Document:

exv10w9

 

p.2

EXHIBIT 10.9

	 	 	 
	COAL SUPPLY AGREEMENT

BETWEEN

WILLIAMS BULK TRANSFER INC. (“WBT”)

AND

LINCOLNWAY ENERGY, LLC (“LWE”)*

	 	

This coal supply agreement (“Agreement”) is made and entered into as
of this  14th day of July 2005, by and
between Williams Bulk Transfer Inc., an Iowa Corporation with offices in
Williams, Iowa (“WBT”), and Lincolnway Energy, LLC, an Iowa Corporation
with offices in Nevada, Iowa (“LWE”).

IN CONSIDERATION OF the following terms and mutual promises set forth
herein, WBT agrees to deliver Coal (as defined in Section 3) to LWE’s
ethanol plant near Nevada, Iowa (“Plant”), and LWE agrees to purchase
and accept delivery of such Coal at the price and on the terms and
conditions stated in this Agreement.

1. TERM

This Agreement shall commence on the day first signed above and expire as of
January 1, 2008 (“Term”).

2. QUANTITY

WBT shall provide to LWE up to 120,000 Tons of Coal per year at a per
Ton price equal to the Coal and Transportation Price for Coal (as
defined in Sections 5 and 8) plus any subsequent price adjustments (see
Sections 6 and 9) for the Term of this Agreement WBT shall make best
efforts to maintain at all times a minimum of a twenty (20) day supply
inventory of Coal at its terminal strictly for the benefit of LWE. If
LWE fails to purchase a minimum of 40,000 Tons of Coal for the calendar
year beginning January 1, 2006 and a minimum of 80,000 Tons of Coal for
the calendar year beginning January 1, 2007 (“Minimum Quantity
Requirement”), LWE shall pay WBT (i) $12.00 per Ton of Coal multiplied
by the difference between the Minimum Quantity Requirement and the
actual Tons of Coal purchased by LWE for the respective calendar year,
less (ii) any amounts that WBT recovers by mitigating its damages. For
purposes of this Agreement, “Ton” shall mean 2,000 pounds avoirdupois

3. SOURCE AND COAL

“Coal” shall mean a Sub-bituminous coal with a Standard Transportation
Commodity Code (STCC) as published in STCC-6001 (series), starting with
the digits 11-21 (series). Coal shall not include beneficiated,
enhanced, or synthetic coal; provided, however, coal treated with
additives used exclusively for dust control or to reduce freezing shall
not be considered “enhanced”.

“Source” shall mean the Powder River Coal Company’s North
Antelope/Rochelle complex located in Campbell or Converse County,
Wyoming. Source Coal shall comply with the specifications set forth in
Section 11 herein.

 

			
	*	 	Portion omitted pursuant to a request for confidential treatment and filed separately with
the Securities and Exchange Commission. 

 

 

p.3

WBT shall have the right, but not the obligation, to deliver raw subbituminous coal
from mines other than the Source (“Substitute Coal”) to LWE, with 120 days prior
written consent of LWE, which consent shall not be unreasonably withheld. The
Substitute Coal shall be of similar quality to the Source Coal.

4. BACKUP SUPPLY

Within 90 days of execution of this Agreement, WBT shall provide to LWE proposals
for procuring backup coal supplies. These proposals shall include the price,
quality, quantity and timeliness of receipt of any backup coal. Backup coal
proposals shall include coal of similar quality to that of the Source.

5. TRANSPORTATION PRICE

“Transportation Price” shall consist of the following components: (i) the cost of
transloading Coal at WBT (ii) the cost of transporting the Coal from the Source to
WBT via Burlington Northern Santa Fe Railroad (“BNSF”) and Canadian National
Railroad (“CN”) (iii) the cost of transporting the Coal from WBT to the Plant via
motor transportation. As of January 15, 2005, LWE’s Transportation Price for Coal
shall be [ * ] per Ton. This Transportation Price is subject to various price
adjustments as contained in Section 6 (“Transportation Price Adjustments”).

6. TRANSPORTATION PRICE ADJUSTMENTS

	 	A.	 	Beginning April 1, 2005, and each July 1, October 1, January
1 and April 1 thereafter, the Transportation Price will be adjusted by 100%
of the percentage change since the previous adjustment in the Rail Cost
Adjustment Factor, Unadjusted for Productivity (“RCAFU”), as approved by the
Surface Transportation Board pursuant to Ex Parte
No.290 (Sub-No.5) (“Adjusted Rates” or “Adjusted Charges”). In no case shall
the Adjusted Rates or Adjusted Charges fall below the level of the initial
Transportation Price.
	 
	 	B.	 	A Fuel Surcharge shall apply to the Price. For every [ * ]
per gallon above [ * ], the Price shall increase by [ * ] per Ton. The Price
shall be adjusted once each month for fuel. The index governing the
surcharge is the Energy Information Administration’s average price in cents
per gallon for Retail On-Highway Diesel Fuel for the United States (US). The
parties agree that the price published on the last Monday of each month
shall apply to the following month. Diesel price information is available by
calling the Energy Information Administration’s Diesel Fuel Motor & Gasoline
Hotline at (202) 568-6966, or under “Featured Topics” on the
Administration’s web page at www.eia.doe.gov. The surcharge amount
shall be round to the nearest one hundredth.

7. DELIVERY INFORMATION

To enable LWE to track shipments of the Coal to its plant via rail or truck,
WBT shall provide delivery information to LWE upon reasonable written request
(“Delivery Information”). For purposes of this section, a request sent via
email or facsimile shall constitute a valid written request. In no event shall
WBT be required to provide this information to LWE on greater than a

 

			
	*	 	Portion omitted pursuant to a request for confidential treatment and filed separately with
the Securities and Exchange Commission.

 

 

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daily basis. WBT shall also promptly notify LIVE of any potential delivery problems within
24 hours of when it becomes aware of the problem (e.g., damage to WBT terminal, train
derailment, etc.).

8. COAL PRICE

The “Coal Price” per calendar year shall be as follows based on a heat content of 8,880 Btu’s
per pound and subject to the Coal Price Adjustments in Section 9:

	 	 	 	 	 
	2005
	 	 [ * ] per ton
	2006
	 	[ * ] per ton
	2007
	 	[ * ] per ton

9. COAL PRICE ADJUSTMENTS

Coal Prices are subject to adjustments for changes in laws and regulations enacted and
in force or expiring during the Term of this Agreement that change Source’s cost of
producing, selling, loading, or shipping coal during the Term of this Agreement. Such
adjustments to the Coal Price because of changes in laws or regulations shall be added
to or subtracted from the Coal Price on a direct pass-through basis. The Coal Prices
stated in Section 6 includes reimbursement to Source of all environmental, land
restoration and regulatory costs, including without limitation
any reclamation costs required under applicable federal, state or local law in effect as
of December 10, 2004. The Coal Price shall also be subject to BTU and S02 adjustments as
set forth herein.

The federal statute (30 U.S.C. Section 1232) that provides for collection of the Federal
Reclamation Fee for Abandoned Mine Lands (“AML”) is scheduled to expire on June 30,
2005, except that portion of the statute that provides for collection of fees to be
transferred to the United Mine Workers of America Combined Benefit Fund. Notwithstanding
anything contained herein to the contrary, this scheduled partial expiration of the
statute and any change in regulations to implement it will have no effect on the base
price of coal purchased and sold pursuant to this Agreement. If the federal government
makes additional changes in the AML fees, beyond those now scheduled to take effect,
those changes shall be passed through to the base price of coal purchased and sold
pursuant to this Agreement only to the extent that they cause the AML fee to exceed
$0.350 per ton.

Adjustment for Inflation. The Coal Prices per ton set forth in Section 8 shall be
increased or decreased for each percentage point of change, or proportionately for
fractional parts of a percentage point of change, to reflect changes in the following
indices. The Coal Price will be allocated per the index weights detailed below. Changes
shall become effective semi annually as of January 1, and July 1 of each year, beginning
July 1, 2005, and shall be based upon the preliminary indices for November and May
respectively. The index base and base amounts shall be the following:

 

			
	*	 	Portion omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission. 

 

 

p.5

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Index	 	 	 	 
	 	 	Weight	 	Index Base	 	 
	CPI (W) **
	 	 	30	%	 	 	186.8	 	 	Preliminary November 2004
	PPI industrial Commodities -
Less Fuel & Pwr**
	 	 	32	%	 	 	154.9	 	 	Preliminary November 2004
	#2 Diesel Fuel wpu 0573-
03**
	 	 	8	%	 	 	159.7	 	 	Preliminary November 2004
	GDP-1PD***
	 	 	15	%	 	 	108.452	 	 	Q3 2004
	Prime Rate****
	 	 	15	%	 	 	5.25	 	 	December 31, 2004

 

			
	**	 	U.S. Department of Labor, Bureau of Labor Statistics, Not Seasonally Adjusted.
	 
	***	 	U.S. Department of Commerce, Bureau of Economic Analysis, Price Indexes
for Gross Domestic Product, Expanded D / Table 1.5.4 / Seasonally Adjusted.
	 
	****	 	Prime Rate of interest as reported in the money rates section of
the Wall Street Journal for the last business day of the quarter — as
published on the subsequent business day.

The impact of the semi-annual escalations, on a net basis, as weighted above
shall not impact
the Base Price until they exceed an Embedded Escalation Deadband, on a
semi-annual basis, as follows:

EMBEDDED ESCALATION DEADBAND

2005-2007

	 	 	 	 	 	 	 	 	 
	 	 	Semi-Annual	 	Cumulative
	Escalation Date	 	Increase	 	Increase
	Jul 1, 2005
	 	 	[ * ]	 	 	 	[ * ]	 
	Jan 1, 2006
	 	 	[ * ]	 	 	 	[ * ]	 
	Jul 1, 2006
	 	 	[ * ]	 	 	 	[ * ]	 
	Jan 1, 2007
	 	 	[ * ]	 	 	 	[ * ]	 
	Jul 1, 2007
	 	 	[ * ]	 	 	 	[ * ]	 

Notwithstanding anything contained herein to the contrary, in no event shall
the Coal Price as adjusted pursuant to this agreement at any time be less
than the original Coal Price stated in Section 8, by calendar year, as set
forth above .

If the basis for any of the index numbers is changed, said index shall be
adjusted to take into account such changed basis. In the event any designated
index is discontinued or altered, becomes unavailable, or is no longer
applicable, the Parties shall undertake to agree on a substitute index or a
substitute method of cost adjustment which most closely matches the economic
structure of the discontinued or altered index. If the Parties fail to reach
agreement on the substitute index or method within 90 days, then the
substitute index or substitute method of

 

			
	*	 	Portion omitted pursuant to a request for confidential treatment and filed separately with
the Securities and Exchange Commission. 

 

 

p.6

cost adjustment shall be submitted to arbitration and resolved. The values
to perform the calculations set forth in this section shall be rounded to three
decimal places.

A hypothetical Coal Price escalation for illustration purposes only is attached hereto
as Exhibit B.

Adjustments for BTU and Sulfur Dioxide., The Coal Price delivered
during a calendar month shall also be adjusted for variations in calorific value and
sulfur dioxide. Adjustments shall be added to or subtracted from, as the case may
be, the Coal Price determined in accordance with Section 8 hereof. The adjustments
shall be calculated as follows:

	 	 	 	 	 
	 

	 	 	 	 
	Btu Adjustment Per Ton = (P + $10.00 ) x

	 	( AR – BB )	 	 
	 

	 	 	 	 
	 

	 	BB	 	 

     Where:

	 	 	 	 	 	 	 
	 

	 	P
	 	=
	 	The Price of coal per ton delivered during the month per Section 6,
	 
	 	 	 	 	 	 
	 

	 	AR
	 	=
	 	The monthly weighted average “As-Received” Btu’s per
pound of the respective coal delivered to Buyer; and,
	 
	 	 	 	 	 	 
	 

	 	BB
	 	=
	 	The Base Btu’s per pound of the respective coal
delivered to Buyer during the month; the BB value = [8,800]

SO2 Adjustment PerTon= ((BSD-ARSD)* (Monthly SO2 value/2000))
* 17.6

     Where:

	 	 	 	 	 	 	 
	 	 	Monthly SO2 value = The simple arithmetic average of all
SO2 allowance prices published in Air Daily for the
	 

	 	 	 	 	 	applicable month.
	 
	 	 	 	 	 	 
	 

	 	ARSD
	 	=
	 	The monthly weighted average “As-Received Sulfur
Dioxide” expressed in pounds per million BTU of the respective coal
delivered to Buyer; and,
	 
	 	 	 	 	 	 
	 

	 	BSD
	 	=
	 	The Base Sulfur Dioxide per pound of the respective coal
expressed in pounds per million BTU during the month. BSD = .55

10. COAL ANALYSIS

The Coal Analysis shall be determined by representative samples of each train which
shall be taken at the Source in accordance with ASTM Standard D2234, employing
increment collection method, Classification I-B-1. Samples shall be analyzed in
conformance with current ASTM standards by Source’s independent contractor. The
contractor shall perform a short proximate and sodium analysis on one sample split
from each trainload on an “as received” basis in accordance with ASTM standards. WBT
shall provide LWE with these results as reasonably requested.

LWE may perform, at its discretion, its own analysis of the calorific value and
sulfur dioxide content of the Coal. The Coal Analysis shall be performed and
analyzed pursuant to the same procedures and standards as at the Source. If the
results from LWE’s testing conflict with the

 

 

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results provided by WBT, then LWE may require that the same analysis be
performed by a third contractor the identity of which the parties shall mutually
agree upon in good faith and without unreasonable delay. The third party may
consider the data and conclusions from the first two analyses when reaching its own
independent results. The results of the third party’s analysis shall determine the
quality of the subject Coal. If the third party determines that its results are
substantially similar to the results provided by WBT, then LWE shall be responsible
for all costs associated with performing the third analysis. However, if the third
party determines that its
results are not substantially similar to the results provided by WBT, then (i) WBT
shall be responsible for all cost associated with performing the third analysis,
and (ii) the Coal Price for all of the Coal delivered to LWE in the train
containing the subject Coal shall be adjusted for the variations in calorific value
and sulfur dioxide in accordance with Section 9 and any other significant
diminutions in value.

11. COAL QUALITY

Exhibit A, which is incorporated herein by this reference, identifies the coal
quality specifications for the coal from the Source Mine.

12. METHOD OF PAYMENT

WBT shall invoice LWE for then current combined Coal and Transportation Price
when Coal is delivered to the Plant, and calculated based on the outbound
certified scale weights at WBT. Such invoices shall occur at least twice
monthly as agreed between WBT and LWE.

LWE shall pay WBT within ten (10) days after LWE’s receipt of such invoices.
Late payments shall carry a delinquent charge of one and one-half percent (1.5%)
of the amount invoiced per month with interest accruing the day after the due
date.

13. OPERATING PROCEDURE

WBT and LWE have agreed to use their best efforts in good faith to jointly
develop a written operating plan containing Coal delivery schedules and other
plans and procedures for development of the most efficient and effective Coal
delivery system. The operating plan shall be completed by the parties within 200
days of execution of this Agreement.

14. REMEDY AND LIMITATIONS OF LIABILITY

LWE’s sole remedy for breach of the Agreement by WBT shall be the remedy of damages

specified in this Agreement. NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
PARTY FOR INCIDENTAL, SPECIAL, EXTRAORDINARY, INDIRECT, CONSEQUENTIAL OR PUNITIVE
DAMAGES, INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS OR REVENUE, LOSS OF USE OF
POWER SYSTEM OR OTHER SYSTEMS, COST OF CAPITAL, COST OF PURCHASED OR REPLACEMENT
POWER, OR FUEL COST DIFFERENTIAL.

The remedy set forth in these general provisions are exclusive, and the sum total
liability of WBT to LWE with respect to this Agreement, or anything done in
connection therewith, such as the

 

 

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performance or breach thereof, whether in contract, in tort (including negligence)
or under any warranty or otherwise, shall not exceed the total amount of fees for
Coal paid by LWE to WBT under this Agreement.

15. INDEMNIFICATION

LWE agrees to assume all risk of loss and to defend, indemnify and hold WBT, its
officers, directors, employees, agents and representatives harmless from and
against any and all claims, liabilities, damages, losses, costs or expenses of
whatever nature or character for all injuries or damage of any type to any person
or property, including, without limitation, injuries or damage of third parties
or employees of both parties and damages to LWE’S property, the Plant, or LWE’s
equipment or facilities, occasioned wholly or in part as a result of LWE’s
willful misconduct, negligence, or purchase and burning of Coal purchased under
this Agreement or relating to pollution, contamination or adverse effects on the
environment, due to, but not limited to, the disposal, discharge, escape,
dispersal, release or saturation of smoke, vapors, soot, fumes, acids, alkalies,
toxic chemicals, liquids, gases, or hazardous substances as defined under 455B of
the Code of Iowa, into the atmosphere, or on, onto, in or into the surface or
subsurface soil, ground water, or surface waters.

Notwithstanding the foregoing, any pollution, contamination or adverse effects on
the environment that result either during or from the Transportation of Coal
shall be the sole responsibility of WBT. Transportation of Coal shall be deemed
complete once a truck is at LWE’s coal receiving hopper and ready to discharge
coal. WBT agrees to assume all risk of loss and to defend, indemnify and hold
LWE, its officers, directors, employees, agents and representatives harmless from
and against any and all claims, liabilities, damages, losses, costs or expenses
of whatever nature or character for all injuries or damage of any type to any
person or property, including, without limitation, injuries or damage of third
parties or employees of both parties and damages to WBT’s property or WBT’s
equipment or facilities, occasioned wholly or in part as a result of WBT’s
willful misconduct, negligence, or transportation of Coal to LWE’s facilities.

16. COMMUNICATION BETWEEN THE PARTIES

All communications related to this Agreement shall be to the persons listed below or to
such other persons as the parties may specify in writing:

General Manager

Lincolnway Energy, LLC

975 West Lincoln Highway

Nevada, Iowa 50201

Williams Bulk Transfer

Attn: Craig Kundert, Superintendent

100 Railroad Road

Williams, Iowa 50271

With Copies To:

Williams Bulk Transfer

Attn: Paul Treangen, President

233012 Street SW

 

 

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Cedar Rapids, Iowa 52404

Any notice, request, or demand pertaining to matters of an operating nature may be
delivered by mail, messenger, telephone, telegraph, facsimile or verbally to such
agent of the party being notified as may be appropriate, and if given by telephone,
telegraph or through other or verbal communications, said communications shall be
confirmed in writing upon request.

17. NO THIRD PARTY BENEFICIARIES

Nothing in this Agreement is intended to confer, nor shall it be asserted or
construed as conferring, any rights or benefits upon any other person or entity
not a party to this Agreement, including, but not limited to, any such rights or
benefits which may be asserted by any person or entity as a purported third party
beneficiary.

18. FORCE MAJEURE

It is understood that unavoidable delays may result from causes which are
reasonably beyond the control of the parties, including, but not limited to, the
following: acts of providence, floods, fortuitous events, unavoidable accidents,
riots, strikes, lockouts, and any other unforeseen act beyond the reasonable
control of either party, and not due to either party’s negligence, which
interferes with the production, loading, transportation, unloading, or consumption
of the Coal (“Force Majeure”). Force Majeure shall include the occurrence or
declaration of force majeure by the Source Mine, Burlington Northern and Santa Fe
Railway Company, Canadian National
Railroad, Williams Bulk Transfer, or Ben Shinn Trucking, as limited by the
definition of such term under WBT’s agreement with the party declaring force
majeure attached as additional Exhibits
hereto. Should the progress of the delivery of Coal be delayed at any time for such
causes, the affected party shall at once notify the other party in writing of the
occurrence. If because of Force Majeure either LWE or WBT is unable to carry out
its obligations under this Agreement, except obligations to pay or expend money for
Coal already delivered, then the obligations of such party shall be suspended to
the extent made necessary by such Force Majeure and during its continuance,
provided such Force Majeure is removed, remedied and/or damages there from
mitigated through good faith and reasonable efforts insofar as possible and
economically practicable with all reasonable dispatch and further provided, that
such party shall not be excused from tendering partial performance if the same is
possible.

Notwithstanding the foregoing, it is agreed that neither party shall be required to
settle, resolve or interfere in a strike or lock-out. Any deficiency in Coal
Tonnage to be delivered under this Agreement caused by Force Majeure shall made up
by mutual consent of LWE and WBT.

19. ASSIGNMENT

This Agreement shall be binding upon and shall inure to the benefit of the
respective successors and permitted assigns of the parties, but shall not be
assigned without the written consent of the other, which consent shall not be
unreasonably withheld.

17. INDEPENDENT TERMS

 

 

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Each term and condition of this Agreement is deemed to have independent effect and the invalidity
of any partial or whole paragraph or article shall not invalidate the remaining paragraphs or
articles.

21. DISPUTES AND GOVERNING LAW

Any controversy or claim arising out of or relating to this Agreement, or the breach thereof,
unless such dispute can be amicably settled by the parties, shall be settled by
arbitration in Iowa in accordance with the Commercial Arbitration Rules of the American Arbitration
Association, and judgment upon the award rendered by the arbitrator(s) may be entered in any court
having
jurisdiction thereof.. This Agreement shall be governed by the laws of the State of Iowa,
notwithstanding its conflict of law rules.

22. INDEPENDENT CONTRACTOR

The relationship of LWE to the WBT shall be that of a provider of coal acting as an
independent contractor for purposes of this Agreement.

23. CONTRACT DOCUMENTS

This Agreement constitutes the entire understanding between the parties making all other
representations null and void.

24. CONFIDENTIALITY OF AGREEMENT

LWE and WBT consider this document and its content to be proprietary .The parties agree to exert
the same efforts to prevent or limit disclosure as it would on behalf of similar proprietary
information of their own. The parties agree to make reasonable efforts to prevent or limit
disclosure, and, where disclosure is permitted herein or required by law, to limit the extent of
inspection of this Agreement by third parties to the extent possible. The parties also agree to
notify the other of any intended disclosure at the earliest opportunity. Notwithstanding the
foregoing, WBT may disclose the terms of this Agreement to the Source, the Burlington Northern and
Santa Fe Railway Company, Canadian National Railroad, and ! or Ben Shinn Trucking or their
successors and assigns and either party may disclose the terms of this Agreement in
order to comply with any applicable law, order, regulation, or rule and to the extent necessary for
the enforcement of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement in their respective corporate names as
of the date first above written.

	 	 	 	 	 	 	 	 	 
	WILLIAMS BULK TRANSFER, INC.	 	 	 	LINCOLNWAY ENERGY, LLC
	 
	 	 	 	 	 	 	 	 
	BY:

	 	/s/ Paul Treangen
	 	 	 	BY:
	 	/s/ Richard J. Brehm
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ITS:

	 	President
	 	 	 	ITS:
	 	CEO
	 
	 	 	 	 	 	 	 	 
	ALLIANT ENERGY CORPORATION	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	BY:

	 	/s/ William D. Harvey	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ITS:

	 	President & CEO	 	 	 	 	 	 

 

 

p.11

EXHIBIT A

GUARANTEED COAL QUALITY SPECIFICATIONS

North Antelope Rochelle Mine (“NARM”)

	 	 	 
	 

	 	Typical Monthly Weighted 
	 

	 	Average, As-Received Basis, from
	 

	 	NARM
	 
	 	 
	Gross Calorific Value, Btu/lb

	 	8,800
	Moisture, %

	 	27.40
	Ash, %

	 	4.5
	Sulfur Dioxide, Ib/MMBtu

	 	0.52
	Fines

	 	27%
	 
	 	 
	 

	 	REJECT QUALITY on a 
	 

	 	Trainload, as-received basis 
	 

	 	from NARM
	 
	 	 
	Btu/lb

	 	Less than 8,500 Btu/lb
	Moisture, %

	 	Greater than 29%
	Ash, %

	 	Greater than 8.0%
	Sulfur Dioxide, lb/MMBTU

	 	Greater than 1.2 Ib/MMBtu
	Fines (<1/4 inch)

	 	Greater than 35%

 

 

p.12

EXHIBIT B

HYPOTHETICAL ESCALATION

July, 2005

	 	 	 	 	 
	Base Price
	 	 	[ * ]	 
	Laws Adjustment
	 	 	[ * ]	 
	 
	Subtotal
	 	 	[ * ]	 
	Government Imposition (5)
	 	 	[ * ]	 
	 
	Escalation Price
	 	 	[ * ]	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Year One	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Adjusted	 
	 	 	Index	 	 	Base	 	 	Base (1)	 	 	Revised (2)	 	 	Adjustment	 	 	Base	 
	Index Utilized	 	Weight	 	 	Amount	 	 	Index	 	 	index	 	 	Amount	 	 	Price	 
	CPI (W)
	 	 	30	%	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 
	PPI
	 	 	32	%	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 
	#2 Diesel (057303)
	 	 	8	%	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 
	GDP-1PD
	 	 	15	%	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 
	Prime Rate
Embedded Escalation
	 	 	15	%	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	[ * ]	 	 	 	 	 
	Deadband (3)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	[ * ]	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	[ * ]	 	 	 	 	 	 	 	 	 	 	$	[ * ]	(4)	 	$	[ * ]	 
	Laws Adjustment
	 	 	 	 	 	 	—	 	 	 	 	 	 	 	 	 	 	 	0.000	 	 	 	—	 
	Government Imposition
(5)
	 	 	 	 	 	 	[ * ]	 	 	 	 	 	 	 	 	 	 	$	[ * ]	 	 	$	[ * ]	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	 	 	 	 	[ * ]	 	 	 	 	 	 	 	 	 	 	$	[ * ]	 	 	$	[ * ]	 

 

			
	(1)	 	Base indices are established per Coal Supply Agreement
	 
	(2)	 	Index for the date established per Coal Supply Agreement
	 
	(3)	 	Per Section 7 of Coal Supply Agreement.
	 
	(4)	 	The sum of the above adjustment or zero, whichever is greater.
	 
	(5)	 	Assumes portions of the Abandoned Mining Land Fee expire July 1, 2005, as per
Section 7 of Coal Supply Agreement
	 
	*	 	Portion omitted pursuant to a request for confidential treatment and filed separately with
the Securities and Exchange Commission.exv10w10

 

April 13, 2005

Mr. William Couser

Lincoinway Energy, LLC 975

W. Lincoln Hwy, Suite B

Nevada, IA 50201

RE: 05–VAPIVF-03 contract – revised to 05-VAPIVF-14

Dear Mr. Couser:

Enclosed is a copy of the executed Value Added Agricultural Products and
Processes Financial Assistance Program (VAPFAP) contract and promissory note
between Lincolnway Energy, LLC and the Department, for your records. Please
note that for recording purposes, the contract number has changed to
05-VAPIVF-14. An amortization schedule for the loan portion of the award has
been prepared and enclosed also for your records.

The contract has an effective date of November 4, 2004 allowing funds to be
committed and drawn for the project. Prior to disbursement of funds the items
under Article 5.1 Conditions to Disbursement of Funds must be provided to the
Department.

Also you will find a request for payment form to complete and sign when
you incur eligible project costs for payment.

Should you have questions, please feel free to contact me directly at
5151242-4831.

Sincerely,

/s/Mike Fastenau

Mike Fastenau, Manager

Business Services

Enclosures

c: file

IOWA
DEPARTMENT OF ECONOMIC DEVELOPMENT

Michael
T. Blouin, Director
Ÿ 200 East
Grand Avenue, Des Moines, Iowa 50309 USA
l
Phone: 515 242 4700
l Fax 515-242-4

 

 

LOAN/FORGIVABLE LOAN AGREEMENT BETWEEN IDED AND

Lincolnway Energy, LLC

Loan/Forgivable Loan #05-VAPIVF-03

TABLE OF CONTENTS

	 	 	 	 	 
	ARTICLE 1
	 	 	 	 
	DEFINITIONS
	 	 	1	 
	1.1 AGREEMENT EXPIRATION DATE 
	 	 	1	 
	1.2 AWARD DATE 
	 	 	1	 
	1.3 FORGIVABLE LOAN 
	 	 	1	 
	1.4 LOAN 
	 	 	1	 
	1.5 LOAN AGREEMENT OR AGREEMENT 
	 	 	2	 
	1.6 PROJECT 
	 	 	2	 
	1.7 PROJECT COMPLETION DATE 
	 	 	2	 
	ARTICLE 2
	 	 	 	 
	FUNDING
	 	 	2	 
	2.1 FUNDING SOURCE 
	 	 	2	 
	2.2 RECEIPT OF FUNDS 
	 	 	2	 
	2.3 PRIOR EXPENSES 
	 	 	2	 
	2.4 DISBURSEMENT OF LESS THAN THE TOTAL AWARD AMOUNT 
	 	 	2	 
	ARTICLE 3
	 	 	 	 
	TERMS OF THE LOAN
	 	 	2	 
	3.1 LOAN 
	 	 	2	 
	3.2 PROMISSORY NOTE 
	 	 	3	 
	3.3 OTHER TERMS 
	 	 	3	 
	3.4 PREPAYMENT 
	 	 	3	 
	3.5 ACCELERATION UPON DEFAULT.
	 	 	 	 
	ARTICLE 4
	 	 	 	 
	TERMS OF FORGIVABLE LOAN 
	 	 	3	 
	4.1 FORGIVABLE LOAN 
	 	 	3	 
	4.2 OTHER TERMS 
	 	 	3	 
	4.3 FORGIVABLE LOAN AMORTIZATION 
	 	 	3	 
	ARTICLE 5
	 	 	 	 
	CONDITIONS TO DISBURSEMENT OF FUNDS 
	 	 	3	 
	5.1 AUTHORITY 
	 	 	4	 
	5.2 LOAN AGREEMENT EXECUTED 
	 	 	4	 
	5.3 RECORDING 
	 	 	4	 
	ARTICLE 6
	 	 	 	 
	REPRESENTATIONS AND WARRANTIES OF BUSINESS 
	 	 	4	 
	6.1 AUTHORITY 
	 	 	4	 
	6.2 FINANCIAL INFORMATION 
	 	 	4	 
	6.3 APPLICATION 
	 	 	4	 
	6.4 CLAIMS AND PROCEEDINGS 
	 	 	4	 
	6.5 EFFECTIVE DATE 
	 	 	4	 
	ARTICLE 7
	 	 	 	 
	COVENANTS OF BUSINESS 
	 	 	4	 
	7.1 AFFIRMATIVE COVENANTS 
	 	 	5	 
	(a) PROJECT WORK AND SERVICES 
	 	 	5	 
	(b) RECORDS AND ACCOUNTS 
	 	 	5	 
	(c) ACCESS TO RECORDS/INSPECTIONS 
	 	 	5	 
	(d) USE OF LOAN AND FORGIVABLE LOAN FUNDS 
	 	 	5	 
	(e) DOCUMENTATION 
	 	 	5	 
	(f) NOTICE OF PROCEEDINGS 
	 	 	5	 
	(g) REPORTS 
	 	 	5	 
	(h) NOTICE OF BUSINESS CHANGES 
	 	 	5	 
	(i) NOTICE OF MEETINGS 
	 	 	6	 

 

 

	 	 	 	 	 
	(j)  MAINTENANCE
OF PROJECT PROPERTY AND INSURANCE
	 	 	6	 
	(k) INDEMNIFICATION 
	 	 	6	 
	(l)  PROJECT FEES 
	 	 	6	 
	(m) INTEREST AND SURPLUS PROCEEDS 
	 	 	6	 
	7.2 NEGATIVE COVENANTS 
	 	 	6	 
	(a) BUSINESS INTEREST 
	 	 	6	 
	(b) PROPERTY, COLLATERAL 
	 	 	6	 
	(c) RESTRICTIONS 
	 	 	6	 
	(d) REMOVAL OF COLLATERAL 
	 	 	6	 
	(e) BUSINESS OWNERSHIP 
	 	 	6	 
	(f)  BUSINESS OPERATION 
	 	 	7	 
	ARTICLE 8
	 	 	 	 
	SECURITY 
	 	 	7	 
	8.1 SECURITY INSTRUMENTS 
	 	 	7	 
	ARTICLE 9
	 	 	 	 
	DEFAULT
AND REMEDIES 
	 	 	7	 
	9.1 EVENTS OF DEFAULT 
	 	 	7	 
	(a) MATERIAL REPRESENTATION 
	 	 	7	 
	(b) NONFAYNENT 
	 	 	7	 
	(c) NONCOMPLIANCE 
	 	 	7	 
	(d) PROJECT COMPLETION DATE 
	 	 	7	 
	(e) BUSINESS CHANGES 
	 	 	7	 
	(f)  MISSPENDING 
	 	 	7	 
	(g) INSOLVENCY OR BANKRUPTCY 
	 	 	8	 
	(h) INSURANCE 
	 	 	8	 
	(i)  INSECURITY 
	 	 	8	 
	9.2 NOTICE OF DEFAULT 
	 	 	8	 
	9.3 REMEDIES UPON DEFAULT 
	 	 	8	 
	ARTICLE 10
	 	 	 	 
	DISBURSEMENT PROCEDURES 
	 	 	8	 
	10.1 REQUEST FOR REIMBURSEMENT 
	 	 	8	 
	ARTICLE 11
	 	 	 	 
	GENERAL TERMS AND PROVISIONS 
	 	 	8	 
	11.1 BINDING EFFECT 
	 	 	8	 
	11.2 COMPLIANCE WITH LAWS AND REGULATIONS 
	 	 	8	 
	11.3 TERMINATION FOR CONVENIENCE 
	 	 	9	 
	11.4 PROCEDURE UPON TERMINATION 
	 	 	9	 
	11.5 SURVIVAL OF AGREEMENT 
	 	 	9	 
	11.6 GOVERNING LAW 
	 	 	9	 
	11.7 MODIFICATION 
	 	 	9	 
	11.8 NOTICES 
	 	 	9	 
	11.9 INVESTMENT OF LOAN/FORGIVABLE LOAN FUNDS 
	 	 	9	 
	11.10 WAIVERS 
	 	 	9	 
	11.11 LIMITATION 
	 	 	10	 
	11.12 ENFORCEMENT EXPENSES 
	 	 	10	 
	11.13 HEADINGS 
	 	 	10	 
	11.14 FINAL AUTHORITY 
	 	 	10	 
	11.15 INTEGRATION 
	 	 	10	 
	11.16 COUNTERPARTS 
	 	 	10	 

EXHIBIT A — LOAN APPLICATION

EXHIBIT B — PROMISSORY NOTE

 

 

IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT

VAAPFAP LOAN/FORGIVABLE LOAN AGREEMENT

VAAPFAP LOAN/FORGIVABLE LOAN NUMBER: 05-VAPIVF-03

AWARD DATE: November 4, 2004

KIND OF AWARD: LOAN/FORGIVABLE LOAN

AWARD AMOUNT: $400,000 ($300,000 Ioan/$100,000 forgivable loan)

AGREEMENT EXPIRATION DATE: October 31, 2008

     THIS VALUE-ADDED AGRICULTURAL PRODUCTS AND PROCESSES FINANCIAL ASSISTANCE PROGRAM
(“VAAPFAP”) AGREEMENT is made by and among the IOWA DEPARTMENT OF ECONOMIC Lincolnway Energy, LLC,
975 W. Lincoln Hwy, Suite B, Nevada, Iowa 50201 (“Business”).

     The Department desires to make a Loan/Forgivable Loan to the Business and the Business
desires to accept this Loan/Forgivable Loan, all upon the terms and conditions set forth in this
Agreement.

     THEREFORE, in consideration of the mutual promises contained in this Agreement and other
good and valuable consideration, it is agreed as follows:

ARTICLE I

DEFINITIONS

     As used in this Agreement, the following terms shall apply:

     1.1 AGREEMENT EXPIRATION DATE. “Agreement Expiration Date” is and means the date the
Agreement ceases to be in force and effect. The Agreement expires upon the occurrence of one of
the following: a) the Loan is repaid in full or required part, including accrued interest, court
costs and any penalties; b) the Agreement is terminated by the Department due to any default under
Article X; c) no disbursement of VAAPFAP funds has occurred within the twenty four months
immediately following the Award Date; or d) if the Agreement includes only a Forgivable Loan, at
the Project Completion Date during which the Business remains a viable operation.

     1.2 AWARD DATE. “Award Date” is November 4, 2004 and means the date on which
the Department and the Business execute the documents incorporated within this Agreement.

     1.3 ,FORGIVABLE LOAN. “Forgivable Loan” means an award made by the
Department to the Business for which repayment is eliminated in part or entirely if the
Business satisfies the terms of this Agreement.

     1.4 LOAN., “Loan” means funds advanced by the Department to the
Business of which full repayment is expected.

     1.5 LOAN/FORGIVABLE LOAN AGREEMENT or AGREEMENT., “Loan/Forgivable Loan
Agreement” or “Agreement” means this Agreement, the Project budget and all of the notes, leases,
assignments, mortgages, and similar documents referred to in the Agreement and all other
instruments or

 

 

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Number 05-VAPIVF-03
Lincolnway Energy, LLC

Page 2 of 10

documents executed by the Business or otherwise required in connection with the
Agreement, including but not limited to the following:

     (a) Exhibit “A”, “Loan Application”

     (b) Exhibit “B”, “Promissory Note”

     (c) Exhibit “C”, “Commitment Letter”

     (d) Exhibit “D”, “Uniform Commercial Code I (UCC I)

     1.6 PROJECT. “Project” means the detailed description of the work,
services, and other obligations to be performed or accomplished by the Business as
described in this Agreement and the VAAPFAP application approved by the Department.

     According to the business plan/application the Business will build an ethanol production
facility in the Nevada, Iowa area that will produce and sell at least 50 million gallons of
ethanol in the period of time between the “Award Date” and the “Project completion Date”

     1.7 PROJECT COMPLETION DATE. Project Completion Date” is October 31, 2008 and
means the date by which the Project tasks shall have been fully accomplished.

ARTICLE II

FUNDING

     2.1 FUNDING SOURCE. The source of funding for the Loan/Forgivable Loan is an
appropriation by the State legislature for the VAAPFAP Program established under Iowa Code
Section 15E111:

     2.2 RECEIPT OF FUNDS. All payments under this Agreement are subject to receipt by
the Department of sufficient State funds for the VAAPFAP program. Any termination, reduction or
delay of VAAPFAP funds to the Department shall, at the option of the Department, result in the
termination, reduction or delay of VAAPFAP funds to the Business.

     2.3 PRIOR COSTS., No expenditures made prior to the Award Date may
be included as Project costs for the purposes of this Agreement.

     2.4 DISBURSEMENT OF LESS THAN THE TOTAL AWARD AMOUNT. If substantial progress
toward work activities as ,specified in Exhibit “A” of this Agreement has not been made
within one hundred eighty (180) days of the Award Date, then the Department shall be under no
obligation for further disbursement. The Business shall be obligated to the extent of
Loan/Forgivable Loan proceeds received.

ARTICLE III

TERMS OF LOAN

     3.1 ,LOAN. The Department agrees to make a Loan in the amount of
$300,000 with interest at a rate of 0% per annum ( zero per cent per annum) for 5 years (five years) to
the Business to assist in the financing of the Project.

     3.2 PROMISSORY NOTES. The obligation to repay the Loan portion of this
Agreement, if any, shall be evidenced by a Promissory Note(s) executed by the Business.

 

 

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Lincolnway Energy, LLC

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     3.3 OTHER TERMS.

(a) Funds will be used for the construction of a 50 million gallon capacity
ethanol plant as stipulated in the business plan/application.

 

(b) Repayments on the loan to be deferred for twenty-four months after the “Award Date”
with no accrual of interest during that period. The loan will based on a 10 year
amortization schedule with repayments for 5 years and a balloon payment on the last payment
of the 5th year.

     3.4 PREPAYMENT. The outstanding principal and accrued interest of this Loan or
any part thereof, may be prepaid in part or in full at any time without penalty.

     3.5 ACCELERATION UPON DEFAULT. If there is a failure to pay any installment of
principal and interest when due, or only a portion is paid, or in the event of any other
default under this Loan, the Department may declare the entire unpaid principal and all accrued
interest immediately due and payable.

ARTICLE IV

TERMS OF FORGIVABLE LOAN

     4.1 FORGIVABLE LOAN. The Department agrees to award a Forgivable Loan in the amount
of $100,000 (One hundred thousand and no/100 dollars) to assist in the financing of the
Project.

     4.2 OTHER TERMS.

     (a) Funds will be used by the company for the construction of a 50 million gallon capacity
ethanol plant as stipulated in the business plan/application.

     (b) The criteria for loan forgiveness are given in section 1.6 and 4.3 of this Agreement.

     4.3 FORGIVABLE LOAN REPAYMENT. The Department will, in its sole discretion, determine
if the Business has satisfied the terms of this Agreement by the Project Completion Date and
.has operated in a manner consistent with the Application/Business Plan including
expectations in section 1 .6 of this Agreement. If the Department determines that the Business has
satisfied said terms and has been consistent in its operation according to the Application/
Business Plan, then repayment of the Forgivable Loan shall be permanently waived. Should the
Department determine that the Business has not satisfied the terms of this Agreement, or has
operated in a manner substantially inconsistent with the Application/Business Plan under which the
terms of the award was made, the Business may be required to repay all or part of the Forgivable
Loan funds. This repayment would be a loan repayable over a five year period at 8.5% interest.

ARTICLE V

CONDITIONS TO DISBURSEMENT OF FUNDS

     Unless and until the following conditions have been satisfied, the Department shall be
under no obligation to disburse to the Business any amounts under this Agreement:

     5.1 AUTHORITY. The Business shall have submitted the following documents
to the Department:

(a) Certificate
of Good Standing of the Corporation from the Secretary of State.

(b) Certified
copy of the Articles of Association and Operating Agreement.

(c) Certificate of Incumbency naming the current officers and directors of the corporation.

 

Contract Number
05-VAPIVF-03
 Lincolnway
Energy, LLC

Page 4 of 10

     (d) Resolution of the Board of Directors authorizing the corporation’s execution and
delivery of this Loan/Forgivable Loan Agreement and the Note and borrowing hereunder, and
such other papers as the Department may reasonably request; and specifying the officer(s)
authorized to execute the Loan/Forgivable Loan Agreement and bind the corporation.

     (e) Funds to be released when all other financing for the project is secured.

     (f) Pursuant to Article V of this Contract, a signed Authorization for Release of
Confidential State Tax Information form, to permit IDED to receive the Business’s state tax
information directly from the Iowa Department of Revenue for purposes of annually updating the
Iowa Public Return on Investment Analysis.

     5.2 LOAN/FORGIVABLE LOAN AGREEMENT EXECUTED. T, he
Loan/Forgivable Loan Agreement shall have been properly executed and, where required,
acknowledged.

     5.3 RECORDING. The Business shall have paid the fees necessary to properly record
in the appropriate office of the Recorder of Deeds and/or the Secretary of State any mortgage,
security agreement, financing statement or similar document required by the Department under the
Agreement.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF BUSINESS

     To induce the Department to make the Loan and/or Forgivable Loan referred to in this
Agreement, the Business represents, covenants and warrants that:

     6.1 AUTHORITY. The Business is a limited liability company duly organized and
validly existing under the laws of the state of incorporation and is in good standing, and has
complied with all applicable laws of the State of Iowa. The Business is duly authorized and
empowered to execute and deliver the Agreement. All action on the Business’ part, such as
appropriate resolution of its Board of Directors for the execution and delivery of the
Agreement, has been effectively taken.

     6.2 FINANCIAL INFORMATION. All financial statements and related materials concerning
the Business and the Project provided to the Department are true and correct in all material
respects and completely and accurately represent the subject matter thereof as of the effective
date of the statements and related materials, and no material adverse change has occurred since
that date.

     6.3 APPLICATION. The contents of the application/business plan submitted by the
Business to the Department for VAAPFAP funding is a complete and accurate representation of the
Business and the Project as of the date of submission and there has been no material adverse
change in the organization, operation, business prospects, fixed properties or key personnel of
the Business since the date the Business submitted its VAAPFAP application to the Department.

     6.4 CLAIMS AND PROCEEDINGS. There are no actions, lawsuits or proceedings pending or,
to the knowledge of the Business, threatened against the Business affecting in any manner
whatsoever its right to execute the Agreement or the ability of the Business to make the payments
required under the agreement, or to otherwise comply with the obligations of the Business contained
under the Agreement. There are no actions, lawsuits or proceedings at law or in equity, or before
any governmental or administrative authority pending or, to the knowledge of the Business,
threatened against or affecting the Business or any property or collateral pledged as security for
the Loan.

     6.5 EFFECTIVE DATE. The covenants, warranties and representations of this Article
are made as of the date of this Agreement and shall be deemed to be renewed and restated by the
Business at the time of each advance or request for disbursement of funds.

 

 

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 Lincolnway
Energy, LLC

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ARTICLE VII

COVENANTS OF BUSINESS

     7.1 AFFIRMATIVE COVENANTS. Until payment in full of the Loan and satisfaction of
terms of the Forgivable Loan, the Business covenants to IDED that:

     (a) PROJECT WORK AND SERVICES. The Business shall complete the work and services
detailed in its VAAPFAP application by the Project Completion Date.

     (b) RECORDS AND ACCOUNTS. The Business shall maintain books, records, documents and
other evidence pertaining to all costs and expenses incurred and revenues received under this
Agreement concerning the project, in sufficient detail to reflect all costs, direct and indirect,
of labor, materials, equipment, supplies, services and other costs and expenses of whatever
nature, for which payment is claimed under this Agreement. The Business shall retain all records
for a period of three (3) years from the Agreement Expiration Date.

     (c) ACCESS TO RECORDS/INSPECTIONS. The Business shall, without prior notice and at
any time (during normal business hours), permit the Department, its representatives or the State
Auditor to examine, audit and/or copy (i) any plans and work details pertaining to the Project,
(ii) all of the Business’ books, records and accounts, and (iii) all other documentation or
materials related to this Agreement; the Business shall provide proper facilities for making such
examination and/or inspection.

     (d) USE OF LOAN AND FORGIVABLE LOAN FUNDS. The Business shall expend funds
received under the Loan and/or Forgivable Loan only for the purposes and activities
described in its VAAPFAP Application and approved by the Department.

     (e) DOCUMENTATION. The Business shall deliver to the IDED, upon request, (i) copies
of all contracts or agreements relating to the Project, (ii) invoices, receipts, statements or
vouchers relating to the Project, (iii) a list of all unpaid bills for labor and materials in
connection with the Project, (iv) budgets and revisions showing estimated Project costs and funds
required at any given time to complete and pay for the Project, and (v) current and year-to-date
operating statements, including but not limited to a Profit and Loss and Balance Sheet, not older
than sixty (60) days from the date of request.

     (f) NOTICE OF PROCEEDINGS. The Business shall promptly notify IDED of the
initiation of any claims, lawsuits, bankruptcy proceedings or other proceedings brought against
the Business which would adversely impact the project, including, but not limited to, any
proceedings to assert or enforce liens against collateral securing the Loan.

     (g) REPORTS. The Business shall prepare, sign and submit the following
reports to the Department when required:

(1) Financial statements on an annual basis within 90 days after the Business’ fiscal
year end. A project progress report will be due annually, except in the last year of the
project when a final project report will be due 90 days after the Project Completion Date.
Depending on the situation the Department may request more frequent reports and/or audited
financial statements.

(2) Business shall execute an Authorization for Release of Confidential State Tax
Information form, to permit IDED to receive the Business’s state tax information directly
from the Iowa Department of Revenue for purposes of annually updating the Iowa Public
Return on Investment Analysis for this Project. Business shall submit to IDED any other
information requested by IDED to update the Iowa Public Return on Investment Analysis for
this Project.

 

 

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Energy, LLC

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     (h) NOTICE OF BUSINESS CHANGES. The Business shall provide prompt advance
notice to the Department of any proposed change in the Business ownership, structure or control
which would materially affect the Project.

     (i) NOTICE OF MEETINGS. The Business shall notify the Department at least ten (10)
working days in advance of all Board of Directors and Stockholders meetings at which the subject
matter of this Agreement or Project is proposed to be discussed. The Business shall provide the
Department with copies of the agenda and minutes of such meetings and expressly agrees that a
representative of the Department has a right to attend any and all such meetings for the
purposes of the discussion of the Project and the Loan and/or Forgivable Loan.

     (j) MAINTENANCE OF PROJECT PROPERTY AND INSURANCE. The Business shall maintain the
Project property in good repair and condition, ordinary wear and tear excepted, and shall not
suffer or commit waste or damage upon the Project property. At the Department’s request, the
Business shall pay for and maintain insurance against loss or damage by fire, tornado, and other
hazards, casualties, and contingencies and all risks from time to time included under “extended
coverage” policies. This insurance shall be in an amount not less than the full insurable value
of the Project property. The Business shall name the Department as a mortgagee and/or an
additional loss payee as appropriate and submit copies of the policies to the Department.

     (k) INDEMNIFICATION. The Business shall indemnify and hold harmless the
Department, its officers and employees, from and against any and all losses, except those losses
incurred by the Department resulting from willful misconduct or negligence on its or their part.

     (I) PROJECT FEES. The Business shall promptly pay all appraisal, survey,
recording, title, license, permit and other fees and expenses incurred incident to the
Loan/Forgivable Loan.

     (m) INTEREST AND SURPLUS PROCEEDS. The Business shall return all unexpended
Loan/Forgivable Loan proceeds and interest accrued on Loan proceeds to the Department within
thirty (30) days after the Project Completion Date.

     7.2 NEGATIVE COVENANTS. So long as the Business is indebted to IDED, the Business
shall not, without prior written disclosure to IDED and prior written consent of IDED (unless
IDED prior approval is expressly waived below), directly or indirectly:

     (a) BUSINESS’ INTEREST. Assign, waive or transfer any of Business’ rights, powers,
duties or obligations under this Agreement.

     (b) PROPERTY/COLLATERAL. Sell, transfer, convey, assign, encumber or otherwise
dispose of any of the real property or other collateral securing the Loan other than in ordinary
course of business provided that the substituted collateral is of equal or greater value.

     (c) RESTRICTIONS. Place or permit any restrictions, covenants or any similar
limitations on the real property and/or other collateral securing the Loan.

     (d) REMOVAL OF COLLATERAL. Remove from the Project site or the State all or any
part of the collateral securing the Loan other than in ordinary course of business provided that
the substituted collateral is of equal or greater value.

     (e) BUSINESS OWNERSHIP. Materially change the ownership structure or control of the
business affecting the Project, including but not limited to, entering into any merger or
consolidation with any person, firm or corporation or permitting substantial distribution,
liquidation or other disposal of business assets directly associated with the Project. Changes in
the business ownership, structure or control which do not materially affect the Project shall
require forty-five (45) days prior written notice of the Department, but

 

 

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05-VAPIVF-03
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Energy, LLC

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not written consent of, the Department. The materiality of the change and whether or not the
change affects the Project shall be determined by the Department.

     (f) BUSINESS OPERATION. Materially change the nature of the business being
conducted, or proposed to be conducted, as described in the Business’ application for VAAPFAP
funding.

ARTICLE VIII

SECURITY

     8.1 SECURITY INSTRUMENTS. The Business shall execute in favor of the Department all
security agreements, financing statements, mortgages, personal and/or corporate guarantees
(hereafter, “Security Instruments”) as required by the Department. The following Security
Instruments shall be executed by the Business:

     (a) UCC-1 all inclusive filing on all business assets, including, but not limited to:
accounts receivable and inventory in which IDED shall maintain a superior position not to exceed
the amount owed on any Loans outstanding in connection with this Agreement. Said UCC-1 shall be
filed with the Secretary of State.

ARTICLE IX

DEFAULT AND REMEDIES

     9.1 EVENTS OF DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

     (a) MATERIAL MISREPRESENTATION. If at any time any representation, warranty or
statement made or furnished to the Department by, or on behalf of, the Business in connection with
this Agreement or to induce the Department to make a Loan/Forgivable Loan to the Business shall be
determined by the Department to be incorrect, false, misleading or erroneous in any material
respect when made or furnished and shall not have been remedied to the Department’s satisfaction
within thirty (30) days after written notice by the Department is given to the Business.

     (b) NON-PAYMENT. If the Business fails to make a payment when due under the terms
of this Agreement within thirty (30) days following written notice of such overdue payment
is given to the Business by the Department.

     (c) NONCOMPLIANCE. If there is a failure by the Business to comply with any of the
covenants, terms or conditions contained in this Agreement or Security Instruments executed
pursuant to this Agreement.

     (d) PROJECT COMPLETION DATE. If the Project, in the sole judgment of the
Department, is not completed on or before the Project Completion Date.

     (e) BUSINESS CHANGES. If there is a material change in the Business ownership,
structure or control which occurs without the prior written disclosure to and if required, written
permission of the Department.

     (f) MISSPENDING. If the Business expends Loan/Forgivable Loan proceeds for purposes
not described in the VAAPFAP application or authorized by the Department.

 

 

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Energy, LLC

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     (g) INSOLVENCY OR BANKRUPTCY. If the Business becomes insolvent or bankrupt,
or admits in writing its inability to pay its debts as they mature, or makes an assignment for
the benefit of creditors, or the Business applies for or consents to the appointment of a trustee
or receiver for the Business or for the major part of its property; or if a trustee or receiver
is appointed for the Business or for all or a substantial part of the assets of the Business and
the order of such appointment is not discharged, vacated or stayed within sixty (60) days after
such appointment; or if bankruptcy, reorganization, arrangement, insolvency, or liquidation
proceedings or other proceedings for relief under any bankruptcy or similar law or laws for the
relief of debtors, are instituted by or against the Business and, if instituted against the
Business, is consented to, or, if contested by the Business is not dismissed by the adverse
parties or by an order, decree or judgment within sixty (60) days after such institution.

     (h) INSURANCE. If loss, theft, damage or destruction of any substantial portion of
the property of the Business occurs for which there is either no insurance coverage or for
which, in the opinion of the Department, there is insufficient insurance coverage.

     (i) INSECURITY. The Department shall deem itself insecure in good faith and
reasonably believes, after consideration of all the facts and circumstances then existing, that
the prospect of payment and satisfaction of the obligations under this Agreement, or the
performance of or observance of the covenants in this Agreement, or the value of its collateral
is or will be materially impaired.

     9.2 NOTICE OF DEFAULT. The Department shall issue a written notice of default
providing therein a thirty (30) day period in which the Business shall have an opportunity to
cure, provided that cure is possible and feasible.

     9.3 REMEDIES UPON DEFAULT. Upon the happening of any Event of Default, the
Department shall have the right, in addition to any rights and remedies available to it under any
of the Security Instruments, to require immediate repayment of the full amount of funds disbursed
to the Business under the Agreement plus interest without presentment, demand, protest, notice of
protest, notice of intention to accelerate or other notice of any kind, all of which are expressly
waived by the Business.

ARTICLE X

DISBURSEMENT PROCEDURES

     10.1 REQUEST FOR REIMBURSEMENT. All disbursements of proceeds shall be subject
to receipt by the Department of requests for disbursement submitted by the Business.
Requests for disbursement shall be in form and content acceptable to the Department.

ARTICLE XI

GENERAL TERMS AND PROVISIONS

     11.1 BINDING EFFECT. This Agreement shall be binding upon and shall inure to the
benefit of the Department and Business and their respective heirs, successors, legal
representatives and assigns. The obligations, covenants, warranties, acknowledgments,
waivers, agreements, terms, provisions and conditions of this Agreement shall be jointly and
severally enforceable against the parties to this Agreement.

     11.2 COMPLIANCE WITH LAWS AND REGULATIONS. The Business shall comply with all
applicable State and federal laws, rules (including the administrative rules adopted by the
Department for the VAAPFAP Program), ordinances, regulations and orders.

 

 

Contract Number
05-VAPIVF-03
 Lincolnway
Energy, LLC

Page 9 of 10

     11.3 TERMINATION FOR CONVENIENCE. In addition to termination due to an Event
of Default or nonappropriation of VAAPFAP funds, this Agreement may be terminated in whole, or in
part, when the Department and the Business agree that the continuation of the Project would not
produce beneficial results commensurate with the future disbursement of Loan/Forgivable Loan
funds. The Department and the Business shall agree upon the termination conditions. The Business
shall not incur new obligations after the effective date of the termination and shall cancel as
many outstanding obligations as is reasonably possible.

     11.4 PROCEDURE UPON TERMINATION. If the Agreement is terminated for convenience, an
Event of Default or nonappropriation of VAAPFAP funds, disbursements shall be allowed for costs
up to the date of termination determined by the Department to be in compliance with this
Agreement. The Business shall return to the Department all unencumbered Loan/Forgivable Loan
proceeds within one (1) week of receipt of Notice of Termination. Any costs previously paid by
the Department which are subsequently determined to be unallowable through audit procedures shall
be returned to the Department within thirty (30) days of the disallowance.

     11.5 SURVIVAL OF AGREEMENT. If any portion of this Agreement is held to be invalid
or unenforceable, the remainder shall be valid and enforceable. The provisions of this Agreement
shall survive the execution of all instruments herein mentioned and shall continue in full force
until the Loan is paid in full and the terms of the Forgivable Loan have been satisfied.

     11.6 GOVERNING LAW. This Agreement and all Security Instruments shall be
interpreted in accordance with the law of the State of Iowa, and any action relating to the
Agreement shall only be commenced in the Iowa District Court for Polk County or the United
States District Court for the Southern District of Iowa.

     11.7 MODIFICATION. Neither this Agreement nor any provision of the Security
Instruments executed in connection with this Agreement may be changed, waived, discharged or
terminated orally, but only by a written document signed by the party against whom enforcement of
the change, waiver, discharge or termination is sought.

     11.8 NOTICES. Whenever this Agreement requires or permits any notice or written
request by one party to another, it shall be in writing, enclosed in an envelope, addressed to
the party to be notified at the address heretofore stated (or at such other address as may have
been designated by written notice), properly stamped, sealed and deposited in the United States
Mail. Any such notice given hereunder shall be deemed delivered upon the earlier of actual
receipt or two (2) business days after posting. The Department may rely on the address of the
Business set forth heretofore, as modified from time to time, as being the address of the
Business.

     11.9 INVESTMENT OF LOAN/FORGIVABLE LOAN FUNDS. Temporarily idle Loan/Forgivable
Loan proceeds held by the Business may be invested provided such investments shall be in
accordance with State law, shall be controlled by the Business, and any interest accrued shall
be credited to and expended on the Project prior to the expenditure of other Loan/Forgivable
Loan proceeds. All proceeds remaining, including accrued interest, after all allowable Project
costs have been paid or obligated shall be returned to the Department within thirty (30) days
after the Project Completion Date.

     11.10 WAIVERS. No waiver by the Department of any default hereunder shall operate
as a waiver of any other default or of the same default on any future occasion. No delay on the
part of the Department in exercising any right or remedy hereunder shall operate as a waiver
thereof. No single or partial exercise of any right or remedy by the Department shall preclude
future exercise thereof or the exercise of any other right or remedy.

 

 

Contract Number
05-VAPIVF-03
 Lincolnway
Energy, LLC

Page 10 of 10

     11.11 LIMITATION. It is agreed by the Business that the Department shall
not, under any circumstances, be obligated financially under this Agreement except to
disburse funds according to the terms of the Agreement.

     11.12 ENFORCEMENT EXPENSES. The Business shall pay upon demand any and all reasonable
fees and expenses of the Department, including the fees and expenses of their attorneys, experts
and agents, in connection with the exercise or enforcement of any of the rights of the Department
under the Agreement.

     11.13 HEADINGS. The headings in this Agreement are intended solely for
convenience of reference and shall be given no effect in the construction and
interpretation of this Agreement.

     11.14 FINAL AUTHORITY. The Department shall have the final authority to assess
whether the Business has otherwise complied with the terms of this Agreement.

     11.15 INTEGRATION. This Agreement contains the entire understanding between the
Business and the Department and any representations that may have been made before or after the
signing of this Agreement, which are not contained herein, are nonbinding, void and of no effect.
None of the parties have relied on any such prior representation in entering into this Agreement.

     11.16 COUNTERPARTS. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all of which together shall constitute but
one and the same instrument.

     IN WITNESS WHEREOF, the parties have executed this Agreement on the latest day and year
specified below.

IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT:

	 	 	 	 	 
	By:

	 	/s/ Michael Fastenau	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	DATE:

	 	2/25/05	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	LINCOLNWAY ENERGY, LLC:	 	 
	 
	 	 	 	 
	BY:

	 	/s/ William D. Couser	 	 
	 

	 	 	 	 
	 

	 	William D. Couser	 	 
	 
	 	 	 	 
	DATE:

	 	2/16/2005 	 	 

 

 

Contract Number
05-VAPIVF-03
 Lincolnway
Energy, LLC

Page 11 of 10

IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT

VALUE-ADDED AGRICULTURAL PRODUCTS AND PROCESSES

FINANCIAL ASSISTANCE PROGRAM

PROMISSORY NOTE

	 	 	 
	Loan Number: 05-VAPIVF-03

	 	Amount: $300,000
	 
	Date: November 4, 2004
	 	 

     FOR VALUE RECEIVED, the undersigned, (hereafter called the “Maker” promises to pay to the
order of Iowa Department of Economic Development (hereafter called “Holder”), at its offices at
200 East Grand Avenue, Des Moines, Iowa 50309, or upon notice to the Maker, at such other place
as may be designated from time to time by the Holder, the principal sum of $300,000 (three
hundred thousand dollars) at 0 % (zero percent) interest on loan Number 05-VAPIVF-03 dated
November 4, 2004, to be paid as follows and in accordance with the Amortization Schedule
attached:

     59 (Fifty-nine) monthly payments of $2,500.00 (Two thousand five hundred and 00/100
dollars) to be paid monthly beginning DECEMBER 1, 2006;

     1(One) payment in the estimated amount of $152,500.00 (One hundred fifty-two thousand five
hundred and 00/100 dollars) due on or before NOVEMBER 1, 2012.

     1. Payments. All payments under the Note shall be applied in this order: (1) to interest,
(2) to unpaid late fees, and (3) to principal in accordance with Amortization Schedule attached
hereto as Attachment “A”.

     2. Loan Agreement; Acceleration Upon Default. This Note is issued by Maker to evidence an
obligation to repay a loan according to the terms of Loan Agreement number
(05-VAPIVF-03) and any amendments thereof, between the Holder and Maker and, at the election of
the Holder without notice to the Maker, shall become immediately due and payable in the event
any payment is not made when due or upon the occurrence of any event of default under the terms
of the Loan Agreement.

     3. Reduced Amounts. In the event the Maker fails to requisition and spend the full face
amount of the Note as set out above, then the amount of each installment payment
shall be reduced accordingly in equal amounts.

     4. Security. Payment of this Note is secured by a UCC-1, personal guarantees of, Purchase
Money Security Interest in items purchased with loan funds dated, November 4, 2004 and the
Holder is entitled to the benefits of the security therein described.

     In case of a decline in the market value of the collateral, or any part thereof, the Holder
may demand that additional collateral of quality and value satisfactory to Holder be delivered,
pledged and transferred to Holder.

     5. Waiver. No delay or omission on the part of the Holder in exercising any right under this
Note shall operate as a waiver of that right or of any other right under this Note. A waiver on any
one occasion shall not be construed as a bar to or waiver of any
right and/or remedy on any future occasion.

 

 

Contract Number 05-VAPIVF-03

Lincolnway Energy, LLC

Page 12 of 10

     6. Waiver of Protest. Each Maker, surety, endorser and guarantor of this Note, expressly
waives presentment, protest, demand, notice of dishonor or default, and notice of any kind with
respect to this Note.

     7. Costs of Collection. The Maker will pay on demand all costs of collection,
maintenance of collateral, legal expenses, and attorneys fees incurred or paid by the Holder
in collecting and/or enforcing this Note on default.

     8. Meaning of Terms. As used in this Note, “Holder” shall mean the Iowa Department of
Economic Development or other endorsee of this Note, who is in possession of it, or the bearer
hereof, if this Note is at the time, payable to the bearer. The word “Maker” shall mean each of
the undersigned. If this Note is signed by more than one person, it shall be the joint and several
liabilities of such persons.

     9. Miscellaneous. The captions of paragraphs in this Promissory Note are for the
convenience of reference only. They shall not define or limit the provisions hereof and shall
not have any legal or other significance whatsoever.

BY:                                         /s/William D. Couser                                        Date: 2/16/2005

 

 

December 9, 2004

Mr. Matt Crouse, Project
Manager
 Lincolnway Energy, LLC

975 W. Lincoln Hwy, Suite
B
 Nevada, Iowa 50201

			
	RE:	 	Value-Added Agricultural Products and Processes Financial
Assistance Program (VAAPFAP)

Dear Mr. Crouse:

It is my pleasure to advise you that the Agricultural Products Advisory Council and
the Iowa Department of Economic Development staff has reviewed the above captioned
application and an award of $400,000 ($300,000 zero interest deferred loan!$100,000
forgivable loan) has been approved by the Department. This approval is expressly
contingent upon any terms and conditions set forth in the contract with
the State of Iowa.

On behalf of the Iowa Department of Economic Development we wish you the very best
in your business endeavors and look forward to working with you on this project.
Should you have any questions regarding this award, please contact Joe Jones at
515-242-4801.

Sincerely,

/s/ Michael T. Blouin

Michael T. Blouin

Director

			
	cc:	 	Stewart Iverson, State Senator

James Kurtenbach, State Representative

IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT

Michael T. Blouin, Directors 200 East Grand Avenue, Des Moines, Iowa
50309 USA  0 Phone: 515.242.4700 O Fax: 515.242.4809 O
www.iowalifechanninu.com

 

 

Page 1

 

Lincolnway Energy, LLC

 

			
	Compound Period :

	 	Monthly
	 
	Nominal Annual Rate:

	 	0.000 %
	Effective Annual Rate:

	 	0.000 %
	Periodic Rate:

	 	0.0000 %
	Daily Rate :

	 	0.00000 %

CASH FLOW DATA

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Event	 	Start Date	 	Amount	 	Number Period	 	End Date
	 
	 
	 	 	1	 	 	Loan	 	12/01/2006	 	 	300,000.00	 	 	1	 	 
	 
	 	 	2	 	 	Payment	 	12/01/2006	 	 	2,500.00	 	 	59 Monthly	 	10/01/2011
	 
	 	 	3	 	 	Payment	 	11/01/2012	 	 	152,500.00	 	 	1	 	 

AMORTIZATION SCHEDULE — Normal Amortization

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Date	 	Payment	 	Interest	 	Principal	 	Balance
	 
	Loan 12/01/2006
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	300,000.00	 
	1  12/01/2006
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	297,500.00	 
	2006  Totals
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	2  01/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	295,000.00	 
	3  02/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	292,500.00	 
	4  03/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	290,000.00	 
	5  04/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	287,500.00	 
	6  05/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	285,000.00	 
	7  06/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	282,500.00	 
	8  07/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	280,000.00	 
	9 
08/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	277,500.00	 
	10  09/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	275,000.00	 
	11 
10/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	272,500.00	 
	12  11/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	270,000.00	 
	13  12/01/2007
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	267,500.00	 
	2007  Totals
	 	 	30,000.00	 	 	 	0.00	 	 	 	30,000.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	14  01/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	265,000.00	 
	15  02/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	262,500.00	 
	16  03/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	260,000.00	 
	17  04/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	257,500.00	 
	18 
05/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	255,000.00	 
	19  06/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	252,500.00	 
	20  07/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	250,000.00	 
	21  08/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	247,500.00	 
	22  09/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	245,000.00	 
	23  10/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	242,500.00	 
	24  11/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	240,000.00	 
	25  12/01/2008
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	237,500.00	 
	2008   Totals
	 	 	30,000.00	 	 	 	0.00	 	 	 	30,000.00	 	 	 	 	 

 

 

Page 2

 

Lincolnway Energy, LLC

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Date	 	Payment	 	Interest	 	Principal	 	Balance
	 
	26 01/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	235,000.00	 
	27 02/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	232,500.00	 
	28 03/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	230,000.00	 
	29 04/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	227,500.00	 
	30 05/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	225,000.00	 
	31 06/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	222,500.00	 
	32 07/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	220,000.00	 
	33 08/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	217,500.00	 
	34 09/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	215,000.00	 
	35 10/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	212,500.00	 
	36 11/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	210,000.00	 
	37 12/01/2009
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	207,500.00	 
	2009 Totals
	 	 	30,000.00	 	 	 	0.00	 	 	 	30,000.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	38 01/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	205,000.00	 
	39 02/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	202,500.00	 
	40 03/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	200,000.00	 
	41 04/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	197,500.00	 
	42 05/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	195,000.00	 
	43 06/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	192,500.00	 
	44 07/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	190,000.00	 
	45 08/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	187,500.00	 
	46 09/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	185,000.00	 
	47 10/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	182,500.00	 
	48 11/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	180,000.00	 
	49 12/01/2010
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	177,500.00	 
	2010 Totals
	 	 	30,000.00	 	 	 	0.00	 	 	 	30,000.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	50 01/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	175,000.00	 
	51 02/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	172,500.00	 
	52 03/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	170,000.00	 
	53 04/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	167,500.00	 
	54 05/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	165,000.00	 
	55 06/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	162,500.00	 
	56 07/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	160,000.00	 
	57 08/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	157,500.00	 
	58 09/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	155,000.00	 
	59 10/01/2011
	 	 	2,500.00	 	 	 	0.00	 	 	 	2,500.00	 	 	 	152,500.00	 
	2011 Totals
	 	 	25,000.00	 	 	 	0.00	 	 	 	25,000.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	     60 11/01/2012
	 	 	152,500.00	 	 	 	0.00	 	 	 	152,500.00	 	 	 	0.00	 
	2012 Totals
	 	 	152,500.00	 	 	 	0.00	 	 	 	152,500.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Grand Totals
	 	 	300,000.00	 	 	 	0.00	 	 	 	300,000.00

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