Document:

Exhibit 10.11
	 

	 
		EXECUTIVE EMPLOYMENT AGREEMENT

	 

	 
		THIS EXECUTIVE EMPLOYMENT AGREEMENT
		(this “Agreement”) is made and entered into as of the
		28th day of April, 2006 (the “Effective Date”) by and between BioFuel Energy, LLC (the
		“Company”) and Scott H. Pearce (“Executive”).
	 

	 
		PRELIMINARY STATEMENTS
	 

	 
		A. The Company desires to employ Executive
		as President and Chief Executive Officer, and Executive desires to be employed
		by the Company in said capacity; and
	 

	 
		B. Each party desires to set forth in
		writing the terms and conditions of their understandings and agreements.

	 

	 
		NOW, THEREFORE, in consideration of
		the mutual covenants and obligations contained herein, the Company hereby
		agrees to employ Executive and Executive hereby accepts such employment upon
		the terms and conditions set forth in this Agreement:
	 

	 
		STATEMENT OF AGREEMENT
	 

	 
		1. Position.

	 

	 
		(a) The Company agrees to employ Executive
		in the position of President and Chief Executive Officer. Executive shall serve
		and perform the duties which may from time to time be assigned to him by the
		board of managers of the Company (the “Board”).
	 

	 
		(b) Executive agrees to serve as President
		and Chief Executive Officer and agrees that he will devote his best efforts and
		full business time and attention to the Company. Executive agrees that he will
		faithfully and diligently carry out the duties of the President and Chief
		Executive Officer. Executive further agrees to comply with all Company policies
		in effect from time to time and to comply with all laws, rules and regulations,
		including, but not limited to, those applicable to the Company.
	 

	 
		(c) Executive agrees to travel as necessary
		to perform his duties under this Agreement.
	 

	 
		(d) Nothing herein shall preclude Executive
		from (i) engaging in charitable and community activities; (ii) participating in
		industry and trade organization activities; (iii) managing his and his
		family’s personal investments and affairs; and (iv) delivering lectures,
		fulfilling speaking engagements or teaching at educational institutions;
		provided, that such activities do not (x) materially interfere with the regular
		performance of his duties and responsibilities under this Agreement or (y)
		constitute activities that compete with the business of Company.
	 

	 
		2. Term. The
		initial term of this Agreement shall be three (3) years from the date stated
		above (“Initial
		Term”), unless otherwise
		terminated pursuant to Section 5 of this Agreement. This Agreement shall
		automatically renew for successive one (1) year terms unless either party gives
		written notice of its or his intent not to renew this Agreement at least sixty
		(60) days prior to the expiration of the then-current term. Executive’s
		continued employment after
	 

	 
		 
	 

	 
		
	 

	 
		 
	 

	 
 

	 
		the expiration of the Initial Term shall be
		in accordance with and governed by this Agreement, unless modified by the
		parties to this Agreement in writing.
	 

	 
		3. Compensation and Benefits.
	 

	 
		(a) Base Salary. The
		Company shall pay Executive a base salary of not less than $300,000 per year
		(“Base
		Salary”).
	 

	 
		(b) Bonus Opportunities. For each calendar year during the Term after the first
		two ethanol production facilities of the Company become operational (the
		“Ethanol Production
		Point”), Executive shall be
		eligible to receive incentive compensation (an “Annual Bonus”) from the Company, with a target bonus
		opportunity of two hundred
		percent (200%) of Base Salary (pro
		rated for any portion of the year that occurs after the Ethanol Production
		Point). The parameters under which Executive’s Annual Bonus for each year
		during the Term will be payable shall be determined by the Board in
		consultation with Executive. Such parameters shall be set forth in a written
		notice delivered to Executive within seventy-five (75) days after the start of
		each calendar year. Executive’s Annual Bonus for any year shall be payable
		in cash no later than thirty (30) days after completion of the Company’s
		audit relating to such fiscal year. Notwithstanding the foregoing and for the
		purposes of clarity, no Annual Bonus will be paid or accrue for any period of
		time that precedes the Ethanol Production Point.
	 

	 
		(c) Payment. Payment
		of all compensation to Executive hereunder shall be made in accordance with the
		terms of this Agreement and applicable Company policies in effect from time to
		time, including normal payroll practices, and shall be subject to all
		applicable withholdings and taxes.
	 

	 
		(d) Benefits Generally. The Company shall make available to Executive,
		throughout the term of this Agreement, benefits as are generally provided by
		the Company to its executive officers, which may presently be in effect or
		which may hereafter be adopted by the Company for its executive officers and
		key management personnel; provided, however, that nothing herein contained
		shall be deemed to require the Company to adopt or maintain any particular plan
		or policy.
	 

	 
		(e) Vacation.
		Executive shall be entitled to paid vacation for up to four weeks during each
		calendar year, consistent with the policies then applicable to executive
		officers.
	 

	 
		(f) Holidays.
		Executive shall further be entitled to paid holidays, personal days, and sick
		days consistent with the policies then applicable to executive officers.

	 

	 
		4. Reimbursement of Expenses. The Company shall reimburse Executive for all business
		expenses, which are reasonable and necessary and are incurred by Executive
		while performing his duties under this Agreement, upon presentation of expense
		statements, receipts and/or vouchers, or such other information and
		documentation as the Company may reasonably require. Executive shall provide
		the Board with, upon reasonable request, an explanation of the purpose of any
		particular business expense and an estimate of the cost of the same, prior to
		incurring any expense related to the same. The Board reserves the right to
		reject any unreasonable business expense. Notwithstanding the foregoing, and in
		furtherance of, and not in limitation of the foregoing, aggregate expenses per
		year in excess of $25,000 shall require the consent of the Board.
	 

	 
		 
	 

	 
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		5. Termination.
	 

	 
		(a) Termination by the Company. The Company may terminate this Agreement for any
		reason immediately upon transmittal of written notice to Executive in
		accordance with this Agreement. If the Company terminates this Agreement
		pursuant to this provision without Cause or Executive terminates this Agreement
		for Good Reason, the Company shall, after receipt of (i) an executed release
		agreement between the Company and Executive, which will consist in substance of
		the language attached as Exhibit
		A (and any other language releasing
		specific claims, complaints, liabilities or obligations that are identified by
		the Company) and (ii) a severance agreement in a form provided by the Company
		that will (A) reflect the relevant related terms and provisions of this
		Agreement and (B) contain only other provisions required by applicable law
		required to give effect to the enforceability of the terms and provisions of
		such agreement (collectively, the “Severance and Release
		Documents”), pay Executive (1)
		all accrued but unpaid Base Salary and any accrued but unpaid Annual Bonus from
		the previous fiscal year, (2) any unreimbursed expenses (in accordance with
		Section 4 of this Agreement), (3) a severance payment equal to eighteen (18)
		months of Executive’s then current Base Salary (“Severance Payment”), and (4) continuing health benefit coverage for
		eighteen (18) months pursuant to COBRA. It is understood by the parties that
		the Severance and Release Documents would not require Executive to (i) forfeit
		any equity securities issued by the Company that are held by the Executive,
		(ii) release any rights to receive distributions, or voting rights, under the
		limited liability company agreement of the Company to the extent that any such
		rights are held by Executive and result from Executive’s ownership of
		equity securities issued by the Company, (iii) release any rights that he may
		have under this Agreement to a Severance Payment or any other payments or
		benefits described in clauses (1), (2) or (4) of the preceding sentence or (iv)
		release any rights Executive has to indemnification pursuant to Section 10
		hereof or otherwise. Any Severance Payment will be paid out in equal
		installments during the eighteen (18) months following such termination.
		Executive acknowledges and agrees that the Company may revise the timing of any
		payments described in this Agreement to the extent necessary to comply with
		Section 409A of the Internal Revenue Code of 1986, as amended, and any
		regulations and/or guidance promulgated thereunder. For the avoidance of doubt,
		Executive shall not be entitled to any portion of the Annual Bonus for the year
		in which this Agreement was terminated. Notwithstanding the foregoing,
		Executive shall not be entitled to any Severance Payment if Executive is
		terminated (A) in contemplation of (i) the Company commencing a case or
		proceeding under Title 11 of the United States Code or similar state or federal
		law or (ii) the liquidation or dissolution of the Company or (B) during a
		period when the Company is insolvent.
	 

	 
		(b) Termination by the Company for Cause. The Company may terminate this Agreement at any time
		for Cause. Upon termination of this Agreement by the Company for Cause or by
		Executive without Good Reason, Executive shall only be entitled to his Accrued
		Compensation and shall have no entitlement to any Severance Payment for the
		year of termination. “Cause”
		means any of the following as determined by the Board:
	 

	 
		(i) Executive’s commission of theft,
		embezzlement, any other act of dishonesty relating to his employment with the
		Company, or any material violation of any law, rules, or regulations by
		Executive to the extent that such law, rule or regulations are applicable to
		the Company, including, but not limited to, those established by the Securities
		and Exchange Commission, or any self-regulatory organization having
		jurisdiction or authority over Executive or the Company or any failure by
		Executive to inform the Company of any material violation,
	 

	 
		 
	 

	 
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		that Executive has knowledge of, of any law,
		rule or regulation by the Company or one of its direct or indirect
		subsidiaries;
	 

	 
		(ii) Executive’s conviction of, or
		pleading guilty or nolo contendere to, a felony or any lesser crime having as
		its predicate element fraud, misappropriation of Company (including any direct
		or indirect subsidiaries) property for personal profit, or moral turpitude, or
		indictment for any crime involving moral turpitude or fraud;
	 

	 
		(iii) Executive has failed to perform his
		material duties and obligations under this Agreement (other than during any
		period of disability) or otherwise materially breaches this Agreement or fails
		to follow any reasonable and lawful instructions of the Board, which failure to
		perform is not remedied within ten (10) days after notice thereof to Executive
		by the Company;
	 

	 
		(iv) Executive’s appropriation or
		attempted appropriation of (A) a material business opportunity of the Company
		or (B) any of the Company’s funds or property; or
	 

	 
		(v) Executive’s commission of an act or
		acts in the performance of his duties under this Agreement amounting to gross
		negligence or willful misconduct, including, but not limited to, any breach of
		Sections 7 or 8 of this Agreement.
	 

	 
		(vi) Executive may be terminated for Cause
		after a hearing of the Board at which the termination for Cause of Executive is
		considered; provided that Executive will be provided with notice of such
		hearing and the opportunity to be heard at such hearing, which shall be held
		within five days of the date of any such notice.
	 

	 
		(c) Termination by Executive for Good Reason. Executive may terminate this Agreement for Good
		Reason, if after providing ten (10) days written notice to the Company, which
		identifies the Good Reason for Executive’s termination, such “Good
		Reason” is not remedied. “Good Reason” means any of the following reasons:
	 

	 
		(i) Executive’s removal from his
		position as President and Chief Executive Officer, other than for Cause or by
		death or disability, as set forth in Section 5 of this Agreement, during the
		term of this Agreement;
	 

	 
		(ii) Any material and detrimental alteration
		or change in Executive’s job title without Executive’s prior written
		consent;
	 

	 
		(iii) Any reduction in Executive’s Base
		Salary; or
	 

	 
		(iv) The Company fails to make any payment
		to Executive required to be made under the terms of this Agreement, if the
		breach is not cured within twenty (20) days after Executive provides written
		notice to the Company that provides in reasonable detail the nature of the
		payment.
	 

	 
		(d) Disability. The
		Company may terminate this Agreement at any time Executive shall be deemed by
		the Board to have sustained a “disability.” Executive shall be deemed
		to have sustained a “disability” if he shall have been unable to
		perform his duties for more than thirty (30) days in any six (6) month period.
		Upon termination of this Agreement for
	 

	 
		 
	 

	 
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		disability, the Company shall pay Executive
		his Accrued Compensation and the Base Salary for a period of the lesser of (i)
		ninety (90) days or (ii) the commencement of payments under any disability
		insurance policy.
	 

	 
		(e) Death. This
		Agreement will terminate automatically upon Executive’s death. Upon
		termination of this Agreement because of Executive’s death, the Company
		shall pay Executive’s estate his Accrued Compensation.
	 

	 
		(f) Employment. Upon
		termination of this Agreement for any reason, including, but not limited to,
		expiration of the Initial Term or any additional term of this Agreement,
		written notice of intent not to renew this Agreement pursuant to Section 2, or
		a termination for a reason specified in this Section 5, Executive’s
		employment shall also terminate and cease.
	 

	 
		(g) Transition Period. Upon termination of this Agreement, and for a period
		of thirty (30) days thereafter (the “Transition Period”), Executive agrees to make himself available to
		assist the Company with transition projects assigned to him by the Board.
		Executive will be paid at an agreed upon reasonable hourly rate for any work
		performed for the Company during the Transition Period.
	 

	 
		6. Release.
		Notwithstanding any other provision in this Agreement to the contrary, as a
		condition precedent to receiving any Severance Payment set forth in this
		Agreement, Executive agrees to execute (and not revoke) the Severance and
		Release Documents. If Executive fails to execute and deliver the Severance and
		Release Documents, or revokes the the Severance and Release Documents,
		Executive agrees that he shall not be entitled to receive the Severance
		Payment. For purposes of this Agreement, the Severance and Release Documents
		shall be considered to have been executed by Executive if it is signed by his
		legal representative in the case of legal incompetence or on behalf of
		Executive’s estate in the case of his death. For purposes of clarity, the
		Severance and Release Documents would not require Executive to waive claims
		against the Company that may arise after the date of execution of the Severance
		and Release Documents.
	 

	 
		7. Nondisclosure.
	 

	 
		(a) The Company shall provide Executive with
		some or all of the Company’s various trade secrets and confidential or
		proprietary information, including information he has not received before,
		consisting of, but not limited to, information relating to: (a) business
		operations and methods; (b) existing and proposed investments and investment
		strategies; (c) financial performance; (d) compensation, severance arrangements
		and amounts (whether relating to the Company or to any of its employees,
		including Executive); (e) contractual relationships (including the terms of
		this Agreement); (f) business partners and relationships; (g) limited partners
		and prospective limited partners of the Company’s funds; (h) marketing
		strategies; (i) intellectual property and technology, software, systems,
		methods, apparatuses, inventions, discoveries, improvements, designs,
		techniques, code, procedures, development tools, formulas, research,
		developments, objects, agents and components thereof, subroutines and other
		programs and (j) lists with information related to existing or prospective
		customers, partners or investors, including, but not limited to particular
		investments, investment strategies, investment patterns and amounts
		(collectively, “Confidential
		Information”). Confidential
		Information shall not
	 

	 
		 
	 

	 
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		include: (i) information that Executive may
		furnish to third parties regarding his obligations under Sections 7 and 8; (ii)
		information that becomes generally available to the public by means other than
		Executive’s breach of Section 7 (for example, not as a result of
		Executive’s unauthorized release of marketing materials); or (iii)
		information that Executive is required by law, regulation, court order or
		discovery demand to disclose; provided, however, that in the case of clause
		(iii), Executive gives the Company reasonable notice prior to the disclosure of
		the Confidential Information and the reasons and circumstances surrounding such
		disclosure to provide the Company an opportunity to seek a protective order or
		other appropriate request for confidential treatment of the applicable
		Confidential Information.
	 

	 
		(b) Executive agrees that all Confidential
		Information, whether prepared by Executive or otherwise coming into his
		possession prior to or during the term of Executive’s employment by the
		Company, shall remain the exclusive property of the Company during
		Executive’s employment with the Company. Executive further agrees that
		Executive shall not, without the prior written consent of the Company, use or
		disclose to any third party any of the Confidential Information described
		herein, directly or indirectly, either during Executive’s employment with
		the Company, except as permitted by the Company, or at any time following the
		termination of Executive’s employment with the Company.
	 

	 
		(c) Upon termination of this Agreement,
		Executive agrees that all Confidential Information and other files, documents,
		materials, records, notebooks, customer lists, business proposals, contracts,
		agreements and other repositories containing information concerning the Company
		or the business of the Company (including all copies thereof) in
		Executive’s possession, custody or control, whether prepared by Executive
		or others, shall remain with or be returned to the Company promptly (within
		twenty-four (24) hours) after the termination date.
	 

	 
		8. Noncompete and Nonsolicitation.
	 

	 
		(a) Business Relationships and
		Goodwill. Executive acknowledges and agrees that, as the President and
		Chief Executive Officer of the Company, Executive will be given Confidential
		Information and that his services are unique and extraordinary. Executive
		acknowledges and agrees that this creates a special relationship of trust and
		confidence between the Company, Executive and the Company’s current and
		prospective customers, members, and investors. Executive further acknowledges
		and agrees that there is a high risk and opportunity for any person given such
		responsibility, specialized training, and Confidential Information to
		misappropriate the relationship and goodwill existing between the Company and
		the Company’s current and prospective customers, members, and investors.
		Executive therefore acknowledges and agrees that it is fair and reasonable for
		the Company to take steps to protect itself from the risk of such
		misappropriation. Consequently, Executive agrees to the following
		noncompetition and nonsolicitation covenants.
	 

	 
		(b) Scope
		of Noncompetition Obligation.
	 

	 
		(i) Executive acknowledges and agrees that
		the period commencing with the date of this Agreement and ending one (1) year
		following the termination or expiration of this Agreement by Executive for any
		reason will constitute the non-compete, non-solicit and non-divert period (the
		“Non-Interference
		Period”). During his
		employment and during the
	 

	 
		 
	 

	 
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		Non-Interference Period, Executive will not,
		directly or indirectly, participate in the ownership, management, operation,
		financing or control of, or be employed by or consult for or otherwise render
		services to, any Competitor in the States of New York, Minnesota, or Nebraska,
		or in any other state within the United States of America, or in any country in
		the world. The term “Competitor” means any person or entity who is engaged in the
		business that the Company or any subsidiary of the Company engages in at or
		preceding the time of termination of employment, including building and
		operating facilities to be used for the production of ethanol and engaging in
		commercial sales of ethanol.
	 

	 
		(ii) Executive agrees that he shall not at
		any time during his employment divert away or attempt to divert away any
		business from the Company to another company, business, or individual.
		Additionally, Executive shall not, during the Non-Interference Period, solicit,
		divert away or attempt to divert away business from any Company Customer,
		either directly or indirectly. “Company Customer” is defined as any person, company, or business
		that Executive has on behalf of the Company contacted, solicited, serviced, or
		had access to Confidential Information about. “Solicit” is defined as soliciting, inducing, attempting to
		induce, or assisting any other person, firm, entity, business or organization,
		whether direct or indirect, in any such solicitation, inducement or attempted
		inducement, in all cases regardless of whether the initial contact was by
		Executive, the Company Customer, or any other person, firm, entity, business,
		or organization.
	 

	 
		(iii) Executive further agrees that, during
		the Non-Interference Period, he will not directly or indirectly: (a) solicit,
		entice, persuade or induce any employee, agent or representative of the
		Company, who was an employee, agent or representative of the Company upon the
		termination or expiration of this Agreement, to terminate such person’s
		relationship with the Company or to become employed by any business or person
		other than the Company; (b) approach any such person for any of the foregoing
		purposes; (c) authorize, solicit or assist in the taking of such actions by any
		third party; or (d) hire or retain any such person, in each instance other than
		any (x) any employee whose employment was terminated by the Company or any
		direct or indirect subsidiary of the Company or (y) employee, agent,
		representative or other person who independently responded to a general
		solicitation for employment by Executive or any third party which was not
		specifically targeted to or reasonably expected to target the Company.
	 

	 
		(c) Acknowledgement.
		Executive acknowledges that the compensation, specialized training, and the
		Confidential Information provided to Executive pursuant to his employment with
		the Company give rise to the Company’s interest in restraining Executive
		from competing with the Company, that the noncompetition and nonsolicitation
		covenants are designed to enforce such consideration and that any limitations
		as to time, geographic scope and scope of activity to be restrained as defined
		herein are reasonable and do not impose a greater restraint than is necessary
		to protect the goodwill or other business interest of the Company.
	 

	 
		(d) Survival of Covenants. Sections 7 and 8 shall survive the expiration or
		termination of this Agreement for any reason. Executive agrees not to challenge
		the enforceability or scope of Sections 7 and 8. Executive further agrees to
		notify all future persons or businesses with which he becomes affiliated or
		employed, of the restrictions set forth in Sections 7 and 8, prior to the
		commencement of any such affiliation or employment.
	 

	 
		 
	 

	 
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		(e) Permitted Ethanol Investments. Notwithstanding anything herein to the contrary,
		during his employment Executive may own a passive equity interest of less
		than one percent in any public ethanol companies; provided,
		that Executive does not participate in the management of such ethanol company
		in any capacity (including, but not limited to, director, officer or manager).
		No such ownership restrictions shall apply to investments in companies that are
		not engaged in the manufacture of ethanol or any other line of business in
		which the Company is engaged at the time of such investment, so long as such
		Executive does not participate in the management of such company in any
		capacity. Executive may also participate in any ethanol investment
		opportunities that are approved in advance by the Board.
	 

	 
		9. Severability and Reformation. If any one or more of the terms, provisions, covenants
		or restrictions of this Agreement shall be determined by a court of competent
		jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
		provisions, covenants and restrictions shall remain in full force and effect,
		and the invalid, void or unenforceable provisions shall be deemed severable.
		Moreover, if any one or more of the provisions contained in this Agreement
		shall for any reason be held to be excessively broad as to duration,
		geographical scope, activity or subject, it shall be reformed by limiting and
		reducing it to the minimum extent necessary, so as to be enforceable to the
		extent compatible with the applicable law as it shall then appear.
	 

	 
		10. Indemnification.
	 

	 
		(a) The Company agrees that (i) if Executive
		is made a party, or is threatened to be made a party, to any threatened or
		actual action, suit or proceeding, whether civil, criminal, administrative,
		investigative, appellate or other (each, a “Proceeding”) by reason of the fact that he is or was a
		director, officer, employee, agent, manager, consultant or representative of
		the Company or is or was serving at the request of the Company as a director,
		officer, member, employee, agent, manager, consultant or representative of
		another entity or (ii) if any claim, demand, request, investigation, dispute,
		controversy, threat, discovery request or request for testimony or information
		(each, a “Claim”)
		is made, or threatened to be made, that arises out of or relates to
		Executive’s service in any of the foregoing capacities, then Executive
		shall promptly be indemnified and held harmless by the Company to the fullest
		extent legally permitted or authorized by the Company’s certificate of
		formation, limited liability company agreement or resolutions of the Board or,
		if greater, by the laws of the State of Delaware, against any and all
		reasonable costs, expenses, liabilities and losses (including, without
		limitation, attorney’s fees, judgments, interest, expenses of
		investigation, penalties, fines, or penalties and amounts paid or to be paid in
		settlement) incurred or suffered by Executive in connection therewith, and such
		indemnification shall continue as to Executive even if he has ceased to be a
		director, member, employee, agent, manger, consultant or representative of the
		Company or other entity and shall inure to the benefit of Executive’s
		heirs, executors and administrators. The Company shall advance to Executive all
		costs and expenses incurred by him in connection with any such Proceeding or
		Claim within fifteen (15) days after receiving written notice requesting such
		an advance, provided that if he is ultimately determined by a court of
		competent jurisdiction not to be entitled to indemnification for such
		Proceeding and Claim Executive will promptly repay the amount advanced.
	 

	 
		(b) Neither the failure of the Company
		(including the Board, independent legal counsel or stockholders) to have made a
		determination in connection with any request for 
	 

	 
		 
	 

	 
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		indemnification or advancement under Section
		10(a) that Executive has satisfied any applicable standard of conduct, nor a
		determination by the Company (including the Board, independent legal counsel or
		stockholders) that Executive has not met any applicable standard of conduct,
		shall create a presumption that Executive has not met an applicable standard of
		conduct.
	 

	 
		(c) During the term of Employment and for a
		period of three (3) years thereafter, the Company shall keep in place a
		directors and officers’ liability insurance policy or (policies) providing
		comprehensive coverage to Executive at least equal to the coverage that the
		Company provides for any other present or former senior executive or director
		of the Company.
	 

	 
		11. Entire Agreement. This Agreement sets forth the entire agreement between
		the parties hereto and fully supersedes any and all prior agreements or
		understandings, written or oral, between the parties hereto pertaining to the
		subject matter hereof.
	 

	 
		12. Notices. All
		notices and other communications required or permitted to be given hereunder
		shall be in writing and shall be deemed to have been duly given if delivered
		personally, mailed by certified mail (return receipt requested) or sent by
		overnight delivery service, or electronic mail, or facsimile transmission (with
		electronic confirmation of successful transmission) to the parties at the
		addresses specified for each party on the signature page hereto, or at such
		other addresses as shall be specified by the parties by like notice, in order
		of preference of the recipient.
	 

	 
		Notice so given shall, in the case of mail,
		be deemed to be given and received on the fifth calendar day after posting, in
		the case of overnight delivery service, on the date of actual delivery and, in
		the case of facsimile transmission, telex or personal delivery, on the date of
		actual transmission or, as the case may be, personal delivery.
	 

	 
		13. Governing Law and Venue. This Agreement will be governed by and construed in
		accordance with the laws of the State of New York, without regard to any
		conflict of laws rule or principle which might refer the governance or
		construction of this Agreement to the laws of another jurisdiction. Any action
		or arbitration in regard to this Agreement or arising out of its terms and
		conditions, pursuant to Sections 25 and 26, shall be instituted and litigated
		only in NewYork City, New York.
	 

	 
		14. Assignment. This
		Agreement is personal to Executive and the Company and may not be assigned in
		any way without the prior written consent of the other party hereto.
	 

	 
		15. Executive Not to Act; Board Actions. Executive agrees that Executive is not entitled to,
		and will not, exercise any rights of the Company under this Agreement or act
		for or on behalf of the Company under this Agreement. In addition, all actions
		to be taken, or rights to be exercised, by the Board pursuant to this Agreement
		will be taken by a special committee of the Board consisting solely of
		directors other than (i) Executive or any of Executive’s immediate family
		members, (ii) directors that are employees or officers of the Company or its
		subsidiaries, and (iii) directors that are employees, officers, directors,
		partners, members, managers or shareholders of any affiliate of
		Executive.
	 

	 
		16. Counterparts.
		This Agreement may be executed in counterparts, each of which will take effect
		as an original, and all of which shall evidence one and the same
		Agreement.
	 

	 
		 
	 

	 
		9
	 

	 
		 
	 

	 
 

	 
		17. Amendment. This
		Agreement may be amended only in writing signed by Executive and by a duly
		authorized representative of the Company (other than Executive).
	 

	 
		18. Construction.
		The headings and captions of this Agreement are provided for convenience only
		and are intended to have no effect in construing or interpreting this
		Agreement. The language in all parts of this Agreement shall be in all cases
		construed in accordance to its fair meaning and not strictly for or against the
		Company or Executive.
	 

	 
		19. Non-Waiver. The
		failure by either party to insist upon the performance of any one or more
		terms, covenants or conditions of this Agreement shall not be construed as a
		waiver or relinquishment of any right granted hereunder or of any future
		performance of any such term, covenant or condition, and the obligation of
		either party with respect hereto shall continue in full force and effect,
		unless such waiver shall be in writing signed by the Company (other than by
		Executive) and Executive.
	 

	 
		20. Use of Name, Likeness and Biography. Company shall have the right (but not the obligation)
		to use, publish and broadcast, and to authorize others to do so, the name,
		approved likeness and approved biographical material of Executive to advertise,
		publicize and promote the business of Company and its affiliates, but not for
		the purposes of direct endorsement without Executive’s consent. This right
		shall terminate upon the termination of this Agreement. An “approved
		likeness” and “approved biographical material” shall be,
		respectively, any photograph or other depiction of Executive, or any
		biographical information or life story concerning the professional career of
		Executive, as approved by Executive from time to time.
	 

	 
		21. Right to Insure.
		Company shall have the right to secure, in its own name or otherwise, and at
		its own expense, life, health, accident or other insurance covering Executive,
		and Executive shall have no right, title or interest in and to such insurance.
		Executive shall assist Company in procuring such insurance by submitting to
		reasonable examinations and by signing such applications and other reasonable
		instruments as may be required by the insurance carriers to which application
		is made for any such insurance.
	 

	 
		22. Assistance in Litigation. Executive shall reasonably cooperate with the Company
		in the defense or prosecution of any claims or actions now in existence or that
		may be brought in the future against or on behalf of the Company that relate to
		events or occurrences that transpired while Executive was employed by the
		Company. Executive’s cooperation in connection with such claims or actions
		shall include, but not be limited to, being available to meet with counsel to
		prepare for discovery or trial and to act as a witness on behalf of the Company
		at mutually convenient times. Executive also shall cooperate fully with the
		Company in connection with any investigation or review by any federal, state,
		or local regulatory authority as any such investigation or review relates to
		events or occurrences that transpired while Executive was employed by the
		Company. The Company will pay Executive a reasonable hourly rate for
		Executive’s cooperation pursuant to this Section 22.
	 

	 
		23. No Inconsistent Obligations. Executive represents and warrants that to his
		knowledge he has no obligations, legal, in contract, or otherwise, inconsistent
		with the terms of this Agreement or with his undertaking employment with the
		Company to perform the duties described herein. Executive will not disclose to
		the Company, or use, or induce the Company to use, any confidential,
		proprietary, or trade secret information of others. Executive represents and
		
	 

	 
		 
	 

	 
		10
	 

	 
		 
	 

	 
 

	 
		warrants that to his knowledge he has
		returned all property and confidential information belonging to all prior
		employers, if he is obligated to do so.
	 

	 
		24. Binding Agreement. This Agreement shall inure to the benefit of and be
		binding upon Executive, his heirs and personal representatives, and the Company
		and its successors.
	 

	 
		25. Remedies. The
		parties recognize and affirm that in the event of a breach of Sections 7 and 8
		of this Agreement, money damages would be inadequate and the Company would not
		have an adequate remedy at law. Accordingly, the parties agree that in the
		event of a breach or a threatened breach of Sections 7 and 8, the Company may,
		in addition and supplementary to other rights and remedies existing in its
		favor, apply to any court of law or equity of competent jurisdiction for
		specific performance and/or injunctive or other relief in order to enforce or
		prevent any violations of the provisions hereof (without posting a bond or
		other security). In addition, Executive agrees that in the event a court of
		competent jurisdiction or an arbitrator finds that Executive violated Sections
		7 or 8, the time periods set forth in those Sections shall be tolled until such
		breach or violation has been cured. Executive further agrees that the Company
		shall have the right to offset the amount of any damages awarded to the Company
		resulting from a breach by Executive of Sections 7 or 8 against any payments
		due Executive under this Agreement. The parties agree that if one of the
		parties is found to have breached this Agreement by a court of competent
		jurisdiction, the breaching party will be required to pay the non-breaching
		party’s attorneys’ fees.
	 

	 
		26. Arbitration.
		Other than as stated in Section 25, the parties agree that any controversy or
		claim arising out of or relating to this Agreement, or the breach thereof,
		shall be resolved by arbitration administered by the American Arbitration
		Association (“AAA”)
		under its Commercial Arbitration Rules. The arbitration will take place in New
		York City, New York. All disputes shall be resolved by a one (1) arbitrator
		chosen by agreement of the parties in accordance with the Commercial
		Arbitration Rules of the AAA. The arbitrator will have the authority to award
		the same remedies, damages, and costs that a court could award. The arbitrator
		shall issue a reasoned award explaining the decision, the reasons for the
		decision, and any damages awarded. The arbitrator’s decision will be final
		and binding. The judgment on the award rendered by the arbitrator may be
		entered in any court having jurisdiction thereof. The arbitration proceedings,
		any record of the same, and the award shall be considered Confidential
		Information under this Agreement. This provision and any decision and award
		hereunder can be enforced under the Federal Arbitration Act.
	 

	 
		27. Voluntary Agreement. Each party to this Agreement has read and fully
		understands the terms and provisions hereof, has had an opportunity to review
		this Agreement with legal counsel, has executed this Agreement based upon such
		party’s own judgment and advice of counsel (if any), and knowingly,
		voluntarily, and without duress, agrees to all of the terms set forth in this
		Agreement. The parties have participated jointly in the negotiation and
		drafting of this Agreement. If an ambiguity or question of intent or
		interpretation arises, this Agreement will be construed as if drafted jointly
		by the parties and no presumption or burden of proof will arise favoring or
		disfavoring any party because of authorship of any provision of this Agreement.
		Except as expressly set forth in this Agreement, neither the parties nor their
		affiliates, advisors and/or their attorneys have made any representation or
		warranty, express or implied, at law or in equity with respect of the subject
		matter contained herein. Without limiting the generality of the previous
		sentence, the Companies, their affiliates, advisors, and/or attorneys 
	 

	 
		 
	 

	 
		11
	 

	 
		 
	 

	 
 

	 
		have made no representation or warranty to
		Executive concerning the state or federal tax consequences to Executive
		regarding the transactions contemplated by this Agreement.
	 

	 
		[Signature page follows]
	 

	 
		 
	 

	 
		12
	 

	 
		 
	 

	 
 

	 
		IN WITNESS WHEREOF, the Company and
		Executive have executed this Agreement, effective as of the day and year first
		above written.
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  BIOFUEL ENERGY, LLC
				

			 
	 	 	 
	
				
				  Dated:
				

			 	
				
				  April 28, 2006
				

			 	
				
				   
				

			 	
				
				  By: 
				

			 	
				
				  /s/ Thomas J.
				  Edelman
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Name: 
				

			 	
				
				  Thomas J. Edelman
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Title: 
				

			 	
				
				  Authorized Person
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  Address for Notices:
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  BioFuel Energy, LLC
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  1801 Broadway, Suite
				  1060
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Denver, CO 80202
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  EXECUTIVE
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  Dated:
				

			 	
				
				  April 28, 2006
				

			 	
				
				   
				

			 	
				
				  /s/ Scott H. Pearce
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Scott H. Pearce
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  Address for Notices:
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  BioFuel Energy Corp.

				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  1801 Broadway, Suite
				  1060
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Denver, CO 80202
				

			 

 

	 
		 
	 

	 
		 
	 

	 
		Executive Employment Agreement Signature
		Page
	 

	 
		 
	 

	 
 

	 
		EXHIBIT A 1
	 

	 
		1. Release.
	 

	 
		(a) General Release.
		As a material inducement for the Company to enter this Agreement, Executive
		does hereby agree to release and forever discharge the Company and all of their
		respective current and former affiliates, subsidiaries, predecessors,
		successors, divisions, other related entities, assigns, agents, attorneys,
		officers, directors, managers, members, stockholders, employees and heirs
		(hereinafter referred to “Releasees”) from any and all claims, complaints, liabilities
		or obligations of any kind whatsoever, whether known or unknown, arising in
		tort or contract, which Executive may have, now has, or has ever had arising
		from Executive’s employment with the Company or any predecessor or the
		termination of that employment, or any other matter or event which may have
		occurred as of the date of this Agreement (“Released Claims”). Executive understands and agrees that the
		Released Claims include, but are not limited to, any and all claims,
		complaints, liabilities or obligations under applicable federal, state or local
		law, including, but not limited to, Title VII of the Civil Rights Act of 1964,
		as amended by the Civil Rights Act of 1991, the Americans With Disabilities
		Act, the Employee Retirement Income Security Act, the Age Discrimination in
		Employment Act (“ADEA”),
		and the Older Worker Benefit Protection Act (“OWBPA”).
	 

	 
		(b) Waiver of Right to Bring Released Claims. Executive further agrees not to bring any Released
		Claims against the Releasees, either individually or collectively; provided
		however, that Executive may file a lawsuit to challenge the validity of the
		release of her ADEA claims under this Agreement, including the knowing and
		voluntary nature of the ADEA release under the OWBPA. Nothing in this Paragraph
		1(b) shall interfere with Executive’s right to file a charge with, or
		cooperate or participate in an investigation or proceeding conducted by, the
		Equal Employment Opportunity Commission (“EEOC”)
		or other federal or state regulatory or law enforcement agency. However, the
		consideration provided to Executive in this Agreement shall be the sole relief
		provided for the Released Claims and Executive will not be entitled to recover
		and Executive agrees to waive any monetary benefits or recovery against the
		Releasees in connection with any such charge or proceeding without regard to
		who has brought such charge or proceeding.
	 

	 
		(c) Costs of Enforcement. Executive agrees that if Executive breaches this
		Agreement and brings a Released Claim against any of the Releasees or otherwise
		breaches this Agreement, Executive shall be liable for any and all expenses
		incurred by the person or entity who has to defend the action, including
		reasonable attorney’s fees; provided however, that this Paragraph 1(c)
		shall not apply to charges filed by Executive with the EEOC or other federal or
		state regulatory or law enforcement agency or to claims initiated by Executive
		to challenge the validity of the release of ADEA claims under this Agreement,
		including the knowing and voluntary nature of the ADEA release under the
		OWBPA.
	 

	 
		______________
	 

	 
		1 For purposes of clarity, the
		contents of this Exhibit A will not be effected by whether the Company, at the
		relevant time, is privately-held or publicly-traded.
	 

	 
		 
	 

	 
		 
	 

	 
		Exhibit A
	 

	 
		 
	 

	 
 

	 
		(d) Equity Interests and Severance Payments. It is understood by the parties that this Agreement
		does not require Executive to (i) forfeit any equity securities issued by the
		Company that are held by Executive, (ii) release any rights to receive
		distributions, or voting rights, under the limited liability company agreement
		of the Company to the extent that any such rights are held by Executive and
		result from Executive’s ownership of equity securities issued by the
		Company, (iii) release any rights that Executive may have, under the second
		sentence of Section 5(a) of the Executive Employment Agreement, made and
		entered into as of the ____ day of April, 2006 (the “Employment Agreement”) by and between the Company and the Executive, as
		may be amended from time to time, or (iv) release any rights Executive has to
		indemnification pursuant to Section 10 of the Employment Agreement or
		otherwise.
	 

	 
		(e) Non-Disparagement. Executive agrees that Executive shall not make any
		disparaging, derogatory or detrimental comments about the Company or any of its
		affiliates or any of their directors, officers, employees, partners, members,
		managers or shareholders, or any investor or other person or entity having a
		business relationship with the Company. Executive also acknowledges that the
		terms of this Exhibit A and the other Severance and Release Documents (as
		defined in the Employment Agreement) constitute Confidential Information (as
		defined in the Employment Agreement).Exhibit 10.12
	 

	 
		EXECUTIVE EMPLOYMENT AGREEMENT

	 

	 
		THIS EXECUTIVE EMPLOYMENT
		AGREEMENT (this
		“Agreement”) is made and entered into as of the
		28th day of April, 2006 (the “Effective Date”) by and between BioFuel Energy, LLC (the
		“Company”) and Daniel J. Simon (“Executive”).
	 

	 
		PRELIMINARY STATEMENTS
	 

	 
		A. The Company desires to employ Executive
		as Executive Vice President and Chief Operating Officer, and Executive desires
		to be employed by the Company in said capacity; and
	 

	 
		B. Each party desires to set forth in
		writing the terms and conditions of their understandings and agreements.
		
	 

	 
		NOW, THEREFORE, in consideration of the mutual covenants and
		obligations contained herein, the Company hereby agrees to employ Executive and
		Executive hereby accepts such employment upon the terms and conditions set
		forth in this Agreement:
	 

	 
		STATEMENT OF AGREEMENT
	 

	 
		1. Position.

	 

	 
		(a) The Company agrees to employ Executive
		in the position of Executive Vice President and Chief Operating Officer.
		Executive shall serve and perform the duties which may from time to time be
		assigned to him by the board of managers of the Company (the
		“Board”). 
	 

	 
		(b) Executive agrees to serve as Executive
		Vice President and Chief Operating Officer and agrees that he will devote his
		best efforts and full business time and attention to the Company. Executive
		agrees that he will faithfully and diligently carry out the duties of the
		Executive Vice President and Chief Operating Officer. Executive further agrees
		to comply with all Company policies in effect from time to time and to comply
		with all laws, rules and regulations, including, but not limited to, those
		applicable to the Company. 
	 

	 
		(c) Executive agrees to travel as necessary
		to perform his duties under this Agreement.
	 

	 
		(d) Nothing herein shall preclude Executive
		from (i) engaging in charitable and community activities; (ii) participating in
		industry and trade organization activities; (iii) managing his and his
		family’s personal investments and affairs; and (iv) delivering lectures,
		fulfilling speaking engagements or teaching at educational institutions;
		provided, that such activities do not (x) materially interfere with the regular
		performance of his duties and responsibilities under this Agreement or (y)
		constitute activities that compete with the business of Company.
	 

	 
		2. Term. The
		initial term of this Agreement shall be three (3) years from the date stated
		above (“Initial
		Term”), unless otherwise
		terminated pursuant to Section 5 of this Agreement. This Agreement shall
		automatically renew for successive one (1) year terms unless either party gives
		written notice of its or his intent not to renew this Agreement at least sixty
		(60)
	 

	 
		 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		days prior to the expiration of the
		then-current term. Executive’s continued employment after the expiration
		of the Initial Term shall be in accordance with and governed by this Agreement,
		unless modified by the parties to this Agreement in writing.
	 

	 
		3. Compensation and Benefits.
	 

	 
		(a) Base Salary. The
		Company shall pay Executive a base salary of not less than $250,000 per year
		(“Base
		Salary”). 
	 

	 
		(b) Bonus Opportunities. For each calendar year during the Term after the first
		two ethanol production facilities of the Company become operational (the
		“Ethanol Production
		Point”), Executive shall be
		eligible to receive incentive compensation (an “Annual Bonus”) from the Company, with a target bonus
		opportunity of one hundred seventy-five
		percent (175%) of Base Salary (pro
		rated for any portion of the year that occurs after the Ethanol Production
		Point). The parameters under which Executive’s Annual Bonus for each year
		during the Term will be payable shall be determined by the Board in
		consultation with Executive. Such parameters shall be set forth in a written
		notice delivered to Executive within seventy-five (75) days after the start of
		each calendar year. Executive’s Annual Bonus for any year shall be payable
		in cash no later than thirty (30) days after completion of the Company’s
		audit relating to such fiscal year. Notwithstanding the foregoing and for the
		purposes of clarity, no Annual Bonus will be paid or accrue for any period of
		time that precedes the Ethanol Production Point.
	 

	 
		(c) Payment. Payment
		of all compensation to Executive hereunder shall be made in accordance with the
		terms of this Agreement and applicable Company policies in effect from time to
		time, including normal payroll practices, and shall be subject to all
		applicable withholdings and taxes.
	 

	 
		(d) Benefits Generally. The Company shall make available to Executive,
		throughout the term of this Agreement, benefits as are generally provided by
		the Company to its executive officers, which may presently be in effect or
		which may hereafter be adopted by the Company for its executive officers and
		key management personnel; provided, however, that nothing herein contained
		shall be deemed to require the Company to adopt or maintain any particular plan
		or policy.
	 

	 
		(e) Vacation.
		Executive shall be entitled to paid vacation for up to four weeks during each
		calendar year, consistent with the policies then applicable to executive
		officers.
	 

	 
		(f) Holidays.
		Executive shall further be entitled to paid holidays, personal days, and sick
		days consistent with the policies then applicable to executive officers.

	 

	 
		4. Reimbursement of Expenses. The Company shall reimburse Executive for all business
		expenses, which are reasonable and necessary and are incurred by Executive
		while performing his duties under this Agreement, upon presentation of expense
		statements, receipts and/or vouchers, or such other information and
		documentation as the Company may reasonably require. Executive shall provide
		the Board with, upon reasonable request, an explanation of the purpose of any
		particular business expense and an estimate of the cost of the same, prior to
		incurring any expense related to the same. The Board reserves the right to
		reject any unreasonable business expense. Notwithstanding the foregoing, and in
		furtherance of, and not in
	 

	 
		 
	 

	 
		2
	 

	 
		 
	 

	 
 

	 
		limitation of the foregoing, aggregate
		expenses per year in excess of $25,000 shall require the consent of the Board.
		
	 

	 
		5. Termination.
	 

	 
		(a) Termination by the Company. The Company may terminate this Agreement for any
		reason immediately upon transmittal of written notice to Executive in
		accordance with this Agreement. If the Company terminates this Agreement
		pursuant to this provision without Cause or Executive terminates this Agreement
		for Good Reason, the Company shall, after receipt of (i) an executed release
		agreement between the Company and Executive, which will consist in substance of
		the language attached as Exhibit
		A (and any other language releasing
		specific claims, complaints, liabilities or obligations that are identified by
		the Company) and (ii) a severance agreement in a form provided by the Company
		that will (A) reflect the relevant related terms and provisions of this
		Agreement and (B) contain only other provisions required by applicable law
		required to give effect to the enforceability of the terms and provisions of
		such agreement (collectively, the “Severance and Release
		Documents”), pay Executive (1)
		all accrued but unpaid Base Salary and any accrued but unpaid Annual Bonus from
		the previous fiscal year, (2) any unreimbursed expenses (in accordance with
		Section 4 of this Agreement), (3) a severance payment equal to eighteen (18)
		months of Executive’s then current Base Salary (“Severance Payment”), and (4) continuing health benefit coverage for
		eighteen (18) months pursuant to COBRA. It is understood by the parties that
		the Severance and Release Documents would not require Executive to (i) forfeit
		any equity securities issued by the Company that are held by the Executive,
		(ii) release any rights to receive distributions, or voting rights, under the
		limited liability company agreement of the Company to the extent any such
		rights are held by Executive and result from Executive’s ownership of
		equity securities issued by the Company, (iii) release any rights that he may
		have under this Agreement to a Severance Payment or any other payments or
		benefits described in clauses (1), (2), or (4) of the preceding sentence or
		(iv) release any rights Executive has to indemnification pursuant to
		Section 10 hereof or otherwise. Any Severance Payment will be paid
		out in equal installments during the eighteen (18) months following such
		termination. Executive acknowledges and agrees that the Company may revise the
		timing of any payments described in this Agreement to the extent necessary to
		comply with Section 409A of the Internal Revenue Code of 1986, as amended, and
		any regulations and/or guidance promulgated thereunder. For the avoidance of
		doubt, Executive shall not be entitled to any portion of the Annual Bonus for
		the year in which this Agreement was terminated. Notwithstanding the foregoing,
		Executive shall not be entitled to any Severance Payment if Executive is
		terminated (A) in contemplation of (i) the Company commencing a case or
		proceeding under Title 11 of the United States Code or similar state or federal
		law or (ii) the liquidation or dissolution of the Company or (B) during a
		period when the Company is insolvent.
	 

	 
		(b) Termination by the Company for Cause. The Company may terminate this Agreement at any time
		for Cause. Upon termination of this Agreement by the Company for Cause or by
		Executive without Good Reason, Executive shall only be entitled to his Accrued
		Compensation and shall have no entitlement to any Severance Payment for the
		year of termination. “Cause”
		means any of the following as determined by the Board: 
	 

	 
		(i) Executive’s commission of theft,
		embezzlement, any other act of dishonesty relating to his employment with the
		Company, or any material violation of any law, rules, or regulations by
		Executive to the extent that such law, rule or regulations are applicable
		to
	 

	 
		 
	 

	 
		3
	 

	 
		 
	 

	 
 

	 
		the Company, including, but not limited to,
		those established by the Securities and Exchange Commission, or any
		self-regulatory organization having jurisdiction or authority over Executive or
		the Company or any failure by Executive to inform the Company of any material
		violation, that Executive has knowledge of, of any law, rule or regulation by
		the Company or one of its direct or indirect subsidiaries; 
	 

	 
		(ii) Executive’s conviction of, or
		pleading guilty or nolo contendere to, a felony or any lesser crime having as
		its predicate element fraud, misappropriation of Company (including any direct
		or indirect subsidiaries) property for personal profit, or moral turpitude, or
		indictment for any crime involving moral turpitude or fraud; 
	 

	 
		(iii) Executive has failed to perform his
		material duties and obligations under this Agreement (other than during any
		period of disability) or otherwise materially breaches this Agreement or fails
		to follow any reasonable and lawful instructions of the Board, which failure to
		perform is not remedied within ten (10) days after notice thereof to Executive
		by the Company;
	 

	 
		(iv) Executive’s appropriation or
		attempted appropriation of (A) a material business opportunity of the Company
		or (B) any of the Company’s funds or property; or
	 

	 
		(v) Executive’s commission of an act or
		acts in the performance of his duties under this Agreement amounting to gross
		negligence or willful misconduct, including, but not limited to, any breach of
		Sections 7 or 8 of this Agreement.
	 

	 
		(vi) Executive may be terminated for Cause
		after a hearing of the Board at which the termination for Cause of Executive is
		considered; provided that Executive will be provided with notice of such
		hearing and the opportunity to be heard at such hearing, which shall be held
		within five days of the date of any such notice.
	 

	 
		(c) Termination by Executive for Good Reason. Executive may terminate this Agreement for Good
		Reason, if after providing ten (10) days written notice to the Company, which
		identifies the Good Reason for Executive’s termination, such “Good
		Reason” is not remedied. “Good Reason” means any of the following reasons: 
	 

	 
		(i) Executive’s removal from his
		position as Executive Vice President and Chief Operating Officer, other than
		for Cause or by death or disability, as set forth in Section 5 of this
		Agreement, during the term of this Agreement; 
	 

	 
		(ii) Any material and detrimental alteration
		or change in Executive’s job title without Executive’s prior written
		consent; 
	 

	 
		(iii) Any reduction in Executive’s Base
		Salary; or
	 

	 
		(iv) The Company fails to make any payment
		to Executive required to be made under the terms of this Agreement, if the
		breach is not cured within twenty (20) days after Executive provides written
		notice to the Company that provides in reasonable detail the nature of the
		payment.
	 

	 
		 
	 

	 
		4
	 

	 
		 
	 

	 
 

	 
		(d) Disability. The
		Company may terminate this Agreement at any time Executive shall be deemed by
		the Board to have sustained a “disability.” Executive shall be deemed
		to have sustained a “disability” if he shall have been unable to
		perform his duties for more than thirty (30) days in any six (6) month period.
		Upon termination of this Agreement for disability, the Company shall pay
		Executive his Accrued Compensation and the Base Salary for a period of the
		lesser of (i) ninety (90) days or (ii) the commencement of payments under any
		disability insurance policy. 
	 

	 
		(e) Death. This
		Agreement will terminate automatically upon Executive’s death. Upon
		termination of this Agreement because of Executive’s death, the Company
		shall pay Executive’s estate his Accrued Compensation. 
	 

	 
		(f) Employment. Upon
		termination of this Agreement for any reason, including, but not limited to,
		expiration of the Initial Term or any additional term of this Agreement,
		written notice of intent not to renew this Agreement pursuant to Section 2, or
		a termination for a reason specified in this Section 5, Executive’s
		employment shall also terminate and cease. 
	 

	 
		(g) Transition Period. Upon termination of this Agreement, and for a period
		of thirty (30) days thereafter (the “Transition Period”), Executive agrees to make himself available to
		assist the Company with transition projects assigned to him by the Board.
		Executive will be paid at an agreed upon reasonable hourly rate for any work
		performed for the Company during the Transition Period. 
	 

	 
		6. Release.
		Notwithstanding any other provision in this Agreement to the contrary, as a
		condition precedent to receiving any Severance Payment set forth in this
		Agreement, Executive agrees to execute (and not revoke) the Severance and
		Release Documents. If Executive fails to execute and deliver the Severance and
		Release Documents, or revokes the Severance and Release Documents, Executive
		agrees that he shall not be entitled to receive the Severance Payment. For
		purposes of this Agreement, the Severance and Release Documents shall be
		considered to have been executed by Executive if it is signed by his legal
		representative in the case of legal incompetence or on behalf of
		Executive’s estate in the case of his death. For purposes of clarity, the
		Severance and Release Documents would not require Executive to waive claims
		against the Company that may arise after the date of execution of the Severance
		and Release Documents.
	 

	 
		7. Nondisclosure.
	 

	 
		(a) The Company shall provide Executive with
		some or all of the Company’s various trade secrets and confidential or
		proprietary information, including information he has not received before,
		consisting of, but not limited to, information relating to: (a) business
		operations and methods; (b) existing and proposed investments and investment
		strategies; (c) financial performance; (d) compensation, severance arrangements
		and amounts (whether relating to the Company or to any of its employees,
		including Executive); (e) contractual relationships (including the terms of
		this Agreement); (f) business partners and relationships; (g) limited partners
		and prospective limited partners of the Company’s funds; (h) marketing
		strategies; (i) intellectual property and technology, software, systems,
		methods, apparatuses, inventions, discoveries, improvements, designs,
		techniques, code, procedures, development tools, formulas,
	 

	 
		 
	 

	 
		5
	 

	 
		 
	 

	 
 

	 
		research, developments, objects, agents and
		components thereof, subroutines and other programs and (j) lists with
		information related to existing or prospective customers, partners or
		investors, including, but not limited to particular investments, investment
		strategies, investment patterns and amounts (collectively,
		“Confidential
		Information”). Confidential
		Information shall not include: (i) information that Executive may furnish to
		third parties regarding his obligations under Sections 7 and 8; (ii)
		information that becomes generally available to the public by means other than
		Executive’s breach of Section 7 (for example, not as a result of
		Executive’s unauthorized release of marketing materials); or (iii)
		information that Executive is required by law, regulation, court order or
		discovery demand to disclose; provided, however, that in the case of clause
		(iii), Executive gives the Company reasonable notice prior to the disclosure of
		the Confidential Information and the reasons and circumstances surrounding such
		disclosure to provide the Company an opportunity to seek a protective order or
		other appropriate request for confidential treatment of the applicable
		Confidential Information. 
	 

	 
		(b) Executive agrees that all Confidential
		Information, whether prepared by Executive or otherwise coming into his
		possession prior to or during the term of Executive’s employment by the
		Company, shall remain the exclusive property of the Company during
		Executive’s employment with the Company. Executive further agrees that
		Executive shall not, without the prior written consent of the Company, use or
		disclose to any third party any of the Confidential Information described
		herein, directly or indirectly, either during Executive’s employment with
		the Company, except as permitted by the Company, or at any time following the
		termination of Executive’s employment with the Company.
	 

	 
		(c) Upon termination of this Agreement,
		Executive agrees that all Confidential Information and other files, documents,
		materials, records, notebooks, customer lists, business proposals, contracts,
		agreements and other repositories containing information concerning the Company
		or the business of the Company (including all copies thereof) in
		Executive’s possession, custody or control, whether prepared by Executive
		or others, shall remain with or be returned to the Company promptly (within
		twenty-four (24) hours) after the termination date. 
	 

	 
		8. Noncompete and Nonsolicitation.
	 

	 
		(a) Business Relationships and Goodwill. Executive acknowledges and agrees that, as the
		Executive Vice President and Chief Operating Officer of the Company, Executive
		will be given Confidential Information and that his services are unique and
		extraordinary. Executive acknowledges and agrees that this creates a special
		relationship of trust and confidence between the Company, Executive and the
		Company’s current and prospective customers, members, and investors.
		Executive further acknowledges and agrees that there is a high risk and
		opportunity for any person given such responsibility, specialized training, and
		Confidential Information to misappropriate the relationship and goodwill
		existing between the Company and the Company’s current and prospective
		customers, members, and investors. Executive therefore acknowledges and agrees
		that it is fair and reasonable for the Company to take steps to protect itself
		from the risk of such misappropriation. Consequently, Executive agrees to the
		following noncompetition and nonsolicitation covenants. 
	 

	 
		 
	 

	 
		6
	 

	 
		 
	 

	 
 

	 
		(b) Scope
		of Noncompetition Obligation.
	 

	 
		(i) Executive acknowledges and agrees that
		the period commencing with the date of this Agreement and ending one (1) year
		following the termination or expiration of this Agreement by Executive for any
		reason will constitute the non-compete, non-solicit and non-divert period (the
		“Non-Interference
		Period”). During his
		employment and during the Non-Interference Period, Executive will not, directly
		or indirectly, participate in the ownership, management, operation, financing
		or control of, or be employed by or consult for or otherwise render services
		to, any Competitor in the States of New York, Minnesota, or Nebraska, or in any
		other state within the United States of America, or in any country in the
		world. The term “Competitor” means any person or entity who is engaged in the
		business that the Company or any subsidiary of the Company engages in at or
		preceding the time of termination of employment, including building and
		operating facilities to be used for the production of ethanol and engaging in
		commercial sales of ethanol. 
	 

	 
		(ii) Executive agrees that he shall not at
		any time during his employment divert away or attempt to divert away any
		business from the Company to another company, business, or individual.
		Additionally, Executive shall not, during the Non-Interference Period, solicit,
		divert away or attempt to divert away business from any Company Customer,
		either directly or indirectly. “Company Customer” is defined as any person, company, or business
		that Executive has on behalf of the Company contacted, solicited, serviced, or
		had access to Confidential Information about. “Solicit” is defined as soliciting, inducing, attempting to
		induce, or assisting any other person, firm, entity, business or organization,
		whether direct or indirect, in any such solicitation, inducement or attempted
		inducement, in all cases regardless of whether the initial contact was by
		Executive, the Company Customer, or any other person, firm, entity, business,
		or organization.
	 

	 
		(iii) Executive further agrees that, during
		the Non-Interference Period, he will not directly or indirectly: (a) solicit,
		entice, persuade or induce any employee, agent or representative of the
		Company, who was an employee, agent or representative of the Company upon the
		termination or expiration of this Agreement, to terminate such person’s
		relationship with the Company or to become employed by any business or person
		other than the Company; (b) approach any such person for any of the foregoing
		purposes; (c) authorize, solicit or assist in the taking of such actions by any
		third party; or (d) hire or retain any such person, in each instance other than
		any (x) any employee whose employment was terminated by the Company or any
		direct or indirect subsidiary of the Company or (y) employee, agent,
		representative or other person who independently responded to a general
		solicitation for employment by Executive or any third party which was not
		specifically targeted to or reasonably expected to target the Company.
	 

	 
		(c) Acknowledgement.
		Executive acknowledges that the compensation, specialized training, and the
		Confidential Information provided to Executive pursuant to his employment with
		the Company give rise to the Company’s interest in restraining Executive
		from competing with the Company, that the noncompetition and nonsolicitation
		covenants are designed to enforce such consideration and that any limitations
		as to time, geographic scope and scope of activity to be restrained as defined
		herein are reasonable and do not impose a greater restraint than is necessary
		to protect the goodwill or other business interest of the Company. 
	 

	 
		 
	 

	 
		7
	 

	 
		 
	 

	 
 

	 
		(d) Survival of Covenants. Sections 7 and 8 shall survive the expiration or
		termination of this Agreement for any reason. Executive agrees not to challenge
		the enforceability or scope of Sections 7 and 8. Executive further agrees to
		notify all future persons or businesses with which he becomes affiliated or
		employed, of the restrictions set forth in Sections 7 and 8, prior to the
		commencement of any such affiliation or employment.
	 

	 
		(e) Permitted Ethanol Investments. Notwithstanding anything herein to the contrary,
		during his employment Executive may own a passive equity interest of less
		than one percent in any public ethanol companies; provided,
		that Executive does not participate in the management of such ethanol company
		in any capacity (including, but not limited to, director, officer or manager).
		No such ownership restrictions shall apply to investments in companies that are
		not engaged in the manufacture of ethanol or any other line of business in
		which the Company is engaged at the time of such investment, so long as such
		Executive does not participate in the management of such company in any
		capacity. Executive may also participate in any ethanol investment
		opportunities that are approved in advance by the Board.
	 

	 
		9. Severability and Reformation. If any one or more of the terms, provisions, covenants
		or restrictions of this Agreement shall be determined by a court of competent
		jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
		provisions, covenants and restrictions shall remain in full force and effect,
		and the invalid, void or unenforceable provisions shall be deemed severable.
		Moreover, if any one or more of the provisions contained in this Agreement
		shall for any reason be held to be excessively broad as to duration,
		geographical scope, activity or subject, it shall be reformed by limiting and
		reducing it to the minimum extent necessary, so as to be enforceable to the
		extent compatible with the applicable law as it shall then appear.
	 

	 
		10. Indemnification.
		
	 

	 
		(a) The Company agrees that (i) if Executive
		is made a party, or is threatened to be made a party, to any threatened or
		actual action, suit or proceeding, whether civil, criminal, administrative,
		investigative, appellate or other (each, a “Proceeding”) by reason of the fact that he is or was a
		director, officer, employee, agent, manager, consultant or representative of
		the Company or is or was serving at the request of the Company as a director,
		officer, member, employee, agent, manager, consultant or representative of
		another entity or (ii) if any claim, demand, request, investigation, dispute,
		controversy, threat, discovery request or request for testimony or information
		(each, a “Claim”)
		is made, or threatened to be made, that arises out of or relates to
		Executive’s service in any of the foregoing capacities, then Executive
		shall promptly be indemnified and held harmless by the Company to the fullest
		extent legally permitted or authorized by the Company’s certificate of
		formation, limited liability company agreement or resolutions of the Board or,
		if greater, by the laws of the State of Delaware, against any and all
		reasonable costs, expenses, liabilities and losses (including, without
		limitation, attorney’s fees, judgments, interest, expenses of
		investigation, penalties, fines, or penalties and amounts paid or to be paid in
		settlement) incurred or suffered by Executive in connection therewith, and such
		indemnification shall continue as to Executive even if he has ceased to be a
		director, member, employee, agent, manger, consultant or representative of the
		Company or other entity and shall inure to the benefit of Executive’s
		heirs, executors and administrators. The Company shall advance to Executive all
		costs and expenses incurred by him in connection with any such Proceeding or
		Claim within fifteen (15) days after receiving written notice requesting such
		an 
	 

	 
		 
	 

	 
		8
	 

	 
		 
	 

	 
 

	 
		advance, provided that if he is ultimately
		determined by a court of competent jurisdiction not to be entitled to
		indemnification for such Proceeding and Claim Executive will promptly repay the
		amount advanced.
	 

	 
		(b) Neither the failure of the Company
		(including the Board, independent legal counsel or stockholders) to have made a
		determination in connection with any request for indemnification or advancement
		under Section 10(a) that Executive has satisfied any applicable standard of
		conduct, nor a determination by the Company (including the Board, independent
		legal counsel or stockholders) that Executive has not met any applicable
		standard of conduct, shall create a presumption that Executive has not met an
		applicable standard of conduct.
	 

	 
		(c) During the term of Employment and for a
		period of three (3) years thereafter, the Company shall keep in place a
		directors and officers’ liability insurance policy or (policies) providing
		comprehensive coverage to Executive at least equal to the coverage that the
		Company provides for any other present or former senior executive or director
		of the Company.
	 

	 
		11. Entire Agreement. This Agreement sets forth the entire agreement between
		the parties hereto and fully supersedes any and all prior agreements or
		understandings, written or oral, between the parties hereto pertaining to the
		subject matter hereof.
	 

	 
		12. Notices. All
		notices and other communications required or permitted to be given hereunder
		shall be in writing and shall be deemed to have been duly given if delivered
		personally, mailed by certified mail (return receipt requested) or sent by
		overnight delivery service, or electronic mail, or facsimile transmission (with
		electronic confirmation of successful transmission) to the parties at the
		addresses specified for each party on the signature page hereto, or at such
		other addresses as shall be specified by the parties by like notice, in order
		of preference of the recipient.
	 

	 
		Notice so given shall, in the case of mail,
		be deemed to be given and received on the fifth calendar day after posting, in
		the case of overnight delivery service, on the date of actual delivery and, in
		the case of facsimile transmission, telex or personal delivery, on the date of
		actual transmission or, as the case may be, personal delivery.
	 

	 
		13. Governing Law and Venue. This Agreement will be governed by and construed in
		accordance with the laws of the State of New York, without regard to any
		conflict of laws rule or principle which might refer the governance or
		construction of this Agreement to the laws of another jurisdiction. Any action
		or arbitration in regard to this Agreement or arising out of its terms and
		conditions, pursuant to Sections 25 and 26, shall be instituted and litigated
		only in NewYork City, New York. 
	 

	 
		14. Assignment. This
		Agreement is personal to Executive and the Company and may not be assigned in
		any way without the prior written consent of the other party hereto. 
	 

	 
		15. Executive Not to Act; Board Actions. Executive agrees that Executive is not entitled to,
		and will not, exercise any rights of the Company under this Agreement or act
		for or on behalf of the Company under this Agreement. In addition, all actions
		to be taken, or rights to be exercised, by the Board pursuant to this Agreement
		will be taken by a special committee of the Board consisting solely of
		directors other than (i) Executive or any of Executive’s immediate family
		members, (ii) directors that are employees or officers of the Company or its
		subsidiaries,
	 

	 
		 
	 

	 
		9
	 

	 
		 
	 

	 
 

	 
		and (iii) directors that are employees,
		officers, directors, partners, members, managers or shareholders of any
		affiliate of Executive.
	 

	 
		16. Counterparts.
		This Agreement may be executed in counterparts, each of which will take effect
		as an original, and all of which shall evidence one and the same
		Agreement.
	 

	 
		17. Amendment. This
		Agreement may be amended only in writing signed by Executive and by a duly
		authorized representative of the Company (other than Executive).
	 

	 
		18. Construction.
		The headings and captions of this Agreement are provided for convenience only
		and are intended to have no effect in construing or interpreting this
		Agreement. The language in all parts of this Agreement shall be in all cases
		construed in accordance to its fair meaning and not strictly for or against the
		Company or Executive.
	 

	 
		19. Non-Waiver. The
		failure by either party to insist upon the performance of any one or more
		terms, covenants or conditions of this Agreement shall not be construed as a
		waiver or relinquishment of any right granted hereunder or of any future
		performance of any such term, covenant or condition, and the obligation of
		either party with respect hereto shall continue in full force and effect,
		unless such waiver shall be in writing signed by the Company (other than by
		Executive) and Executive.
	 

	 
		20. Use of Name, Likeness and Biography. Company shall have the right (but not the obligation)
		to use, publish and broadcast, and to authorize others to do so, the name,
		approved likeness and approved biographical material of Executive to advertise,
		publicize and promote the business of Company and its affiliates, but not for
		the purposes of direct endorsement without Executive’s consent. This right
		shall terminate upon the termination of this Agreement. An “approved
		likeness” and “approved biographical material” shall be,
		respectively, any photograph or other depiction of Executive, or any
		biographical information or life story concerning the professional career of
		Executive, as approved by Executive from time to time.
	 

	 
		21. Right to Insure.
		Company shall have the right to secure, in its own name or otherwise, and at
		its own expense, life, health, accident or other insurance covering Executive,
		and Executive shall have no right, title or interest in and to such insurance.
		Executive shall assist Company in procuring such insurance by submitting to
		reasonable examinations and by signing such applications and other reasonable
		instruments as may be required by the insurance carriers to which application
		is made for any such insurance.
	 

	 
		22. Assistance in Litigation. Executive shall reasonably cooperate with the Company
		in the defense or prosecution of any claims or actions now in existence or that
		may be brought in the future against or on behalf of the Company that relate to
		events or occurrences that transpired while Executive was employed by the
		Company. Executive’s cooperation in connection with such claims or actions
		shall include, but not be limited to, being available to meet with counsel to
		prepare for discovery or trial and to act as a witness on behalf of the Company
		at mutually convenient times. Executive also shall cooperate fully with the
		Company in connection with any investigation or review by any federal, state,
		or local regulatory authority as any such investigation or review relates to
		events or occurrences that transpired while Executive was employed by the
		Company. The Company will pay Executive a reasonable hourly rate for
		Executive’s cooperation pursuant to this Section 22. 
	 

	 
		 
	 

	 
		10
	 

	 
		 
	 

	 
 

	 
		23. No Inconsistent Obligations. Executive represents and warrants that to his
		knowledge he has no obligations, legal, in contract, or otherwise, inconsistent
		with the terms of this Agreement or with his undertaking employment with the
		Company to perform the duties described herein. Executive will not disclose to
		the Company, or use, or induce the Company to use, any confidential,
		proprietary, or trade secret information of others. Executive represents and
		warrants that to his knowledge he has returned all property and confidential
		information belonging to all prior employers, if he is obligated to do
		so.
	 

	 
		24. Binding Agreement. This Agreement shall inure to the benefit of and be
		binding upon Executive, his heirs and personal representatives, and the Company
		and its successors.
	 

	 
		25. Remedies. The
		parties recognize and affirm that in the event of a breach of Sections 7 and 8
		of this Agreement, money damages would be inadequate and the Company would not
		have an adequate remedy at law. Accordingly, the parties agree that in the
		event of a breach or a threatened breach of Sections 7 and 8, the Company may,
		in addition and supplementary to other rights and remedies existing in its
		favor, apply to any court of law or equity of competent jurisdiction for
		specific performance and/or injunctive or other relief in order to enforce or
		prevent any violations of the provisions hereof (without posting a bond or
		other security). In addition, Executive agrees that in the event a court of
		competent jurisdiction or an arbitrator finds that Executive violated Sections
		7 or 8, the time periods set forth in those Sections shall be tolled until such
		breach or violation has been cured. Executive further agrees that the Company
		shall have the right to offset the amount of any damages awarded to the Company
		resulting from a breach by Executive of Sections 7 or 8 against any payments
		due Executive under this Agreement. The parties agree that if one of the
		parties is found to have breached this Agreement by a court of competent
		jurisdiction, the breaching party will be required to pay the non-breaching
		party’s attorneys’ fees.
	 

	 
		26. Arbitration.
		Other than as stated in Section 25, the parties agree that any controversy or
		claim arising out of or relating to this Agreement, or the breach thereof,
		shall be resolved by arbitration administered by the American Arbitration
		Association (“AAA”)
		under its Commercial Arbitration Rules. The arbitration will take place in New
		York City, New York. All disputes shall be resolved by a one (1) arbitrator
		chosen by agreement of the parties in accordance with the Commercial
		Arbitration Rules of the AAA. The arbitrator will have the authority to award
		the same remedies, damages, and costs that a court could award. The arbitrator
		shall issue a reasoned award explaining the decision, the reasons for the
		decision, and any damages awarded. The arbitrator’s decision will be final
		and binding. The judgment on the award rendered by the arbitrator may be
		entered in any court having jurisdiction thereof. The arbitration proceedings,
		any record of the same, and the award shall be considered Confidential
		Information under this Agreement. This provision and any decision and award
		hereunder can be enforced under the Federal Arbitration Act.
	 

	 
		27. Voluntary Agreement. Each party to this Agreement has read and fully
		understands the terms and provisions hereof, has had an opportunity to review
		this Agreement with legal counsel, has executed this Agreement based upon such
		party’s own judgment and advice of counsel (if any), and knowingly,
		voluntarily, and without duress, agrees to all of the terms set forth in this
		Agreement. The parties have participated jointly in the negotiation and
		drafting of this Agreement. If an ambiguity or question of intent or
		interpretation arises, this Agreement will be construed as if drafted jointly
		by the parties and no presumption or burden of
	 

	 
		 
	 

	 
		11
	 

	 
		 
	 

	 
 

	 
		proof will arise favoring or disfavoring any
		party because of authorship of any provision of this Agreement. Except as
		expressly set forth in this Agreement, neither the parties nor their
		affiliates, advisors and/or their attorneys have made any representation or
		warranty, express or implied, at law or in equity with respect of the subject
		matter contained herein. Without limiting the generality of the previous
		sentence, the Companies, their affiliates, advisors, and/or attorneys have made
		no representation or warranty to Executive concerning the state or federal tax
		consequences to Executive regarding the transactions contemplated by this
		Agreement.
	 

	 
		[Signature page follows]
	 

	 
		 
	 

	 
		12
	 

	 
		 
	 

	 
 

	 
		IN WITNESS WHEREOF, the Company and
		Executive have executed this Agreement, effective as of the day and year first
		above written.
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  BIOFUEL ENERGY, LLC
				

			 
	 	 	 
	
				
				  Dated:
				

			 	
				
				  April 28, 2006
				

			 	
				
				   
				

			 	
				
				  By: 
				

			 	
				
				  /s/ Thomas J.
				  Edelman
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Name: 
				

			 	
				
				  Thomas J. Edelman
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Title: 
				

			 	
				
				  Authorized Person
				

			 

 

	 
		 
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  Address for Notices:
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  BioFuel Energy, LLC
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  1801 Broadway, Suite
				  1060
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Denver, CO 80202
				

			 

 

	 
		 
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  EXECUTIVE
				

			 
	 	 
	
				
				  Dated:
				

			 	
				
				  April 28, 2006
				

			 	
				
				   
				

			 	
				
				  /s/ Daniel J. Simon
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Daniel J. Simon
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 

 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  Address for Notices:
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  BioFuel Energy Corp.

				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  1801 Broadway, Suite
				  1060
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Denver, CO 80202
				

			 

 

	 
		 
	 

	 
		Executive Employment Agreement Signature
		Page
	 

	 
		 
	 

	 
 

	 
		EXHIBIT A1
	 

	 
		1. Release.
	 

	 
		(a) General Release.
		As a material inducement for the Company to enter this Agreement, Executive
		does hereby agree to release and forever discharge the Company and all of their
		respective current and former affiliates, subsidiaries, predecessors,
		successors, divisions, other related entities, assigns, agents, attorneys,
		officers, directors, managers, members, stockholders, employees and heirs
		(hereinafter referred to “Releasees”) from any and all claims, complaints, liabilities
		or obligations of any kind whatsoever, whether known or unknown, arising in
		tort or contract, which Executive may have, now has, or has ever had arising
		from Executive’s employment with the Company or any predecessor or the
		termination of that employment, or any other matter or event which may have
		occurred as of the date of this Agreement (“Released Claims”). Executive understands and agrees that the
		Released Claims include, but are not limited to, any and all claims,
		complaints, liabilities or obligations under applicable federal, state or local
		law, including, but not limited to, Title VII of the Civil Rights Act of 1964,
		as amended by the Civil Rights Act of 1991, the Americans With Disabilities
		Act, the Employee Retirement Income Security Act, the Age Discrimination in
		Employment Act (“ADEA”),
		and the Older Worker Benefit Protection Act (“OWBPA”).
	 

	 
		(b) Waiver of Right to Bring Released Claims. Executive further agrees not to bring any Released
		Claims against the Releasees, either individually or collectively; provided
		however, that Executive may file a lawsuit to challenge the validity of the
		release of her ADEA claims under this Agreement, including the knowing and
		voluntary nature of the ADEA release under the OWBPA. Nothing in this Paragraph
		1(b) shall interfere with Executive’s right to file a charge with, or
		cooperate or participate in an investigation or proceeding conducted by, the
		Equal Employment Opportunity Commission (“EEOC”)
		or other federal or state regulatory or law enforcement agency. However, the
		consideration provided to Executive in this Agreement shall be the sole relief
		provided for the Released Claims and Executive will not be entitled to recover
		and Executive agrees to waive any monetary benefits or recovery against the
		Releasees in connection with any such charge or proceeding without regard to
		who has brought such charge or proceeding.
	 

	 
		(c) Costs of Enforcement. Executive agrees that if Executive breaches this
		Agreement and brings a Released Claim against any of the Releasees or otherwise
		breaches this Agreement, Executive shall be liable for any and all expenses
		incurred by the person or entity who has to defend the action, including
		reasonable attorney’s fees; provided however, that this Paragraph 1(c)
		shall not apply to charges filed by Executive with the EEOC or other federal or
		state regulatory or law enforcement agency or to claims initiated by Executive
		to challenge the validity of the release of ADEA claims under this Agreement,
		including the knowing and voluntary nature of the ADEA release under the
		OWBPA.
	 

	 
		______________
	 

	 
			
				
				  1 For purposes of clarity, the contents of this Exhibit A
				  will not be effected by whether the Company, at the relevant time, is
				  privately-held or publicly-traded.
				

			 

 

	 
		 
	 

	 
		Exhibit A
	 

	 
		 
	 

	 
 

	 
		(d) Equity Interests and Severance Payments. It is understood by the parties that this Agreement
		does not require Executive to (i) forfeit any equity securities issued by the
		Company that are held by Executive, (ii) release any rights to receive
		distributions, or voting rights, under the limited liability company agreement
		of the Company to the extent that any such rights are held by Executive and
		result from Executive’s ownership of equity securities issued by the
		Company, (iii) release any rights that Executive may have, under the second
		sentence of Section 5(a) of the Executive Employment Agreement, made and
		entered into as of the ____ day of April, 2006 (the “Employment Agreement”) by and between the Company and the Executive, as
		may be amended from time to time, or (iv) release any rights Executive has to
		indemnification pursuant to Section 10 of the Employment Agreement or
		otherwise. 
	 

	 
		(e) Non-Disparagement. Executive agrees that Executive shall not make any
		disparaging, derogatory or detrimental comments about the Company or any of its
		affiliates or any of their directors, officers, employees, partners, members,
		managers or shareholders, or any investor or other person or entity having a
		business relationship with the Company. Executive also acknowledges that the
		terms of this Exhibit A and the other Severance and Release Documents (as
		defined in the Employment Agreement) constitute Confidential Information (as
		defined in the Employment Agreement).
	 

	 
		 
	 

	 
		Executive Employment Agreement Signature
		Page
	 

	 
		 
	 

	 
		15

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