exv10w1



 








EXHIBIT 10.1




AMENDED LETTER OF INTENT




	 	 	 
	Date:

	 	October 25, 2005
	 
	 	 
	Parties:

	 	Fagen, Inc., a Minnesota
Corporation, of Granite Falls, MN (“Fagen”) and Gold
Energy, LLC (f/k/a Red River Energy, LLC) of Elbow Lake, Minnesota (“Owner”)





WHEREAS, Owner is an entity organized to facilitate the development and building of either a 100
MGY gas-fired fuel ethanol plant to be located within 100 miles of
Wahpeton, ND (the “Facility” or
“Project”); and



WHEREAS, Fagen is an engineering and construction firm capable of providing development
assistance, as well as designing and constructing the Facility being considered by Owner; and



WHEREAS,
this Letter of Intent supercedes and replaces the Letter of Intent dated May 2, 2005,
between Fagen and Owner relating to the Project.



NOW, THEREFORE, in consideration of the promises and mutual covenants set forth herein, Owner and
Fagen agree to use best efforts in jointly developing this Project under the following terms:





     1. Owner agrees that Fagen will Design-Build the Facility if determined by Owner to
be feasible and if adequate financing is obtained. Should Owner choose to develop or
pursue a relationship with a company other than Fagen to provide the
preliminary engineering or design-build services for the project, then Owner shall
reimburse Fagen for all expenses Fagen has incurred in connection with the Project based
upon Fagen’s standard rate schedule plus all third party costs incurred from the date of
the former Letter of Intent (dated May 2, 2005) between Fagen and Owner. Such expenses
include, but are not limited to, labor rates and reimbursable expenses such as legal
charges for document review and preparation, travel expenses, reproduction costs, long
distance phone costs, and postage. In the event Fagen’s services are terminated by Owner,
title to the technical data, which may include preliminary engineering drawings and
layouts and proprietary process related information, shall remain with Fagen; however,
Owner shall, upon payment of the foregoing expenses, have the limited license to use the
above described technical data, excluding proprietary process related information, for
completing documentation required for construction, operation, repair and maintenance of
the Project, at Owner’s sole risk.




     Owner acknowledges that the technical data provided by Fagen under this Letter o
Intent shall be preliminary and may not be suitable for construction and agrees that any
use of such technical data without Fagen’s involvement shall be at the Owner’s sole risk.




     If Fagen intentionally or by gross negligence fails or refuses to comply with its



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commitments contained in this Letter of Intent, Fagen shall absorb all of its own
expenses, and Owner shall have the right to terminate the Letter of Intent immediately upon
written notice to Fagen, and Owner shall be released from its obligations to pay or
reimburse Fagen as described above.



     2. Fagen will provide Owner with assistance in evaluating, from both a technical and
business perspective:




	 	•	 	Owner organizational options;
	 
	 	•	 	The appropriate location of the proposed Facility, and
	 
	 	•	 	Business plan development.




Fagen assumes no risk or liability of representation or advice to Owner by assisting in
evaluating the above. All decisions made regarding feasibility, financing, and business risks are
the Owner’s sole responsibility and liability. In addition, Owner shall utilize project
consultants recommended by Fagen that have successfully financed previous Fagen projects.




     3. Fagen agrees to Design-Build the Facility, utilizing ICM, Inc. technology in the plant
process, for a lump sum price of $105,997,000.00. If, as of the date a Notice to Proceed is
given, the Construction Cost Index published by Engineering New-Record Magazine (“CCI”) for the
month in which the Notice to Proceed is issued, has increased over the CCI published in the
Engineering New Record for September 2005 (CCI as of September 2005= 7540.38), the Contract Price
will be increased by an equal percentage amount.



     4. Fagen will assist Owner in locating appropriate management for the Facility.



     5. Fagen requires representation of 10 counties, at a minimum, located within Minnesota and
North Dakota on the Board of Directors, and Owner shall provide to Fagen a list of the names,
addresses (residential), and phone numbers of such Directors.



     6. Fagen will assist Owner in presenting information to potential investors, potential
lenders, and various entities or agencies that may provide project development assistance, so long
as the Project has 5% or less dilution. In addition, pro forma projections shall be greater than
20% ROI by year five.



     7. During the term of this Letter of Intent the Owner agrees that Fagen will be the exclusive
Developer and Design-Builder for the Owner in connection with matters covered by this Letter of
Intent, and Owner shall not disclose any information related to this Letter of Intent to a
competitor or prospective competitor of Fagen.



     8. This Letter of Intent shall terminate on December 31, 2007 unless the basic size and design
of the Facility have been determined and mutually agreed upon, and a specific site or sites have
been determined and mutually agreed upon, and at least 10% of the necessary equity has been raised.
Furthermore, this Letter of Intent shall terminate on December 31, 2008 unless financing for the
Facility has been secured. Either of the



 









 




aforementioned dates may be extended upon mutual written agreement of the Parties.




     9. Fagen and Owner agree to negotiate in good faith and enter into a definitive lump sum
design build agreement, including exhibits thereto(“Transaction Documents”), acceptable to the
Parties. This Letter of Intent shall terminate upon execution of the Transaction Documents.



     10. The Parties will jointly agree on the timing and content of any public disclosure,
including, but not limited to, press releases, relating to Fagen’s involvement in Owner’s Project,
and no such disclosure shall be made without mutual consent and approval, except as may be
required by applicable law.



     11. The Parties agree that this Letter of Intent may be modified only by written agreement by
the Parties.



     12. This Letter of Intent may be executed in one or more counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which taken together constitute one
and the same instrument. Signatures which have been affixed and transmitted by facsimile shall be
binding to the same extent as an original signature, although the Parties contemplate that a fully
executed counterpart with original signatures will be delivered to each Party.



	 	 	 	 	 	 	 
	Gold Energy, LLC	 	Fagen, Inc.
	(f/k/a Red River Energy, LLC)	 	 	 	 
	 
	 	 	 	 	 	 
	By:

	 	/s/ Les Nesuig	 	By:	 	/s/ [ILLEGIBLE SIGNATURE]
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Its:

	 	Chairman	 	Its:	 	 
	 	 	 	 	 	 	 





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