**Exhibit 10.1**   Amount: $740,000.00 Date: 7/13/2006RURAL DEVELOPMENT LOAN AGREEMENT     THIS AGREEMENT dated as of the date first written above between Western Iowa Energy, LLC., alimited liability company organized and existing under the laws of the State of Iowa (the“Borrower”) and Glidden Rural Electric Cooperative of Glidden, Iowa, a cooperative corporationorganized and existing under the laws of the State of Iowa, (“Glidden”) sets forth the terms andunderstandings between the Borrower and Glidden regarding a loan (the “Loan”) Glidden is making tothe Borrower pursuant to Section 313 of the Rural Electrification Act of 1936, as amended (the“Act”) and 7 C.F.R. Part 1703, Subpart B — Rural Economic Development Loan and Grant Program (the“Regulations”).     Glidden has filed an application and supporting material (collectively, the “ApplicationMaterials”) with the United States of America (the “Government”) pursuant to 7 C.F.R. Section1703.34 requesting the Loan for promoting rural economic development.     The Government wishes to make the Loan to Glidden from the Rural Economic DevelopmentSubaccount within the Rural Electrification and Telephone Revolving Fund pursuant to Section 313 ofthe Act to finance the Rural development project (the “Project”) more particularly described in theLetter of Agreement (the “Letter of Agreement”) between the Government and Glidden dated February27, 2006.     Glidden wishes to make a loan to Borrower for the purposes described in the ApplicationMaterials.     NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL AGREEMENTS HEREIN CONTAINED, GLIDDEN AND BORROWERAGREE AS FOLLOWS:1. Loan Terms.A. Glidden shall lend Seven Hundred Forty Thousand Dollars ($740,000.00) to the Borrower, andthe proceeds of the Loan shall be used solely: (a) to finance the construction of a bio-dieselmanufacturing facility in Wall Lake, Iowa (the Approved Purpose) as set forth in theApplication Materials, or (b) to reimburse short-term financing and expenditures for theApproved Purpose. The proceeds of the Loan shall not be used to finance any costs or retireany indebtedness for the Approved Purpose incurred prior to the Government’s receipt on June15, 2005, of the Application Materials.B. Glidden shall advance the proceeds of the Loan to the Borrower in one disbursement at thetime of closing.
 

 
C. The Borrower shall repay the Loan in accordance with the note to be executed by theBorrower and made payable to Glidden. The Borrower shall begin to repay the Loan on thedate set forth in the note and shall continue paying without interruption until allindebtedness associated with the Loan has been repaid in full on or before the tenthanniversary of the date of the note. D. The Loan will not bear interest although indebtedness not paid when due will besubjected to late charges and other charges provided in the note described below. E. If the Borrower fails to satisfy all conditions, requirements and terms prerequisite to theadvance of the proceeds of the Loan from Glidden to the Borrower as set forth in thisAgreement before the first anniversary of the date of this Agreement, or such later date asGlidden at its discretion may approve in writing in furtherance of the purposes of the Act,the Loan Commitment shall be considered rescinded. F. In order to secure performance of its obligations hereunder and under the Note, the Borrowershall provide Glidden with an Irrevocable Letter of Credit in a form acceptable to Glidden andin an amount equal to the Principal amount of the Note, with Glidden designated as thebeneficiary of said Irrevocable Letter of Credit. 2. Affirmative Covenants. A. The Borrower shall execute and deliver its promissory note (the “Note”) to Glidden in theform attached hereto in order to evidence its obligation to repay the Loan by the terms ofthis Agreement, the Letter of Agreement and the Note. The Borrower shall pay all indebtednessevidenced by the Note in the manner and at the times described therein. B. The Borrower shall promptly use the proceeds of the Loan only in the manner and exclusivelyfor the purposes set forth in the Application Materials as previously approved by TheGovernment and in accordance with the Letter of Agreement between The Government and Glidden,and this Agreement and the Regulations (as they may be amended from time to time). No changesmay be made in the foregoing without the prior written approval of Glidden and the Government.Until disbursed by the Borrower for authorized Loan purposes, the Borrower shall deposit theLoan Proceeds in a separate bank account which is fully insured by the Federal DepositInsurance Corporation. C. The Borrower shall return to Glidden as a prepayment on the Note all proceeds of the Loan,including any interest earned on the proceeds of the Loan, which have not been expended by theBorrower for authorized Loan purposes before the second anniversary of the date of the advanceof the proceeds of the Loan from Glidden to the Borrower, or such later date as Glidden at itsdiscretion may approve in writing in furtherance of the purposes of the Act. D. The Borrower shall make all payments on the Note by using a reasonable method of
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  payment specified by Glidden. E. The Borrower agrees to provide to Glidden (a) an itemized list with attached invoices,receipts, bills of sale, and other evidence that shows the expenditures made on the Projectfor the Approved Purpose using the proceeds of the Loan and (b) a signed certification from anauthorized official of Borrower to the effect “I certify that the proceeds of the RuralEconomic Development Loan from Glidden were expended on the approved purposes shown on thislist and the attached invoices, receipts, bills of sale, and other evidence represent theitems shown on this list.” Such invoices, receipts, bills of sale, and other evidence must atleast total the amount of funds that have been provided to Borrower using the proceeds of theLoan. The certified list must be provided upon completion of the Project, or by the firstanniversary of the date of the advance of funds to Borrower, whichever occurs first. If allfunds have not been expended by the first anniversary, Borrower must provide to Glidden acertified list of current expenditures and a statement of its intended expenditure schedule.Upon completion of the Project, Borrower must provide to Glidden a final certified list of theexpenditures, including the attachments. A duplicate certified listing of expenditures shallalso be submitted to RBS for its files.F. The Borrower shall permit Glidden officials and officials of The Government to inspect andcopy its records about the Project during regular business hours. Representatives of Gliddenand The Government may inspect the Project itself during regular business hours.G. The Borrower shall comply with the Regulations, as they may be amended from time to time,including, without limitation, any federal regulations or federal statutes which theRegulations identify as being applicable to activities contemplated by the ApplicationMaterials or this Agreement.H. So long as the Borrower remains obligated to Glidden under the terms of any financialassistance previously or subsequently extended under the Act, the Borrower shall fully performall obligations to Glidden which the Borrower has undertaken concerning such assistance.I. Upon completion of the Project, Borrower shall provide to Glidden and the Government aManagement Representation Letter, a copy of which is attached hereto as Exhibit “A,” typed onthe Borrower’s letterhead and duly executed by an authorized officer of the Borrower.J. The Borrower shall complete the certification form, Certification Regarding Debarment,Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transactions, attachedhereto as Exhibit “B.” In addition, Borrower shall ensure that the certification form iscompleted by all applicable parties in conjunction with any lower-tier transactions involvingthe Project.
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3. Negative Covenant.     The Borrower shall not enter into or request Glidden to approve any agreements which wouldpermit third parties to fund, develop, manage, own, lease or operate the Project in a manner thatwould violate the Regulations or this Agreement if the Borrower were to undertake such activity inits own name.4. Representations and Warranties.The Borrower represents and warrants that on and as of the date first set forth above:A. The Borrower has been duly organized and is validly- existing as a as a corporation in goodstanding, with authority to do business in the State of Iowa, and with the power and authorityto perform its obligations under this Agreement, the Note and the Regulations.B. This Agreement and the Note have been duly authorized, executed and delivered by the Borrowerand such documents constitute the legal and binding agreements of the Borrower, enforceableagainst the Borrower in accordance with their respective terms, subject to (i) applicable lawsof general application relating to or affecting creditors’ rights generally and (ii) theapplication of general principles of equity regardless of whether such enforceability isconsidered in a proceeding in equity or at law.C. The execution or the delivery by the Borrower of this Agreement, the Security Agreement andthe Note; the consummation of the transactions contemplated herein or therein; and thefulfillment by the Borrower of the terms hereof or thereof, do not conflict with or violate,result in a breach of or constitute a default under any term or provision of theorganizational documents of the Borrower or any law or regulation or any order now applicableto the Borrower of any court, regulatory body having jurisdiction over the Borrower, or theterms of any indenture, deed of trust, mortgage, note, note agreement or instrument to whichthe Borrower or any of its properties is bound. The Borrower has not received any notice fromany other party to any of the foregoing that a default has occurred or that any event orcondition exist that with the giving of notice or lapse of time or both would constitute sucha default.D. No approval, authorization, consent, order, registration, filing, qualification, license orpermit of or with any state or federal court or governmental agency or body havingjurisdiction over the Borrower is required by the Borrower for the consummation by theBorrower of the transactions contemplated by this Agreement, the Letter of Agreement, theSecurity Agreement, and the Note except such as have been obtained.
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E. There is no pending or threatened action, suit or proceeding before any court or governmentalagency, authority or body or any arbitrator concerning the Borrower, this Agreement, theLetter of Agreement or the Note which, if adversely determined, would have a material adverseeffect on the Borrowers ability to perform its obligations under this Agreement, the Letter ofAgreement or the Note.F. All information, reports and other papers and data furnished to Glidden by the Borrowerconcerning the preapplication and application of the Borrower for the Loan were, at the timethe same were so furnished, complete and correct in all material respects to the extentnecessary to give Glidden a true and accurate knowledge of the subject matter and no documentfurnished or other written statement made to Glidden in connection with the Loan contains anyuntrue statement of a fact material to the financial condition of the Borrower or the Projector omits to state such a material fact necessary in order to make the statements containedtherein not misleading. G. The Borrower has reviewed the Regulations and understands and accepts therequirements which the Regulations impose upon it. H. The Borrower does not expect or intend the Project to result primarily in thetransfer of any existing employment or business activity from one area to another. 5. Default. A. Upon the occurrence of an event: of default as defined in this Agreement, the holder of theNote may declare all or any portion of the indebtedness arising under this Agreement,including indebtedness evidenced by the Note, to be immediately due and payable and mayproceed to enforce its rights under this Agreement and the Note. B. As used in this Agreement, the term “event of default” shall mean the occurrenceof any of the following: (1) Any principal installment is not paid within ten (10) days of the date on which itis required to be made, whether by acceleration or note; (2) Failure, inability or unwillingness of the Borrower to carry out or comply with, or cause tobe carried out or complied with, the specific undertakings described in the ApplicationMaterials; (3) Any representation or warranty made by the Borrower herein, in the Application Materials, orin any certificate or report furnished by or on behalf of the Borrower about any of theforegoing shall prove to be false, incomplete or incorrect in any material respect;
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(4) Default shall be made in due observance or performance of any of the covenants,conditions or agreements of the Borrower, and such default shall continue for thirty (30)days after written notice specifying such default and requiring the same to be remediedshall have been given to the Borrower by the holder of the Note; (5) An event of default shall have occurred and be continuing under any mortgage of the Borrowerwhich secures any form of financial assistance heretofore or hereafter furnished to theBorrower by Glidden; (6) Commencement of a case in bankruptcy by or against the Borrower;(7) Application for appointment of a receiver for, making a general assignment for the benefit ofcreditors by, or insolvency of the Borrower; or(8) Violation of the Regulations in any material respect, by trustees or other officials,employees or agents of the Borrower, and such violation shall continue for a period of thirty(30) days without being rectified to the satisfaction of Glidden after written noticespecifying such default and requiring the same to be rectified has been given by Glidden tothe Borrower. 6. Miscellaneous.A. Every right or remedy herein conferred upon or reserved to the holder of the Note shall becumulative and shall be in addition to every other right and remedy now or hereafter existingat law or in equity, or by statute or regulation.B. The invalidity of any one or more phrases, clauses, sentences, paragraphs or provisions ofthis Agreement shall not affect the remaining portions hereof.C. In the event that Glidden shall sell the Note to an insured purchaser, Glidden and not theinsured purchaser, shall be considered to be, and shall have the rights of, the holder of theNote for purposes of this Agreement.D. This Loan Agreement is entered into between the parties concerning a zero interest loan whichGlidden is making to the Borrower pursuant to § 313 of the Rural Electrification Act of 1936as amended, to promote rural economic development and job creation projects. Accordingly, solong as Glidden shall, under the terms of this Agreement, be the holder of the Note, thisAgreement and the Note shall each he governed by and construed in accordance with the laws ofthe United States and the regulations of the Rural Utilities Service.     IN WITNESS WHEREOF, WESTERN IOWA ENERGY, LLC, as Borrower, has caused this Loan Agreement tobe signed in its name and its seal to he hereunto affixed and attested by its duly authorizedofficials thereunto, and GLIDDEN RURAL ELECTRIC
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COOPERATIVE, has caused this Loan Agreement to be duly executed in its behalf, all as of the dayand year first written above.      WESTERN IOWA ENERGY, LLC