPAYMENT. 
The BORROWER may prepay this promissory note in
full or in part at any time.  Provided,
however, a condition of any prepayment is that a fee shall be paid to BANK
sufficient to make BANK whole for any expenses related to breaking fixed
interest rates.  Each prepayment may be
applied in inverse order of maturity or as the BANK in its sole discretion may
deem appropriate.  Such prepayment shall
not excuse the BORROWER from making subsequent payments each quarter until the
indebtedness is paid in full.  No
payment of EXCESS CASH FLOW shall be the cause of a payment to BANK for
interest rate breakage fees or otherwise result in any prepayment fee.


 


ADDITIONAL TERMS AND CONDITIONS.  The LOAN AGREEMENT,
and any amendments or substitutions, contains additional terms and conditions,
including default and acceleration provisions, which are incorporated into this
promissory note by reference.  The
BORROWER agrees to pay all costs of collection, including reasonable attorneys
fees and legal expenses incurred by the BANK if this promissory note is not
paid as provided above.  This promissory
note shall be governed by the substantive laws of the State of Nebraska.


 


WAIVER OF PRESENTMENT AND NOTICE OF
DISHONOR.  BORROWER
and any other person who signs, guarantees or endorses this promissory 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 promissory note.


 


(signatures on next page)


 

















 


 


	
   

  	
   

  	
  LSCP, L.P., an Iowa Limited Partnership 

  
	
   

  	
   

  	
  By Little Sioux Corn Processors, L.L.C., Its 

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Daryl J. Haack

  	
   

  
	
   

  	
   

  	
   

  	
  Daryl J. Haack, President of Little

  
	
   

  	
   

  	
   

  	
  Sioux Corn Processors, L.L.C.

  



 


 


	
  STATE
  OF IOWA

  	
  )

  
	
   

  	
  )
  ss.

  
	
  COUNTY
  OF CHEROKEE

  	
  )

  



 


On this 20 day of June, 2003, before me, the undersigned, a Notary
Public, personally appeared Daryl J. Haack, President of Little Sioux Corn
Processors, L.L.C., General Partner of LSCP, L.P., on behalf of said entity,
who executed the foregoing instrument, and acknowledged that he executed the
same as his voluntary act and deed.


 


	
   

  	
  /s/ Becky J. Nothem

  	
   

  
	
   

  	
  Notary Public

  



 

















 


Exhibit 3-4


REVOLVING PROMISSORY NOTE


 


	
  Omaha, Nebraska

  	
   

  	
  $3,500,000.00

  
	
  Note Date: June 23, 2003

  	
   

  	
  Maturity Date: July 24, 2003

  



 


On or before July 24, 2003, LSCP, L.P. (“BORROWER”) promises to
pay to the order of First National Bank of Omaha (“BANK”) at any of its offices
in Omaha, Nebraska the principal sum hereof, which shall be Three Million Five
Hundred Thousand and no/100 ($3,500,000.00) Dollars or so much thereof as may
have been advanced by BANK and shown on the records of the BANK to be
outstanding, under this Note and the loan agreement executed by the BANK and
BORROWER dated as of July 25, 2002, as it may, from time to time, be
amended.


 


Interest on the principal amount outstanding shall accrue based on a
one month LIBOR +380bps.  Interest shall
be calculated on the basis of a 360-day year, counting the actual number of
days elapsed.  Interest on this
promissory note shall be payable monthly.


 


The interest rate
applicable to this promissory note is subject to reduction after a date six
months subsequent to CONSTRUCTION COMPLETION DATE, based on the business
results of BORROWER.  During any three
month INTEREST PERIOD that BORROWER maintains the following ratios, measured
for the prior INTEREST PERIOD, the interest rates will adjust accordingly:


 


	
  If INDEBTEDNESS to NET WORTH is:

  	
   

  	
  Interest rate will be:

  
	
   

  	
   

  	
   

  
	
  Greater than 1.30 : 1.00

  	
   

  	
  one month LIBOR plus 380 basis points 

  
	
  Greater than 1.10 : 1.00, but less than or equal to 1.30 : 1.00

  	
   

  	
  one month LIBOR plus 355 basis points

  
	
  Greater than .90 : 1.00, but less than or equal to 1.10 : 1.00

  	
   

  	
  one month LIBOR plus 330 basis points 

  
	
  Greater than .70 : 1.00, but less than or equal to .90 : 1.00

  	
   

  	
  one month LIBOR plus 305 basis points 

  
	
  Less than or equal to .70 : 1:00

  	
   

  	
  one month LIBOR plus 280 basis points

  



 


This note is executed pursuant to a Construction Loan Agreement dated
as of July 25, 2002, between BANK and BORROWER (the “LOAN AGREEMENT”). The
LOAN AGREEMENT contains additional terms of this Note, including, but not
limited to enumerated events of default, and the granting of liens to secure
BORROWER’s performance.  All capitalized
terms not otherwise defined herein shall have the same meanings as set forth in
the LOAN AGREEMENT.


 


As provided in the LOAN AGREEMENT, upon any such enumerated default,
BANK may accelerate the due date of this Note and declare all obligations set
forth herein immediately due and payable, and BANK shall also have such other
remedies as are described in the LOAN AGREEMENT and are provided by law.  All makers and endorsers hereby waive
presentment,


 

















 


demand, protest and notice of dishonor, consent to any number of
extensions and renewals for any period without notice; and consent to any
substitution, exchange or release of collateral, and to the addition or releases
of any other party primarily or secondarily liable.


 


Executed as of the 23rd day of June, 2003.


 


	
   

  	
   

  	
  LSCP, L.P., an Iowa Limited Partnership 

  
	
   

  	
   

  	
  by Little Sioux Corn Processors, L.L.C.,

  
	
   

  	
   

  	
  Its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
    Daryl J. Haack, President