##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-KSB
 
 þ
    
    Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934.
 For the fiscal year ended September 30, 2006
 o
    
    Transition report under Section 13 or 15(d) of the Exchange Act.
 For the transition period from  to
 Commission file number 333-131749
 CARDINAL ETHANOL, LLC
  Indiana
    
    20-2327916(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)2 OMCO Square, Suite 201, Winchester, IN
    
    47394(Address of principal executive offices)
    
    (Zip Code)
 (765) 584-2209
  None
  None
 þ o
 þ
  o þ
 None
   o þ




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##### 



Table of Contents
 PART I
    
    
    3ITEM 1. DESCRIPTION OF BUSINESS
    
    
    3ITEM 1A. RISK FACTORS
    
    
    18ITEM 2. DESCRIPTION OF PROPERTY
    
    
    25ITEM 3. LEGAL PROCEEDINGS
    
    
    26ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    26PART II
    
    
    26ITEM 5. MARKET FOR COMMON EQUITY AND RELATED MEMBER MATTERS
    
    
    26ITEM 6. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
    
    
    27ITEM 7. FINANCIAL STATEMENTS
    
    
    36ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    47ITEM 8A. CONTROLS AND PROCEDURES
    
    
    47ITEM 8B. OTHER INFORMATION
    
    
    47PART III
    
    
    47ITEM 9. DIRECTORS; EXECUTIVE OFFICERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
    
    
    47ITEM 10. EXECUTIVE COMPENSATION
    
    
    53ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED MEMBER MATTERS
    
    
    54ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
    
    
    56ITEM 13. EXHIBITS
    
    
    57ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    59SIGNATURES
    
    
    60Project Development Fee AgreementDistiller's Grain Marketing AgreementLump Sum Design-Build AgreementEthanol Purchase and Sale AgreementConstruction Loan AgreementConstruction NoteRevolving NoteLetter of Credit Promissory Note and Continuing Letter of Credit AgreementConstruction Loan Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Financing StatementSecurity AgreementMaster AgreementCode of EthicsCertificateCertificateSection 1350 CertificationSection 1350 Certification
  2




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AVAILABLE INFORMATION
  
 PART I
 
 ITEM 1. DESCRIPTION OF BUSINESS.
 Business Development
      3




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See Distribution of
Principal Products.
   Principal Products and Markets
  Ethanol
    Distillers Grains
  4




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Local Ethanol and Distillers Grains Markets
 Distribution of Principal Products
  Regional Ethanol Markets
  National Ethanol Markets
    Distribution of Principal Products
  5




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Ethanol Distribution
  Distillers Grains Distribution
  New Products and Services
  Governmental Regulation and Federal Ethanol Supports
 Federal Ethanol Supports
 See,
National Ethanol Markets.
  6




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Effect of Governmental Regulation
   7




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Competition
    most
 U.S. FUEL ETHANOL BIOREFINERIES AND PRODUCTION CAPACITY
million gallons per year (mmgy)
 UnderCurrent
    
    Construction/Capacity
    
    ExpansionsCOMPANY
    
    LOCATION
    
    FEEDSTOCK
    
    (mgy)
    
    (mgy)Abengoa Bioenergy Corp.
    
    York, NE
    
    Corn/milo
    
    
    55Colwich, KS
    
    
    
    
    25Portales, NM
    
    
    
    
    30Ravenna, NE
    
    
    
    
    
    
    
    
    88
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UnderCurrent
    
    Construction/Capacity
    
    ExpansionsCOMPANY
    
    LOCATION
    
    FEEDSTOCK
    
    (mgy)
    
    (mgy)Aberdeen Energy*
    
    Mina, SD
    
    Corn
    
    
    
    
    
    
    100Absolute Energy, LLC
    
    St. Ansgar, IA
    
    Corn
    
    
    
    
    
    
    100ACE Ethanol, LLC
    
    Stanley, WI
    
    Corn
    
    
    41Adkins Energy, LLC*
    
    Lena, IL
    
    Corn
    
    
    40Advanced Bioenergy
    
    Fairmont, NE
    
    Corn
    
    
    
    
    
    
    100AGP*
    
    Hastings, NE
    
    Corn
    
    
    52Agra Resources Coop. d.b.a EXOL*
    
    Albert Lea, MN
    
    Corn
    
    
    40
    
    
    
    8Agri-Energy, LLC*
    
    Luverne, MN
    
    Corn
    
    
    21Alchem Ltd. LLLP
    
    Grafton, ND
    
    Corn
    
    
    10.5Al-Corn Clean Fuel*
    
    Claremont, MN
    
    Corn
    
    
    35
    
    
    
    15Amaizing Energy, LLC*
    
    Denison, IA
    
    Corn
    
    
    40Archer Daniels Midland
    
    Decatur, IL
    
    Corn
    
    
    1070Cedar Rapids, IA
    
    CornClinton, IA
    
    CornColumbus, NE
    
    CornMarshall, MN
    
    CornPeoria, IL
    
    CornWallhalla, ND
    
    Corn/barleyASAlliances Biofuels, LLC
    
    Albion, NE
    
    Corn
    
    
    
    
    
    
    100Linden, IN
    
    Corn
    
    
    
    
    
    
    100Bloomingburg, OH
    
    Corn
    
    
    
    
    
    
    100Aventine Renewable Energy, Inc.
    
    Pekin, IL
    
    Corn
    
    
    100
    
    
    
    57Aurora, NE
    
    Corn
    
    
    50Badger State Ethanol, LLC*
    
    Monroe, WI
    
    Corn
    
    
    48Big River Resources, LLC *
    
    West Burlington, IA
    
    Corn
    
    
    52Blue Flint Ethanol
    
    Underwood, ND
    
    Corn
    
    
    
    
    
    
    50Broin Enterprises, Inc.*
    
    Scotland, SD
    
    Corn
    
    
    1Bushmills Ethanol, Inc.*
    
    Atwater, MN
    
    Corn
    
    
    40Cardinal Ethanol
    
    Harrisville, IN
    
    Corn
    
    
    
    
    
    
    100Cargill, Inc.
    
    Blair, NE
    
    Corn
    
    
    85Eddyville, IA
    
    Corn
    
    
    35Cascade Grain
    
    Clatskanie, OR
    
    Corn
    
    
    
    
    
    
    108Center Ethanol Company
    
    Sauget, IL
    
    Corn
    
    
    
    
    
    
    54Central Indiana Ethanol, LLC
    
    Marion, IN
    
    Corn
    
    
    
    
    
    
    40Central MN Ethanol Coop*
    
    Little Falls, MN
    
    Corn
    
    
    21.5Central Wisconsin Alcohol
    
    Plover, WI
    
    Seed corn
    
    
    4Chief Ethanol
    
    Hastings, NE
    
    Corn
    
    
    62Chippewa Valley Ethanol Co.*
    
    Benson, MN
    
    Corn
    
    
    45Commonwealth Agri-Energy, LLC*
    
    Hopkinsville, KY
    
    Corn
    
    
    33Conestoga Energy Partners
    
    Garden City, KS
    
    Corn/milo
    
    
    
    
    
    
    55Corn, LP*
    
    Goldfield, IA
    
    Corn
    
    
    50Cornhusker Energy Lexington, LLC
    
    Lexington, NE
    
    Corn
    
    
    40Corn Plus, LLP*
    
    Winnebago, MN
    
    Corn
    
    
    44Dakota Ethanol, LLC*
    
    Wentworth, SD
    
    Corn
    
    
    50DENCO, LLC*
    
    Morris, MN
    
    Corn
    
    
    21.5E3 Biofuels
    
    Mead, NE
    
    Corn
    
    
    
    
    
    
    24East Kansas Agri-Energy, LLC*
    
    Garnett, KS
    
    Corn
    
    
    35ESE Alcohol Inc.
    
    Leoti, KS
    
    Seed corn
    
    
    1.5Ethanol2000, LLP*
    
    Bingham Lake, MN
    
    Corn
    
    
    32Frontier Ethanol, LLC
    
    Gowrie, IA
    
    Corn
    
    
    60Front Range Energy, LLC
    
    Windsor, CO
    
    Corn
    
    
    40
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UnderCurrent
    
    Construction/Capacity
    
    ExpansionsCOMPANY
    
    LOCATION
    
    FEEDSTOCK
    
    (mgy)
    
    (mgy)Glacial Lakes Energy, LLC*
    
    Watertown, SD
    
    Corn
    
    
    50
    
    
    
    50Global Ethanol/Midwest Grain
Processors
    
    Lakota, IA
    
    Corn
    
    
    95Riga, MI
    
    Corn
    
    
    
    
    
    
    57Golden Cheese Company of
California*
    
    Corona, CA
    
    Cheese whey
    
    
    5Golden Grain Energy LLC*
    
    Mason City, IA
    
    Corn
    
    
    60
    
    
    
    50Golden Triangle Energy, LLC*
    
    Craig, MO
    
    Corn
    
    
    20Grain Processing Corp.
    
    Muscatine, IA
    
    Corn
    
    
    20Granite Falls Energy, LLC
    
    Granite Falls, MN
    
    Corn
    
    
    52Great Plains Ethanol, LLC*
    
    Chancellor, SD
    
    Corn
    
    
    50Green Plains Renewable Energy
    
    Shenandoah, IA
    
    Corn
    
    
    
    
    
    
    50Superior, IA
    
    Corn
    
    
    
    
    
    
    50Hawkeye Renewables, LLC
    
    Iowa Falls, IA
    
    Corn
    
    
    105Fairbank, IA
    
    Corn
    
    
    115Heartland Corn Products*
    
    Winthrop, MN
    
    Corn
    
    
    35Heartland Grain Fuels, LP*
    
    Aberdeen, SD
    
    Corn
    
    
    9Huron, SD
    
    Corn
    
    
    12
    
    
    
    18Heron Lake BioEnergy, LLC
    
    Heron Lake, MN
    
    Corn
    
    
    
    
    
    
    50Holt County Ethanol
    
    O'Neill, NE
    
    Corn
    
    
    
    
    
    
    100Horizon Ethanol, LLC
    
    Jewell, IA
    
    Corn
    
    
    60Husker Ag, LLC*
    
    Plainview, NE
    
    Corn
    
    
    26.5Illinois River Energy, LLC
    
    Rochelle, IL
    
    Corn
    
    
    
    
    
    
    50Indiana Bio-Energy
    
    Bluffton, IN
    
    Corn
    
    
    
    
    
    
    101Iowa Ethanol, LLC*
    
    Hanlontown, IA
    
    Corn
    
    
    50Iroquois Bio-Energy Company, LLC
    
    Rensselaer, IN
    
    Corn
    
    
    
    
    
    
    40James Valley Ethanol, LLC
    
    Groton, SD
    
    Corn
    
    
    50KAAPA Ethanol, LLC*
    
    Minden, NE
    
    Corn
    
    
    40Land O Lakes*
    
    Melrose, MN
    
    Cheese whey
    
    
    2.6Levelland/Hockley County Ethanol,
LLC
    
    Levelland, TX
    
    Corn
    
    
    
    
    
    
    40Lincolnland Agri-Energy, LLC*
    
    Palestine, IL
    
    Corn
    
    
    48Lincolnway Energy, LLC*
    
    Nevada, IA
    
    Corn
    
    
    50Liquid Resources of Ohio
    
    Medina, OH
    
    Waste beverage
    
    
    3Little Sioux Corn Processors, LP*
    
    Marcus, IA
    
    Corn
    
    
    52Merrick & Company
    
    Golden, CO
    
    Waste beer
    
    
    3MGP Ingredients, Inc.
    
    Pekin, IL
    
    Corn/wheat starch
    
    
    78Atchison, KSMichigan Ethanol, LLC
    
    Caro, MI
    
    Corn
    
    
    50Mid American Agri
Products/Wheatland
    
    Madrid, NE
    
    Corn
    
    
    
    
    
    
    44Mid-Missouri Energy, Inc.*
    
    Malta Bend, MO
    
    Corn
    
    
    45Midwest Renewable Energy, LLC
    
    Sutherland, NE
    
    Corn
    
    
    25Millennium Ethanol
    
    Marion, SD
    
    Corn
    
    
    
    
    
    
    100Minnesota Energy*
    
    Buffalo Lake, MN
    
    Corn
    
    
    18Missouri Ethanol
    
    Laddonia, MO
    
    Corn
    
    
    45Missouri Valley Renewable Energy,
LLC
    
    Meckling, SD
    
    Corn
    
    
    
    
    
    
    60NEDAK Ethanol
    
    Atkinson, NE
    
    Corn
    
    
    
    
    
    
    44New Energy Corp.
    
    South Bend, IN
    
    Corn
    
    
    102North Country Ethanol, LLC*
    
    Rosholt, SD
    
    Corn
    
    
    20Northeast Biofuels
    
    Voley, NY
    
    Corn
    
    
    
    
    
    
    114Northeast Missouri Grain, LLC*
    
    Macon, MO
    
    Corn
    
    
    45
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UnderCurrent
    
    Construction/Capacity
    
    ExpansionsCOMPANY
    
    LOCATION
    
    FEEDSTOCK
    
    (mgy)
    
    (mgy)Northern Lights Ethanol, LLC*
    
    Big Stone City, SD
    
    Corn
    
    
    50Northstar Ethanol, LLC
    
    Lake Crystal, MN
    
    Corn
    
    
    52Northwest Renewable, LLC
    
    Longview, WA
    
    Corn
    
    
    
    
    
    
    55Otter Creek Ethanol, LLC*
    
    Ashton, IA
    
    Corn
    
    
    55Otter Tail Ag Enterprises
    
    Fergus Falls, MN
    
    Corn
    
    
    
    
    
    
    57.5Pacific Ethanol
    
    Madera, CA
    
    Corn
    
    
    35Boardman, OR
    
    Corn
    
    
    
    
    
    
    35Panda Energy
    
    Hereford, TX
    
    Corn/milo
    
    
    
    
    
    
    100Panhandle Energies of Dumas, LP
    
    Dumas, TX
    
    Corn/Grain Sorghum
    
    
    
    
    
    
    30Parallel Products
    
    Louisville, KY
    
    Beverage Waste
    
    
    5.4R. Cucamonga, CAPatriot Renewable Fuels, LLC
    
    Annawan, IL
    
    Corn
    
    
    
    
    
    
    100Permeate Refining
    
    Hopkinton, IA
    
    Sugars & starches
    
    
    1.5Phoenix Biofuels
    
    Goshen, CA
    
    Corn
    
    
    25Pinal Energy, LLC
    
    Maricopa, AZ
    
    Corn
    
    
    
    
    
    
    55Pine Lake Corn Processors, LLC*
    
    Steamboat Rock, IA
    
    Corn
    
    
    20Pinnacle Ethanol, LLC
    
    Corning, IA
    
    Corn
    
    
    
    
    
    
    60Prairie Ethanol, LLC
    
    Loomis, SD
    
    Corn
    
    
    60Prairie Horizon Agri-Energy, LLC
    
    Phillipsburg, KS
    
    Corn
    
    
    40Premier Ethanol
    
    Portland, IN
    
    Corn
    
    
    
    
    
    
    60Pro-Corn, LLC*
    
    Preston, MN
    
    Corn
    
    
    42Quad-County Corn Processors*
    
    Galva, IA
    
    Corn
    
    
    27Red Trail Energy, LLC
    
    Richardton, ND
    
    Corn
    
    
    
    
    
    
    50Redfield Energy, LLC
    
    Redfield, SD
    
    Corn
    
    
    
    
    
    
    50Reeve Agri-Energy
    
    Garden City, KS
    
    Corn/milo
    
    
    12Renew Energy
    
    Jefferson Junction, WI
    
    Corn
    
    
    
    
    
    
    130Siouxland Energy & Livestock Coop*
    
    Sioux Center, IA
    
    Corn
    
    
    25
    
    
    
    40Siouxland Ethanol, LLC
    
    Jackson, NE
    
    Corn
    
    
    
    
    
    
    50Sioux River Ethanol, LLC*
    
    Hudson, SD
    
    Corn
    
    
    50Southwest Iowa Renewable Energy,
LLC
    
    Council Bluffs, IA
    
    Corn
    
    
    
    
    
    
    110Sterling Ethanol, LLC
    
    Sterling, CO
    
    Corn
    
    
    42Summit Ethanol
    
    Leipsic, OH
    
    Corn
    
    
    
    
    
    
    60Tall Corn Ethanol, LLC*
    
    Coon Rapids, IA
    
    Corn
    
    
    49Tate & Lyle
    
    Loudon, TN
    
    Corn
    
    
    67
    
    
    
    38Ft. Dodge, IA
    
    Corn
    
    
    
    
    
    
    105The Anderson Albion Ethanol LLC
    
    Albion, MI
    
    Corn
    
    
    55The Andersons Clymers Ethanol, LLC
    
    Clymers, IN
    
    Corn
    
    
    
    
    
    
    110The Andersons Marathon Ethanol, LLC
    
    Greenville, OH
    
    Corn
    
    
    
    
    
    
    110Trenton Agri Products, LLC
    
    Trenton, NE
    
    Corn
    
    
    40United WI Grain Producers, LLC*
    
    Friesland, WI
    
    Corn
    
    
    49US Bio Albert City
    
    Albert City, IA
    
    Corn
    
    
    
    
    
    
    100US Bio Woodbury
    
    Woodbury, MI
    
    Corn
    
    
    45US Bio Hankinson
    
    Hankinson, ND
    
    Corn
    
    
    
    
    
    
    100US Bio Ord
    
    Ord, NE
    
    Corn
    
    
    
    
    
    
    50US Bio Platte Valley
    
    Central City, NE
    
    Corn
    
    
    100US Bio Dyersville
    
    Dyersville, IA
    
    Corn
    
    
    
    
    
    
    100U.S. Energy Partners, LLC (White
Energy)
    
    Russell, KS
    
    Milo/wheat starch
    
    
    48
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UnderCurrent
    
    Construction/Capacity
    
    ExpansionsCOMPANY
    
    LOCATION
    
    FEEDSTOCK
    
    (mgy)
    
    (mgy)Utica Energy, LLC
    
    Oshkosh, WI
    
    Corn
    
    
    48VeraSun Energy Corporation
    
    Aurora, SD
    
    Corn
    
    
    230
    
    
    
    330Ft. Dodge, IA
    
    CornCharles City, IA
    
    CornWelcome, MN
    
    CornHartely, IA
    
    CornVoyager Ethanol, LLC*
    
    Emmetsburg, IA
    
    Corn
    
    
    52Western Plains Energy, LLC*
    
    Campus, KS
    
    Corn
    
    
    45Western Wisconsin Renewable
Energy, LLC*
    
    Boyceville, WI
    
    Corn
    
    
    40White Energy
    
    Hereford, TX
    
    Corn/Milo
    
    
    
    
    
    
    100Wind Gap Farms
    
    Baconton, GA
    
    Brewery Waste
    
    
    0.4
    
    
    
    38Renova Ethanol
    
    Torrington, WY
    
    Corn
    
    
    5Xethanol BioFuels, LLC
    
    Blairstown, IA
    
    Corn
    
    
    5
    
    
    
    35Yuma Ethanol
    
    Yuma, CO
    
    Corn
    
    
    
    
    
    
    40Total Current Capacity at 109
ethanol biorefineries
    
    
    
    
    
    
    5,281.4Total Under Construction (56)/
Expansions (7)
    
    
    
    
    
    
    
    
    
    
    4,434.5Total Capacity
    
    
    
    
    
    
    9,715.9
 
 * locally-owned
    
    Renewable Fuels AssociationLast Updated December 12, 2006
 Competition from Alternative Fuels
    12




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Distillers Grains Competition
  Sources and Availability of Raw Materials
 Corn Feedstock Supply
      13




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Utilities
  Natural Gas.
 Electricity.
 Water
  14




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Research and Development
  Dependence on One or a Few Major Customers
  Costs and Effects of Compliance with Environmental Laws
  Alcohol Fuel Producers Permit.
 SPCC and RMP.
  15




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Air Permits.
    Water Permits.
  16




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Employees
  See Item 12 Certain Relationships and Related Transactions.
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# Full-TimePosition
    
    PersonnelGeneral manager
    
    
    1Plant Manager
    
    
    1Commodities Manager
    
    
    1Controller
    
    
    1Lab Manager
    
    
    1Lab Technician
    
    
    2Secretary/Clerical
    
    
    3Shift Supervisors
    
    
    4Officer Manager
    
    
    1Maintenance Supervisor
    
    
    1Maintenance Craftsmen
    
    
    6Plant Operators
    
    
    23TOTAL
    
    
    45
 
 ITEM 1A. RISK FACTORS.
 You should carefully read and consider the risks and uncertainties below and the other information
contained in this report. The risks and uncertainties described below are not the only ones we may
face. The following risks, together with additional risks and uncertainties not currently known to
us or that we currently deem immaterial could impair our financial condition and results of
operation.
 Risks Related to Cardinal Ethanol as a Development-Stage Company
 Cardinal Ethanol has no operating history, which could result in errors in management and
operations causing a reduction in the value of your investment.
 We have little to no experience in the ethanol industry and our directors do not dedicate
their efforts to our project on a full time basis, which may affect our ability to build and
operate the ethanol plant.
 We will depend on Fagen, Inc. for expertise in beginning operations in the ethanol industry
and any loss of this relationship could cause us delay and added expense, placing us at a
competitive disadvantage.
 18




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If we fail to finalize critical agreements, such as
utility supply agreements, or the final agreements are unfavorable compared to what we currently
anticipate, our project may fail or be harmed in ways that significantly reduce the value of your
investment.
 Our business is not diversified.
 We have a history of losses and may not ever operate profitably.
 We will depend on decisions made by our initial board of directors until the plant is built.
 We have one full-time employee, but we may not be able to hire employees capable of
effectively operating the ethanol plant, which may hinder our ability to operate profitably.
 Risks Related to Construction of the Ethanol Plant
 We will depend on Fagen, Inc. and ICM, Inc. to design and build our ethanol plant and their
failure to perform could force us to abandon business, hinder our ability to operate profitably or
decrease the value of your investment.
  19




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We may need to increase cost estimates for construction of the ethanol plant, and such
increase could result in devaluation of our units if ethanol plant construction requires additional
capital.
  Construction delays could result in delays in our ability to generate profits if our
production and sale of ethanol and its co-products are similarly delayed.
 Fagen, Inc. and ICM, Inc. may have current or future commitments to design and build other
ethanol manufacturing facilities ahead of our plant and those commitments could delay construction
of our plant and our ability to generate revenues.
 Defects in plant construction could result in delays in our ability to generate revenues if
our plant does not produce ethanol and its co-products as anticipated.
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The plant site may have unknown environmental problems that could be expensive and time
consuming to correct, which may delay or halt plant construction and delay our ability to generate
revenue.
 Risks Relating to Our Business
 We have no operating history and our business may not be as successful as we anticipate.
 Our financial performance will be significantly dependent on corn and natural gas prices and
generally we cannot pass on increases in input prices to our customers.
   . See Risks Relating to Our Business  We expect to engage in hedging transaction
which involve risks that can harm our business.
 The spread between ethanol and corn prices can vary significantly and we do not expect the
spread to
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remain at the high levels recently experienced by the ethanol industry.
 Our revenues will be greatly affected by the price at which we can sell our ethanol and
distillers grains.
  We expect to sell all of the ethanol we produce to Murex in accordance with an exclusive
ethanol marketing agreement.
 We expect to engage in hedging transactions which involve risks that can harm our business.
  22




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Changes and advances in ethanol production technology could require us to incur costs to
update our plant or could otherwise hinder our ability to compete in the ethanol industry or
operate profitably.
 Risks Related to Ethanol Industry
 Overcapacity within the ethanol industry could cause oversupply of ethanol and a decline in
ethanol prices.
 We operate in a competitive industry and compete with larger, better financed entities which
could impact our ability to operate profitably.
  Competition from the advancement of alternative fuels may lessen the demand for ethanol.
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Corn-based ethanol may compete with cellulose-based ethanol in the future, which could make it
more difficult for us to produce ethanol on a cost-effective basis .
 Competition from ethanol imported from Caribbean basin countries may be a less expensive
alternative to our ethanol.
 Competition from ethanol imported from Brazil may be a less expensive alternative to our
ethanol.
 Consumer resistance to the use of ethanol based on the belief that ethanol is expensive, adds
to air pollution, harms engines and takes more energy to produce that it contributes may reduce the
demand for ethanol.
 Risks Related to Regulation and Governmental Action
 A change in government policies favorable to ethanol may cause demand for ethanol to decline.
 24




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##### Table of Contents



Government incentives for ethanol production, including federal tax incentives, may be
eliminated in the future, which could hinder our ability to operate at a profit.
  Changes in environmental regulations or violations of the regulations could be expensive and
reduce our profitability.
 
 ITEM 2. DESCRIPTION OF PROPERTY.
     25




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##### Table of Contents



ITEM 3. LEGAL PROCEEDINGS.
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
  
 PART II
 
 ITEM 5. MARKET FOR COMMON EQUITY AND RELATED MEMBER MATTERS.
      26




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##### Table of Contents



ITEM 6. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
 Cautionary Statements Regarding Forward Looking Statements
  
    
    the availability and adequacy of our cash flow to meet its requirements, including payment of loans;
    
    economic, competitive, demographic, business and other conditions in our local and regional markets;
    
    changes or developments in laws, regulations or taxes in the ethanol, agricultural or energy industries;
    
    actions taken or not taken by third-parties, including our suppliers and competitors,
as well as legislative, regulatory, judicial and other governmental authorities;
    
    competition in the ethanol industry;
    
    the loss of any license or permit;
    
    the loss of our plant due to casualty, weather, mechanical failure or any extended or
extraordinary maintenance or inspection that may be required;
    
    changes in our business strategy, capital improvements or development plans;
    
    the availability of additional capital to support capital improvements and development; and
    
    other factors discussed under the section entitled RISK FACTORS or elsewhere in this prospectus.
  Overview
  27




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##### Table of Contents



Plan of Operations for the Next 12 Months
  Project Capitalization
  28




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##### Table of Contents



Plant construction and start-up of plant operations
  29




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##### Table of Contents



Permitting and Regulatory Activities
    Trends and Uncertainties Impacting the Ethanol Industry and Our Future Operations
  30




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##### Table of Contents



31




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##### Table of Contents



Trends and uncertainties impacting the corn and natural gas markets and our future cost of goods
sold
      Technology Developments
  32




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##### Table of Contents



Liquidity and Capital Resources
 Estimated Sources of Funds
  Sources ofFunds(1)
    
    
    
    
    
    PercentOffering Proceeds (2)
    
    $
    70,210,000
    
    
    
    44.91
    %Seed Capital Proceeds (3)
    
    $
    1,360,000
    
    
    
    0.87
    %Grants(5)
    
    $
    775,000
    
    
    
    0.49
    %Interest Income
    
    $
    1,000,000
    
    
    
    0.64
    %Senior Debt Financing (4)
    
    $
    83,000,000
    
    
    
    53.09
    %Total Sources of Funds
    
    $
    156,345,000
    
    
    
    100.00
    %
 
 (1)
    
    The amount of senior debt financing may be adjusted depending on the amount of
grants we are able to obtain.(2)
    
    We received subscriptions from investors for approximately $70,210,000 in our
registered offering.(3)
    
    We have issued a total of 496 units to our seed capital investors at a price of
$2,500.00 per unit. In addition, we have issued 72 units to our founders at a price of
$1,666.67 per unit. We have issued a total of 568 units in our two private placements in
exchange for proceeds of $1,360,000.(4)
    
    On December 19, 2006, we closed our debt financing with First National Bank of
Omaha. Our senior credit facility is in the amount of $96,000,000, consisting of a
construction note of up to $83,000,000, a $10,000,000 revolving line
of credit, and
$3,000,000 in letters of credit.(5)
    
    In December 2005, we were awarded a $100,000 Value-Added Producer Grant from the
United States Department of Agriculture (USDA). Pursuant to the term of the grant, we
have used the funds for our costs related to raising capital, marketing, risk management,
and operational plans. In September 2006 we were awarded a $300,000 Value-Added Producer
Grant from the USDA which we expect to use for working capital expenses. In addition, we
have been awarded but have not yet received funds for a $250,000 grant from Randolph
County and $125,000 from the city of Union City. The physical address of our plant site
is in Union City, Indiana. Estimated Uses of Proceeds
   33




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Percent ofUse of Proceeds
    
    Amount
    
    TotalPlant construction
    
    $
    105,997,000
    
    
    
    67.80
    %CCI Contingencies
    
    
    4,800,000
    
    
    
    3.07
    %Land cost
    
    
    2,700,000
    
    
    
    1.73
    %Site development costs
    
    
    5,470,000
    
    
    
    3.50
    %Construction contingency
    
    
    6,383,000
    
    
    
    4.08
    %Construction performance bond
    
    
    300,000
    
    
    
    0.19
    %Construction insurance costs
    
    
    200,000
    
    
    
    0.13
    %Administrative building
    
    
    500,000
    
    
    
    0.32
    %Office equipment
    
    
    100,000
    
    
    
    0.06
    %Computers, Software, Network
    
    
    190,000
    
    
    
    0.12
    %Railroad
    
    
    5,500,000
    
    
    
    3.52
    %Rolling stock
    
    
    960,000
    
    
    
    0.61
    %Fire Protection/Water Supply
    
    
    6,345,000
    
    
    
    4.06
    %Capitalized interest
    
    
    1,750,000
    
    
    
    1.12
    %Start up costs:Financing costs
    
    
    800,000
    
    
    
    0.51
    %Organization costs
    
    
    1,500,000
    
    
    
    0.96
    %Pre production period costs
    
    
    850,000
    
    
    
    0.54
    %Inventory  working capital
    
    
    5,000,000
    
    
    
    3.20
    %Inventory  corn
    
    
    3,000,000
    
    
    
    1.92
    %Inventory  chemicals and ingredients
    
    
    500,000
    
    
    
    0.32
    %Inventory  Ethanol & DDGS
    
    
    3,000,000
    
    
    
    1.92
    %Spare parts  process equipment
    
    
    500,000
    
    
    
    0.32
    %Total
    
    
    156,345,000
    
    
    
    100.00
    %
  Financial Results
   Critical Accounting Estimates
  34




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Off-Balance Sheet Arrangements
  Employees
 DESCRIPTION OF BUSINESS  Employees.
 35




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##### Table of Contents



ITEM 7. FINANCIAL STATEMENTS.
  
    /s/ Boulay, Heutmaker, Zibell & Co. P.L.L.P.Certified Public Accountants
 
 36




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CARDINAL ETHANOL, LLC
   September 30,
    
    
    September 30,2006
    
    
    2005ASSETSCurrent AssetsCash and cash equivalents
    
    $
    330,836
    
    
    $
    5,295Investments
    
    
    
    
    
    
    66,573Interest receivable
    
    
    1,292
    
    
    
    Prepaid expenses
    
    
    25,193
    
    
    
    13,726Total current assets
    
    
    357,321
    
    
    
    85,594Property and EquipmentOffice equipment
    
    
    17,033
    
    
    
    5,681Less accumulated depreciation
    
    
    (1,955
    )
    
    
    (79
    )Net property and equipment
    
    
    15,078
    
    
    
    5,602Other AssetsDeferred offering costs
    
    
    596,977
    
    
    
    18,685Financing costs
    
    
    20,000
    
    
    
    Land options
    
    
    10,000
    
    
    
    Total other assets
    
    
    626,977
    
    
    
    18,685Total Assets
    
    $
    999,376
    
    
    $
    109,881
 September 30,
    
    
    September 30,2006
    
    
    2005LIABILITIES AND EQUITYCurrent LiabilitiesAccounts payable
    
    $
    141,781
    
    
    $
    33,392Accrued expenses
    
    
    3,856
    
    
    
    375Total current liabilities
    
    
    145,637
    
    
    
    33,767Commitments and ContingenciesMembers EquityMember
contributions, net of cost of raising capital, 568 and 72 units
outstanding at September 30, 2006 and 2005, respectively
    
    
    1,335,348
    
    
    
    120,000Deficit accumulated during development stage
    
    
    (481,609
    )
    
    
    (43,886
    )Total members equity
    
    
    853,739
    
    
    
    76,114Total Liabilities and Members Equity
    
    $
    999,376
    
    
    $
    109,881
  37




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CARDINAL ETHANOL, LLC
   Year Ended
    
    
    Year Ended
    
    
    From InceptionSeptember 30,
    
    
    September 30,
    
    
    (February 7, 2005)2006
    
    
    2005
    
    
    to September 30, 2006Revenues
    
    $
    
    
    
    $
    
    
    
    $
    Operating ExpensesProfessional fees
    
    
    301,475
    
    
    
    35,322
    
    
    
    336,797General and administrative
    
    
    288,247
    
    
    
    10,149
    
    
    
    298,396Total
    
    
    589,722
    
    
    
    45,471
    
    
    
    635,193Operating Loss
    
    
    (589,722
    )
    
    
    (45,471
    )
    
    
    (635,193
    )Other Income (Expense)Grant income
    
    
    100,000
    
    
    
    
    
    
    
    100,000Interest income
    
    
    34,295
    
    
    
    
    
    
    
    34,295Dividend income
    
    
    514
    
    
    
    1,487
    
    
    
    2,001Miscellaneous income
    
    
    18,000
    
    
    
    
    
    
    
    18,000Gain (loss) on sale of investments
    
    
    (810
    )
    
    
    98
    
    
    
    (712
    )Total
    
    
    151,999
    
    
    
    1,585
    
    
    
    153,584Net Loss
    
    $
    (437,723
    )
    
    $
    (43,886
    )
    
    $
    (481,609
    )Weighted Average Units Outstanding
    
    
    477
    
    
    
    68
    
    
    
    316Net Loss Per Unit
    
    $
    (917.66
    )
    
    $
    (645.38
    )
    
    $
    (1,524.08
    )
  38




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##### Table of Contents



CARDINAL ETHANOL, LLC
    Balance  February 7, 2005 (Date of Inception)
    
    $
    Capital contributions - 72 units, $1,666.67 per unit, February 2005
    
    
    120,000Net loss for the period from inception to September 30, 2005
    
    
    (43,886
    )Balance  September 30, 2005
    
    
    76,114Capital contributions - 496 units, $2,500 per unit, December 2005
    
    
    1,240,000Costs related to capital contributions
    
    
    (24,652
    )Net loss for the year ending September 30, 2006
    
    
    (437,723
    )Balance  September 30, 2006
    
    $
    853,739
  39




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##### Table of Contents



CARDINAL ETHANOL, LLC
   Year Ended
    
    
    Year Ended
    
    
    From InceptionSeptember 30,
    
    
    September 30,
    
    
    (February 7, 2005)2006
    
    
    2005
    
    
    to September 30, 2006Cash Flows from Operating ActivitiesNet loss
    
    $
    (437,723
    )
    
    $
    (43,886
    )
    
    $
    (481,609
    )Adjustments to reconcile net loss to net cash from operations:Depreciation
    
    
    1,876
    
    
    
    79
    
    
    
    1,955(Gain) loss on sale of investments
    
    
    810
    
    
    
    (98
    )
    
    
    712Grant income
    
    
    (100,000
    )
    
    
    
    
    
    
    (100,000
    )Unexercised land options
    
    
    16,800
    
    
    
    
    
    
    
    16,800Change in assets and liabilities:Interest receivable
    
    
    (1,292
    )
    
    
    
    
    
    
    (1,292
    )Prepaid expenses
    
    
    (11,467
    )
    
    
    (13,726
    )
    
    
    (25,193
    )Accounts payable
    
    
    111,223
    
    
    
    21,507
    
    
    
    132,730Accrued expenses
    
    
    3,481
    
    
    
    375
    
    
    
    3,856Net cash used in operating activities
    
    
    (416,292
    )
    
    
    (35,749
    )
    
    
    (452,041
    )Cash Flows from Investing ActivitiesCapital expenditures
    
    
    (12,937
    )
    
    
    (4,096
    )
    
    
    (17,033
    )Payments for land options
    
    
    (26,800
    )
    
    
    
    
    
    
    (26,800
    )Proceeds from (purchases of) investments, net
    
    
    65,763
    
    
    
    (66,475
    )
    
    
    (712
    )Net cash provided by (used in) investing activities
    
    
    26,026
    
    
    
    (70,571
    )
    
    
    (44,545
    )Cash Flows from Financing ActivitiesProceeds from grants
    
    
    100,000
    
    
    
    
    
    
    
    100,000Payments for deferred offering costs
    
    
    (579,541
    )
    
    
    (8,385
    )
    
    
    (587,926
    )Payments for financing costs
    
    
    (20,000
    )
    
    
    
    
    
    
    (20,000
    )Costs related to capital contributions
    
    
    (24,652
    )
    
    
    
    
    
    
    (24,652
    )Member contributions
    
    
    1,240,000
    
    
    
    120,000
    
    
    
    1,360,000Net cash provided by financing activities
    
    
    715,807
    
    
    
    111,615
    
    
    
    827,422Net Increase in Cash and Cash Equivalents
    
    
    325,541
    
    
    
    5,295
    
    
    
    330,836Cash and Cash Equivalents  Beginning of Period
    
    
    5,295
    
    
    
    
    
    
    
    Cash and Cash Equivalents  End of Period
    
    $
    330,836
    
    
    $
    5,295
    
    
    $
    330,836Supplemental Disclosure of Noncash
Investing and Financing ActivitiesDeferred offering costs included in accounts payable
    
    $
    9,051
    
    
    $
    10,300
    
    
    $
    9,051Capital expenditures included in accounts payable
    
    $
    
    
    
    $
    1,585
    
    
    $
    
  40




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##### Table of Contents



CARDINAL ETHANOL, LLC
  1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Nature of Business
  Fiscal Reporting Period
  Accounting
Estimates
  Cash
and Cash Equivalents
   Investments
   Property and Equipment
  41




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##### Table of Contents



CARDINAL ETHANOL, LLC
  Deferred Offering Costs
  Financing Costs
  Grants
  Income Taxes
  Fair Value of Financial Instruments
  Recently Issued Accounting Pronouncements
  2. DEVELOPMENT STAGE ENTERPRISE
    42




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##### Table of Contents



CARDINAL ETHANOL, LLC
  3. MEMBERS EQUITY
  4. INCOME TAXES
  2006
    
    
    2005Financial statement basis of assets
    
    $
    999,376
    
    
    $
    109,881Plus: organization and start-up costs capitalized
    
    
    471,722
    
    
    
    45,471Income tax basis of assets
    
    $
    1,471,098
    
    
    $
    155,352
  5. BANK FINANCING
    6. COMMITMENTS AND CONTINGENCIES
 Design Build Contract
  43




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##### Table of Contents



CARDINAL ETHANOL, LLC
     Office Lease
   Land options
  44
    Table of Contents   CARDINAL ETHANOL, LLC
    Grants
    Consulting Services
   45
    Table of Contents   CARDINAL ETHANOL, LLC
    Rail Track Design
  Marketing Agreements
   46




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##### Table of Contents



ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
  
 ITEM 8A. CONTROLS AND PROCEDURES.
   
 ITEM 8B. OTHER INFORMATION.
  
 PART III.
 
 ITEM 9. DIRECTORS; EXECUTIVE OFFICERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE
EXCHANGE ACT.
 Identification of Directors, Executive Officers and Significant Employees
  Director
    
    OfficeTroy Prescott
    
    Director & Chairman/PresidentThomas Chalfant
    
    Director & Vice Chairman/Vice PresidentDale Schwieterman
    
    Director & TreasurerJeremey Jay Herlyn
    
    Director & SecretaryRobert E. Anderson
    
    DirectorLawrence Allen Baird
    
    DirectorLarry J. Barnette
    
    DirectorRalph Brumbaugh
    
    DirectorThomas C. Chronister
    
    DirectorRobert John Davis
    
    DirectorDavid Matthew Dersch
    
    DirectorG. Melvin Featherston
    
    Director
 47




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##### Table of Contents



Director
    
    OfficeJohn W. Fisher
    
    DirectorEverett Leon Hart
    
    DirectorBarry Hudson
    
    DirectorLee James Kunzman
    
    DirectorCyril George LeFevre
    
    DirectorRobert L. Morris
    
    DirectorCurtis Allan Rosar
    
    DirectorJohn N. Shanks II
    
    DirectorMichael Alan Shuter
    
    DirectorSteven John Snider
    
    DirectorJerrold Lee Voisinet
    
    DirectorAndrew J. Zawosky
    
    Director
 Business Experience of Directors and Officers
  Troy Prescott, Chairman/President, Director,
   Thomas E. Chalfant, Vice Chairman/Vice President, Director,
   Dale A. Schwieterman, Treasurer, Director,
   Jeremey Jay Herlyn, Secretary, Director
 48




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##### Table of Contents



Robert E. Anderson, Director, th
   Lawrence Allen Baird, Director,
   Larry J. Barnette, Director,
   Ralph E. Brumbaugh, Director,
   Thomas C. Chronister, Director,
  49




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##### Table of Contents



Robert John Davis, Director,
   David Mathews Dersch, Director
   G Melvin Featherston, Director,
   John Wesley Fisher, Director,
   50




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##### Table of Contents



Everett Leon Hart, Director,
   Barry Hudson, Director,
   Lee James Kunzman, Director
   Cyril George LeFevre, Director,
   Robert L. Morris, Director,
   Curtis Allan Rosar, Director,
  51




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##### Table of Contents



John Nelton Shanks II, Director,
   Michael Alan Shuter, Director
   Steven John Snider, Director,
   Jerrold Leo Voisinet, Director,
   52




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##### Table of Contents



Andrew Zawosky Jr. Director
   Code of Ethics
   Identification of Audit Committee
  Audit Committee Financial Expert
  
 ITEM 10. EXECUTIVE COMPENSATION.
      53




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##### Table of Contents



ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED MEMBER
MATTERS.
 Security Ownership of Certain Beneficial Owners
  (3) Amount and(1) Title of
    
    (2) Name and Address of
    
    Nature of
    
    (4) PercentClass
    
    Beneficial Owner
    
    Beneficial Owner
    
    of ClassMembership Units
    
    Stephen L. Clark Family Partnership, LP
1223 North Rock Rd,
Bldg E, Suite 200
Witchita, KS 67206
    
    
    950
    
    
    
    6.52
    %
 Security Ownership of Management
  (3) Amount and(1) Title of
    
    (2) Name and Address of
    
    Nature of
    
    (4) PercentClass
    
    Beneficial Owner
    
    Beneficial Owner
    
    of ClassMembership Units
    
    Troy Prescott3780 N. 250 EastWinchester, IN 47394
    
    
    82 units
    
    
    
    0.56
    %Membership Units
    
    Thomas Chalfant12028 W. 700 NorthParker City, IN 47368
    
    
    57 units
    
    
    
    0.39
    %Membership Units
    
    Dale Schwieterman3924 CR 716 ACelina, OH 45822
    
    
    46 units
    
    
    
    0.32
    %Membership Units
    
    John N. Shanks, II349 N. 500 WestAnderson, IN 46011
    
    
    16 units
    
    
    
    0.11
    %Membership Units
    
    Robert E. Anderson5737 E. 156th StreetNoblesville, IN 46062
    
    
    88 units
    
    
    
    0.60
    %Membership Units
    
    Lawrence Allen Baird2579 S. 500 WestTipton, IN 46072
    
    
    48 units
    
    
    
    0.33
    %Membership Units
    
    Larry J. Barnette3247 N. 300 EastPortland, IN 47371
    
    
    26 units
    
    
    
    0.18
    %Membership Units
    
    Ralph BrumbaughP.O. Box 309Arcanum, OH 45304
    
    
    100 units
    
    
    
    0.69
    %Membership Units
    
    Thomas C. Chronister440 Kerr Island NorthRome City, IN 46784
    
    
    76 units
    
    
    
    0.52
    %Membership Units
    
    Robert John Davis4465 N. Co. Rd. 100 EastNew Castle, IN 47362
    
    
    36 units
    
    
    
    0.25
    %
 54




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##### Table of Contents



(3) Amount and(1) Title of
    
    (2) Name and Address of
    
    Nature of
    
    (4) PercentClass
    
    Beneficial Owner
    
    Beneficial Owner
    
    of ClassMembership Units
    
    David Matthew Dersch(1)305 N. Greenbriar Rd.Muncie, IN 47304
    
    
    696 units
    
    
    
    4.77
    %Membership Units
    
    G. Melvin
Featherston(2)14740 River Rd.Noblesville, IN 46062
    
    
    106 units
    
    
    
    0.73
    %Membership Units
    
    John W.
Fisher(3)P.O. Box 1408Muncie, IN 47308
    
    
    238 units
    
    
    
    1.63
    %Membership Units
    
    Everett
Hart(5)6934 Bradford
Childrens Home Rd.Greenville, OH 45331
    
    
    100 units
    
    
    
    0.69
    %Membership Units
    
    Jeremey Jay Herlyn841 Hidden Valley Dr.Richmond, IN 47374
    
    
    36 units
    
    
    
    0.25
    %Membership Units
    
    Barry Hudson1525 Meridian St.Portland, IN 47371
    
    
    66 units
    
    
    
    0.45
    %Membership Units
    
    Lee James Kunzman4740 Pennington Ct.Indianapolis, IN 46254
    
    
    20 units
    
    
    
    0.14
    %Membership Units
    
    Cyril George LeFevre1318 Fox Rd.Fort Recovery, OH 45846
    
    
    36 units
    
    
    
    0.25
    %Membership Units
    
    Robert L. Morris9380 W. CR 1000 S.Losantville, IN 47354
    
    
    32 units
    
    
    
    0.22
    %Membership Units
    
    Curtis Allan
Rosar(4)3587 Wernle Rd.Richmond, IN 47374
    
    
    326 units
    
    
    
    2.24
    %Membership Units
    
    Michael Alan Shuter6376 N. 300 WestAnderson, IN 46011
    
    
    26 units
    
    
    
    0.18
    %Membership Units
    
    Steven John Snider7290 Langdon Rd.Yorktown, IN 47396
    
    
    40 units
    
    
    
    0.27
    %Membership Units
    
    Jerrold Lee Voisinet450 Garby Rd.Piqua, OH 45356
    
    
    24 units
    
    
    
    0.16
    %Membership Units
    
    Andrew J. Zawosky50 Celestial Way # 208Juno Beach, FL 33408
    
    
    120 units
    
    
    
    0.82
    %Membership Units
    
    All Directors and Officers as a Group
    
    
    2,441 units
    
    
    
    16.75
    %
 55




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##### Table of Contents



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
 Transaction with director and member Troy Prescott
   56




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ITEM 13. EXHIBITS.
  Exhibit
    
    
    
    Method ofNo.
    
    Description
    
    Filing3.1
    
    Articles of Organization of Indiana Ethanol, LLC, Indiana.
    
    
    13.1A
    
    Name Change Amendment.
    
    
    13.3
    
    Second Amended & Restated Operating Agreement of the registrant.
    
    
    14.1
    
    Form of membership unit certificate.
    
    
    14.2
    
    Amended Form of Subscription Agreement.
    
    
    34.3
    
    Escrow Agreement dated April 21, 2006 between Cardinal Ethanol, LLC and First
Merchants Trust Company, N.A.
    
    
    25.1
    
    Opinion of Brown, Winick, Graves, Gross, Baskerville & Schoenebaum, P.L.C. as to
certain securities matters.
    
    
    48.1
    
    Opinion of Brown, Winick, Graves, Gross, Baskerville & Schoenebaum, P.L.C. as to
certain tax matters.
    
    
    410.1
    
    Letter of Intent dated June 13, 2005 between Cardinal Ethanol, LLC and Fagen, Inc.
    
    
    110.2
    
    Amendment Number One to Letter of Intent dated October 24, 2005 between Cardinal
Ethanol, LLC and Fagen, Inc.
    
    
    110.3
    
    Letter Agreement dated June 8, 2005 between Cardinal Ethanol, LLC and Planscape
Partners.
    
    
    110.4
    
    Commercial Lease dated August 15, 2005 between Cardinal Ethanol, LLC and OMCO
Mould, Inc.
    
    
    110.5
    
    Employment Agreement dated November 7, 2005 between Cardinal Ethanol, LLC and
Angela J. Armstrong.
    
    
    110.6
    
    Phase I and II Engineering Services Agreement with Fagen Engineering, LLC dated
December 19, 2005.
    
    
    110.7
    
    Letter Agreement dated January 13, 2006 between Cardinal Ethanol, LLC and
TerraTec Engineering, LLC.
    
    
    110.8
    
    Service Agreement dated January 17, 2006 between Cardinal Ethanol, LLC and RTP
Environmental Associates, Inc.
    
    
    110.9
    
    Energy Management Agreement dated January 23, 2006 between Cardinal Ethanol, LLC
and U.S. Energy Services, Inc.
    
    
    110.10
    
    Real Estate Option Agreement dated December 21, 2005 between the Rodgers Farms
LLC and Cardinal Ethanol, LLC.
    
    
    1
 57




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##### Table of Contents



Exhibit
    
    
    
    Method ofNo.
    
    Description
    
    Filing10.11
    
    Real Estate Option Agreement dated January 10, 2005 between Timothy L. and Diana
S. Cheesman, the Lydia E. Harris Trust and the Mary Frances James Revocable Trust
Agreement dated September 18, 2003 and Cardinal Ethanol, LLC.
    
    
    110.12
    
    Real Estate Option Agreement dated January 11, 2006 between Dale and Bonnie
Bartels and Cardinal Ethanol, LLC.
    
    
    110.13
    
    Real Estate Option Agreement dated February 17, 2006 between Douglas R. and Mary
E. Stafford and Cardinal Ethanol, LLC.
    
    
    210.14
    
    Real Estate Option Agreement dated March 22, 2006 between Nelson E. Bateman and
Cardinal Ethanol, LLC.
    
    
    210.15
    
    Consulting Agreement dated March 27, 2006 between Cardinal Ethanol, LLC and Above
Zero Media, LLC.
    
    
    210.16
    
    Project Development Fee Agreement dated April 21, 2006 between Cardinal Ethanol,
LLC and Troy Prescott.
    
    
    210.17
    
    Real Estate Option Agreement dated May 11, 2006 between M.J.C.F. Farms, Inc. and
Cardinal Ethanol, LLC.
    
    
    410.18
    
    Project Development Fee Agreement dated December 13, 2006 between Cardinal
Ethanol, LLC and Spiceland Wood Products, Inc.
    
    
    *10.19
    
    Distillers Grain Marketing Agreement dated December 13, 2006 between Cardinal
Ethanol, LLC and Commodity Specialist Company.
    
    
    *10.20
    
    Lump Sum Design-Build Agreement dated December 14, 2006 between Cardinal Ethanol,
LLC and Fagen, Inc. +
    
    
    *10.21
    
    Ethanol Purchase and Sale Agreement
dated December 20, 2006 between Cardinal
Ethanol, LLC and Murex N.A., Ltd.
    
    
    *10.22
    
    Construction Loan Agreement dated December 19, 2006 between Cardinal Ethanol, LLC
and First National Bank of Omaha.
    
    
    *10.23
    
    Construction Note dated December 19, 2006 between Cardinal Ethanol, LLC and First
National Bank of Omaha.
    
    
    *10.24
    
    Revolving Note dated December 19, 2006 between Cardinal Ethanol, LLC and First
National Bank of Omaha.
    
    
    *10.25
    
    Letter of Credit Promissory Note and Continuing Letter of Credit Agreement dated
December 19, 2006 between Cardinal Ethanol, LLC and First National Bank of Omaha.
    
    
    *10.26
    
    Construction Loan Mortgage, Security Agreement, Assignment of Leases and Rents
and Fixture Financing Statement dated December 19, 2006 between Cardinal Ethanol,
LLC and First National Bank of Omaha.
    
    
    *10.27
    
    Security Agreement dated December 19, 2006 between Cardinal Ethanol, LLC and
First National Bank of Omaha.
    
    
    *
 58




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##### Table of Contents



Exhibit
    
    
    
    Method ofNo.
    
    Description
    
    Filing10.28
    
    Master Agreement dated December 19, 2006 between Cardinal Ethanol, LLC and First
National Bank of Omaha.
    
    
    *14.1
    
    Code of Ethics.
    
    
    *31.1
    
    Certificate pursuant to 17 CFR 240 15d-14(a)
    
    
    *31.2
    
    Certificate pursuant to 17 CFR 240 15d-14(a)
    
    
    *32.1
    
    Certificate pursuant to 18 U.S.C. Section 1350
    
    
    *32.2
    
    Certificate pursuant to 18 U.S.C. Section 1350
    
    
    *
 
 (1)
    
    Incorporated by reference to the exhibit of the same number on our Registration Statement on
Form SB-2, No. 333-131749, originally filed on February 10, 2006.(2)
    
    Incorporated by reference to the exhibit of the same number in Pre-Effective Amendment No. 1
filed on April 26, 2006 to our Registration Statement on Form SB-2, No. 333-131749, originally
filed on February 10, 2006.(3)
    
    Incorporated by reference to the exhibit of the same number in Pre-Effective Amendment No. 2
filed on May 12, 2006 to our Registration Statement on Form SB-2, No. 333-131749, originally
filed on February 10, 2006.(4)
    
    Incorporated by reference to the exhibit of the same number in Pre-Effective Amendment No. 3
filed on May 26, 2006 to our Registration Statement on Form SB-2, No. 333-131749, originally
filed on February 10, 2006.(*)
    
    Filed herewith.(+)
    
    Material has been omitted pursuant to a request for confidential treatment and such materials
have been filed separately with the Securities and Exchange Commission. 
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
  Category
    
    Year
    
    FeesAudit Fees(1)
    
    2006
    
    $
    65,2802005
    
    $
    30,355Audit-Related Fees(1)
    
    2006
    
    
    2005
    
    
    Tax Fees
    
    2006
    
    $
    1,0352005
    
    
    All Other Fees
    
    2006
    
    
    2005
    
    
    
 
 (1)
    
    Audit fees consist of fees for services rendered related to the Companys fiscal year end
audits, quarterly reviews, registration statement and related amendments. 59




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##### Table of Contents



SIGNATURES
  CARDINAL ETHANOL, LLCDate:December 19, 2006
    /s/ Troy PrescottTroy PrescottChairman
(Principal Executive Officer) Date: December 19, 2006
    /s/Dale SchwietermanDale Schwieterman


Treasurer

(Principal Financial and Accounting Officer)  Date: December 19, 2006
    
    /s/ Troy PrescottTroy PrescottChairman (Principal Executive Officer)Date: December 19, 2006
    
    /s/ Dale SchwietermanDale SchwietermanTreasurer (Principal Financial and Accounting Officer)Date: December 19, 2006
    
    /s/ Thomas ChalfantTom ChalfantVice Chairman, Vice President and DirectorDate: December 19, 2006
    
    /s/ Jeremey HerlynJeremey Herlyn, DirectorDate: December 19, 2006
    
    /s/ Robert E. AndersonRobert E. Anderson, DirectorDate: December 19, 2006
    
    /s/ Lawrence Allen BairdLawrence Allen Baird, DirectorDate: December 19, 2006
    
    /s/ Larry J. BarnetteLarry J. Barnette, Director
 60




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##### Table of Contents



Date: December 19, 2006
    
    /s/ Ralph BrumbaughRalph Brumbaugh, DirectorDate: December 19, 2006
    
    /s/ Thomas C. ChronisterThomas C. Chronister, DirectorDate: December 19, 2006
    
    /s/ Robert John DavisRobert John Davis, DirectorDate: December 19, 2006
    
    /s/ David M. DerschDavid Matthew Dersch, DirectorDate: December 19, 2006
    
    /s/ G. Melvin FeatherstonG. Melvin Featherston, DirectorDate: December 19, 2006
    
    /s/ John W. FisherJohn W. Fisher, DirectorDate: December 19, 2006
    
    /s/ Everett Leon HartEverett Leon Hart, DirectorDate: December 19, 2006
    
    /s/ Cyril G. LeFevreCyril G. LeFevre, DirectorDate: December 19, 2006
    
    /s/ Robert L. MorrisRobert L. Morris, DirectorDate: December 19, 2006
    
    /s/ C. Allan RosarC. Allan Rosar, DirectorDate: December 19, 2006
    
    /s/ Michael A. ShuterMichael A. Shuter, DirectorDate: December 19, 2006
    
    /s/ Steven J. SniderSteven J. Snider, DirectorDate: December 19, 2006
    
    /s/ Jerrold L. VoisinetJerrold L. Voisinet, Director
 61