Document:

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                                                                   EXHIBIT 10.12

           Written Description of Compensatory Plan for David B. Barr

                 Samuels Jewelers, Inc.'s Chairman of the Board

         On November 6, 2000 Mr. Barr became Chairman of the Board, with a
compensation in the amount of $28,571 per month. His arrangement also provided
for the granting of 100,000 options for common stock of the Company with a
strike price of $1.75 per share. Upon commencement of the arrangement, options
with respect to 50,000 shares of common stock vested. The remaining options
vested 25,000 on July 18, 2001 and 25,000 on January 18, 2002. On August 1,
2001, his compensation was reduced to $12,500 per month. The arrangement can be
terminated by either party upon thirty days' notice.<PAGE>
                                                                  EXHIBIT 10.13

        Written Description of Compensatory Plan for Randy N. McCullough

         Samuels Jewelers, Inc.'s President and Chief Executive Officer

         On October 2, 1998, the Company entered into an employment agreement
with Randy McCullough making him President and Chief Executive Officer. This
contract called for an annual salary of $325,000, a guaranteed bonus of 100% of
base salary, the granting of 100,000 shares of restricted stock and the issuance
of an option to purchase 75,000 shares of the Company's stock for $6.67. The
employment agreement expired on October 3, 2001. Mr. McCullough currently
receives a base salary of $325,000 with no guaranteed bonus.<PAGE>
                                                                   EXHIBIT 10.14

          Written Description of Compensatory Plan for Robert J. Herman

                 Samuels Jewelers, Inc.'s Vice President Finance

         On May 21, 2001 The Company entered into an employment arrangement with
Robert Herman making him Vice President Finance. The arrangement called for a
base salary of $110,000 annually with two guaranteed bonuses equal to one third
of his base salary payable in December 2001 and June 2002. His arrangement also
provided for the granting of 25,000 options for common stock of the Company with
a strike price of $.60 per share.<PAGE>
                                                                   EXHIBIT 10.15

             Written Description of Compensatory Plan for Directors

         Employees of the Company receive no extra pay for serving as directors.
The Company pays each of its non-employee directors an annual retainer fee of
$15,000, plus, for attendance at meeting of the Board or committee meetings, an
additional $500 per meeting. Directors are also reimbursed for the reasonable
expenses incurred in connection with attending meetings of the Board and its
committees.<PAGE>
                                OPTION AGREEMENT

         IN CONSIDERATION of the sum of One and 00/100 Dollars ($1.00) and other
good and valuable consideration ("Option Price"), the receipt of which is hereby
acknowledged, David Jepson and Donna Jepson, husband and wife, (Owner) hereby
grants to Granite Falls Community Ethanol Plant, LLC, ("Granite"), an exclusive
option to purchase approximately 31.72 acres of real property described as:

         THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER (NE3NE3) OF SECTION ONE
         (1), TOWNSHIP ONE HUNDRED FIFTEEN (115), RANGE THIRTY-NINE (39),
         EXCEPTING THEREFROM THE RIGHT OF WAY OF MINNESOTA HIGHWAY 23

located in Chippewa County, Minnesota, (the "Option Property") on the terms and
conditions set forth below:

         1. TIME TO EXERCISE OPTION. This option shall be exercised by written
notice delivered to Owner by certified mail postmarked no later than December
31, 2002, or by personally delivering the notice to Owner no later than December
31, 2002 at 5:00 p.m. This Option is exclusive to Granite for the duration of
the option period and Owner shall not grant any options or agree to sell any
other interest in the Option Property to any other persons or entities at any
time while the option granted herein remains exercisable.

         2. LAND PURCHASE PRICE. The purchase price, in the event of the
exercise of the option, shall be in the sum of One Hundred Sixty Eight Thousand
and 00/100 Dollars ($168,000.00), which includes the option price set forth
above.

         3. TESTS AND INVESTIGATIONS ON PROPERTY. Granite shall, at Granite's
sole costs and expenses, have the right to conduct tests and investigations on
the Option Property prior to the time of exercise of this Option. Granite agrees
to indemnify and hold Owner harmless from and against all costs, expenses,
damages, claims, and causes of action arising out of Granite's activities on the
Option Property prior to the time of exercise of the Option. Granite's
activities on the Option Property may include, but not be limited to:

                  a.       Soil tests and soil borings.

                  b.       Any well drilling or other tests with respect to
                           investigation of the adequacy and quality of water
                           resources.

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                  c.       Any search of the Option Property or property of
                           Owner adjacent thereto for purposes of verifying that
                           no abandoned wells are in existence within the
                           vicinity of the facility.

                  d.       The parties understand that the foregoing tests are
                           intended to include but do not limit Granite from
                           performing all other tests and investigations as may
                           be necessary to determine the suitability of the
                           Option Property for construction and operation of an
                           Ethanol plant and related facilities and fixtures
                           (the "Plant").

                  e.       Granite agrees that the testing and investigation
                           shall be conducted, to the extent reasonably possible
                           at a time and in a manner so as to not unduly
                           interfere with farming operations being conducted on
                           or about the Option Property. To the extent any crop
                           damage occurs as a result of Granite's testing or
                           investigation, Granite agrees to reimburse Owner for
                           the reasonable value thereof.

         4. PRELIMINARY WORK. Prior to exercising its option, Granite may, after
notifying Owner, perform such preliminary earth moving or other initial site
preparation or other investigation of the site so long as Granite provides
financial assurance to Owner that is adequate to restore the property if the
option is not exercised by Granite.

         5. PERMITTING. Owner understands that Granite will be required to
obtain permits and/or certifications from Federal, State, County and/or local
governmental units prior to construction and operation of the Plant. Owner
agrees to permit Granite to do such things as may be necessary to obtain such
permits and agrees to offer reasonable assistance in providing any information
or complying with any directives or orders issued by said governmental units
which may arise during any permitting or approval process.

         6. SURVEY AND ROAD. The parties agree that on or before closing, they
must mutually agree on:

                  a.       A survey of 31.72 acres more or less describing the
                           property which is the subject matter of this Option.
                           The parties shall equally share the costs of any such
                           survey.

                  b.       Enter into an Agreement with respect to maintenance,
                           upkeep and repair of any driveway servicing the
                           property and the costs of any such maintenance which
                           shall be allocated on the basis of usage made of the
                           driveway by the respective parties.

                                      -2-
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         7. CLOSING. The closing shall take place at such time and place
mutually agreed to between the parties within thirty (30) days of completion of
the survey of the Option property and following Granite's exercise of this
Option. In the event that Granite exercises this Option, then Owner shall
immediately forward to Granite (at Owner's expense) an updated abstract for
examination of title. Granite shall be allowed 20 days after receipt of the
abstract to make any objections with regard to title which shall be made in
writing and delivered to the Owner. If any objections are made, Owner shall have
90 days to make title marketable. Pending correction of title, the date of
closing shall be postponed, but upon correction of title within ten days after
written notice thereof to Granite, the closing shall be held. If title is not
correct, to the reasonable satisfaction of Granite, within the time provided
for, then at Granite's option, this Agreement shall be null and void and the
Option Price shall be refunded to it.

         8. MISCELLANEOUS.

                  a.       POSSESSION. Possession shall be delivered to Granite
                           Falls Community Ethanol Plant, LLC.

                  b.       CLOSING COSTS. Each party shall be responsible for
                           paying those expenses normally paid by a purchaser or
                           seller of like kind real estate in the State of
                           Minnesota.

                  c.       TAXES AND ASSESSMENTS.

                           i.       All real estate taxes and assessments due
                                    and payable in the year of closing shall be
                                    pro rated between the parties.

                           ii.      In the event that the sale of the Option
                                    Property accelerates the payment of real
                                    estate taxes and any other special
                                    assessments on Owner's property other than
                                    the Option Property, then Owner agrees that
                                    all such accelerated taxes shall be paid by
                                    Owner at the time of closing.

                  d.       CROPS. If the date of closing occurs and there are
                           growing crops on the Option Property, then Granite
                           Falls Community Ethanol Plant, LLC may, at it's
                           option, do the following

                           i.       Take title of the growing crops on the
                                    Option Property, and pay Owner the mutually
                                    agreed value of such crops, or

                           ii.      Permit Owner to enter upon the Option
                                    Property and promptly harvest such crops for
                                    Owner's sole benefit.

                                      -3-
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                  e.       WARRANTY. Owner represents and warrants that there
                           are no active or abandoned wells or underground
                           storage tanks on the Option Property.

                  f.       EXPIRATION. If Granite does not exercise the option
                           granted hereunder, this Agreement shall terminate
                           upon the expiration of the option term and Granite
                           will deliver to Owner an instrument in writing and in
                           recordable form acknowledging the termination of this
                           Agreement and the non-exercise of its option to
                           purchase. If Granite does not exercise this Option on
                           account of not receiving all required local, county
                           and state permits by December 31, 2002, then the
                           Option Price shall be returned to Granite, - this
                           Agreement shall be null and void and neither party
                           shall have any claim or further responsibility to the
                           other. In the event that Granite does not exercise
                           its option for any other reason, Owner shall retain
                           the Option Price and neither party shall have any
                           claim against or further responsibility to the other.

                  g.       NOTICES. All notices and other communications
                           required or permitted to be given or served under
                           this Agreement shall be in writing and shall be
                           deemed to have been duly given if delivered in person
                           or deposited in the U.S. Mail, postage prepaid, for
                           mailing by certified mail, return receipt requested,
                           as follows:

                           OWNER:

                           David & Donna Jepson
                           Route 3, Box 98
                           Granite Falls, MN 56241

                           GRANITE FALLS COMMUNITY ETHANOL PLANT

                           c/o Paul Enstad
                           3124 490th Street
                           Granite Falls, MN 56241

                                      -4-
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                  h.       SUCCESSORS BOUND. This Agreement is binding upon the
                           heirs, successors and assigns of the parties. Any
                           assignment of this Option Agreement by Granite shall
                           require the prior written consent of Owner.

Dated this 21st day February, 2001.

                                              OWNER:

                                                   /s/ David Jepson
                                              ----------------------------------
                                              David Jepson

                                                   /s/ Donna Jepson
                                              ----------------------------------
                                              Donna Jepson

                                              GRANITE FALLS COMMUNITY
                                              ETHANOL PLANT

                                              By   /s/ Paul Enstad
                                                --------------------------------
                                                Paul Enstad

                                               Its Chairman
                                                   -----------------------------

State of Arizona           )
                           ) ss.
County of Maricopa         )

         The foregoing instrument was acknowledged before me this 21st day of
February, 2001, by David Jepson and Donna Jepson, husband and wife.

                                                   /s/ Melinda C. Villone
                                              ----------------------------------
                                              Notary Public

State of Minnesota         )
                           ) ss.
County of Yellow Medicine  )

         On the 27th day of February, 2001, before me, personally appeared Paul
Enstad, to me personally known, who, being by me duly sworn, did say that he is
the Chairman of Granite Falls Community Ethanol Plant, LLC, the limited
liability named

                                      -5-
<PAGE>
in the foregoing instrument, and that said instrument was signed and sealed on
behalf of said limited liability company by authority of its Governors, and said
Paul Enstad acknowledged said instrument to be the free act and deed of said
limited liability company.

                                                   /s/ Spencer H. Kvam
                                              ----------------------------------
                                              Notary Public

This Instrument Was Drafted By:

Spencer H. Kvam
HOLMSTROM & KVAM, PLLP
685 Prentice Street - PO Box 70
Granite Falls, MN 56241
320/564-3825
Attorney ID No:  59171

                                      -6-
<PAGE>

                          EXTENSION OF OPTION AGREEMENT

         The undersigned, having entered into an Option Agreement dated February
21, 2001, do hereby agree to extend the option as follows:

         1. Section 1, Time to Exercise Option, is hereby amended to provide
that the references to December 31, 2002, shall be amended and replaced with
December 31, 2003, thereby extending the time to exercise the option for one
year.

         2. Section 8 (f) is hereby amended to provide that references to
December 31, 2002, shall be amended and replaced with December 31, 2003, thereby
extending the date to which Granite Falls Community Ethanol Plant will have to
obtain all required permits and operating authorities.

         3. In all other respects, the terms and conditions of the Option
Agreement shall remain as stated.

         Dated this 22nd of April, 2002.

                                              OWNER:

                                                   /s/ David Jepson
                                              ----------------------------------
                                              David Jepson

                                                   /s/ Donna Jepson
                                              ----------------------------------
                                              Donna Jepson

                                              GRANITE FALLS COMMUNITY
                                              ETHANOL PLANT

                                              By   /s/ Paul Enstad
                                                --------------------------------
                                                Paul Enstad
                                              Its:  Chairman

                                      -7-
<PAGE>

STATE OF MINNESOTA    )
                      )ss.
COUNTY OF LYON        )

         The foregoing instrument was acknowledged before me this 22nd day of
April, 2002, by David Jepson and Donna Jepson, husband and wife.

                                                   /s/ Robin Claire Sorbel
                                              ----------------------------------
                                              Notary Public

STATE OF MINNESOTA         )
                           )ss.
COUNTY OF YELLOW MEDICINE  )

         On the 25th day of April, 2002, before me, personally appeared Paul
Enstad, to me personally known, who, being by me duly sworn, did say that he is
the Chairman of Granite Falls Community Ethanol Plant, LLC, the limited
liability named in the foregoing instrument, and that said instrument was signed
and sealed on behalf of said limited liability company by authority of its
Governors, and said Paul Enstad, acknowledge said instrument to be the free act
and deed of said limited liability company.

                                                   /s/ Gail Mae Eye
                                              ----------------------------------
                                              Notary Public

                                      -8-

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