EXHIBIT
10.5


 


AMENDMENT TO


GRAIN ORIGINATION AGREEMENT


 


THIS AMENDMENT TO GRAIN ORIGINATION AGREEMENT (this “Amendment”), is made and entered into
as of the 1st day of October, 2007, between Heartland Grain Fuels, L.P. a
Delaware limited partnership (“HGF”), and South Dakota Wheat Growers
Association, a South Dakota cooperative (“SDWG”).


 


BACKGROUND


 


1.             HGF and SDWG are parties to that certain
Grain Origination Agreement, made and entered into as of the 8th day
of November, 2006 (the “Agreement”);


 


2.             HGF and SDWG wish to amend the Agreement
pursuant to the terms and conditions set forth herein;


 


4.             All capitalized terms used but not otherwise
defined herein shall have the meanings assigned in the Agreement.


 


AGREEMENT


 


In
consideration of the mutual promises and agreements contained herein, it is
hereby agreed as follows:


 


1.             Section 3.2. Section 3.2 of the Agreement is deleted in its entirety and replaced
with the following:


 


“3.2         Termination. Except as set forth under Section 3.1 and 3.4, (i) HGF will only have
the right to terminate this Agreement upon the occurrence of an Event of
Default (as defined in Section 4.1) and (ii) SDWG shall have no right to
terminate this Agreement. Except as otherwise provided below, upon the
occurrence of an Event of Default by SDWG, HGF will have the right to terminate
this Agreement effective immediately by sending written notice thereof to SDWG
and to receive payment from SDWG as set forth in Sections 3.3 and 4.2, and as
is otherwise allowed by applicable law (except that no party will be entitled
to consequential damages for any claim arising under this Agreement). Notwithstanding
the foregoing, HGF will only have the right to terminate this Agreement with
respect to the Ethanol Plant to which the Event of Default relates.”


 


2.             Section 3.4. Section 3.4 of the Agreement is deleted in its entirety and replaced
with the following:


 

















 


“3.4         Suspension of Operations. If the operation of an Ethanol Plant is
suspended for any reason (including pursuant to Section 7.3), including for
repairs, modifications, expansions or damage to the Ethanol Plant for at least
fifteen (15) months, then either party may terminate this Agreement with
respect to such Ethanol Plant by providing the other party with written notice
of such termination, which shall be effective as of the date of such written
notice.”


 


3.             Section 4.1(c). Section 4.1(c) of the Agreement shall be
deleted in its entirety and replaced with the following:


 


“(c)         HGF fails to pay any amount due to SDWG
under this Agreement by 5:00 p.m. of the business day following the due date of
such payment; or”


 


4.             Section 4.2(b). Section 4.2(b) of the Agreement is deleted
in its entirety and replaced with the following:


 


“(b)         SDWG Remedies. If an Event of Default occurs under Section 4.1(a), (b)
or (c), in addition to recovering payment of any amounts under Section 3.3,
SDWG shall have the right to pursue any one or more of the following remedies:


 


(1)           SDWG may withhold future deliveries of corn until such
Event of Default is either cured or waived by SDWG; provided, however, SDWG will resume delivery of corn
under this Agreement if (1) prior to SDWG resuming deliveries of corn
hereunder, HGF pays SDWG an amount equal to average cost of one day’s
supply of corn determined by reference to 30 day period prior to the Event of
Default; (2) HGF pays SDWG for all
deliveries of corn in immediately available funds by 5 p.m. of the day
following the day of delivery and in the
case of deliveries on any day that is not a business day by 10 a.m. on the next
succeeding business day for the remainder of the term of this Agreement; and
(3) HGF pays all past due amounts
(including interest at the rate set forth in
Section 2.4 hereof) in equal monthly installments of principal and
interest in such an amount as is necessary to fully recover all past due
amounts plus interest within two years from the date of the initial Event of
Default; provided, however, that if HGF has fully repaid all past due amounts
(including interest at the rate set forth in Section 2.4 hereof) owed under
this Agreement within 3 days of the initial due date of the payment which
caused the Event of Default and has paid all other amounts due for the purchase
of corn on a current


 

















 


basis
for such period, the initial failure to timely pay which resulted in the
exercise of remedies hereunder, will no longer be treated as an Event of
Default and HGF may again make payments in accordance with the terms set forth
in Section 2.4 hereof. Notwithstanding anything to the contrary stated in this
Section 4.2(b)(1), SDWG may immediately suspend corn deliveries if HGF breaches
the terms of clauses 2 or 3 above. Further, notwithstanding anything to the
contrary stated in this Section 4.2(b)(1), if HGF has fully repaid all past due
amounts (including the amounts referred to in clause (3) above) and has paid
all other amounts due for the purchase of corn on a current basis, if HGF
delivers to SDWG a written notice indicating that it desires to pay for
deliveries of corn in increments of days or a week (although in no case shall
the payment cycle be longer than that provided for in Section 2.4 hereof)
together with a letter of credit (from a commercial banking institution
reasonably acceptable to SDWG and in form and substance reasonably acceptable
to SDWG) or other form of adequate assurance (reasonably acceptable to SDWG)
that demonstrates and supports HGF’s ability to pay according to the longer
payment cycle, the payment date referred to in Section 2.4 shall be adjusted
accordingly to match the terms of the letter of credit or other assurance and
any failure to pay within one day of that modified payment date shall be
treated as an Event of Default described in Section 4.1(c) hereof, allowing
SDWG’s to exercise remedies at its discretion pursuant to this Section 4.2(b).


 


(2)           SDWG
may seek and receive injunctive relief or a decree of specific performance;
and/or


 


(3)           SDWG
may pursue any other remedy (except for consequential damages) to which it may
be entitled in law or equity for breach of contract, except that SDWG may not
terminate this Agreement.”


 


5.             Section 4.2. (“Rights to Withhold Future Deliveries”). Section 4.2 on page 14 of
the Agreement, identified as “Rights to Withhold Future Deliveries,” is hereby
renumbered as Section 4.3. This Section is otherwise unchanged.


 


6.             Insurance. The following shall be added as Section 8.13:


 


“8.13       Insurance. So long
as those certain Leases dated as of October    , 2007 by and
between SDWG and HGF relating to SDWG’s property in Huron and


 

















 


Aberdeen,
South Dakota remain in effect (the “Leases”), to the extent that the cost of
any insurance SDWG is required to obtain and maintain under the Leases exceeds
the cost of the insurance SDWG is required to obtain and maintain hereunder,
HGF shall pay SDWG such difference within 15 days of SDWG delivering an invoice
to HGF.


 


6.             Representations and Warranties. Each of the parties hereto represents and
warrants to the other that this Amendment has been duly and validly authorized,
executed and delivered by such party and, assuming this Amendment constitutes a
valid and binding obligation of the other party, this Amendment constitutes a
valid and binding obligation of the such party, enforceable against such party
in accordance with its terms, subject to applicable bankruptcy, reorganization,
insolvency, moratorium, and other laws affecting creditors’ rights generally
and to general equitable principles.


 


7.             Governing Law. This Amendment shall be governed and
construed in accordance with the laws of the State of South Dakota without regard
to any applicable conflicts of law.


 


8.             Counterparts. This Amendment my be executed by facsimile
signature in two or more counterparts, all of which shall be considered one and
the same agreement and shall become effective when a counterpart has been signed
by each of the parties and delivered to the other party, it being understood
that all parties need not sign the same counterpart.


 


9.             Limited Effect. Except as amended hereby, the Agreement
shall continue in full force and effect in accordance with its terms without
amendment or modification.


 


[Signature Pages Follow]


 

















 


The
parties hereto have duly executed this Amendment as of the date and year first
above written.


 


 


	
   

  	
  HGF:

  
	
   

  	
   

  
	
   

  	
  Heartland Grain Fuels, L.P.,

  
	
   

  	
   

  
	
   

  	
  By:

  	
   Dakota Fuels, Inc.

  
	
   

  	
  Its:

  	
  General
  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Revis L. Stephenson III

  	
   

  
	
   

  	
   

  	
   Name: Revis L. Stephenson III

  
	
   

  	
   

  	
  Title:
  Chairman of the Board

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SDWG:

  
	
   

  	
   

  
	
   

  	
  South
  Dakota Wheat Growers Association

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Dale Locken

  	
   

  
	
   

  	
  Printed
  Name:

  	
  Dale
  Locken

  	
   

  
	
   

  	
  Title:

  	
  CEO/Treasurer