Document:

FORM
      OF ESCROW AGREEMENT

    

    THIS
      ESCROW AGREEMENT
      (this
      "Agreement") is made this _____ day of ______________________, 200_, by and
      between East Coast Ethanol, LLC, a Delaware limited liability company ("East
      Coast") and ____________________________ as escrow agent (the “Escrow Agent”).

    

    W
      I T N E S S E T H: 

    

    WHEREAS,
      East
      Coast proposes to offer a minimum of 22,545
      and
      a
      maximum of 39,455
      of
      its
      Membership Units (the "Units") at a price of $15,000 per Unit, in minimum blocks
      of one-third Units after an initial minimum purchase of 1 Unit in an offering
      registered with the Securities and Exchange Commission and in the states of
      Florida,
      Maryland, New York, South Carolina, North Carolina, Georgia and
      Tennessee,
      and
      possibly offered in other states pursuant to state securities registration
      exemptions and under the provisions of the Securities Act of 1933, as amended
      (the “Offering”); 

    

    WHEREAS,
      East
      Coast will file a registration statement to register the Units with the
      Securities and Exchange Commission, the States of Florida,
      Maryland, New York, South Carolina, North Carolina, Georgia and
      Tennessee,
      and
      possibly other states; 

    

    WHEREAS,
      East
      Coast will allow investors in the Offering to deliver the purchase price of
      the
      subscribed Units in installments; and 

    

    WHEREAS,
      East
      Coast desires to comply with the requirements of federal and state securities
      laws and regulations, and desires to protect the investors in the Offering
      by
      providing, under the terms and conditions herein set forth, for the return
      to
      subscribers of the money which they may pay on account of purchases of Units
      in
      the Offering if the Minimum Escrow Deposit (as hereinafter defined) is not
      deposited with the Escrow Agent.

    

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants herein contained and for other good and
      valuable consideration, the receipt and sufficiency of which is acknowledged,
      the parties agree as follows:

    

    1. Acceptance
      of Appointment.
      _______________________________ hereby agrees to act as Escrow Agent under
      this
      Agreement. The Escrow Agent shall have no duty to enforce any provision hereof
      requiring performance by any other party hereunder.

    

    2. Establishment
      of Escrow Account.
      An
      escrow account (the "Escrow Account") is hereby established with the Escrow
      Agent for the benefit of the investors in the Offering. Except as specifically
      provided in this Agreement, the Escrow Account shall be created and maintained
      subject to the customary rules and regulations of the Escrow Agent pertaining
      to
      such accounts.

    

    3. Ownership
      of Escrow Account.
      Until
      such time as the funds deposited in the Escrow Account (the "Deposited Funds")
      shall equal the Minimum Escrow Deposit (as hereinafter defined), all funds
      deposited in the Escrow Account by East Coast shall not become the property
      of
      East Coast or be subject to the debts of East Coast or any other person but
      shall be held by the Escrow Agent solely for the benefit of the investors who
      have purchased Units in the Offering.

    

    4. Deposit
      of Proceeds.
      All
      proceeds from sales of Units in the Offering shall be delivered by East Coast
      to
      the Escrow Agent, within forty-eight hours of the receipt thereof from
      investors, endorsed (if appropriate) to the order of the Escrow Agent, together
      with an appropriate written statement setting forth name, address and social
      security number of each person purchasing Units, the number of Units purchased,
      and the amount paid by each such purchaser. Any such proceeds deposited with
      the
      Escrow Agent in the form of uncollected checks shall be promptly presented
      by
      the Escrow Agent for collection through customary banking and clearing house
      facilities. As the proceeds of each sale are deposited with the Escrow Agent,
      East Coast shall reserve the number of Units confirmed to the purchaser thereof
      in connection with such sale. All such deposited proceeds are referred to herein
      as the "Escrow Funds".

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    5. Investment
      of Escrow Account.
      The
      Escrow Funds shall be credited by the Escrow Agent and recorded in the Escrow
      Account. The Escrow Agent shall be permitted, and is hereby authorized to
      deposit, transfer, hold and invest all funds received under this Agreement,
      including principal and interest, in those investments directed, in writing
      by
      East Coast. The Escrow Agent is hereby authorized to invest Escrow Funds in
      the
      Federated Treasury Obligations Money Market Mutual Fund for temporary investment
      without written direction. Any interest received by the Escrow Agent with
      respect to the Escrow Funds shall be paid to East Coast , or the investors,
      as
      indicated elsewhere in this Agreement.

    

    6. Termination
      of Escrow.
      This
      Agreement and the Escrow created hereunder shall be terminated as provided
      in
      paragraph 7 hereof or as of the date in calendar year 2009 (the "Termination
      Date"), which is one year and one day following the date in calendar year 2008
      upon which the Securities and Exchange Commission authorizes the Offering (the
      "Offering's Effective Date"). The Company shall notify Escrow Agent of the
      Offering's Effective Date within 30 days of the receipt of notice of the
      Offering's Effective Date from the Securities and Exchange Commission.

     

    7. Disposition
      of Escrow Funds.
      The
      Escrow Agent shall have the following duties and obligations under this
      Agreement:

    

    A. The
      Escrow Agent shall send a written notice acknowledging the receipt of the
      Deposited Funds every seven days to the Company. 

    

    B. The
      Escrow Agent shall give the Company prompt written notice when the Deposited
      Funds equal $33,817,500
      (exclusive of interest). Following receipt of such notice, the Company will
      advise the purchasers of Units to remit to the Escrow Agent the balance of
      the
      purchase price within 20 days. Thereafter, Escrow Agent shall give the Company
      written notice acknowledging the receipt of the Deposited Funds every seven
      days. The Escrow Agent shall give the Company prompt written notice when the
      Deposited Funds total $338,175,000
      (exclusive of interest). 

    

    C. At
      the
      time (and in the event) that: (a) the Deposited Funds shall, during the term
      of
      this Agreement, equal $338,175,000
      in
      subscription proceeds (exclusive of interest) (the "Minimum Escrow Deposit");
      (b) the Escrow Agent
      shall
      have received written confirmation from the Company that the Company has
      obtained a written debt financing commitment for debt financing ranging from
      a
      minimum of $ $243,805,000 to a maximum of $497,455,000; (c) the Company has
      affirmatively elected in writing to terminate this Agreement; (d)
      the
      Escrow Agent shall have provided to each state securities department in which
      the Company has registered its securities for sale, as communicated to the
      Escrow Agent by the Company, an affidavit stating that the foregoing
      requirements (a), (b) and (c) of this subsection 7C have been
      satisfied;
      and
      (d)
      in each state in which consent is required, the state securities commissioners
      have consented to release of the funds on deposit, then this Agreement shall
      terminate, and the Escrow Agent shall promptly disburse the funds on deposit,
      including interest, to the Company to be used in accordance with the provisions
      set out in the Registration Statement. The Company will deliver a copy of the
      Registration Statement to the Escrow Agent upon execution of this Agreement.
      The
      Escrow Agent will have no responsibility to examine the Registration Statement
      with regard to the Escrow Account or otherwise and the Registration Statement
      shall contain a provision to such effect. Upon the making of such disbursement,
      the Escrow Agent shall be completely discharged and released of any and all
      further responsibilities hereunder.

    

    D. In
      the
      event the Deposited Funds do not equal or exceed the Minimum Escrow Deposit
      on
      or before the Termination Date or if the Company has not received a written
      debt
      financing commitment as described herein on or before the Termination Date,
      the
      Escrow Agent shall return to each of the purchasers of the Units in the
      Offering, as promptly as possible after such Termination Date and on the basis
      of its records pertaining to the Escrow Account: (a) the sum which each
      purchaser initially paid in on account of purchases of the Units in the Offering
      and (b) each purchaser's portion of the total interest earned on the Escrow
      Account as of the Termination Date, (c) reduced by the transaction fees provided
      in paragraph 10 hereof. Computation of any purchaser's share of the net interest
      earned will be a weighted average based on the proportion of such purchaser's
      deposit in the Escrow Account from the Offering to all such purchasers' deposits
      held by the Escrow Agent and upon the length of time in days such deposit was
      held in the Escrow Account as compared to all such deposits. All computations
      with respect to each purchaser's allocable share of net interest shall be made
      by the Escrow Agent, which determinations shall be final and conclusive. Any
      amount paid or payable to a purchaser pursuant to this paragraph shall be deemed
      to be the property of such purchaser, free and clear of any and all claims
      of
      the Company or its agents or creditors; and the respective purchases of the
      Units made and entered into in the Offering shall thereupon be deemed, ipso
      facto, to be cancelled without any further liability of the purchasers or any
      of
      them to pay for the Units purchased. At such time as the Escrow Agent shall
      have
      made all the payments called for in this paragraph, the Escrow Agent shall
      be
      completely discharged and released of any and all further responsibilities
      hereunder, and the Units reserved (as provided in paragraph 5) shall be released
      from such reservation, except that Escrow Agent shall be required to prepare
      and
      issue a single IRS Form 1099 to each investor in the event that funds are
      returned to investors.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    8. Agreement
      with Escrow Agent.
      To
      induce Escrow Agent to act hereunder, it is agreed by East Coast
      that:

    

    A. The
      sole
      duty of the Escrow Agent, other than as herein specified, shall be to receive
      the Escrow Funds and hold them subject to release, in accordance herewith,
      and
      the Escrow Agent shall be under no duty to determine whether East Coast is
      complying with the requirements of this Agreement in tendering to the Escrow
      Agent said proceeds of the sale of said Units. The Escrow Agent may conclusively
      rely upon and shall be protected in acting upon any statement, certificate,
      notice, request, consent, order or other document believed by it to be genuine
      and to have been signed or presented by the proper party or parties. The Escrow
      Agent shall have no duty or liability to verify any such statement, certificate,
      notice, request, consent, order or other document, and its sole responsibility
      shall be to act only as expressly set forth in this Agreement. The Escrow Agent
      shall be under no obligation to institute or defend any action, suit or
      proceeding in connection with this Agreement unless first indemnified to its
      satisfaction. The Escrow Agent may consult counsel in respect of any question
      arising under this Agreement and the Escrow Agent shall not be liable for any
      action taken or omitted in good faith upon advice of such counsel.

    

    B. East
      Coast hereby indemnifies and holds harmless the Escrow Agent from and against
      any and all loss, liability, cost, damage and expense, including, without
      limitation, reasonable counsel fees, which the Escrow Agent may suffer or incur
      by reason of any action, claim or proceeding brought against the Escrow Agent
      arising out of or relating in any way to this Agreement or any transaction
      to
      which this Agreement relates unless such action, claim or proceeding is the
      result of the gross negligence or willful misconduct of the Escrow Agent.

    

    9. Resignation
      and Removal of Escrow Agent Successors.
      The
      Escrow Agent may resign upon 30 days advance written notice to East Coast .
      If a
      successor Escrow Agent is not appointed within the 30-day period following
      such
      notice, Escrow Agent may petition any court of competent jurisdiction to name
      a
      successor Escrow Agent. Any commercial banking institution or trust company
      with
      which Escrow Agent may merge or consolidate, and any commercial banking
      institution or trust company to which Escrow Agent transfers all or
      substantially all of its corporate trust business shall be the successor Escrow
      Agent without further act.

    

    10. Fees
      and Expenses of Escrow Agent.
      East
      Coast agrees to pay the Escrow Agent the fees specified in the Escrow Agent’s
      fee schedule attached hereto as Exhibit A, in the manner set forth therein,
      unless otherwise agreed to by the parties in writing. The parties further agree
      that such fees shall be paid from interest on the escrow account only and not
      from principal. In the event the interest on the escrow account is insufficient
      to satisfy the full amount of fees payable hereunder, East Coast shall be solely
      responsible for the payment of such fees and the Escrow Agent shall not seek
      payment of the fees from investors or apply any principal deposited by investors
      in the escrow account against such fees. The fee agreed upon herein is intended
      as full consideration for the Escrow Agent's services as contemplated by this
      Agreement; provided,
      however,
      that in
      the event the Escrow Agent renders any material service not contemplated in
      this
      Agreement or there is any assignment of interest in the subject matter of this
      Agreement, or any material modification hereof; or if any material controversy
      arises hereunder, or the Escrow Agent is made a party to any litigation
      pertaining to this Agreement, or the subject matter hereof, then the Escrow
      Agent shall be reasonably compensated for such extraordinary services and
      reimbursed for all costs and expenses, including reasonable attorney's fees,
      occasioned by any delay, controversy, litigation or event, and the same shall
      be
      recoverable from East Coast , but not from the escrow account.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    11. Notices.
      All
      notices, requests, demands, and other communications under this Agreement shall
      be in writing and shall be deemed to have been duly given (a) on the date of
      service if served personally on the party to whom notice is to be given, (b)
      on
      the day of transmission if sent by facsimile transmission to the facsimile
      number given below, and telephonic confirmation of receipt is obtained promptly
      after completion of transmission, (c) on the next day on which such deliveries
      are made in Columbia, South Carolina, when delivery is to Federal Express or
      similar overnight courier or the Express Mail service maintained by the United
      States Postal Service, or (d) on the fifth day after mailing, if mailed to
      the
      party to whom notice is to be given, by first class mail, registered or
      certified, postage prepaid, and properly addressed, return receipt requested,
      to
      the party as follows:

    

    If
      to
      Escrow Agent:

    __________________________

    __________________________

    __________________________

    __________________________

    Attn:______________________     

    Fax:_______________________     

    Phone:_____________________     

     

    If
      to
      East Coast :

    

    East
      Coast Ethanol, LLC

    1907
      Thurmond Mall Post Office Box 1058 

    Columbia,
      South Carolina 29202

    Fax:
      (803) 799-5638

     

    with
      a
      required copy to:

    

    Brown,
      Winick, Graves, Gross, Baskerville and Schoenebaum, P.L.C.

    666
      Grand
      Avenue, Suite 2000

    Des
      Moines, IA 50309

    Attention:
      Valerie D. Bandstra

    Fax:
      (515) 323-8559

    

    12. Governing
      Law.
      This
      Agreement shall be construed, performed, and enforced in accordance with, and
      governed by, the internal laws of the State of South Carolina, without giving
      effect to the principles of conflict of laws thereof. 

    

    13. Successors
      and Assigns.
      Except
      as otherwise provided in this Agreement, no party hereto shall assign this
      Agreement or any rights or obligations hereunder without the prior written
      consent to the other parties hereto and any such attempted assignment without
      such prior written consent shall be void and of no force and effect. This
      Agreement shall inure to the benefit of and shall be binding upon the successors
      and permitted assigns of the parties hereto.

    

    14. Severability.
      In the
      event that any part of this Agreement is declared by any court or other judicial
      or administrative body to be null, void, or unenforceable, said provision shall
      survive to the extent it is not so declared, and all of the other provisions
      of
      this Agreement shall remain in full force and effect.

    

    15. Further
      Assurances.
      Each of
      the parties shall execute such documents and other papers and take such further
      actions, as may be reasonably required or desirable to carry out the provisions
      hereof and the transactions contemplated hereby.

    

    16. Amendments.
      This
      Agreement may be amended or modified, and any of the terms, covenants,
      representations, warranties, or conditions hereof may be waived, only by a
      written instrument executed by the parties hereto, or in the case of a waiver,
      by the party waiving compliance. Any waiver by any party of any condition,
      or of
      the breach of any provision, term, covenant, representation, or warranty
      contained in the Agreement, in any one or more instances, shall not be deemed
      to
      be nor construed as further or continuing waiver of any such conditions, or
      of
      the breach of any other provision, term, covenant, representation, or warranty
      of this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    17. Entire
      Agreement.
      This
      Agreement contains the entire understanding among the parties hereto with
      respect to the escrow contemplated hereby and supersedes and replaces all prior
      and contemporaneous agreements and understandings, oral or written, with regard
      to such escrow.

    

    18. Section
      Headings.
      The
      section headings in this Agreement are for reference purposes only and shall
      not
      affect the meaning or interpretation of this Agreement.

    

    19. Counterparts.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed an original but all of which together shall constitute one and the same
      instrument.

    

    IN
      WITNESS WHEREOF, the parties hereto have hereunto affixed their signatures
      as of
      the day and year first written above.  

    

               

    
      	EAST COAST:	 	 	ESCROW AGENT
	 	 	 	 
	East Coast Ethanol, LLC	 	 	 
	 	 	 	
              
 
	By:	 	 	By:
	
              
                

              

              Randy
                Hudson, CEO    

            	 	 	
              
                

              
Printed Name:  
              
	 	 	 	
              
                

              

            
	 	 	 	Title:
	 	 	 	
              
                

              

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
      A

     

    Escrow
      Agent Fee Schedule

    

    Escrow
      Agreement

    East
      Coast Solutions, LLC

    

      
        	
                Administration

              	
                $

              
	 	 
	
                Transaction
                  Fees

              	 
	
                Subscriber

              	
                $

              
	
                Disbursement/Each

              	
                $

              
	 	 
	
                1099
                  Filing

              	
                $

              
	
                Subscriber/Filing

              	
                $

              

      

    

     

    All
      out
      of pocket costs and expenses, including postage, supplies, long distance
      telephone charges, wires and reasonable attorney’s fees will be in addition
      hereto. 

     

    We
      reserve the right to revise fees, including establishing new minimums, as
      necessitated by changing economic conditions. 

    

    All
      fees
      are charged in arrears and are quoted on an annualized basis; however we reserve
      the right to bill in advance, or on a more frequent basis.January
      2, 2008

    

    East
      Coast Ethanol, LLC

    Attention:
      Dr. Randy Hudson

    528
      Vo-Tech Drive

    PO
      Box
      527

    Ocilla,
      GA 31774

    

    Re:       
      East
      Coast Ethanol, LLC Jesup, GA Ethanol Project

    

    Dear
      Dr.
      Hudson:

    

    This
      letter of intent will confirm our discussions regarding the proposed terms
      and
      conditions under which Fagen, Inc. (“Fagen”)
      will
      enter into exclusive negotiations with East Coast Ethanol, LLC (“Owner”)
      to
      implement the transaction described in Paragraph 1 below (the “Transaction”).
      (Fagen and Owner are referred to herein individually as a “Party”
and
      collectively as the “Parties”).
      This
      letter will constitute a letter of intent between us (the “Letter
      of Intent”)
      if
      this letter is executed and returned by you within thirty (30) days of the
      date
      hereof.

    Upon
      execution by both Parties, this letter shall supercede and replace in all
      respects any and all prior letters of intent entered into by Fagen with, or
      for
      the benefit of, Owner. 

    

    The
      Parties agree to effect the Transaction subject only to the execution and
      delivery (in each case in a form satisfactory to Fagen) of a definitive
      Design-Build Agreement and other ancillary instruments and agreements (the
      “Transaction
      Documents”).
      The
      Parties agree that the Transaction Documents must be executed and delivered
      by
      the parties thereto no later than February 1, 2009 (the “Closing
      Date”);
      or
      this Letter of Intent will terminate in accordance with Paragraph 11(a)
      hereof.

    

    
      	
              1.

            	
              The
                Transaction.
                The Parties agree that the Transaction will consist of the
                following:

            

    

    

    
      	 	
              (a)

            	
              Fagen
                agrees to provide Owner with those services as described in this
                Letter of
                Intent which are necessary for Owner to develop a detailed description
                of
                a one hundred ten (110) million gallons per year (“MGY”)
                dry grind ethanol production facility located near Jesup, Georgia
                (the
                “Plant”)
                and to establish a price for which Fagen would provide design,
                engineering, procurement of equipment and construction services for
                the
                Plant. The description of the Plant will be sufficiently detailed
                to
                permit an analysis of the Owner’s lump-sum cost to develop the Plant and
                to develop an economic pro forma sufficient to determine if the Plant
                can
                be financed. 

            

    

    

    
      	 	
              (b)

            	
              Fagen
                will also provide Owner with assistance in evaluating, from both
                a
                technical and business perspective, the appropriate location of the
                Plant
                and business plan development. Fagen will assume no risk or liability
                of
                representation or advice to Owner by assisting in evaluating the
                above and
                all decisions made regarding feasibility, financing, and business
                risks
                are the Owner’s sole responsibility and liability. Owner acknowledges that
                Fagen has no control over cost of labor, materials, equipment, or
                services
                furnished by others, over other contractors’ methods of determining
                prices, or other competitive bidding or market conditions. Fagen’s
                estimates of project construction cost will be made on the basis
                of its
                experience and qualifications and will represent Fagen’s best judgment as
                experienced and qualified professionals familiar with the construction
                industry. Fagen does not guarantee that proposals, bids, or actual
                construction cost will not vary from its estimates of project cost
                and
                Owner acknowledges the same. 

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        2
of
        19

    

     

    
      	 	
              (c)

            	
              Fagen
                will also provide Owner with conceptual design and technical information
                required to support Owner’s application for a construction air permit
                prior to the commencement of Plant Construction.
                

            

    

    

    
      	 	
              (d)

            	
              If
                Owner determines that the Plant is economically feasible and desires
                to
                proceed with the development of the Plant, then Owner agrees to enter
                into
                a Lump Sum Design-Build contract with Fagen for the design, procurement
                of
                equipment and construction of the Plant (the “Design-Build
                Agreement”).
                

            

    

    
      	 	 	 

    

    
      	 	
              (e)

            	
              Owner
                shall offer Fagen the right to invest in the project. Unless otherwise
                specifically agreed between Fagen and Owner, such investment shall
                be
                offered on the same terms and conditions as all other
                investors.

            

    

    

    
      	 	
              (f)

            	
              Owner
                agrees that the Design-Build Agreement will be based on Fagen’s chosen
                form of Design-Build Agreement, with terms and conditions acceptable
                to
                both parties, and will contain among other things, those terms and
                conditions set forth in the General Terms and Conditions section
                of this
                Letter of Intent.

            

    

    

    
      	
              2.

            	
              Contract
                Price.
                Subject to the terms and conditions set forth herein, Owner shall
                pay
                Fagen One Hundred Forty-six Million Two Hundred Thousand Dollars
                ($146,200,000) (the “Contract
                Price”)
                as full consideration to Fagen for complete performance of the services
                described in the Design-Build Agreement and all costs incurred in
                connection therewith. The Contract Price is based upon Fagen’s standard
                plant design, attached hereto as Exhibit A, and shall be subject
                to
                adjustments to reflect any deviations from standard design requested
                by
                Owner; provided, however, that all requested deviations from Fagen’s
                standard design must be submitted to Fagen by Owner no later than
                the
                earlier of: (a) the date upon which the Phase I engineering is scheduled
                to be delivered to Owner pursuant to the Phase I and Phase II Engineering
                Services Agreement (as such term is defined herein); or (b) the date
                upon
                which the Design-Build Agreement is executed. The Contract Price
                shall be
                subject to the following:

            

    

    

    
      	 	
              (a)

            	
              The
                Contract Price shall not include any costs related to union labor
                or
                prevailing wage requirements. If any action by Owner, a change in
                applicable law, or a governmental authority (as those terms are defined
                in
                the Design-Build Agreement) acting pursuant to a change in applicable
                law,
                shall require Fagen to employ union labor or compensate labor at
                prevailing wages, the Contract Price shall be adjusted upwards to
                include
                any increased costs, of any kind or nature, associated with such
                labor or
                wages including but not limited to site security and personnel costs.
                Such
                adjustment shall include, but not be limited to, increased labor,
                subcontractor, and material and equipment costs resulting from any
                union
                or prevailing wage requirement; provided, however, that if an option
                is
                made available to either employ union labor, or to compensate labor
                at
                prevailing wages, such option shall be at Fagen’s sole discretion and that
                if such option is executed by Owner without Fagen’s agreement, Fagen shall
                have the right to terminate this Letter of Intent or the Design-Build
                Agreement, as applicable, and receive compensation pursuant to Paragraph
                4(c) hereof or the terms of the Design-Build Agreement, whichever
                is
                applicable.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      
        East
          Coast Ethanol, LLC 

        Letter
          of
          Intent

        January
          2, 2008

        Page
          3
of
          19

      

       

    

    
      	 	
              (b)

            	
              If
                Notice to Proceed is given on or after February 15, 2009 and the
                Construction Cost Index published by Engineering News-Record Magazine
                (“CCI”)
                for the month in which such Notice to Proceed is given to Fagen is
                greater
                than the February 2009 CCI, then the Contract Price shall be increased
                by
                a percentage amount equal to the percentage increase in the
                CCI.

            

    

    

    
      	 	
              (c)

            	
              If
                Notice to Proceed is given on or after February 15, 2009, then due
                to
                rapidly accelerating costs of certain specialty materials required
                for
                Plant Construction, in addition to any adjustment provided for in
                Paragraph 2(b) hereof, Fagen shall also add a surcharge to the Contract
                Price of one half of one percent (0.50%) for each calendar month
                that has
                passed between February 2009 and the month in which a valid Notice
                to
                Proceed is given to Fagen. By way of example, if a valid Notice to
                Proceed
                is given on April 7, 2009 and the CCI has increased one percent (1%)
                over
                such period of time, the total adjustment to the Contract Price shall
                be
                one percent (1%) in accordance with Paragraph 2(b) plus one half
                of one
                percent (0.50%) for each of the two months from February 2009 to
                the
                delivery of a valid Notice to Proceed in accordance with this paragraph,
                for a total adjustment of two percent
                (2%).

            

    

    

    
      	
              3.

            	
              General
                Terms and Conditions.
                The consummation of the Transaction will be subject to the Design-Build
                Agreement containing the following
                conditions:

            

    

    

    
      	 	
              (a)

            	
              Fagen
                will have no responsibility for and will not perform any site preparation
                work. Owner’s site responsibilities, in each instance in accordance with
                applicable specifications provided by Fagen, will include, but will
                not be
                limited to:

            

      	 	 	 

    

    
      	 	
              i.

            	
              Obtaining
                land and legal authority to use the site for its intended
                purpose;

            

    

    
    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
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        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
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              ii.

            	
              site
                grading including soil stabilization and the costs connected
                therewith;

            

    

    
      	 	 	 

      	 	
              iii.

            	
              final
                grading, seeding, and mulching;

            

      	 	 	 

    

    
      	 	
              iv.

            	
              site
                security, including any site fencing;

            

      	 	 	 

    

    
      	 	
              v.

            	
              procuring
                boundary and topographic surveys;

            

      	 	 	 

    

    
      	 	
              vi.

            	
              procuring
                soil borings and geotechnical reports;

            

      	 	 	 

    

    
      	 	
              vii.

            	
              obtaining
                all operating permits, including any fees, bonding, and required
                testing;

            

      	 	 	 

    

    
      	 	
              viii.

            	
              obtaining
                storm water runoff permit and erosion control/land disturbance
                permit;

            

      	 	 	 

    

    
      	 	
              ix.

            	
              obtaining
                any necessary pollutant elimination discharge
                permit;

            

      	 	 	 

    

    
      	 	
              x.

            	
              obtaining
                a natural gas supply and service agreement and providing all gas
                piping to
                the use points, providing burner tip pressures as specified by Fagen,
                and
                supplying a digital flowmeter; 

            

      	 	 	 

    

    
      	 	
              xi.

            	
              securing
                temporary utilities for the duration of construction and permanent
                electrical service, including all infrastructure design and installation
                for any line/service extensions, substation, primary feed and metering
                system, and on-site electrical distribution system up to and including
                the
                service transformers;

            

      	 	 	 

    

    
      	 	
              xii.

            	
              supplying
                a water source, storage, and water supply lines of appropriate quality
                and
                quantity;

            

      	 	 	 

    

    
      	 	
              xiii.

            	
              paying
                for a water pre-treatment system, including any building or structure
                required to house such system and other equipment, the cost of which
                is
                not included in the Contract Price, which shall be provided by a
                vendor
                selected by Fagen and designed and constructed by Fagen pursuant
                to a
                separate side-letter agreement executed by Owner and Fagen at Fagen’s
                standard time plus material rates during the relevant time period
                and at
                the relevant locale (the “Water
                Pre-Treatment System Agreement”),
                and maintaining and using such system, including the use of all chemicals
                specified for the operation of such water pre-treatment system, for
                the
                entirety of the warranty period, it being agreed that failure by
                Owner to
                maintain and properly use the water pre-treatment system for the
                duration
                of the warranty period shall void any and all warranties affected
                by such
                failure. 

            

      	 	 	 

    

    
      	 	
              xiv.

            	
              providing
                wastewater discharge piping, septic tank and drainfield or connect
                to a
                municipal system as required for the sanitary sewer requirements
                of the
                Plant;

            

      	 	 	 

    

    
      	 	
              xv.

            	
              providing
                and maintain required ditches and permanent
                roads;

            

      	 	 	 

    

    
      	 	
              xvi.

            	
              constructing,
                furnishing, and equipping the administration
                building;

            

      	 	 	 

    

    
      	 	
              xvii.

            	
              providing
                maintenance and power equipment and spare
                parts;

            

      	 	 	 

    

    
      	 	
              xviii.

            	
              providing
                all rail design, engineering, and construction, including any railroad
                permits or approvals;

            

      	 	 	 

    

    
      	 	
              xix.

            	
              supplying
                drawings of rail system and administration building to Fagen;
                and

            

      	 	 	 

    

    
      	 	
              xx.

            	
              paying
                for the required fire protection system for the Plant, including
                any
                building or structure required to house such system, the cost of
                which is
                not included in the Contract Price, and which shall be provided by
                Fagen
                pursuant to a separate side-letter agreement executed by Owner and
                Fagen
                at Fagen’s standard time plus material rates during the relevant time
                period and at the relevant locale (the “Fire
                Protection System Agreement”).

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      
        East
          Coast Ethanol, LLC 

        Letter
          of
          Intent

        January
          2, 2008

        Page
          5
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          19

      

       

    

    
      	 	
              (b)

            	
              Owner
                will enter into a Phase I and Phase II Engineering Services Agreement
                with
                Fagen Engineering, LLC on a form acceptable to both parties but which
                shall be based on Fagen Engineering, LLC’s standard form (“Phase
                I and Phase II Engineering Services Agreement”).
                The Phase I and Phase II Engineering Services Agreement will provide
                for
                commencement of work on the Phase I and Phase II engineering for
                the
                project as set forth therein. The Phase I engineering shall consist
                of
                engineering and design of the Plant site and shall include: property
                layout; grading, drainage and erosion control plan drawings; roadway
                alignment drawings; culvert cross sections and details; and seeding
                and
                landscaping, if required. The Phase II engineering shall consist
                of
                engineering and design of site work and utilities for the Plant,
                all
                within the property line of the Plant, including: property layout;
                site
                grading and drainage drawings; roadway alignment; all utility layout
                including fire loop, potable water, well water if applicable, sanitary
                sewer, utility water blowdown, and natural gas; geometric layout;
                site
                utility piping tables; tank farm layout; tank farm details; sections
                and
                details drawing, if required, and miscellaneous details drawing,
                if
                required. Owner will pay Fagen Engineering, LLC One Hundred Eighty-five
                Thousand Dollars ($185,000) for such engineering services pursuant
                to the
                terms of that agreement, the full amount of which, upon payment in
                full,
                shall be included in and credited to the Contract Price. Notwithstanding
                the foregoing sentence, if a Notice to Proceed is not issued pursuant
                to
                the terms of the Design-Build Agreement, or Financial Closing is
                not
                obtained, then Fagen Engineering, LLC shall keep the full amount
                paid
                under the Phase I and Phase II Engineering Services Agreement as
                compensation for the services provided
                thereunder.

            

    

    

    
      	 	
              (c)

            	
              Fagen
                will provide reasonable assistance to Owner in obtaining Owner’s permits,
                approvals and licenses. Notwithstanding the foregoing, Owner shall
                hold
                harmless Fagen, its officers, directors, employees, and agents, for
                Owner's failure to comply with applicable laws in obtaining or maintaining
                the required permits, except to the extent caused by the gross negligence,
                misrepresentations, fraud, or willful misconduct of Fagen or its
                officers,
                directors, employees, and agents. The denial or revocation of any
                Owner-obtained permit as a result of Owner's failure to comply with
                applicable laws shall entitle Fagen to an extension of contract times
                and
                an adjustment of Contract Price to the extent affected by such denial
                or
                revocation and to any and all other remedies available pursuant to
                the
                Design-Build Agreement and applicable law except to the extent caused
                by
                the gross negligence, misrepresentations, fraud, or willful misconduct
                of
                Fagen or its officers, directors, employees, and
                agents.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      
        East
          Coast Ethanol, LLC 

        Letter
          of
          Intent

        January
          2, 2008

        Page
          6
of
          19

      

       

    

    
      	 	
              (d)

            	
              Owner
                will provide: surveys describing the property’s boundaries; geotechnical
                studies describing subsurface conditions; temporary and permanent
                easements, zoning and other requirements and encumbrances to enable
                Fagen
                to perform the work; a legal description of the site; as-built and
                record
                drawings of any existing structures; environmental studies, reports,
                and
                statements describing the environmental conditions, including hazardous
                conditions at the site.

            

    

    

    
      	 	
              (e)

            	
              Owner
                will be responsible for securing and executing all necessary real
                estate
                agreements to secure the site and is responsible for all costs incurred
                in
                obtaining those agreements. 

            

    

    

    
      	 	
              (f)

            	
              Fagen
                may subcontract portions of the
                work.

            

    

    

    
      	 	
              (g)

            	
              Fagen
                will provide up to two (2) weeks of training for Owner’s employees and, if
                applicable, Owner’s Operator’s employees required for the operation and
                maintenance of the Plant.

            

    

    

    
      	 	
              (h)

            	
              Owner
                must obtain Financial Closing prior to the issuance of a Notice to
                Proceed
                Financial Closing shall be deemed occurred when the loan documents
                for the
                construction financing have been executed and Owner is not in default
                under the terms of such loan
                documents.

            

    

    

    
      	 	
              (i)

            	
              Owner
                will pay, at Fagen’s standard time plus material rates during the relevant
                time period and at the relevant locale, all reasonable costs incurred
                by
                Fagen for frost removal so that winter construction can proceed.
                Such
                costs will be in addition to, and not included in, the Contract
                Price.

            

    

    

    
      	 	
              (j)

            	
              Fagen
                will utilize certain proprietary property and information of ICM,
                Inc., a
                Kansas corporation (“ICM”),
                in the design and construction of the project, and may incorporate
                proprietary property and information of ICM into the project. Owner’s use
                of the proprietary property and information of ICM shall be governed
                by
                the terms and provisions of a license agreement between Owner and
                ICM
                which shall be attached as an exhibit to the Design-Build Agreement.
                Owner
                will be responsible for negotiating any requested changes to the
                ICM
                license directly with ICM, not
                Fagen.

            

    

    

    
      	 	
              (k)

            	
              All
                drawings, specifications, calculations, data, notes and other materials
                and documents, including electronic data furnished by Fagen to Owner
                under
                the Design-Build Agreement (“Work
                Product”)
                will be instruments of service and Fagen will retain the ownership
                and
                property interests therein, including copyrights
                thereto.

            

    

    

    
      	 	
              (l)

            	
              Upon
                payment in full under the Design-Build Agreement, Fagen will grant
                Owner a
                limited license to the Work Product for use solely in connection
                with the
                operation, maintenance, and repair of the Plant. The limited license
                will
                not permit Owner to use the Work Product in connection with any expansion
                or enlargement of the Plant, however, nothing in the limited license
                granted to Owner is intended to limit Owner’s use of the Plant’s actual
                production capability as built.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        7
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        19

    

     

    
      	 	
              (m)

            	
              Work
                will commence following receipt of Owner’s written valid notice to proceed
                (“Notice
                to Proceed”).
                At least twenty (20) days, but no more than thirty (30) days prior
                to
                Owner’s anticipated delivery of Notice to Proceed, Owner must deliver
                notice to Fagen specifying the anticipated delivery date for Notice
                to
                Proceed (“Pre-NTP Notice”). The Notice to Proceed cannot be given until
                (1)
                Owner has title to the real estate on which the project will be
                constructed; (2) the site work required of Owner is completed; (3)
                Owner
                has executed the Water Pre-Treatment System Agreement and the Fire
                Protection System Agreement; (4) the air permit(s) and/or other applicable
                local, state or federal permits necessary so that construction can
                begin
                have been obtained; (5) Owner has obtained Financial Closing and
                delivered
                a certificate of financial closing executed by Owner and Lenders
                in a form
                acceptable to Fagen; (6) if applicable, Owner has executed a sales
                tax
                exemption certificate and provided the same to Fagen; (7) Owner has
                provided the name of its property/all-risk insurance carrier and
                the
                specific requirements for fire protection; (8) Owner has provided
                insurance certificates or copies of insurance policies demonstrating
                that
                Owner has obtained the insurance policies required pursuant to the
                Design-Build Agreement and naming additional insureds and protecting
                other
                interests as prescribed therein, and (9)  Fagen
                has provided Owner written notification of its acceptance of the
                Notice to
                Proceed,
                provided that Fagen shall not be required to accept the Notice to
                Proceed
                earlier than twenty (20) days after receipt of the Pre-NTP Notice.
                Owner
                must deliver the Pre-NTP Notice, complete the prerequisites to the
                issuance of a valid Notice to Proceed, as listed in items number
                (1)
                through (8) of this Paragraph, and submitted a Notice to Proceed,
                to Fagen
                for Fagen’s acceptance by June 2009; otherwise, this LOI and Design-Build
                Agreement may be terminated, at Fagen’s sole option,
                thus releasing Fagen of all obligations. In the event that Owner
                has not
                delivered a valid Notice to Proceed to Fagen by December 31, 2009,
                the
                Contract Price may, at Fagen’s sole discretion, and if the LOI and
                Design-Build Agreement have not already been terminated, be adjusted
                to
                reflect Fagen’s then current (December 2009) Contract Price for a 110 MGY
                dry grind ethanol production facility (with a corresponding revised
                December 2009 CCI benchmark). Within ten (10) business days of receipt
                by
                Design-Builder of the notice to proceed, Design-Builder shall deliver
                to
                Owner notice of either acceptance or denial of notice to proceed.
                If
                accepted by Design-Builder, the Notice to Proceed shall be deemed
                effective on the date on which it was received by
                Design-Builder.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        8
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        19

    

     

    
      	 	
              (n)

            	
              “Substantial
                Completion”
                will be the date on which the Plant construction has been completed
                to a
                point that the Plant is ready to grind the first batch of corn for
                producing ethanol and begin operation for its intended use as a one
                hundred ten (110) MGY dry grind ethanol production facility. No production
                capacity is guaranteed on the Substantial Completion date, but the
                Plant
                is largely completed as of that date.

            

    

    

    
      	 	
              (o)

            	
              Substantial
                Completion will occur within Six Hundred and Thirty-Five (635) days
                after
                the date of the Notice to Proceed; provided, however, that, in addition
                to
                other adjustments to this date as may be available pursuant to the
                Design-Build Agreement, Design-Builder shall be entitled to a day-for-day
                extension of time for attaining Substantial Completion for each day
                in
                excess of thirty (30) days that the Pre-NTP Notice was delivered
                prior to
                Owner’s delivery of a valid Notice to
                Proceed.

            

    

    

    
      	 	
              (p)

            	
              Fagen
                will be entitled to an early completion bonus for each day that
                Substantial Completion occurs in advance of the scheduled Substantial
                Completion date (“Early
                Completion Bonus”).
                Early Completion Bonus shall accrue at a rate of Twenty Thousand
                Dollars
                ($20,000) per day. The Early Completion Bonus shall be capped and
                shall
                not exceed One Million Dollars ($1,000,000). The Early Completion
                Bonus is
                earned for achieving Substantial Completion early, but is not due
                until
                the final payment.

            

    

    

    
      	 	
              (q)

            	
              “Final
                Completion”
                will be achieved once Owner reasonably determines that: Substantial
                Completion has been achieved; any outstanding amounts owed by Fagen
                to
                Owner have been paid; remaining items of work have been completed;
                clean-up of the site has been completed; all permits required to
                have been
                obtained by Fagen have been obtained; certain information including
                an
                affidavit stating that there are no outstanding liens, a release
                from
                further compensation, consent to final payment, and a hard copy of
                the
                as-built plans (which will remain Work Product) has been provided
                to
                Owner; releases and waivers of all claims and liens from Fagen and
                subcontractors have been provided; and the Performance Tests have
                been
                successfully completed. Final Completion will occur no more than
                ninety
                (90) days after the actual Substantial Completion date. The 90-day
                period
                between Substantial Completion and Final Completion will be tied
                directly
                to actual Substantial Completion. By way of example, if Substantial
                Completion is achieved 10 days early, then the 90-day period to Final
                Completion would begin on that earlier
                date.

            

    

    

    
      	 	
              (r)

            	
              Fagen
                will demonstrate certain performance guarantee criteria through
                performance testing performed following Substantial Completion but
                prior
                to Final Completion (“Performance
                Tests”).
                Air permit testing shall be done by a third party contractor retained
                by
                Owner.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        9
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              (s)

            	
              Owner
                will take control of the Plant after completion and acceptance of
                the
                Performance Tests. The Performance Tests will be completed by Owner’s
                personnel under Fagen’s direction. 

            

    

    

    
      	 	
              (t)

            	
              Fagen
                will pay liquidated damages at a daily amount equal to the daily
                Early
                Completion Bonus amount for each day past 90 days after Substantial
                Completion that Final Completion is not attained. Fagen’s liability for
                liquidated damages shall be capped at and shall not exceed One Million
                Dollars ($1,000,000).

            

    

    

    
      	 	
              (u)

            	
              The
                aggregate liability of Fagen, its Subcontractors, vendors, suppliers,
                agents and employees, to Owner (or any successor thereto or assignee
                thereof) for any and all claims and/or liabilities arising out of
                or
                relating in any manner to the work or to Fagen’s performance or
                non-performance of its obligations under the Design-Build Agreement,
                whether based on contract, tort (including negligence), strict liability,
                or otherwise, shall not exceed in the aggregate, the Contract Price
                and
                shall be reduced, upon the issuance of each Application for Payment,
                by
                seventy-five percent (75%) of the total value of such Application
                for
                Payment; provided, however, that upon the earlier of Substantial
                Completion or such point in time that requests for payment pursuant
                to the
                Design-Build Agreement have been made for ninety percent (90%) of
                the
                Contract Price, Fagen's aggregate liability shall be limited to the
                greater of (1) Ten Percent (10%) of the Contract Price or (2) the
                amount
                of insurance coverage available to respond to the claim or liability
                under
                any policy of insurance provided by Fagen under the Design-Build
                Agreement.

            

    

    

    
      	 	
              (v)

            	
              The
                warranty period for work completed pursuant to the Design-Build Agreement
                will extend for one year past Substantial Completion. The Warranty
                will
                not apply to defects caused by abuse, alterations, or failure to
                maintain
                the work by persons other than Fagen or anyone for whose acts Fagen
                may be
                liable. The warranty period will be extended one day for each day
                that
                such part of the work repaired under such warranty is malfunctioning
                or
                not in conformance with project requirements provided that Owner
                must
                report such non-conformance or malfunction within seven (7) days
                of the
                appearance of such non-conformance or malfunction.
                

            

    

    

    
      	 	
              (w)

            	
              Owner
                will pay Fagen a mobilization fee in the amount of Twenty Million
                Dollars
                ($20,000,000) as soon as possible following the execution of the
                Design-Build Agreement, and at the latest, at the earlier to occur
                of
                financial closing or the issuance of a Notice to Proceed. Such
                mobilization fee shall be applied against the Contract
                Price.

            

    

    

    
      	 	
              (x)

            	
              Fagen
                will request payment and Owner will pay Fagen in accordance with
                the
                following procedures:

            

    

    

    
      	 	
              i.

            	
              On
                or before the twenty-fifth (25th) day of each month following the
                acceptance of Notice to Proceed Fagen will submit to Owner a request
                for
                payment (an “Application
                for Payment”).
                Along with each Application for Payment, except with respect to the
                first
                Application for Payment, Fagen will submit to Owner, via hardcopy
                or by
                electronic means including facsimile or portable document format,
                signed
                lien waivers for the work included in the Application for Payment
                submitted for the immediately preceding pay period and for which
                payment
                has been received. 

            

    

    
    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        10
of
        19 

    

     

    
      	 	
              ii.

            	
              The
                Application for Payment will constitute Fagen’s representation that the
                work has been performed consistent with the Transaction Documents
                and has
                progressed to the point indicated in the Application for Payment.
                No
                additional documentation will be provided to Owner in support of
                the
                Application for Payment. The work completed at the site and the comparison
                of the Application for Payment against the Schedule of Values shall
                provide sufficient substantiation to Owner of the accuracy of the
                Application for Payment. The Schedule of Values subdivides the work
                into
                its respective parts, includes values for all items comprising the
                work,
                and serves as the basis for the monthly progress
                payments.

            

      	 	 	 

    

    
      	 	
              iii.

            	
              The
                Application for Payment may request payment for (i) completed work;
                (ii)
                prepayments for materials or equipment for the project when prepayment
                is
                required by the manufacturer or supplier of such materials or equipment;
                or (iii) equipment and materials not yet incorporated into the
                project
                provided that (x) the materials and equipment are suitably stored
                at the
                site or elsewhere, (y) the equipment and materials are protected
                by
                suitable insurance, and (z) upon payment, Owner will receive title
                to such
                equipment and materials.

            

      	 	 	 

    

    
      	 	
              iv.

            	
              Owner
                shall make payment within ten (10) days of receipt of the Application
                for
                Payment. Failure to make such payment will result in the accrual
                of
                interest at a rate of eighteen percent (18%) per annum commencing
                five (5)
                days after the payment is due. Failure to make such payment, except
                if due
                to appropriate withholding of payment due to a good faith dispute,
                entitles Fagen to stop work.

            

      	 	 	 

    

    
      	 	
              v.

            	
              If
                Owner wishes to dispute any portion of the Application for Payment,
                Owner
                must notify Fagen in writing within five (5) days of receipt of the
                Application for Payment. Such notice must state the specific amounts
                Owner
                intends to withhold, the reasons and contractual basis for withholding,
                and the specific measures Fagen must take to rectify Owner’s concerns.
                Regardless of a dispute as to a portion of the Application for Payment,
                Owner must pay all undisputed amounts by the payment due
                date.

            

      	 	 	 

    

    
      	 	
              vi.

            	
              Retainage
                on progress payments made pursuant to the Design-Build Agreement
                will be
                capped at five percent (5%) of the total price. Owner will retain
                ten
                percent (10%) of each payment up to a maximum of five percent (5%)
                of the
                total final Contract Price, as adjusted pursuant to any increased
                based on
                the CCI pursuant to Paragraph 2(b) herein as well as the monthly
                percentage increases pursuant to Paragraph 2(c) herein. Once five
                percent
                (5%) of the total price has been retained, Owner will not retain
                any
                additional amounts from subsequent payments. Owner will release retainage,
                less the amount equal to the value of subcontractor lien waivers
                not yet
                obtained, upon completion of the Performance Tests. The release of
                any
                retainage by Owner shall be reduced by an amount equal to one hundred
                fifty percent (150%) of any amount required to finish any incomplete
                items
                of work.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        11
of
        19

    

     

    
      	 	
              vii.

            	
              Upon
                Final Completion, Fagen will deliver to Owner a request for final
                payment.
                Owner will make the final payment within thirty (30) days after the
                receipt of such request. Owner’s failure to make Final Payment will void
                any and all warranties, whether express or implied, provided by Fagen
                pursuant to the Design-Build
                Agreement.

            

    

    

    
      	 	
              (y)

            	
              Except
                for hazardous conditions caused by Fagen or anyone for which Fagen
                is
                responsible, Fagen will not be responsible for any hazardous condition
                encountered at the site and may stop work in an affected area until
                such
                hazardous condition is removed by
                Owner.

            

    

    

    
      	 	
              (z)

            	
              Fagen
                will not be responsible for differing site conditions including concealed
                or latent physical conditions or subsurface conditions and will be
                entitled to a price adjustment to the Contract Price to the extent
                that
                its cost and/or time of performance is adversely impacted by the
                differing
                site conditions. 

            

    

    

    
      	 	
              (aa)

            	
              “Force
                Majeure Events”
                shall mean any cause or event beyond the reasonable control of, and
                without the fault or negligence of a Party claiming Force Majeure,
                including, without limitation, an emergency, floods, earthquakes,
                hurricanes, tornadoes, adverse weather conditions not reasonably
                anticipated or acts of God; sabotage; vandalism beyond that which
                could
                reasonably be prevented by a Party claiming Force Majeure; terrorism;
                war;
                riots; fire; explosion; blockades; insurrection; strike; slow down
                or
                labor disruptions (even if such difficulties could be resolved by
                conceding to the demands of a labor group); economic hardship or
                delay in
                the delivery of materials or equipment that is beyond the control
                of a
                Party claiming Force Majeure, and action or failure to take action
                by any
                governmental authority after the effective date of the Design-Build
                Agreement (including the adoption or change in any rule or regulation
                or
                environmental constraints lawfully imposed by such governmental
                authority), but only if such requirements, actions, or failures to
                act
                prevent or delay performance; and inability, despite due diligence,
                to
                obtain any licenses, permits, or approvals required by any governmental
                authority.

            

    

    

    
      	 	
              (bb)

            	
              If
                Fagen is delayed at any time in the commencement or progress of the
                work
                due to a delay in the delivery of, or unavailability of, essential
                materials or labor to the project as a result of a significant
                industry-wide economic fluctuation or disruption beyond the control
                of and
                without the fault of Fagen or its subcontractors which is experienced
                or
                expected to be experienced by certain markets providing essential
                materials, equipment or labor to the project during the performance
                of the
                work and such economic fluctuation or disruption adversely impacts
                the
                price, availability, and delivery timeframes of essential materials
                and
                equipment (such event an “Industry-Wide
                Disruption”),
                Fagen shall be entitled to an equitable extension of the Contract
                Time on
                a day-for-day basis equal to such delay and an equitable adjustment
                to the
                Contract Price. The Owner and Fagen shall undertake reasonable steps
                to
                mitigate the effect of such delays. Notwithstanding any other provision
                to
                the contrary, Fagen shall not be liable to the Owner for any expenses,
                losses or damages arising from a delay, or unavailability of, essential
                materials or labor to the project as a result of an Industry-Wide
                Disruption.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        12
of
        19

    

     

    
      	
              4.

            	
              Exclusivity,
                No Solicitation or Negotiations.
                

            

    

    

    
      	 	
              (a)

            	
              During
                the term of this Letter of Intent, neither Owner, nor its affiliates,
                shareholders, members or other equity owners, or their officers,
                representatives, agents or employees will solicit or negotiate, directly
                or indirectly, with any third party to obtain the services contemplated
                by
                this Letter of Intent.

            

    

     

    
      	 	
              (b)

            	
              During
                the term of this Letter of Intent the Owner agrees that Fagen will
                have
                the exclusive right to provide to Owner the services contemplated
                by the
                Letter of Intent. Owner will not disclose any information related
                to this
                Letter of Intent to a competitor or prospective competitor of
                Fagen.

            

    

    

    
      	 	
              (c)

            	
              Should
                Owner choose not to develop the project or to develop or pursue a
                relationship with a company other than Fagen to provide the preliminary
                engineering or design-build services for the project, then Owner
                will
                reimburse Fagen for all expenses Fagen has incurred in connection
                with the
                project
                based upon Fagen’s standard rate schedule plus all third party costs
                incurred from the date of this Letter of Intent. Such expenses include,
                but are not limited to, labor rates and reimbursable expenses such
                as
                legal charges for document review and preparation, travel expenses,
                reproduction costs, long distance phone costs, and postage.
                

            

    

    

    
      	 	
              (d)

            	
              In
                the event Fagen’s services are terminated by Owner, title to the technical
                data, which may include preliminary engineering drawings and layouts
                and
                proprietary process related information, will remain with Fagen and
                any
                copies thereof will be returned to
                Fagen.

            

    

    

    
      	 	
              (e)

            	
              Owner
                acknowledges that the technical data provided by Fagen under this
                Letter
                of Intent is preliminary and may not be suitable for construction.
                Owner
                agrees that any use of such technical data following termination
                of
                Fagen’s services will be at Owner’s sole
                risk.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        13
of
        19

    

     

    
      	
              5.

            	
              Commitment
                Fee.
                Owner has paid to Fagen Five Hundred Thousand Dollars ($500,000)
                as a
                non-refundable commitment fee (“Commitment
                Fee”).
                The Commitment Fee will be credited against the Contract Price upon
                the
                occurrence of: (i) the execution of the Transaction documents; and
                (ii)
                timely acceptance of Notice to Proceed pursuant to the Design-Build
                Agreement. If Owner chooses not to proceed with the project or the
                Transaction Documents are not executed and delivered by the Closing
                Date
                or Owner fails to provide a timely Notice to Proceed pursuant to
                the
                Design-Build Agreement, Fagen shall retain the full amount of the
                Commitment Fee and Owner shall not be entitled to any refund or credit.
                 

            

    

    

    
      	
              6.

            	
              Confidentiality.
                Owner and
                Fagen have entered into that certain Confidentiality and Non-Circumvention
                Agreement dated September 19, 2007 (“Confidentiality
                Agreement”),
                which agreement is incorporated herein by reference hereto. Owner
                hereby
                acknowledges and agrees that any Confidential Information, as such
                term is
                defined in the Confidentiality Agreement, disclosed to Owner pursuant
                to
                or in advancement of this Letter of Intent shall be subject to the
                terms
                and conditions of the Confidentiality Agreement. Notwithstanding
                anything
                herein to the contrary, the Parties hereto shall, with respect to
                information disclosed pursuant to or in advancement of this Letter
                of
                Intent, have all rights and obligations as set forth in the
                Confidentiality Agreement.

            

    

    

    
      	
              7.

            	
              Publicity.
                Neither Owner nor any of its affiliates, shareholders, subcontractors,
                or
                vendors or their officers, representatives, agents and employees
                will
                issue any press or publicity release or otherwise release, distribute,
                announce, or disseminate any information for publication concerning
                the
                Transaction, the existence of the negotiations among Fagen and Owner,
                the
                participation of Fagen in the Transaction, or any other matter affecting
                Fagen hereunder, without the prior written consent of Fagen, which
                consent
                may be withheld for any reason, except where such press or publicity
                release is required by order of a court or necessary or appropriate
                under
                the rules or regulations of any governmental
                agency.

            

    

    

    The
      Parties will jointly agree on the timing and content of any public disclosure
      by
      Owner, including but not limited to, press releases, relating to Fagen’s
      involvement in Owner’s project,
      and no
      such disclosure will be made without Fagen’s consent and approval, except as may
      be required by applicable law.

     

    
      	
              8.

            	
              Disclaimer
                of Consequential Damages.
                In no event will either Fagen or Owner be liable to the other pursuant
                to
                this Letter of Intent, or for activities conducted under this Letter
                of
                Intent, under any theory of recovery for any indirect, special, incidental
                or consequential damages (including, without limitation, loss of
                revenues
                or profits, loss of use, cost of replacement, cost of capital and
                claims
                of customers, interest charges, or increased costs of nature
                whatsoever).

            

    

    

    
      	
              9.

            	
              Legal
                Effect. Although
                this Letter of Intent does not contain all matters upon which agreement
                must be reached in order for the Transaction to be consummated, Fagen
                and
                Owner wish to set forth, prior to the execution of the Transaction
                Documents, their mutual agreement as to the material terms and conditions
                of the Transaction. Each Party agrees to negotiate in good faith
                towards
                entering into the written, definitive and legally binding Transaction
                Documents containing, among other terms and conditions, those terms
                and
                conditions set forth in this Letter of Intent including, without
                limitation, those terms set forth in Paragraphs 2 and 3 hereof;
                provided, however, that except as specifically identified and set
                forth
                herein, nothing in this Agreement shall be read to promise, guarantee,
                or
                otherwise secure on Owner’s behalf any specific construction start date
                with respect to the Plant including but not limited to any pour concrete
                date, scheduling slots or dates for the delivery of design packages
                or to
                entitle Owner to any rights, privileges, or claims with respect thereto
                or
                any right, privilege, or claim to any place on Fagen’s construction
                schedule.
                Notwithstanding the foregoing, the provisions of this Paragraph and
                of
                Paragraphs 1, 4, 5, 6, 7, 8, 11, 12, 14, 17, 18 and 20 hereof are
                agreed
                to be legally binding obligations of the Parties upon the execution
                and
                acceptance of this Letter of Intent.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        14
of
        19

    

     

    
      	
              10.

            	
              Negotiation
                of Definitive Agreements.
                The Transaction Documents will contain reasonable terms and conditions
                regarding releases, payment obligations, cooperation as to tax planning
                and structuring, other financial matters, legal opinions, confidentiality,
                limitations of liability, assignment, breach, dispute resolution,
                events
                of default, remedies, representations, warranties, indemnifications
                and
                other provisions customary for similar transactions. Time is of the
                essence in the performance of this Letter of Intent in all
                respects.

            

    

    

    
      	
              11.

            	
              Termination.
                This Letter of Intent will terminate on February 1,
                2009:

            

    

    

    
      	 	
              (a)

            	
              at
                the option of either Fagen or Owner if the Design-Build Agreement
                is not
                completed and executed; or

            

    

    

    
      	 	
              (b)

            	
              upon
                the execution and delivery of the Transaction
                Documents.

            

    

    

    
      	12.	
              Governing
                Law. This
                Letter of Intent is governed by, and the Transaction shall be governed
                by,
                and will be construed and interpreted in accordance with the laws
                of the
                State of Minnesota, without regard to any conflicts of law or choice
                of
                law rules.

            

    

    

    
      	
              13.

            	
              Expenses.
                Except as set forth in Paragraph 4(c) above, unless otherwise agreed
                by
                Fagen and Owner, each Party will bear its own expenses in connection
                with
                the negotiation and execution of definitive documentation for the
                transactions contemplated herein. 

            

    

    

    
      	
              14.

            	
              Indemnification.
                Each Party will indemnify, defend and hold harmless the other Party
                and
                its respective agents, servants, officers, directors, employees and
                affiliates from and against any loss, cost, liability, claim, damage,
                expense (including reasonable attorneys’ and consultants’ fees and
                disbursements), penalty or fine incurred in connection with any claim
                or
                cause of action arising from or in connection with this Letter of
                Intent
                to the extent caused by the negligence, misrepresentation, fraud,
                fault or
                misconduct of the indemnifying Party.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        15
of
        19

    

     

    
      	15.	
              Assignability;
                Binding Effect; Benefit. This
                Letter of Intent will inure to the benefit of and be binding upon
                the
                Parties and their respective successors and assigns. Nothing in this
                Letter of Intent, either expressed or implied, is intended to confer
                on
                any person other than the Parties and their respective successors
                and
                permitted assigns, any rights, remedies, obligations or liabilities
                under
                or by reason of this Letter of Intent. Neither Fagen nor Owner shall,
                without the written consent of the other, assign or transfer this
                Letter
                of Intent. Any sale, transfer, or disposition by Owner of over fifty
                percent (50%) of its assets or any sale, transfer, or disposition
                of more
                than fifty percent (50%) of Owner to any single entity by one or
                more
                entities holding interest in Owner shall be deemed an assignment
                subject
                to this paragraph. Notwithstanding any consent granted by Fagen to
                any
                assignment, Owner shall remain jointly liable for any failure of
                any
                assignee to fulfill its obligations under this Letter of Intent,
                including
                but not limited to any payment and confidentiality obligations established
                hereunder.

            

    

    

    
      	
              16.

            	
              Further
                Action.
                Each Party agrees to execute and deliver all further instruments,
                legal
                opinions and documents, and take all further action not inconsistent
                with
                the provisions of this Letter of Intent that may be reasonably necessary
                to complete performance of the Parties’ obligations hereunder and to
                effectuate the purposes and intent of this Letter of
                Intent.

            

    

    

    
      	
              17.

            	
              Amendments.
                The Parties agree that this Letter of Intent may be modified only
                by
                written agreement by the Parties.

            

    

    

    
      	
              18.

            	
              Integration;
                Letter of Intent.
                This Letter of Intent represents the entire understanding between
                the
                Parties in relation to the subject matter hereof, and supersedes
                any and
                all previous agreements, arrangements or discussions between the
                Parties
                (whether written or oral) in respect of the subject matter hereof.
                No
                change, amendment or modification of this Letter of Intent will be
                valid
                or binding upon the Parties unless such change, amendment or modification
                will be in writing and duly executed by both
                Parties.

            

    

    

    
      	
              19.

            	
              No
                Representation, Warranties 
                or Covenants. Notwithstanding
                anything contained herein to the contrary, Fagen is not making any
                representation, warranty or covenant of any kind with respect to
                any
                design, engineering or construction scheduling, or with respect to
                projections, estimates or budgets heretofore delivered to or made
                available to Owner of future revenues, expenses or expenditures,
                future
                results of operations (or any component thereof) or the future business
                and operations of the Owner, nor any other commitments or assurances
                except as may be provided in the Transaction
                Documents.

            

    

    

    
      	
              20.

            	
              Other
                Contractual Obligations. Owner
                represents and warrants that it has not entered into any contracts
                with,
                and has no other contractual obligations or prospective contractual
                obligations or relations with, any project design/build firm or technology
                provider for any work contemplated in this Letter of Intent. Owner
                will
                indemnify, defend, and hold harmless Fagen, its officers, directors,
                shareholders, and employees from and against any and all liabilities,
                claims, losses, suits, liabilities, damages, penalties, fines, and
                expenses (including reasonable attorneys’ and consultants’ fees and
                disbursements, and costs of settlement, defense, and investigation
                of any
                claim or suit) which Fagen, its officers, directors, shareholders,
                or
                employees may hereafter incur, become responsible for, or pay out
                as a
                result of the breach of the representation and warranty made pursuant
                to
                this Paragraph 20.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        16
of
        19

    

     

    
      	
              21.

            	
              Counterparts.
                This
                Letter of Intent may be executed in one or more counterpart, each
                of which
                when so executed and delivered will be deemed an original, but all
                of
                which taken together constitute one and the same instrument. Signatures
                which have been affixed and transmitted by facsimile or other electronic
                means will be binding to the same extent as an original signature,
                although the Parties contemplate that a fully executed counterpart
                with
                original signatures will be delivered to each Party.
                

            

    

    

    
      	
              22.

            	
              Binding
                Agreement.
                This Letter of Intent replaces and supercedes in all respects any
                prior
                letters of intent (including any amendments thereto), contracts,
                memoranda, and other agreements relating to the subject matter hereof.
                

            

    

     

    If
      the
      foregoing terms accurately reflect your understanding of our discussions and
      are
      acceptable to you, please sign and return the enclosed counterpart of this
      Letter of Intent to Fagen to the attention of Becky Dahl.

    
      	 	 	 
	 	Yours sincerely,
	 	 
	 	Fagen,
              Inc.
	 	 	 
	 	 	/s/ Bruce Langseth
	 
	
            	
              
By:  Bruce
              Langseth
	
            	
            	
              Title:
                Vice
                President

            

    

     

    Accepted
      and agreed to this 28th
      day
      of
January,
      2008.

    

    East
      Coast Ethanol, LLC

    

    

    /s/
      Randall Hudson  

    
      
        

      

    

    By:
      Randall Hudson

    Title:
      Chairman & CEO

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        17
of
        19

       

    

    EXHIBIT
      A

    

    Standard
      Scope of Work

     

    Construct
      a 110 MGY dry mill fuel ethanol plant near Jesup, Georgia. The plant will grind
      approximately 39.3 million bushels of corn per year to produce approximately
      110
      MGY of denatured fuel ethanol. The plant will also produce approximately 353,100
      tons per year of 11% moisture dried distillers grains with solubles (DDGS),
      and
      approximately 314,270 tons per year of raw carbon dioxide (CO2)
      gas.

     

    Delivered
      corn will be dumped in the receiving building. The receiving building will
      have
      two truck grain receiving bays and a rail receiving bay, including an
      underground conveyor from the rail pit to the second truck receiving bay both
      of
      which share a common receiving leg. The truck driver will drive onto one of
      two
      pitless scales located near the administration building, be weighed and sampled,
      then drive to the receiving building, dump the grain, then proceed back to
      one
      of two pitless scales and obtain a final weight ticket. Two independent
      20,000-bu/hr legs will lift the corn to storage bins with a total capacity
      of
      1,000,000 bushels. A dust collection system will be installed on the grain
      receiving system to limit particulate emissions as described in the Air Quality
      Permit application. 

     

    Corn
      is
      cleaned in rotary scalpers before being milled in four parallel hammermills.
      Ground corn will be mixed in a slurry tank, passed through a second, and then
      routed through a hydroheater and cook tube following which steam is flashed
      off
      in a flash vessel. Cooked mash will continue through liquefaction tanks and
      into
      one of the seven fermenters. Simultaneously, propagated yeast will be added
      to
      the mash as the fermenter is filling. After batch fermentation is complete,
      the
      beer will be pumped to the beer well and then to the beer column to vaporize
      the
      alcohol from the mash. CO2
      from the
      fermentation process is vented to atmosphere through a scrubber for reducing
      emissions.

     

    Alcohol
      streams are dehydrated in the rectifier column, the side stripper and the
      molecular sieve system. Two hundred proof alcohol is pumped to the tank farm
      day
      tank and blended with five percent natural gasoline as the product is being
      pumped into one of two 1,500,000 gallon final storage tanks. Two 600 gpm trucks
      and one uncovered 1,000 gpm rail load out stations will be provided. Tank farm
      tanks include: one tank for 190 proof storage, one tank for 200 proof storage,
      one tank for denaturant storage and two 1,500,000 gallon tanks for denatured
      ethanol storage. Concrete truck loading secondary containment is by the
      Design-Builder. Track pan secondary containment is by the Owner. Pipe connecting
      both to the tank farm basin are by the Owner. The tank farm liner and tank
      foundations are provided by the Design-Builder.

     

    Corn
      mash
      from the beer stripper is dewatered in the parallel centrifuges. Wet cake is
      conveyed from the centrifuges to the dryer(s) where the water is removed from
      the cake and the product is dried to 11% moisture. A wet cake pad is located
      along side the DDGS dryer building to divert wet cake to the pad when necessary
      or for limited production of wet cake for sales. Water in the thin stillage
      is
      evaporated and recycled by the Bio-Methanation system. Syrup is added to the
      wet
      cake entering the dryer(s). DDGS is cooled and conveyed to flat storage in
      the
      DDGS storage building, then conveyed to DDGS storage silos. Transfer to silos
      is
      accomplished by scooping and pushing the product with a front-end loader into
      an
      in-floor conveyor system. The DDGS load out pit has capacity for approximately
      one semi-trailer load. DDGS is weighed for shipment through a 15,000 bph
      bulk-weigh system after being mechanically unloaded from the DDGS silos. A
      truck
      or rail car can be loaded without repositioning.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        18
of
        19

    

     

    Fresh
      water for the boilers, cooking, cooling tower and other processes will be
      obtained from the Owner supplied water pretreatment system. Boiler water will
      be
      pumped through a deaerator scrubber and into a deaerator tank. Appropriate
      boiler chemicals will be added as preheated water is sent to the
      HRSG.

     

    Steam
      energy will be provided by heat recovery steam generators (HRSG’s) recovering
      heat from thermal oxidizers (TO’s) and utilizing a high percentage of condensate
      return.

     

    The
      TO’s
      are a process used to thermally oxidize the exhaust gasses from the Dryers.
      This
      process will be used to reduce VOCs and particulates that are in the dryer
      exhaust and ensure compliance with environmental regulations. The energy
      required to complete thermal oxidization will then be ducted to a waste heat
      boiler that will produce 100% of the steam requirements of the ethanol plant.
      The exhaust gasses after passing through the HRSG’s will be ducted through stack
      gas economizer(s) to recover the majority of energy possible from the exhaust
      gas stream. After the economizer(s), the gas stream will be vented to atmosphere
      through a stack.

     

    The
      process will be cooled by circulating water through heat exchangers, a chiller,
      and a cooling tower.

     

    The
      design includes a compressed air system consisting of air compressor(s), a
      receiver tank, pre-filter, coalescing filter, and double air
      dryer(s).

     

    The
      design also incorporates the use of a clean-in-place (CIP) system for cleaning
      cook, fermentation, evaporation, centrifuges, and other systems. Fifty percent
      caustic soda is received by truck and stored in a tank. 

     

    Under
      normal operating circumstances, the plant will not have any wastewater
      discharges that have been in contact with corn, corn mash, cleaning system,
      or
      contact process water. An ICM/Phoenix Bio-Methanator will reduce the BOD in
      process water allowing complete reuse within the plant. The plant will have
      blowdown discharges from the cooling tower, RO reject, softener reject, and
      may
      have water discharge from any water pre-treatment processes. Owner shall provide
      on-site connection to sanitary sewer or septic system.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      East
        Coast Ethanol, LLC 

      Letter
        of
        Intent

      January
        2, 2008

      Page
        19
of
        19

    

     

    Most
      plant processes are computer controlled by a distributed control system with
      graphical user interface and three workstations. The control room control
      console will have dual monitors to facilitate operator interface between two
      graphics screens at the same time. Additional programmable logic controllers
      (PLCs) will control certain process equipment. Design-Builder provides lab
      equipment. 

     

    The
      cooking system requires the use of anhydrous ammonia, and other systems require
      the use of sulfuric acid. Therefore, a storage tank for ammonia and a storage
      tank for acid will be on site to store reasonable quantities. The ammonia
      storage requires that plant management implement and enforce a Process Safety
      Management (PSM) program. The plant design may require additional programs
      to
      ensure safety and to satisfy regulatory authorities. 

     

    NOTE:
      This Exhibit A is a general description of the Plant’s basic design and
      operation only. It is not intended to be the final Project scope or to establish
      the final specifications. The final design of the Plant, including equipment
      incorporated, and equipment specifications will be reflected in the As Built
      Plans.

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