Document:

Exhibit 10.18
	 

	 
		GRAIN FACILITY LEASE AND
		SUBLEASE
	 

	 
		THIS GRAIN FACILITY LEASE AND SUBLEASE
		(this “Lease”) is made and
		entered into this 25th day of September, 2006 (“Signing
		Date”), by and between Cargill,
		Incorporated, a Delaware corporation
		with principal offices and place of business at 15407 McGinty Road West,
		Wayzata, Minnesota 55391 (hereinafter referred to as “Landlord”), and
		Pioneer Trail Energy,
		LLC, a Delaware limited liability
		company with principal offices and place of business in Wood River, Nebraska
		(hereinafter referred to as “Tenant”). The Effective Date of this
		Lease shall be the date of Provisional Acceptance (as defined in the Agreement
		for Engineering, Procurement and Construction, dated as of April 28, 2006,
		between Tenant and TIC - The Industrial Company Wyoming, Inc.) (“Effective
		Date”). Landlord and Tenant are each a “Party” and collectively
		are the “Parties” to this Lease. 
	 

	 
		RECITALS
	 

	 
			
				
				  A.
				

			 	
				
				  Tenant intends to construct, own and
				  operate a plant at Wood River, Nebraska, for the production of 115 million
				  gallons per year of denatured fuel grade ethanol and related products (the
				  “Ethanol Facility”).
				

			 
	
				
				  B.
				

			 	
				
				   The Ethanol Facility will be
				  located immediately adjacent to Landlord’s grain handling facility located
				  in Wood River, Nebraska (the “Grain Facility”).
				

			 
	
				
				  C.
				

			 	
				
				   Landlord and Tenant are parties to
				  that certain Corn Supply Agreement of even date herewith (the “Corn Supply
				  Agreement”), under which Tenant is required to purchase corn exclusively
				  from Landlord for the purpose of ethanol production at the Ethanol Facility,
				  and under which corn will be delivered by Landlord to Tenant at the Grain
				  Facility truck dump or rail pit, as applicable.
				

			 
	
				
				  D.
				

			 	
				
				   Landlord desires to lease to
				  Tenant, and Tenant desires to lease from Landlord, the Grain Facility,
				  including the buildings, fixtures, improvements, machinery, and equipment
				  located at or about the Grain Facility (collectively, the “Premises,”
				  as more specifically defined in Section
				  1.01 below). 
				

			 
	
				
				  E.
				

			 	
				
				  Landlord entered into that certain
				  Industry Track Contract-Articles of Agreement dated October 24, 1997, with
				  Union Pacific Railroad Company (“Railroad”) in connection with the
				  track (the “Track”) located at or about the Grain Facility (the
				  “Basic Agreement”).
				

			 

 

	 
			
				
				  F.
				

			 	
				
				  Railroad has agreed to allow tenant
				  to use the Track pursuant to a Consent to Joint Use of Track in the form of
				  Exhibit D-1 attached hereto and by this reference incorporated
				  herein.
				

			 

 

	 
			
				
				  G.
				

			 	
				
				  Landlord desires to sublease to
				  Tenant, and Tenant desires to sublease from Landlord, property described in the
				  two grain storage leases with Union Pacific Railroad Company located at or
				  about the Grain Facility (“Railroad Leases”) as more specifically
				  defined in Section
				  1.02(b) below).
				

			 

 

	 
			
				
				  G.
				

			 	
				
				  In consideration of the premises and
				  the terms, covenants, warranties and conditions hereinafter set forth, the
				  Parties mutually agree as follows:
				

			 

 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE I
	 

	 
		DEMISE AND PERMITTED
		USE
	 

	 
		SECTION 1.01. Landlord agrees to lease to Tenant and Tenant agrees to
		lease from Landlord the Premises which consists of the real property more fully
		described on Exhibit A, attached hereto and by this reference incorporated
		herein (the “Real Property”), and all buildings, structures,
		installations, improvements, machinery and equipment located on the Real
		Property, including the property which is set forth in Exhibit B,
		attached hereto and by this reference incorporated herein (the “Personal
		Property”), subject, however, to:
	 

	 
		(a) Any state of facts an accurate survey may show;
	 

	 
		(b) Covenants, restrictions, easements, agreements and
		reservations listed in Exhibit
		C, whether or not of record (the
		“Permitted Exceptions”), and the standard exceptions contained in a
		standard title policy; and
	 

	 
		(c) Building, platting and zoning ordinances, and state and
		federal regulations.
	 

	 
		SECTION 1.02. 
	 

	 
		(a) During the Term (as defined in
		Section 2.01 below), and subject to Section 15.02
		below, Landlord hereby agrees that Tenant shall have the exclusive use of the
		Track pursuant to the Track Agreement and Consent to Joint Use of Track which
		is incorporated into this Lease as Exhibit D-1 (the “Track
		Agreement”). Tenant hereby covenants and agrees: (i) to perform during the
		Term all covenants and obligations of the “Industry” as set forth in
		the Basic Agreement and all covenants and obligation of the User as set forth
		in the Track Agreement, and (ii) that in the event of a conflict between the
		terms and conditions of this Lease and the terms and conditions of the Track
		Agreement, by way of example, but without limitation, the termination
		provisions, then the terms and conditions of the Track Agreement shall govern
		and control. Landlord will not issue to the Railroad a notice of termination
		under the Basic Agreement or the Track Agreement so long as (i) this Lease
		is in effect, and (ii) Tenant is not in breach or default of any of its
		covenants or obligations under this Lease, the Basic Agreement or the Track
		Agreement.
	 

	 
		(b) During the Term, and subject to the
		provisions of Section
		15.02 below Landlord hereby agrees to
		sublease the property described in (1) the Lease dated October 22, 1985,
		between Railroad and Landlord for grain storage facilities in Wood River, Hall
		County, Nebraska near Mile Post 162.91 Main Line and, (2) the Lease dated
		October 24, 1984, between Railroad and Landlord for grain storage facilities in
		Wood River, Hall County, Nebraska near Mile Post 162.80 Main Line (the
		“Railroad Leases”), pursuant to the Consent to Sublease which is
		incorporated into this Lease as Exhibit D-2 (the “Sublease Consent”).
		Tenant hereby covenants and agrees: (i) to perform all covenants and
		obligations of the “Lessee” as set forth in the Railroad Leases and
		all the obligations of Sublessee under the Sublease Consent, and (ii) that in
		the event of a conflict between the terms and conditions of this Lease and the
		terms and conditions of the Railroad Leases, by way of example, but without
		limitation, the termination provisions, then the terms and conditions of the
		Railroad Leases shall govern and control.
	 

	 
		SECTION 1.03. Tenant shall only use the Premises for purposes of
		receiving, storing and transferring corn (or any substitute or alternative raw
		commodity as permitted under the Corn Supply Agreement) to the Ethanol Facility
		to the extent required for the continued operation of the Ethanol Facility (the
		“Permitted Use”). 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE II
	 

	 
		TERM
	 

	 
		SECTION 2.01. The term (“Term”) of this Lease shall commence
		on the Effective Date and continue for a period of twenty (20) years. The Term
		shall be automatically extended for a period of two (2) years after the end of
		the initial 20-year period and after the end of any two-year extension period,
		unless at least one (1) year prior to the end of the initial term or any
		extended term either Party provides a written notice of termination to the
		other Party.
	 

	 
		ARTICLE III
	 

	 
		RENT
	 

	 
		SECTION 3.01. Base Rent. During the
		Term, Tenant agrees to pay to Landlord as and for rent for the Premises the sum
		of USD $1,200,000.00 per annum, subject to the Escalator Percentage set forth
		below, which sum shall be due and payable in equal monthly installments of USD
		$100,000.00, to be paid on the first business day of each month (“Base
		Rent”); provided, however, that one third (1/3) of the Base Rent shall be
		deemed to have been paid for so long as the Corn Supply Agreement between
		Landlord and Tenant with respect to the Ethanol Facility remains in effect; if
		for any reason whatsoever the Corn Supply Agreement expires or is terminated,
		this proviso shall not apply. Base Rent shall be prorated for any partial
		month. Base Rent payable by Tenant hereunder shall be absolutely net to
		Landlord. The Base Rent shall be payable at Landlord’s address given
		hereinbelow or at such other place as Landlord may, from time to time,
		designate in writing. The Base Rent shall be adjusted by the Escalator
		Percentage on the first day of the month immediately preceding each anniversary
		of the Term. The Escalator Percentage shall be the CPI Index for Nebraska for
		the immediately preceding twelve (12) month period. 
	 

	 
		SECTION 3.02. Taxes. During the
		Term, in addition to the amount specified in Section 3.01, Tenant shall pay, as
		additional rent, before any penalty, interest or cost may be added thereto for
		the nonpayment thereof, the amount of any real estate taxes, special
		assessments, or other taxes or charges of any kind and nature which may be
		assessed, imposed, levied or charged upon the Premises or any part thereof, as
		more particularly set forth in Section 4.01 hereof.
	 

	 
		SECTION 3.03. Additional Rental/Triple Net
		Lease. During the Term, all other burdens or charges on the
		Premises, in addition to the rental provided hereinabove, and all operating
		costs thereof, shall be paid by the Tenant, so that this Lease shall yield
		Landlord the annual net rent specified in Section 3.01. Specifically, and
		without limitation, Tenant shall pay and discharge as they become due, promptly
		and before delinquency, any and all rentals, fees or other charges due and
		payable pursuant to the terms of any leases, licenses or other agreements
		entered into by or assumed by Tenant pertaining to the Premises demised
		hereunder.
	 

	 
		SECTION 3.04. Interest. If Tenant
		fails to pay any amounts to Landlord when due, Landlord may charge and receive
		interest accrued on the unpaid amount from the date it was due until the date
		actually paid at the Default Rate. “Default Rate” means an interest
		rate per annum equal to the lesser of (i) the interest rate per annum for large
		commercial loans as published in The
		Wall Street Journal, Midwest edition,
		as the “prime rate” (sometimes referred to as the “base
		rate”) from time to time (or, if more than one rate is published, the
		arithmetic mean of such rates), determined as of the date the obligation to pay
		interest arises, plus two hundred (200) basis points, and (ii) the maximum
		rate permitted by applicable law.
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE IV
	 

	 
		TAXES AND UTILITIES
	 

	 
		SECTION 4.01. Payment of Taxes. Tenant shall
		pay, before any fine, penalty, interest or cost may be added thereto, or become
		due or be imposed by operation of law for the nonpayment thereof, all real
		estate taxes, special assessments or installments of special assessments, water
		and sewer rents, rates and charges, charges for public utilities, excises,
		levies, license and permit fees and other governmental charges, general and
		special, ordinary and extraordinary, foreseen and unforeseen, of any kind and
		nature whatsoever which at any time during the Term (or prior to the Term but
		relating to periods during the Term) may be levied, confirmed, imposed upon, or
		become due and payable out of or in respect of, or become a lien on, the
		Premises and any improvements thereof or in any part thereof or any
		appurtenance thereto, or any use or occupation of the Premises, or such
		franchises as may be appurtenant to the use of the Premises (all of which are
		sometimes herein referred to collectively as “Impositions” and
		individually as “Imposition”). 
	 

	 
		Tenant may exercise any option provided by
		law to pay any Imposition (and interest thereon) in installments as the same
		respectively become due and before fine, penalty or further interest may be
		added thereto. If, by exercising such option, any such installments shall be
		payable after the termination of this Lease, such unpaid installments shall be
		prorated as of the date of termination, and amounts payable after such date
		shall be paid by Landlord. All of the Impositions hereunder shall be prorated
		at the commencement of the term hereof. 
	 

	 
		SECTION 4.02. Right to Contest. Tenant, at its
		own expense, shall have the right in good faith to contest the amount or
		validity of any Imposition by appropriate legal proceedings diligently
		conducted in good faith; provided, however, that Tenant shall promptly pay and
		discharge all amounts determined to be payable pursuant to such legal
		proceedings. Landlord agrees to join in any such proceedings if such joinder is
		necessary to the prosecution thereof. Cost of such joinder shall be for the
		account of Tenant. 
	 

	 
		SECTION 4.03. Rebates. All rebates on
		account of any such taxes, rates, levies, charges, or assessments required to
		be paid and paid by Tenant under the provisions hereof shall belong to Tenant,
		and Landlord will, on the request of Tenant, execute any receipts, assignments,
		or other acquaintances that may be necessary in order to secure the recovery of
		any such rebates, and will pay over to Tenant any such rebates that may be
		received by Landlord. 
	 

	 
		SECTION 4.04. Personal Property Taxes. Tenant shall
		bear the burden for any Imposition levied against the personal property
		belonging to Tenant stored, kept or maintained in or upon the Premises. 

	 

	 
		SECTION 4.05. Utilities. Tenant shall
		initiate, contract for, and obtain, in its name, all utility or other services
		it desires for the Premises, and Tenant shall pay all such charges for such
		utility services as they become due during the Term.
	 

	 
		ARTICLE V
	 

	 
		REPAIRS AND MAINTENANCE OF
		PREMISES 
	 

	 
		SECTION 5.01. During the Term, Tenant shall, at its own cost and
		expense, keep and maintain the Premises and any improvements thereon in good
		order and condition, and will make all necessary repairs (or replacements if
		not repairable), structural or nonstructural, to the Premises and 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		improvements, to the end that the Premises
		and improvements shall at all times be kept in good and tenantable condition,
		reasonable wear and tear excepted, for the purposes for which the Premises are
		being used and in compliance with Article XI hereof. Tenant will not do or
		suffer any waste or damage or injury to the Premises or any improvement
		thereon, or any part thereof. All repairs made by Tenant shall be equal in
		quality and class to the original work. During the Term, Tenant hereby assumes
		the full and sole responsibility for the condition, operation, repair,
		replacement, maintenance and management of the Premises and any improvements
		thereon. During the Term, Tenant shall keep sidewalks and parking areas free
		and clear of snow, ice or other obstructions to travel and shall maintain lawn
		and parking areas in a clear and sightly condition, free of debris and waste.
		Notwithstanding the foregoing, and except as provided in Section 12.01 and
		Exhibit F, Tenant shall make no alterations to the Premises without
		the prior written consent of Landlord. Any alterations made by Tenant shall be
		at Tenant’s sole expense.
	 

	 
		ARTICLE VI
	 

	 
		LIENS
	 

	 
		SECTION 6.01. Tenant shall keep the Premises free of liens and
		covenants and agrees to hold harmless and indemnify Landlord from and against
		any costs, expenses and liabilities from any mechanic’s, laborers’ or
		materialmen’s or other liens, of whatsoever nature, which may be filed
		against the Premises during the Term of this Lease. Tenant shall discharge any
		such liens within thirty (30) days of the filing thereof. However, Tenant shall
		have the right to contest in the name of Landlord, any such liens as Tenant may
		deem necessary; provided that all expenses incurred by reason thereof shall be
		paid by Tenant, Tenant provides written notice to Landlord of its intent to
		contest such lien within three (3) days after the filing of such lien and
		Tenant, at Landlord’s request, gives reasonable security to insure payment
		thereof and to prevent any sale, foreclosure or forfeiture of the Premises by
		reason of such nonpayment.
	 

	 
		ARTICLE VII
	 

	 
		LANDLORD’S ACCESS TO THE
		PREMISES
	 

	 
		SECTION 7.01. Landlord, or its employees, agents or nominees, shall,
		at reasonable times and upon reasonable notice, have free access to the
		Premises for the purposes of examining or inspecting the condition thereof and
		to determine if Tenant is performing the covenants and agreements of this
		Lease, exhibiting the same to prospective tenants and for the purpose of
		posting reasonable notices as Landlord may require to protect the rights of
		Landlord including, without limitation, notices of non-responsibility for lien
		claims. Notwithstanding the foregoing, Landlord, or its employees, agents or
		nominees, may access the Premises at any time without notice in the event
		Landlord determines in its sole discretion that exigent circumstances exist
		involving the threat of harm to the Premises or persons on or about the
		Premises. 
	 

	 
		ARTICLE VIII
	 

	 
		INSURANCE 
	 

	 
		SECTION 8.01. Liability Insurance. During the
		Term, Tenant, at its sole cost and expense, but for the mutual benefit of
		Landlord and Tenant, shall provide Commercial General Liability Insurance
		covering bodily injury (including personal injury) and property damage to
		third-parties occurring upon, in or about the Premises. Such insurance shall
		include Broad Form Contractual Liability covering Section 9.01 of this Lease.
		The policy shall have a limit of liability not less than $20,000,000 each
		occurrence and provide that coverage will not be canceled without thirty (30)
		days advance written notice to Landlord. Tenant shall also maintain an
		Automobile Liability policy with 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		combined single limits of $20,000,000.
		Landlord shall be named an additional insured on such policies and
		Tenant’s policies shall be primary without right of contribution from
		Landlord or Landlord’s insurance policies.
	 

	 
		SECTION 8.02. Claims Made Basis. Tenant shall,
		to the extent reasonably possible, obtain the liability insurance required in
		Section 8.01 on an occurrence basis rather than a claims-made basis. To the
		extent Tenant must obtain some or all of this coverage on a claims-made basis,
		Tenant shall provide Landlord with satisfactory evidence that the retroactive
		date of the claims-made policy is prior to the date of this Lease, that the
		then remaining aggregate amount of Tenant’s coverage is and will be
		sufficient to meet the minimum amount of coverage required, and that the policy
		will either remain in force, be renewed, or a satisfactory discovery period
		will be purchased, to cover any claims which might arise in the future.
	 

	 
		SECTION 8.03. All
		Risk Property Insurance. During the
		Term, Tenant, at its sole cost and expense, but for the mutual benefit of
		Landlord and Tenant, shall insure against all risks of loss or damage to the
		Premises in an amount equal to the full replacement cost of the Premises, with
		such replacement cost to be approved by Landlord. The policy shall name
		Landlord as an additional insured as its interest may appear with respect to
		this Lease and provide that coverage will not be canceled without thirty (30)
		days advance written notice to Landlord. Tenant shall waive its rights of
		recovery and subrogation against Landlord for loss or damage to the Premises or
		Tenant’s other property. Tenant shall also, at its sole cost and expense,
		insure the Ethanol Facility against all risks of loss or damage in an amount
		equal to the full replacement cost of the facility, including building,
		fixtures, improvements, machinery, and equipment located on or about the
		Ethanol Facility. Such limits shall be separate from those for the leased
		Premises. 
	 

	 
		SECTION 8.04. Contents Insurance. Tenant, at its
		sole cost and expense, but for the mutual benefit of Landlord and Tenant, shall
		maintain Property Insurance in All Risk form against loss or damage in an
		amount equal to the replacement cost of Tenant’s improvements,
		alterations, equipment, trade fixtures and other personal property located,
		leased or stored by Tenant in the Premises. The policy shall name Tenant as
		loss payee as its interest may appear with respect to this Lease and provide
		that coverage will not be canceled without thirty (30) days advance written
		notice to Landlord.
	 

	 
		SECTION 8.05. Workers
		Compensation and Employers Liability Insurance. Tenant, at its
		sole cost and expense, shall maintain Workers’ Compensation insurance with
		statutory limits, if applicable. The Employers Liability insurance shall have
		limits of not less than $20,000,000 each accident/disease each employee/disease
		policy limit. 
	 

	 
		SECTION 8.06. Certificates of Insurance. Tenant shall
		provide Landlord with certificates of insurance evidencing the coverage
		required in Sections 8.01 and 8.03 above. In the event Tenant shall fail to
		insure or to effect and maintain such policies, Landlord may obtain such
		insurance, and any amount so paid by Landlord for such insurance shall be
		treated as additional rent hereunder, which rent shall be immediately due and
		payable. 
	 

	 
		SECTION 8.07. Qualified Insurers. Any insurance
		required to be maintained by Tenant shall be written by companies reasonably
		acceptable to Landlord and legally qualified to issue such insurance. An
		insurance company will be deemed reasonably acceptable to Landlord if it is
		rated by Best’s Rating Guide not less than A-, X or better, and authorized
		to do business in the state where the Premises are located. The Commercial
		General Liability and Auto Liability insurance policies shall name Landlord as
		an additional insured, and the All Risk Property insurance shall name Landlord
		as additional 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		insured and the Escrow Agent (as defined in
		the Escrow Agreement) as the sole loss payee, for the purpose that all loss
		proceeds be directed into the escrow account established pursuant to the Escrow
		Agreement for the purpose of replacing and/or rebuilding the damaged or
		destroyed Premises in accordance with Tenant’s obligations in Section
		11.02. In the event any serious personal injury (including death of) or
		property damage occurs on or about the Premises, Tenant agrees to give Landlord
		prompt notice and a general description of the occurrence. Tenant agrees to
		reasonably cooperate with Landlord in the event Landlord has any questions
		concerning such personal injury or property damage. “Escrow
		Agreement” shall mean that certain escrow agreement by and among Landlord,
		Tenant, Buffalo Lake Energy, LLC and Deutsche Bank Trust Company Americas, as
		escrow agent. 
	 

	 
		ARTICLE IX
	 

	 
		INDEMNIFICATION
	 

	 
		SECTION 9.01. 
	 

	 
		(a) Tenant shall hold Landlord harmless and
		indemnify Landlord from and against all liabilities, injuries, losses, claims,
		expenses (including, without limitation, attorneys’ fees) or damages
		directly or indirectly arising out of (i) Tenant’s, its employees’,
		agents’, licensees’, invitees’, contractors’ or
		customers’ use and occupancy of the Premises; (ii) any events on the
		Premises during the Term; (iii) any breach of this Lease by Tenant; (iv) any
		act or omission of Tenant or any of the foregoing parties on the Premises
		taking place in, on or about the Premises; or (v) any failure of Tenant, its
		employees, agents, licensees, invitees, contractors or customers to comply and
		conform with all federal, state and local laws, statutes, regulations, rules
		and ordinances, or any directive, rule, regulation or request of Landlord,
		except to the extent of, in each case, such liabilities, losses, claims,
		expenses (including, without limitation, attorneys’ fees) or damages
		arising out of the fraud or willful misconduct of the Landlord.
	 

	 
		(b) Tenant further agrees to indemnify
		Landlord against and hold Landlord harmless from any loss or liability for or
		on account of any injury to (including death of) persons or damage to property,
		including costs and expenses (including attorneys’ fees and costs of
		defense) incident thereto, which losses, liability, costs and expenses arise
		out of or relate to the presence of Tenant, its agents, servants, employees,
		guests or invitees on or about the Premises or the use by Tenant, its agents,
		servants, employees, guests or invitees of the Premises, except to the extent
		of, in each case, such liabilities, losses, claims, expenses (including,
		without limitation, attorneys’ fees) or damages arising out of the fraud
		or willful misconduct of the Landlord.
	 

	 
		(c) From and after the Effective Date,
		Landlord will indemnify and hold harmless Tenant of and from any and all
		claims, damages, liabilities, losses, costs and expenses (including reasonable
		attorneys’ fees, court costs or costs incurred in investigation)
		(collectively “Losses”) incurred or suffered by Tenant to the extent
		arising out of any claim by a third party (including any governmental
		authority) or any fact, condition or circumstance which would reasonably form
		the basis of such a third party claim against Tenant resulting from an
		Environmental Defect (as defined below) with respect to the Premises caused by
		Landlord’s activities or operations on or about the Premises prior to the
		Effective Date. 
	 

	 
		(d) From and after the Effective Date,
		Tenant will indemnify and hold harmless Landlord of and from any and all Losses
		incurred or suffered by Landlord to the extent arising out of any claim by a
		third party (including any governmental authority) or any fact, condition or
		circumstance which would reasonably form the basis of such a third party claim
		against Landlord resulting from an Environmental Defect (as defined below) with
		respect to the Premises caused by Tenant’s activities or operations on or
		about the Premises on and after the Effective Date. 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		For purposes of this Section 9.01(c) and
		9.01(d), the following words and phrases shall have the following meanings:
		
	 

	 
		(i) “Environment” shall mean
		surface water, groundwater, land surface or subsurface strata or ambient air;
		
	 

	 
		(ii) “Environmental Defect” shall
		mean any environmentally-related commission, omission, activity or condition
		that: (i) constitutes a violation of an Environmental Law; (ii) would require
		remedial activity under any Environmental Law; (iii) presents an endangerment
		to the public health, welfare or the environment; or (iv) constitutes or is the
		result of a Release of any Hazardous Substance at the Real Property (all
		capitalized terms as hereafter or heretofore defined). “Environmental
		Defect” shall not include any environmentally-related commission,
		omission, activity or condition that is discovered by or known to Tenant prior
		to the Signing Date; 
	 

	 
		(iii) “Environmental Law” shall
		mean any applicable environmental law, regulation, rule, ordinance, or bylaw at
		the federal, state, or local level, whether existing as of the date hereof,
		previously enforced, or subsequently enacted, and shall include any condition
		or requirement in a Permit.
	 

	 
		(iv) “Hazardous Substance” shall
		mean any substance so defined under 42 U.S.C. §9601(14), petroleum,
		including crude oil or any fraction thereof, asbestos, polychlorinated
		byphenyls and radon.
	 

	 
		(v) “Release” shall have the
		meaning set forth in 42 U.S.C. §9601(22).
	 

	 
		ARTICLE X
	 

	 
		COMPLIANCE WITH LAWS
	 

	 
		SECTION 10.01. During the Term, Tenant agrees to comply with all
		governmental laws and regulations relative to the use or operation of the
		Premises, including, without limiting the generality of the foregoing, any
		OSHA, EPA or other safety or environmental laws and regulations. Tenant shall
		not store hazardous materials or hazardous substances on the Premises except
		(i) as consented to by Landlord (such consent not to be unreasonably withheld)
		and (ii) in compliance with all Environmental Laws. Tenant shall store all
		material on the Premises according to prudent and standard industry practice
		and label instructions, if any, even if such are more restrictive than the
		aforesaid governmental laws and regulations. The Tenant warrants that, at all
		times during the Term, Tenant shall be fully responsible for compliance with
		the Public Accommodation/ Commercial Facilities disability access rules and
		regulations under the American with Disabilities Act and with The Clean Air Act
		Amendments of 1990 (hereinafter the “Acts”) and shall indemnify and
		hold Landlord harmless from and against any and all claims, demands, damages,
		liabilities, costs and expenses arising out of said Acts, as amended from time
		to time, and their corresponding regulations or any other environmental laws or
		their regulations, except to the extent of, in each case, such liabilities,
		losses, claims, expenses (including, without limitation, attorneys’ fees)
		or damages arising out of the fraud or willful misconduct of the Landlord.
		During the period from the Signing Date
		until the Effective Date, Landlord will comply with all applicable laws
		relating to its ownership, use or operation of the Premises, and will use
		commercially reasonable efforts to maintain, and transfer to Tenant, any
		permits and licenses held by Landlord relating to the Premises that are
		transferable and which Tenant has requested be transferred by Landlord to
		Tenant as of the Effective Date.
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE XI
	 

	 
		DAMAGE OR DESTRUCTION
	 

	 
		SECTION 11.01. No Obligation of Landlord to
		Repair. In the event of any damage or destruction to the
		Premises, Landlord shall have no obligation to repair, restore or rebuild the
		Premises.
	 

	 
		SECTION 11.02. Tenant
		Obligation to Repair. In the event
		all or any part of the Premises is damaged or destroyed by any casualty during
		the Term, Tenant shall, regardless of the amount of insurance proceeds
		available to cover relevant costs, have the obligation to repair and restore or
		rebuild to substantially the same condition that the Premises were in (or
		required to be in under the Lease) prior to such casualty, taking into account
		changes in laws and technology and according to plans and specifications
		developed by Tenant and approved in writing by Landlord. Net rent shall not be
		abated for any period during which the improvements are partially or wholly
		untenantable. 
	 

	 
		ARTICLE XII
	 

	 
		TENANT ALTERATIONS AND
		CONTESTS
	 

	 
		SECTION 12.01. Except as set forth in Exhibit F,
		Tenant may not make alterations, modifications or install fixtures, machinery
		or other trade equipment on or about the Premises (collectively,
		“Alterations”) without Landlord’s prior written consent.
		Notwithstanding the foregoing, Tenant may, without Landlord’s consent, and
		at Tenant’s sole expense, make (i) alterations required by applicable law
		and (ii) reasonably minor, non-structural Alterations, provided that the cost
		for such Alterations does not exceed, in the aggregate, Ten Thousand and 00/100
		Dollars ($10,000.00). Further, Tenant may install, at its sole expense, a
		conveyor belt and bulk weigher (collectively, the “Conveyor System”)
		to facilitate transfer of corn from the Grain Facility to the Ethanol Facility,
		subject to the design being approved by Landlord, with such approval not to be
		unreasonably withheld. If Alterations are permitted hereunder, Tenant shall
		make such Alterations at Tenant’s sole expense and in conformance with all
		applicable laws, statutes, ordinances, rules, regulations and the same may be
		removed at any time during the term of this Lease provided any damage caused by
		such removal is repaired by Tenant. Tenant shall keep the Premises free from
		any liens arising out of any work performed for, materials furnished to, or
		obligations incurred by Tenant. All Alterations (including, without limitation,
		the Conveyor System) made by Tenant shall become a part of the Premises at the
		termination of this Lease by lapse of time or otherwise, and without cost to
		Landlord shall remain on the Premises as the property of Landlord unless
		Landlord requires, by written notice to Tenant, specific items thereof to be
		removed by Tenant at Tenant’s sole expense, in which event Tenant shall do
		so prior to the expiration of the Term at its expense, and shall repair any
		damage caused thereby. Tenant shall return the Premises upon the termination of
		this Lease in the same condition as when rented to Tenant, reasonable wear and
		tear excepted.
	 

	 
		SECTION 12.02. Contests. After written
		notice to Landlord, Tenant may at its expense contest, by appropriate
		proceedings conducted in good faith and with due diligence (all such
		proceedings together with appeals therefrom being hereinafter referred to as
		“Contests”) the amount, validity or application, in whole or in part,
		of any law, tax, assessment, mechanics’ lien, encumbrance, charge or any
		other adverse claim for which Tenant is responsible under this Lease
		(hereinafter a “claim” or collectively “claims”); provided
		that (i) Tenant shall have furnished such security, if any, as may be required
		in the proceedings or reasonably required by Landlord, (ii) neither the
		Premises nor any part thereof nor any interest therein shall be, in the
		reasonable opinion of Landlord, in imminent danger of being forfeited or lost,
		and (iii) Tenant shall indemnify Landlord for any claims, costs, damages or
		other losses incurred by Landlord in connection with all Contests.
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE XIII
	 

	 
		CONDEMNATION 
	 

	 
		SECTION 13.01. If all or a substantial part of the Premises are taken
		or conveyed as a result of condemnation and the remaining portion of the
		Premises cannot be restored to support the Ethanol Facility as required under
		the Corn Supply Agreement, this Lease shall terminate as of the date of such
		taking. Landlord shall be entitled to receive any and all awards that may be
		made in any such condemnation proceeding, and Tenant hereby assigns and
		transfers to Landlord any and all such awards that may be made to Tenant.
		Tenant shall not be entitled to damages based upon the value of the unexpired
		term of this Lease or for consequential damages to the land not so
		taken.
	 

	 
		ARTICLE XIV
	 

	 
		ASSIGNMENT AND SUBLEASE

	 

	 
		SECTION 14.01. No Assignment. Neither this
		Lease nor any interest of Tenant in this Lease shall be sold, assigned,
		transferred, sublet, conveyed, mortgaged or otherwise transferred or disposed
		of, whether by operation of law or otherwise (“Transfer”), without
		the prior written consent of Landlord. The acquisition or assumption of any
		interest in Tenant or an Affiliate of Tenant by a Prohibited Party shall
		constitute a Transfer. Notwithstanding the foregoing or any other provision of
		this Lease, Tenant may mortgage or
		otherwise encumber Tenant’s leasehold estate and Tenant’s rights
		under this Lease together with the Conveyor System, but excluding all other
		improvements appurtenant thereto pursuant to a leasehold mortgage or deed of
		trust (“Leasehold Mortgage”), and Tenant may assign its interest in
		the Lease as collateral security for such Leasehold Mortgage. For purposes of
		this section, (i) ) “Prohibited Party” means and includes,
		collectively, Archer Daniels Midland Company, CHS Inc., Tate & Lyle PLC,
		The Scoular Company, Bunge Limited, and their respective Affiliates, as such
		list is reasonably updated by Landlord on an annual basis during the Term with
		the prior written consent of Tenant, which consent shall not be unreasonably
		withheld; provided, however, that in no event shall there be more than five (5)
		Prohibited Parties, but there may be any number of Affiliates of each
		Prohibited Party, (ii) “Affiliate” means with respect to any entity,
		any other entity that directly or indirectly controls, is controlled by, or is
		under common control with that entity. For the purposes of this Lease,
		“control” means (i) the direct or indirect ownership of more than
		fifty percent (50%) of the total voting securities of every class or other
		evidences of ownership interest of the entity, or (ii) the possession, directly
		or indirectly, of the power to direct or cause the direction of the management
		and policies of an entity.
	 

	 
		SECTION 14.02. Release. Any assignment
		or sublease permitted by Landlord shall not release Tenant from its obligations
		herein unless Landlord’s consent specifically so provides. 
	 

	 
		ARTICLE XV
	 

	 
		DEFAULT
	 

	 
		SECTION 15.01. Events of Default. In the event
		any one or more of the following events shall occur: 
	 

	 
			
				
				   
				

			 	
				
				  (a)
				

			 	
				
				  Tenant fails to pay any Base Rent
				  due Landlord under this Lease within thirty (30) calendar days following
				  Landlord’s written notice that the same is due and payable;
				

			 

 

	 
			
				
				   
				

			 	
				
				  (b)
				

			 	
				
				  Tenant fails to pay any other
				  amounts due Landlord under this Lease, including without limitation Additional
				  Rent, within thirty (30) days following Landlord’s written notice that the
				  same is due and payable; 
				

			 

 

	 
		 
	 

	 
		 
	 

	 
 

	 
			
				
				   
				

			 	
				
				  (c)
				

			 	
				
				  Tenant defaults in any of its
				  non-monetary obligations hereunder and fails to cure such default within thirty
				  (30) days after Landlord’s notice of such default to Tenant;
				  provided, however, that if
				  such default cannot be cured within such thirty-day period, but such default is
				  capable of being cured within sixty (60) days, then such period shall be
				  extended for a period not to exceed sixty (60) days in the aggregate so long as
				  Tenant is diligently pursing a cure during such period;
				

			 

 

	 
			
				
				   
				

			 	
				
				  (d)
				

			 	
				
				  Tenant files a voluntary petition in
				  bankruptcy, has filed against it an involuntary petition in bankruptcy, makes
				  an assignment for the benefit of creditors, has a trustee or receiver appointed
				  for any or all of its assets, is insolvent or fails or is unable to pay its
				  debts generally when due, in each case where such petition, appointment or
				  insolvency is not dismissed, discharged or remedied, as applicable, within
				  sixty (60) days; 
				

			 

 

	 
			
				
				   
				

			 	
				
				  (e)
				

			 	
				
				  Tenant shall permit this Lease or
				  any estate of Tenant hereunder to be sold under any attachment or execution;
				  
				

			 

 

	 
		then Landlord shall have the right to either
		(i) terminate this Lease upon the expiration of ten (10) days after written
		notice of such intent is given to Tenant in which event the term hereof shall
		expire and terminate with the same force and effect as though the date set
		forth in said notice were the date originally set forth herein and fixed for
		the expiration of the term, or (ii) re-enter and take possession of the
		Premises, dispossessing Tenant therefrom and thereupon receive any and all
		rents or other payments from subtenants, if any, of the Premises, and hold the
		Premises as hereinafter provided, without being deemed guilty of trespass, or
		becoming liable for any loss or damage which may be occasioned thereby, Tenant
		agreeing that no such re-entry or taking possession of the Premises by Landlord
		shall be construed as an election on Landlord’s part to terminate this
		Lease, such right however, being continuously reserved by Landlord. For
		purposes of this Article XV, the terms “entry” and re-entry” are
		not limited to their technical meanings. 
	 

	 
		SECTION 15.02 Landlord May
		Perform Tenant’s Obligations under the Basic Agreement and the Railroad
		Leases. If Tenant shall fail to keep or perform any of its
		obligations as provided under the Basic Agreement or the Railroad Leases,
		Landlord may (but shall not be obligated to do so), without waiving or
		releasing Tenant from any obligation, as an additional but not exclusive
		remedy, make any such payment or perform any such obligation, and all sums so
		paid by Landlord plus all necessary and incidental costs and expenses incurred
		by Landlord shall be deemed additional rent and shall be paid to Landlord on
		demand and if not so paid by Tenant, Landlord shall have the same rights and
		remedies as in the case of Events of Default, as set forth in Section 15.01
		above.
	 

	 
		SECTION 15.03. Effect of Re-Letting. Landlord has
		no obligation to relet the Premises. In the event Landlord elects to re-enter
		the Premises, Landlord, in addition to collecting rents from subtenants as
		above provided, may, but shall not be obligated to, make such alterations and
		repairs as may be necessary in order to relet the Premises, or any part thereof
		and may continue to let or relet the Premises or any part thereof for such term
		or terms (which may extend beyond the term of this Lease) and at such rental
		and upon such other terms and conditions as Landlord in its sole discretion may
		deem advisable. All rentals and other sums received by Landlord from existing
		subtenants or from such reletting shall be applied first, to the payment of any
		indebtedness other than rent due hereunder from Tenant to Landlord; second, to
		the payment of any costs and expenses of such reletting, including reasonable
		brokerage fees and attorneys’ fees and of costs of any alterations and
		repairs; third, to the payment of rent and other charges due and unpaid
		hereunder; and the residue, if any, shall be held by Landlord and applied to
		payment of future rent as the same may become due and payable hereunder. If
		such rentals and other sums received from such reletting during any month be
		less than that to be paid 
	 

	 
		 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		during that month by Tenant hereunder,
		Tenant shall pay such deficiency to Landlord; if such rentals and sums shall be
		more, Tenant shall have no right to the excess. Such deficiency shall be
		calculated and paid monthly. Notwithstanding any such re-entry by Landlord,
		Landlord reserves the right at any time hereafter to terminate this Lease for
		any breach of Tenant, including the breach(es) which resulted in Landlord
		re-entering the Premises. 
	 

	 
		SECTION 15.04. Rights of Recovery. Should
		Landlord at any time terminate this Lease for any breach, it may recover from
		Tenant all damages it may incur by reason of such breach, including, without
		limitation, the cost of recovering the Premises, reasonable attorneys’
		fees, and the excess, if any, of the present value of the rent reserved under
		this Lease, for the remainder of the stated term, over the then-reasonable
		present rental value of the Premises, for the remainder of the stated term. All
		such amounts shall be immediately due and payable from Tenant to Landlord. For
		purposes of determining the rent reserved hereunder, the rent for the remainder
		of the unexpired term shall be equal to the sum of all rents then being paid by
		Tenant pursuant to Article III. The failure of Landlord to relet the Premises
		shall not affect Tenant’s liability. The recovery provided for in this
		paragraph shall be in addition to any other rights and remedies Landlord shall
		have hereunder or under any federal, state or local law, regulation or
		ordinance. 
	 

	 
		ARTICLE XVI
	 

	 
		REMEDIES FOR DEFAULT
	 

	 
		SECTION 16.01. In the event a dispute arises under this Lease or if any
		Party hereto should default in the performance of any of its obligations
		hereunder, the other Party may resort to any remedy specified herein or
		available to it for said default, at law, in equity or by statute; provided,
		however, that Tenant shall not have any self-help right to cure a Landlord
		default under this Lease. With the exception of Section 9.01(c), in the event
		Landlord is in breach or default under this Lease, Landlord’s liability
		shall be limited to USD $5,000,000.00 as adjusted by the CPI Index for Nebraska
		for the immediately preceding twelve (12) month period prior to such breach or
		default.
	 

	 
		ARTICLE XVII
	 

	 
		DISCLAIMER OF
		WARRANTIES
	 

	 
		 SECTION 17.01. The Premises is leased on an “AS IS, WHERE IS”
		and “WITH ALL FAULTS” basis, and Landlord shall have no obligation to
		prepare the Premises for Tenant’s occupancy. Except with respect to
		Section 19.11, Tenant acknowledges that Landlord SPECIFICALLY DISCLAIMS ALL
		WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY
		WARRANTY OF MERCHANTABILITY OR FITNESS FOR INTENDED OR PARTICULAR PURPOSE, ANY
		WARRANTY AS TO THE DESIGN OR CONDITION OF THE PREMISES, QUALITY OR CAPACITY OF
		THE PREMISES, OR ANY WARRANTY WITH RESPECT TO PATENT INFRINGEMENT OR THE
		ABSENCE OF ANY LATENT DEFECT. In making this Lease, Tenant has not been induced
		by and has not relied upon representations, warranties or statements, whether
		express or implied, made by Landlord or any broker or any other person
		representing or purporting to represent Landlord, except such representations,
		warranties or statements which are included herein. Notwithstanding the
		foregoing, between the Signing Date and the Effective Date, Landlord (i) shall
		maintain the Premises as they existed as of the Signing Date in good order and
		repair consistent with Landlord’s customary maintenance and repair
		procedures applying to the Premises, reasonable wear and tear excepted, and
		(ii) shall provide Tenant with reasonable access as set forth in an access
		agreement to be mutually negotiated by the Parties. 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		ARTICLE XVIII
	 

	 
		NOTICES
	 

	 
		SECTION 18.01. Any notice required or permitted to be given hereunder
		shall be in writing and shall be deemed to have been duly given on the date
		actually delivered, or if transmitted by telex, telecopier or other form of
		written telecommunication, on the business day next following the date of
		transmission, if delivered or sent to the Parties at the following addresses or
		to such other address as shall be furnished in writing by any addressee:
		
	 

	 
		 
	 

	 
			
				
				  If to Landlord:
				

			 	
				
				  Cargill, Incorporated

				  15407 McGinty Road West

				  Wayzata, MN 55391-2399

				  Attention: AgHorizons Commercial Leader / 19

				  Fax No: (952) 742-7313
				

			 
	
				
				   
				

			 	
				
				   
				

			 
	
				
				  With copy to:
				

			 	
				
				  Cargill, Incorporated 

				  Law Department / 24

				  15407 McGinty Road West

				  Wayzata, MN 55391-2399

				  Attention: AgHorizons BU Attorney

				  Fax No: (952) 742-6349
				

			 
	
				
				   
				

			 	
				
				   
				

			 
	
				
				  If to Tenant:
				

			 	
				
				  Pioneer Trail Energy, LLC

				  1625 Broadway, Suite 2400

				  Denver, CO 80202

				  Attention: Scott H. Pearce 

				  Fax No: (303) 626-8251
				

			 

 

	 
		ARTICLE XIX
	 

	 
		MISCELLANEOUS
		PROVISIONS
	 

	 
		SECTION 19.01. Entire Agreement. This Lease and
		Exhibits attached hereto contain the entire understanding and agreement of the
		Parties hereto and shall not be modified in any manner except by an instrument
		in writing executed by both Parties. In the event any term, covenant or
		condition herein contained is held invalid or void by any court of competent
		jurisdiction, the invalidity of any such term, covenant or condition shall in
		no way affect any other term, covenant or condition herein contained.
	 

	 
		SECTION 19.02. Signage.
		Within sixty (60) days from the
		commencement of the Term, Tenant shall have removed or covered, at
		Tenant’s sole expense, any and all Landlord-owned signs, logos, and/or
		other trademarks and trade names, if any, from the Grain Facility.
	 

	 
		SECTION 19.03. Successors and Assigns. All the terms,
		covenants, and conditions of this Lease shall be binding upon, and inure to the
		benefit of and be enforceable by the Parties hereto and their respective
		successors, heirs, executors and permitted assigns. 
	 

	 
		SECTION 19.04. Governing Law. This Lease
		shall be governed, construed, and interpreted in accordance with the laws of
		the State of Nebraska. 
	 

	 
		 
	 

	 
		 
	 

	 
 

	 
		SECTION 19.05. Headings. The headings
		contained in this Lease are for reference purposes only and shall not affect
		the meaning or interpretations of this Lease. 
	 

	 
		SECTION 19.06. Incorporation by Reference. The Recitals
		and Exhibits A through E attached hereto are hereby incorporated by reference
		and made a part hereof. 
	 

	 
		SECTION 19.07. Waivers and Amendments. This Lease and
		the other instruments to be executed pursuant hereto may be amended,
		superseded, canceled, renewed or extended, and their terms or covenants 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. The failure of any
		Party at any time or times to require performance of any provision hereof shall
		in no manner affect its right at a later time to enforce the same. No waiver by
		any Party of the breach of any term or covenant contained in this Lease or in
		any other such instrument, whether by conduct or otherwise, in any one or more
		instances, shall be deemed to be, or construed as, a further or continuing
		waiver of any breach, or a waiver of the breach of any other term or covenant
		contained herein. The Parties reserve the right by mutual written consent to
		amend, modify, supersede and cancel this Lease, or waive the terms or
		conditions hereof, without the consent of any other person (natural or
		otherwise). 
	 

	 
		SECTION 19.08. Memorandum of Lease. Landlord and
		Tenant will, upon request of Tenant, execute, acknowledge and deliver to each
		other a memorandum of this Lease for recording in the form attached hereto as
		Exhibit E.
	 

	 
		SECTION 19.09. Fee Mortgage. The lien of
		any mortgage now or hereafter placed upon the fee title to the Premises (a
		“Fee Mortgage”) shall be subject and subordinate to this Lease and to
		any amendments of this Lease; provided,
		however, that so long as any Fee Mortgage shall constitute a
		lien on the fee title to the Premises no amendment hereafter made to this Lease
		(i) to reduce the amount of rent payable by Tenant hereunder or (ii) to
		increase Landlord’s obligations in any way shall be binding upon the
		holder of any Fee Mortgage and any such holder shall be entitled to enforce
		this Lease in accordance with its terms prior to such amendment.
	 

	 
		SECTION 19.10. Quiet Enjoyment. Upon the
		observance and performance of all of the agreements, covenants, terms and
		conditions on Tenant’s part to be observed and performed in this Lease,
		Tenant shall peaceably and quietly hold and enjoy the Premises for the Term
		without unreasonable hindrance or interruption by Landlord. 
	 

	 
		SECTION 19.11. Representations and Warranties of
		Landlord. Landlord hereby makes the following representations and
		warranties to Tenant:
	 

	 
			
				
				   
				

			 	
				
				  (a)
				

			 	
				
				  Sale Agreements. Landlord has not
				  entered into any agreements contingent or otherwise for the sale of all or any
				  portion of the Premises, and, to Landlord’s actual knowledge and except as
				  may be set forth in the public records, there are no purchase options, rights
				  of first refusal or offer, or similar rights in favor of any party to purchase
				  all or any portion of the Premises.
				

			 

 

	 
			
				
				   
				

			 	
				
				  (b)
				

			 	
				
				  Condemnation. Landlord has not
				  received any written notice of the commencement of any proceedings for taking
				  by condemnation or eminent domain of any part of the Premises.
				

			 

 

	 
			
				
				   
				

			 	
				
				  (c)
				

			 	
				
				  No Violations. Landlord has not
				  received any written notice that expressly alleges that the Premises is in
				  violation of any private restriction or agreement. 
				

			 

 

	 
			
				
				   
				

			 	
				
				  (d)
				

			 	
				
				  Encumbrances. To Landlord’s
				  actual knowledge and except as may be set forth in the public records, Landlord
				  has not granted any easement, lease or license over all or 
				

			 

 

	 
		 
	 

	 
		 
	 

	 
 

	 
		any portion of the Premises, that would
		materially interfere with Tenant’s intended use of the Premises.
	 

	 
			
				
				   
				

			 	
				
				  (e)
				

			 	
				
				  Knowledge. As used herein,
				  Landlord’s actual knowledge (and words of similar import) shall be limited
				  to the actual, present knowledge of Jim Reiff, without duty of investigation or
				  inquiry. 
				

			 

 

	 
		SECTION 19.12. Integrated Agreements. The Parties
		hereby acknowledge and agree that the Corn Supply Agreement and this Lease have
		been negotiated and entered into simultaneously as integrated parts of one
		unified transaction with a common purpose. Without limiting the generality of
		the foregoing, (i) the Parties would not have entered into the Corn Supply
		Agreement and this Lease separately without entering into the other, (ii) the
		consideration for such agreements is not separate and distinct, but
		interrelated and incorporated by reference between the Corn Supply Agreement
		and this Lease, and (iii) in the event that either of the Parties becomes a
		debtor in bankruptcy, the Parties intend that the Corn Supply Agreement and
		this Lease are either accepted or rejected together as one executory
		contract.
	 

	 
		 
	 

	 
 

	 
		IN WITNESS WHEREOF, the Parties hereto have caused this Lease to be
		executed on the day and year first above written.
	 

	 
		 
	 

	 
			
				
				   
				

			 	
				
				   
				

			 	
				
				  CARGILL, INCORPORATED
				

			 
	
				
				

			 	
				
				   
				

			 	
				
				  
 By:
				

			 	
				
				  /s/ Dennis C. Inman
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Its:
				

			 	
				
				  V.P. Cargill
				  AgHorizons
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  PIONEER TRAIL ENERGY,
				  LLC
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  
 By:
				

			 	
				
				  /s/ Scott H. Pearce
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				

			 
	
				
				   
				

			 	
				
				   
				

			 	
				
				  Its:
				

			 	
				
				  Authorized
				  RepresentativeExhibit 10.19
	 

	 
		EXECUTION COPY
	 

	 
		 
	 

	 
		Confidential treatment has been requested
		for portions of this exhibit. The copy filed herewith omits the information
		subject to the confidentiality request. Omissions are designated as [*]. A
		complete version of this exhibit has been filed separately with the Securities
		and Exchange Commission.
	 

	 
		CARGILL DIRECT
	 

	 
		FUTURES ADVISORY AGREEMENT
	 

	 
		This Agreement is made and entered into as
		of the 25th day of September, 2006, by and between Cargill Commodity
		Services Inc., a Delaware corporation, doing business as Cargill Direct (the
		“Advisor” or “CARGILL DIRECT”), and Buffalo Lake Energy,
		LLC, a Delaware limited liability company (the “Client” and together
		with the Advisor the “Parties” and individually a
		“Party”).
	 

	 
		WITNESSETH:
	 

	 
		WHEREAS, CARGILL DIRECT is a commodity trading advisor
		registered with the Commodity Futures Trading Commission (“CFTC”) and
		a member of National Futures Association;
	 

	 
		WHEREAS, pursuant to Regulation 4.31 of the CFTC under the
		Commodity Exchange Act, as amended, CARGILL DIRECT has heretofore delivered to
		Client a Disclosure Document dated January 12, 2006 (the “Disclosure Document”);
	 

	 
		WHEREAS, Client has reviewed and understands the Disclosure
		Document and is, by execution and delivery of this Agreement, delivering to
		CARGILL DIRECT acknowledgment of Client’s receipt thereof, in accordance
		with Regulation 4.31(b) of the CFTC;
	 

	 
		WHEREAS, Client intends
		to construct, own and operate a commercial facility at Fairmont, Minnesota that
		will produce denatured fuel-grade ethanol (as such plant may be expanded or
		upgraded according to the terms of Corn Supply Agreement, the “Ethanol
		Facility”), which Ethanol Facility is anticipated to produce approximately
		110 million gallons per year; and
	 

	 
		WHEREAS, Client desires to obtain the benefit of CARGILL
		DIRECT’s knowledge and experience by retaining the Advisor to provide
		advisory services as described herein in connection with corn feed stock
		procurement by Client for operation of the Ethanol Facility (the “Advisory
		Program”);
	 

	 
		WHEREAS, CARGILL DIRECT desires to provide such advisory
		services, upon the terms and conditions set forth in the Disclosure Document
		and herein, it being understood and agreed that the terms on which any futures
		brokerage services are performed in connection with such advice, through a
		managed account or otherwise, shall be established by the customer
		agreement between Client and the futures commission merchant
		(“Broker”) selected by Client;
	 

	 
		NOW, THEREFORE, in consideration of the premises and the mutual
		covenants contained herein and other good and valuable consideration, the
		receipt and sufficiency of which are hereby acknowledged, the Parties hereto
		agree as follows:
	 

	 
 

	 
		1. Master Agreement. The Parties
		have executed a Master Agreement of even date herewith (as amended from time to
		time, the “Master Agreement”). The terms and conditions of the Master
		Agreement are hereby incorporated herein by reference. To the extent any
		provision of the Master Agreement conflicts with any provision contained
		herein, the provision contained herein will control. Terms capitalized but not
		defined in this Agreement shall have the meanings ascribed to them by the
		Master Agreement.
	 

	 
		2. Advisory Services. Client hereby
		retains CARGILL DIRECT to provide futures advisory services. These services
		will include: 
	 

	 
		(a) Hedging
		Strategy and Budget.
		CARGILL DIRECT, together with the
		Client, has developed a customized corn procurement and hedging strategy and
		budget for the Client which includes risk management tools such as futures
		transactions, swaps, futures options, futures and future option derivatives,
		also known as over-the-counter transactions (“OTC Transactions”)
		and/or combinations thereof (“Risk Management Transactions”), and
		which covers an annual operational period as specified therein. The hedging
		strategy and budget will be reviewed and updated by Client, in consultation
		with CARGILL DIRECT, at least sixty (60) days prior to the expected Provisional
		Acceptance Date for the Ethanol Facility, and thereafter on an annual basis, or
		more frequently as requested by Client or CARGILL DIRECT, at the times
		specified therein. The approved strategy and budget, as so updated, is referred
		to in this Agreement as the “Risk Management Plan”. Included in the
		Risk Management Plan, the Client will establish a risk management committee
		(the “Risk Management Committee”) that will establish and maintain
		specific position limits as it relates to corn futures and all other Risk
		Management Transactions. CARGILL DIRECT will not exceed the position limits
		established by the Risk Management Committee in the Risk Management Plan from
		time to time. CARGILL DIRECT will use its market knowledge and trading
		expertise with the goal of achieving as low a price as possible for the
		Client’s corn feed stock while adhering to the limitations described in
		this Agreement and in the Risk Management Plan in effect.
	 

	 
		(b) Deliverables. CARGILL DIRECT
		will: 
	 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Implement the customized hedging
				  strategy according to the agreed budget and the Risk Management Plan in effect
				  from time to time
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Provide weekly market consultation
				  by telephone on US/World corn markets
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Assist in developing FY budgets for
				  CBOT futures values
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Provide monthly financial statements
				  in a form and content mutually agreed upon by the Parties
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Provide fundamental and technical
				  analysis of market conditions as requested by the Client 
				

			 

 

	 
		 
	 

	 
		2
	 

	 
 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Meet with the Client quarterly to
				  evaluate performance
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Attend Risk Management Committee
				  meetings as requested by the Client
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Deliver to Client upon request any
				  and all calculations and determinations made by CARGILL DIRECT pursuant to this
				  Agreement in reasonable detail.
				

			 

 

	 
			
				
				   
				

			 	
				
				  •
				

			 	
				
				  Meet with the Client annually and at
				  such other times as requested by Client or CARGILL DIRECT to evaluate
				  performance and establish the following year’s budget and to agree on
				  appropriate updates for the Risk Management Plan
				

			 

 

	 
		(c) Risk Management Advisory Services. CARGILL DIRECT
		will manage Client’s Advisory Program by designing and executing on risk
		management strategies on Client’s behalf intended to reduce Client’s
		exposure to volatility in corn prices. Specifically, CARGILL DIRECT will place
		futures and futures options trades and all other Risk Management Transactions
		for Client’s account (without Client consultation, except to the extent
		such consultation is required by the Risk Management Plan) within the
		parameters specified in the Risk Management Plan and in a manner consistent
		with the principles established in the Risk Management Plan, as contemplated
		and authorized by this Agreement and the Power of Attorney document of even
		date herewith, attached and hereby incorporated into this Agreement by this
		reference as Exhibit A.
	 

	 
		(d) Mechanics for Exiting Futures Positions.
		CARGILL DIRECT will work with the
		Client to either exit any open futures positions prior to the business day
		prior to the first business day of the delivery month of the applicable futures
		contract, move the futures position to a forward futures month or exchange the
		open futures position with Cargill AgHorizons to price forward cash contracts.
		
	 

	 
		3. Term of Agreement; Early
		Termination. 
	 

	 
		(a) The term of this Agreement shall be an
		initial period of ten (10) years commencing on the Provisional Acceptance Date
		for the Ethanol Facility ( the “Initial Term”), subject however to
		early termination pursuant to Section 3(b), Section 3(c), or Section 11 hereof.
		At the request of either Party, during the six-month period prior to the end of
		the fifth (5th) year of the Initial Term, the Parties shall meet and
		review the terms and conditions of this Agreement and the compensation paid to
		CARGILL DIRECT hereunder, and, if necessary or appropriate in the opinion of
		either Party, enter into good faith discussions regarding potential
		modifications as necessary or appropriate to ensure that this Agreement is fair
		and equitable to both Parties. It is understood and agreed, however, that even
		if the Parties are unable to agree on any modifications, this Agreement will
		nevertheless remain in effect for the remainder of the Initial Term. 
	 

	 
		(b) Client will have the right to terminate
		this Agreement at any time after the end of the second anniversary of the
		Provisional Acceptance Date, and prior to the end of the Initial Term, if the
		“Cargill Hedge Price” (as defined in Section 4(c)) for each
		month
	 

	 
		 
	 

	 
		3
	 

	 
 

	 
		in any twelve (12) consecutive calendar
		month period during the Initial Term exceeds by more than ten percent (10%) the
		average of the “Target Corn Price” (as defined in Section 4(c))
		calculated for each of those calendar months. In the event Client desires to
		terminate this Agreement pursuant to this paragraph, Client shall provide
		written notice of termination to CARGILL DIRECT within sixty (60) days after
		the end of the 12-month period giving rise to the termination right, and the
		written notice of termination shall specify a termination date no earlier than
		fifteen (15) days after the date of the termination notice. As promptly as
		practicable after any such termination, all outstanding risk management
		transactions between the Parties shall be financially settled as of the
		termination date pursuant to the terms of the agreements governing those
		transactions, and such termination shall not relieve Client of its obligation
		to pay to CARGILL DIRECT any amounts due under this Agreement. 
	 

	 
		(c) CARGILL DIRECT may terminate this
		Agreement prior to the end of the Initial Term under the circumstances and in
		the manner provided in Section 3 of the Master Agreement.
	 

	 
		4. Compensation. As
		compensation for the advisory services to be performed by CARGILL DIRECT,
		Client agrees to pay CARGILL DIRECT:
	 

	 
		(a) Flat Fee.
		A base monthly fee of $[*] per bushel
		per calendar month based on the projected number of bushels of corn hedged, as
		set forth in the Risk Management Plan in effect for the month, which shall be
		due and payable within five (5) days of the end of each calendar month
		(“Flat Fee”). 
	 

	 
		(b) Performance Incentive. The Parties
		shall use commercially reasonable efforts to agree on a market-based
		performance incentive (“Performance Incentive”) prior to the
		commercial operation of the Ethanol Facility. As a guide to establishing the
		Performance Incentive, the Parties agree to negotiate in good faith. 
	 

	 
		(c) Definitions:
	 

	 
		i. Cargill Hedge Price is the final futures
		buying price achieved by CARGILL DIRECT for corn to be delivered during the
		applicable Shipment Period taking into account all gains and losses from
		hedging the same during the Pricing Period through its hedging for
		Client’s account. 
	 

	 
		The Client will maintain trading accounts
		for the purpose of determining the Cargill Hedge Prices and will provide
		discretionary authority to CARGILL DIRECT to enter trades on the Client’s
		behalf, subject to the parameters contained in this Agreement and in the Risk
		Management Plan in effect from time to time. CARGILL DIRECT will assume that
		Client’s corn usage (“Projected Corn Usage”) is 3.46 million
		bushels per calendar month when hedging, except as otherwise provided in the
		Risk Management Plan in effect from time to time. In the event that
		Client’s actual corn usage is significantly different (greater than 10%),
		the Client will communicate changes within 5 business days of first notice or
		knowledge of such difference. In such event, CARGILL DIRECT will make
	 

	 
		         

	 

	 
		* Certain confidential information on
		this page has been omitted and filed separately with the Securities and
		Exchange Commission.
	 

	 
		 
	 

	 
		4
	 

	 
 

	 
		every reasonable effort to minimize the
		economic impact on the Client’s position. The Parties agree that trades
		made to accommodate Client’s adjustment to the Projected Corn Usage will
		not be taken into account in the calculation of the Performance Incentive for
		the Shipment Periods for which Cargill already has taken a hedge
		position.
	 

	 
		ii. Target Corn Price for any Shipment
		Period shall be an amount negotiated by the Parties in good faith prior
		to such Shipment Period.
	 

	 
		iii. Pricing Period is the period during
		which the Projected Corn Usage for the applicable Shipment Period will be
		hedged in Client’s account and shall run from the effective date of this
		Agreement through the CBOT close on the last trading day of the calendar month
		preceding the first day of the applicable Shipment Period. 
	 

	 
		(d) Payment. All
		Compensation due shall be payable to CARGILL DIRECT at: 
	 

	 
		CARGILL DIRECT
	 

	 
		c/o Cargill, Inc. – Attn: Clayton
		Weiby
	 

	 
		15407 McGinty Road West, MS #20
	 

	 
		Wayzata, MN 55391-2399
	 

	 
		(e) Brokerage Fees. CARGILL DIRECT
		will receive no compensation for brokerage fees. All trades shall be executed
		through an introducing broker other than CARGILL DIRECT. 
	 

	 
		5. Standard of Liability; Risk of
		Loss. Client represents and warrants that it understands the
		risks involved with the Advisory Program, including, without limitation, the
		risks set forth on the Risk Disclosure Statement, attached hereto as
		Exhibit B; the possibility that an entire investment may be lost
		and that liability could exceed the assets in Client’s brokerage account;
		the fact that such brokerage account will be subject to brokerage commissions
		regardless of whether profits are earned; that even if best efforts are used to
		close out all positions in the account at a particular time, there is no
		assurance that any such open positions will be closed out without incurring
		additional losses; and that fees for CARGILL DIRECT advisory services will be
		charged regardless of whether the Advisory Program as a whole is successful.
		The Advisor makes no guarantee that its Advisory Program will result in a
		profit or will not result in a loss for Client. CARGILL DIRECT, its principals,
		officers, employees, agents and affiliates shall not be liable, responsible or
		accountable in damages or otherwise to Client, its successors or assigns,
		except for willful misconduct, fraud or bad faith on the part of CARGILL
		DIRECT, or any breach by CARGILL DIRECT of its obligation to effect
		transactions only within the parameters specified in the Risk Management Plan
		as specified in Section 2(c), or a breach of CARGILL DIRECT’s obligations
		specified in this Agreement. Other than in such circumstances, all advice
		provided to Client pursuant to the Advisory Program, is at Client’s risk,
		and Client shall be solely liable therefore. Client is willing and financially
		able to sustain such losses should they occur. CARGILL DIRECT shall not be
		liable to Client for the loss of any margin deposits or other Client funds or
		property that is the direct or indirect result of the bankruptcy, insolvency,
		liquidation, receivership, custodianship or assignment for the benefit
		of
	 

	 
		 
	 

	 
		5
	 

	 
 

	 
		creditors of any bank, clearing or other
		broker, exchange, clearing organization or similar entity, or of any grain
		elevator or other storage facility.
	 

	 
		6. Advisory Services to Various Clients.
		Client understands that CARGILL
		DIRECT may advise a variety of clients with differing degrees of risk
		tolerance. It is understood that such variation may result in substantial
		differences between the results achieved by Client and the results achieved by
		other clients advised by CARGILL DIRECT. CARGILL DIRECT hereby agrees that
		under no circumstances will it knowingly recommend or use strategies for Client
		that are inferior to strategies recommended or used for any other similarly
		situated client advised by CARGILL DIRECT, nor will it knowingly or
		deliberately favor any client advised by CARGILL DIRECT over Client in any way
		or manner.
	 

	 
		7. Confidentiality. CARGILL DIRECT agrees to respect and protect the
		confidentiality of information pertaining to the Client. Client agrees to
		respect and protect the confidentiality of CARGILL DIRECT’s strategies to
		the fullest extent practicable. Client shall (1) limit access to and knowledge
		of CARGILL DIRECT’s advice, positions, trades and trading methods to those
		with a reasonable need to know, (2) prevent others under its control from
		knowingly duplicating in other accounts the positions and trades recommended to
		Client, and (3) shall not duplicate, reprint or resell any of the advice or the
		printed material provided to Client by CARGILL DIRECT. Notwithstanding the
		foregoing, Client and CARGILL DIRECT acknowledge and agree that (a) Client may
		provide such information to any wholly-owned Affiliate which owns or operates
		an ethanol production facility, for which Cargill and the Affiliate have
		entered into agreements similar in nature to the Goods and Services Agreements,
		provided that such Affiliate agrees to be bound by the terms hereof or
		otherwise agree to maintain the confidential nature of such information, and
		provided further that Client may no longer provide such information to the
		owner of such ethanol production facility after the owner is no longer
		wholly-owned by the Client, (b) Client may provide such information to the
		Financing Parties and any existing or potential parties to Risk Management
		Transactions and guarantors, to rating agencies, to Persons to which offering
		statements or other disclosure documents associated with the private or public
		offering of debt securities by or on behalf of Client are provided, to
		financial institutions and other Persons providing or expressing interest in
		providing debt financing or refinancing, lease financing and/or credit support
		in connection with the construction and operation of the Ethanol Facility, and
		to Persons that are potential equity participants or transferees or purchasers
		of the Ethanol Facility, provided that such Person executes a confidentiality
		agreement in substantially the form of Exhibit C hereto
		in which such Person agrees (i) to be bound by the terms hereof or otherwise
		agree to maintain the confidential nature of such information, and (ii) to use
		such information only for purposes of evaluating their investment or other
		involvement in the Ethanol Facility, and (c) each Party may provide such
		information to its board members and equity owners consistent with its internal
		governance practices. Notwithstanding the foregoing, Client may disclose such
		information if requested by any governmental authority, if subject to a
		subpoena, or in connection with any litigation, arbitration or dispute.
	 

	 
		8. Notices. All
		notices, demands and other communications made hereunder shall be in writing
		and shall be deemed to have been duly given if hand delivered or mailed by
		registered mail to the address stated herein, or to such other address as the
		Parties may hereafter direct in writing:
	 

	 
		 
	 

	 
		6
	 

	 
 

	 
		If to CARGILL DIRECT
	 

	 
		c/o Cargill, Incorporated
	 

	 
		15407 McGinty Road West, MS #20
	 

	 
		Wayzata, MN 55391-2399
	 

	 
		Attn: Clayton Weiby
	 

	 
		If to Client:
	 

	 
		Buffalo Lake Energy, LLC
	 

	 
		1625 Broadway, Suite 2400
	 

	 
		Denver, CO 80202
	 

	 
		Attn: Scott Pearce
	 

	 
		9. Governing Law. This Agreement shall be construed and governed by the
		laws of the State of New York without regard to principles of conflicts of
		laws, except for Sections 5-1401 and 5-1402 of the New York General Obligations
		Law and except as otherwise provided in Exhibit E with
		respect to arbitration. If any one or more of the provisions of this Agreement
		should be held to be invalid, illegal or unenforceable in any respect, the
		validity, legality or enforceability of the remaining provisions shall not in
		any way be affected or impaired.
	 

	 
		10. Successors and Assigns. This Agreement shall be binding upon and inure to the
		benefit of the Parties and their permitted successors and assigns. Neither
		Party may assign this Agreement except as permitted by the Master Agreement.
		Client may assign this Agreement to the Financing Parties as security for
		financing the Ethanol Facility. The Financing Parties may further assign this
		Agreement upon foreclosure or assignment in lieu of foreclosure to any Person
		which has acquired the Ethanol Facility; provided, however, that lenders shall
		not assign this Agreement to any entity (or its successors or any assignee of
		substantially all of its ethanol business) that directly competes with Cargill,
		Incorporated or CARGILL DIRECT and that is identified on Exhibit D
		hereto. All other assignments by Client require the consent of CARGILL DIRECT,
		not to be unreasonably withheld. 
	 

	 
		11. Events of Default and Termination Upon Event of
		Default.
	 

	 
		(a) Events of Default. The occurrence
		at any time with respect to a Party of any of the following events constitutes
		an event of default (an “Event of Default”) with respect to such
		Party:
	 

	 
		i. Failure to Pay.
		Failure by the Party to make when due, any payment, including any undisputed
		portion of an invoice, under this Agreement if such failure is not remedied on
		or before the fifth business day after notice of such failure is given to the
		Party; provided, however, that it shall not constitute an Event of Default
		under this Agreement for the Party to fail to make a payment while such
		Party’s obligation to make such payment is being contested in good faith
		by such Party provided that any undisputed portion of such payment has been
		made;
	 

	 
		ii. Breach of Risk Management Plan. Failure by CARGILL DIRECT in any material respect to
		comply strictly with the Risk Management Plan;
	 

	 
		 
	 

	 
		7
	 

	 
 

	 
		iii. Breach of Agreement. Failure by the Party to comply in any material respect
		with any provision of or perform any material obligation (other than an
		obligation to make any payment under this Agreement) to be complied with or
		performed by the Party in accordance with this Agreement if such failure is not
		remedied on or before the second day after notice of such failure is given to
		the Party; 
	 

	 
		iv. Bankruptcy. The
		Party files a petition in bankruptcy, has filed against it an involuntary
		petition in bankruptcy and fails to controvert such petition in an appropriate
		manner within 60 days of the filing thereof, makes an assignment for the
		benefit of creditors, has a trustee or receiver appointed for any or all of its
		assets, is insolvent or fails or is unable to pay its debts when due. 
	 

	 
		(b) Right to Terminate Following Event of
		Default. If at any time an Event of Default with respect to a
		Party (the “Defaulting Party”) has occurred and is then continuing,
		the other Party (the “Non-Defaulting Party) may terminate this Agreement,
		by providing the Defaulting Party with at least 3 days’ notice; provided,
		however, that Client may terminate this Agreement immediately upon notice to
		CARGILL DIRECT upon any breach of the Risk Management Plan. No termination of
		this Agreement shall, however, relieve either Party of the obligation to pay
		the other Party any sums due the other Party under this Agreement.
	 

	 
		(c) No Limit On Default Remedies. This Section
		11 is not intended to and shall not be construed as limiting any rights or
		remedies either Party may otherwise have at law or in equity or pursuant to the
		provisions of this Agreement or the Master Agreement in connection with any
		breach or default by the other Party under this Agreement.
	 

	 
		12. Standard. Each Party shall perform its obligations under this
		Agreement in good faith and in a commercially reasonable manner.
	 

	 
		13. Counterparts. This Agreement
		may be executed in counterparts, each of which shall be deemed to be an
		original and both of which shall constitute one and the same instrument.

	 

	 
		14. Arbitration. All disputes and controversies arising out of this
		Agreement shall be subject to the dispute resolution procedures specified in
		Section 6(a) and Section 6(f) of the Master Agreement and, if unsuccessful,
		shall be settled in accordance with the arbitration agreement attached hereto
		and incorporated herein as Exhibit E.
		
	 

	 
		15. Integration. This Agreement and its Exhibits (and to the extent
		incorporated herein, the Master Agreement) sets forth the complete Agreement
		between the Parties with respect to the subject matter hereof. Other than the
		Master Agreement and the other Goods and Services Agreement described therein,
		there are no collateral agreements or representatives of either Party which
		affect this Agreement.
	 

	 
		[signature page follows]
	 

	 
		 
	 

	 
		8
	 

	 
 

	 
		IN WITNESS WHEREOF, this Agreement has been executed on behalf of Client
		and CARGILL DIRECT by their duly authorized representatives or officers as of
		the date first set forth
		above.
	 

	 
		 
	 

	 
			
				
				  BUFFALO LAKE ENERGY,
				  LLC
				

			 	
				
				   
				

			 	
				
				  CARGILL COMMODITY SERVICES
				  INC.,
 DBA CARGILL DIRECT
				

			 
	
				
				  
 By: 
				

			 	
				
				  /s/ Scott H. Pearce
				

			 	
				
				   
				

			 	
				
				  
 By: 
				

			 	
				
				  /s/ Dennis Inman
				

			 
	 	 	 	 	 
	
				
				  Name: 
				

			 	
				
				  Scott H. Pearce
				

			 	
				
				   
				

			 	
				
				  Name: 
				

			 	
				
				  Dennis Inman
				

			 
	 	 	 	 	 
	
				
				  Title: 
				

			 	
				
				  Authorized
				  Representative
				

			 	
				
				   
				

			 	
				
				  Title: 
				

			 	
				
				  President — Cargill
				  Commodity Services, Inc.
				

			 
	 	 	 	 	 

 

	 
		 
	 

	 
		9
	 

	 
 

	 
		EXHIBIT A
	 

	 
		POWER OF ATTORNEY FOR FUTURES AND OPTIONS
		ON FUTURES TRANSACTIONS
	 

	 
		Client hereby irrevocably constitutes and
		appoints CARGILL DIRECT as Client’s agent and true and lawful
		attorney-in-fact, in its name, place and stead, to (i) enter into OTC
		Transactions (as defined in their Futures Advisory Agreement) for the account
		and risk of Client through the Managed Account and (ii) order withdrawal of
		funds from the Managed Account to pay the brokerage commissions owed to Broker,
		subject in the case of both clause (i) and (ii) to the limits set forth in the
		Risk Management Plan in effect between Client and CARGILL DIRECT pursuant to
		their Futures Advisory Agreement. Client hereby agrees to indemnify and hold
		CARGILL DIRECT, its principals and affiliates, harmless from, and pay CARGILL
		DIRECT promptly upon demand, any and all loss, cost, indebtedness and
		liabilities arising therefrom; provided,
		however, that Client shall not be required to indemnify CARGILL
		DIRECT with respect to any such losses, costs, indebtedness or liabilities
		arising from a transaction for which CARGILL DIRECT is responsible as specified
		in Section 5 of the Future Advisory Agreement. Client hereby ratifies and
		confirms any and all transactions made by CARGILL DIRECT on behalf of or for
		the account of Client within the parameters set forth in the Risk Management
		Plan, and acknowledges that Client shall have no right of prior consultation
		with CARGILL DIRECT or of approval of particular trades, except to the extent
		such consultation is required by the Risk Management Plan. As attorney-in-fact,
		CARGILL DIRECT shall be, in all matters necessary or incidental to the conduct
		of the Managed Account authorized to act for Client in the same manner and with
		the same force and effect as Client might or could do. The foregoing power of
		attorney and commodity trading authority shall be deemed to be continuing and
		shall remain in full force and effect until such time as the Futures Advisory
		Agreement shall have been terminated pursuant to its terms. Such power of
		attorney may not be modified or limited orally or by any course of dealing
		between CARGILL DIRECT and Client; any such modification or limitation being
		required to be in writing to be of any force or effect.
	 

	 
		 
	 

	 
			
				
				  BUFFALO LAKE ENERGY,
				  LLC
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  
 By: 
				

			 	
				
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  
	
				
				  Name: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  
	
				
				  Title: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  

 

	 
		 
	 

	 
			
				
				  Cargill Commodity Services Inc.,
				  dba CARGILL DIRECT
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  
 By: 
				

			 	
				
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  
	
				
				  Name: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  
	
				
				  Title: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	
				
 	 	 	  

 

	 
		 
	 

	 
		 
	 

	 
 

	 
		EXHIBIT B
	 

	 
		RISK DISCLOSURE
		STATEMENT
	 

	 
		THE RISK OF LOSS IN TRADING COMMODITIES
		CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH
		TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. IN
		CONSIDERING WHETHER TO TRADE OR TO AUTHORIZE SOMEONE ELSE TO TRADE FOR YOU, YOU
		SHOULD BE AWARE OF THE FOLLOWING:
	 

	 
		IF YOU PURCHASE A COMMODITY OPTION YOU
		MAY SUSTAIN A TOTAL LOSS OF THE PREMIUM AND OF ALL TRANSACTION
		COSTS.
	 

	 
		IF YOU PURCHASE OR SELL A COMMODITY
		FUTURE OR SELL A COMMODITY OPTION YOU MAY SUSTAIN A TOTAL LOSS OF THE INITIAL
		MARGIN FUNDS AND ANY ADDITIONAL FUNDS THAT YOU DEPOSIT WITH YOUR BROKER TO
		ESTABLISH OR MAINTAIN YOUR POSITION. IF THE MARKET MOVES AGAINST YOUR POSITION,
		YOU MAY BE CALLED UPON BY YOUR BROKER TO DEPOSIT A SUBSTANTIAL AMOUNT OF
		ADDITIONAL MARGIN FUNDS, ON SHORT NOTICE, IN ORDER TO MAINTAIN YOUR POSITION.
		IF YOU DO NOT PROVIDE THE REQUESTED FUNDS WITHIN THE PRESCRIBED TIME, YOUR
		POSITION MAY BE LIQUIDATED AT A LOSS, AND YOU WILL BE LIABLE FOR ANY RESULTING
		DEFICIT IN YOUR ACCOUNT.
	 

	 
		UNDER CERTAIN MARKET CONDITIONS, YOU MAY
		FIND IT DIFFICULT OR IMPOSSIBLE TO LIQUIDATE A POSITION. THIS CAN OCCUR, FOR
		EXAMPLE, WHEN THE MARKET MAKES A “LIMIT MOVE.”
	 

	 
		THE PLACEMENT OF CONTINGENT ORDERS BY YOU
		OR YOUR TRADING ADVISOR, SUCH AS A “STOP-LOSS” OR
		“STOP-LIMIT” ORDER, WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE
		INTENDED AMOUNTS, SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE
		SUCH ORDERS.
	 

	 
		A “SPREAD” POSITION MAY NOT BE
		LESS RISKY THAN A SIMPLE “LONG” OR “SHORT”
		POSITION.
	 

	 
		THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN
		OBTAINABLE IN COMMODITY TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE
		USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS.
	 

	 
		IN SOME CASES, MANAGED COMMODITY ACCOUNTS
		ARE SUBJECT TO SUBSTANTIAL CHARGES FOR MANAGEMENT AND ADVISORY FEES. IT MAY BE
		NECESSARY FOR THOSE ACCOUNTS THAT ARE SUBJECT TO THESE CHARGES TO MAKE
		SUBSTANTIAL TRADING PROFITS TO AVOID DEPLETION OR EXHAUSTION OF THEIR ASSETS.
		THIS AGREEMENT CONTAINS A 
	 

	 
		 
	 

	 
		B-1
	 

	 
 

	 
		COMPLETE DESCRIPTION OF EACH FEE TO BE
		CHARGED TO YOUR ACCOUNT BY THE COMMODITY TRADING ADVISOR.
	 

	 
		THIS BRIEF STATEMENT CANNOT DISCLOSE ALL
		THE RISKS AND OTHER SIGNIFICANT ASPECTS OF THE COMMODITY MARKETS. YOU SHOULD
		THEREFORE CAREFULLY STUDY THIS DISCLOSURE DOCUMENT AND COMMODITY TRADING BEFORE
		YOU TRADE.
	 

	 
		THIS COMMODITY TRADING ADVISOR IS
		PROHIBITED BY LAW FROM ACCEPTING FUNDS IN THE TRADING ADVISOR’S NAME FROM
		A CLIENT FOR TRADING COMMODITY INTERESTS. YOU MUST PLACE ALL FUNDS FOR TRADING
		IN THIS TRADING PROGRAM DIRECTLY WITH A FUTURES COMMISSION MERCHANT.

	 

	 
		 
	 

	 
		B-2
	 

	 
 

	 
		EXHIBIT C
	 

	 
		CONFIDENTIALITY AGREEMENT
	 

	 
		This Confidentiality Agreement
		(“Agreement”), is made effective this _____ day of __________,
		20__ (the “Effective
		Date”) by and among CARGILL
		COMMODITY SERVICES INC. a Delaware corporation, doing business as CARGILL
		DIRECT (“CARGILL
		DIRECT”), BUFFALO LAKE ENERGY,
		LLC, a Delaware limited liability company (“Buffalo Lake”), and Cargill, Incorporated , a Delaware
		corporation (“Cargill”)
		collectively referred to hereinafter as “Parties” or
		individually as a “Party.”
	 

	 
		1. Purpose of this Agreement.
	 

	 
		The purpose of this Agreement is for the
		Parties to discuss matters relating to or in connection with the Futures
		Advisory Agreement, including the Goods and Services Agreements referred to
		therein (the “Futures Advisory
		Agreement”) entered into by the
		Parties dated _________, 2006 and the respective obligations of the Parties
		thereunder (“Purpose”),
		and to protect the confidential nature of such discussions. In order to
		facilitate discussions contemplated hereunder, Buffalo Lake may receive from,
		and provide to, CARGILL DIRECT and/or Cargill certain Confidential Information,
		as defined below. Each Party’s information is proprietary, secret, and
		confidential, and will be disclosed by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”) on the following terms and conditions.
	 

	 
		2. Definition of Confidential Information.
	 

	 
		“Confidential Information” shall
		mean any and all business, technical, and financial information related to the
		Purpose set forth above and disclosed by one Party to the other Party, either
		directly or indirectly. Confidential Information may include, by way of
		example, but without limitation, products, specifications, formulae, equipment,
		business strategies, customer lists, know-how, drawings, pricing information,
		inventions, ideas, and other information, or its potential use, that is owned
		by or in possession of CARGILL DIRECT or Cargill on the one hand, or Buffalo
		Lake on the other hand. 
	 

	 
		Confidential Information shall not include
		that which: (a) is in the public domain prior to disclosure by Disclosing
		Party; (b) becomes part of the public domain, by publication or otherwise,
		through no unauthorized act or omission on the part of the Receiving Party; (c)
		is lawfully in the Receiving Party’s possession prior to disclosure by the
		Disclosing Party; or (d) is independently developed by an employee(s) of the
		Receiving Party with no access to the disclosed Confidential
		Information.
	 

	 
		If Confidential Information is legally
		disclosed in confidence to the Receiving Party by a third party, then: (a) the
		Receiving Party shall have the right to use that portion of the above-mentioned
		Confidential Information so disclosed by the third party in connection with
		work done for that third party; and (b) such disclosure by that third party
		shall not place that portion of the above-mentioned Confidential Information in
		the public domain, and shall not relieve the Receiving Party of its obligations
		under this Agreement.
	 

	 
		 
	 

	 
		C-1
	 

	 
 

	 
		3. Obligations of Protection.
	 

	 
		Proper and appropriate steps shall be taken
		and maintained by the Receiving Party, at all times, to protect the
		Confidential Information received. Dissemination of Confidential Information
		shall be limited to employees or agents that are directly involved with
		discussions contemplated by this Agreement, and even then only to such extent
		as is necessary and essential. The Parties shall inform their employees and
		agents of the confidential nature of the information disclosed hereunder and
		cause all such employees and agents to abide by the terms of this Agreement.
		
	 

	 
		In addition, each Party may disclose
		Confidential Information regarding the Ethanol Facility and the performance of
		the Master Agreement, including the material terms thereof, to the Financing
		Parties as defined in the Master Agreement and to financial institutions and
		other Persons providing or expressing interest in providing debt financing or
		refinancing, lease financing and/or other credit support to Buffalo Lake in
		connection with the construction and operation of the Ethanol Facility, and to
		the agent or trustee of any of them, to existing or potential parties to Risk
		Management Transactions, as such term is defined in the Futures Advisory
		Agreement, and guarantors, to rating agencies, to Persons to which offering
		statements or other disclosure documents associated with the private or public
		offering of debt securities by or on behalf of Buffalo Lake are provided and to
		Persons that are potential equity transferees or purchasers of the Ethanol
		Facility; provided, however, that such Persons agree to bound by
		the terms hereof or otherwise agree to maintain the confidential nature of the
		information hereof in a manner reasonably acceptable to the Parties.
		Notwithstanding the foregoing, (i) each Party may publish information regarding
		the Master Agreement or the Ethanol Facility with the express written consent
		of the other Party, which consent shall not be unreasonably withheld, and (ii)
		each Party may provide information with respect to the Futures Advisory
		Agreement and the Ethanol Facility to its board members and equity owners
		consistent with its internal governance practices. Notwithstanding the
		foregoing, Buffalo Lake may disclose such information if requested by any
		governmental authority, if subject to a subpoena, or in connection with any
		litigation, arbitration or dispute.
	 

	 
		4. Obligations of Non-disclosure.
	 

	 
		The Receiving Party shall not disclose the
		Disclosing Party’s Confidential Information to any unauthorized party
		without prior express written consent of the Disclosing Party or unless
		required by law or court order. If a Party is required by law or court order to
		disclose Confidential Information of the other Party, they shall give the
		Disclosing Party prompt notice of such requirement so that an appropriate
		protective order or other relief may be sought.
	 

	 
		5. Authorized Use and Ownership of Confidential
		Information.
	 

	 
		Confidential Information will be used only
		in connection with discussions contemplated by this Agreement; no other use
		will be made of it by the Receiving Party, it being recognized that both
		Parties have reserved all rights to their respective Confidential Information
		not expressly granted herein.
	 

	 
		 
	 

	 
		C-2
	 

	 
 

	 
		All documents containing Confidential
		Information and provided by the Disclosing Party shall remain the property of
		the Disclosing Party, and all such documents, and copies thereof, shall be
		returned or destroyed upon the request of the Disclosing Party. Documents
		prepared by the Receiving Party using Confidential Information of the
		Disclosing Party, or derived therefrom, shall be destroyed upon request of the
		Disclosing Party, confirmation of which shall be provided in writing. The
		Receiving Party, however, may keep one copy of any document requested to be
		returned or destroyed in the files of its legal department or outside counsel
		for record purposes only.
	 

	 
		6. Term of Disclosure and Duration of
		Confidentiality.
	 

	 
		The period for disclosure of Confidential
		Information between the Parties under this Agreement shall be coterminous with
		the term of the Master Agreement. The obligations imposed by this Agreement,
		including but not limited to non-disclosure and non-use, however, shall endure
		for one (1) year from the expiration or earlier termination of the Master
		Agreement. 
	 

	 
		7. Ownership of Intellectual
		Property.
	 

	 
		This Agreement is not, and is not intended
		to be, for the development of or the conception of inventions. Should the
		Parties hereto choose to pursue such activities, the Parties hereby agree to
		draft a subsequent written agreement for such activities. 
	 

	 
		Except as expressly provided herein, no
		license or right is granted hereby to the Receiving Party, by implication or
		otherwise, with respect to or under any patent application, patent, claims of
		patent or proprietary rights of the Disclosing Party. 
	 

	 
		8. General Provisions.
	 

	 
		This Agreement shall be governed by and
		construed in accordance with the laws of the State of New York, USA
		(notwithstanding its principles of conflict of laws except for Sections 5-1401
		and 5-1402 of the New York General Obligations Law).
	 

	 
		This Agreement shall not be assigned by
		either Party without the prior written consent of the other Party, which
		consent shall not be unreasonably withheld. This Agreement shall be binding
		upon and shall inure to the benefit of the Parties and their permitted
		successors and assigns.
	 

	 
		Failure to enforce any provisions of this
		Agreement shall not constitute a waiver of any of the terms and conditions
		hereof.
	 

	 
		No amendment, modification, or waiver of the
		terms of this Agreement shall be binding unless placed in writing and duly
		executed by the Parties’ authorized representatives.
	 

	 
		[Signature page follows.]
	 

	 
		 
	 

	 
		C-3
	 

	 
 

	 
		The Parties, through their authorized
		representatives, hereby agree to the terms and conditions of this
		Confidentiality Agreement.
	 

	 
		 
	 

	 
			
				
				  CARGILL COMMODITY SERVICES
				  INC.       

				  d/b/a
 CARGILL DIRECT
				

			 	
				
				   
				

			 	
				
				  BUFFALO LAKE ENERGY,
				  LLC
				

			 
	
				
				  
 By: 
				

			 	
				
				

			 	
				
				   
				

			 	
				
				  By: 
				

			 	
				
				

			 
	 	 	 	 	 
	
				
				  Name: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Name: 
				

			 	
				
				   
				

			 
	 	 	 	 	 
	
				
				  Title: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Title: 
				

			 	
				
				   
				

			 
	 	 	 	 	 
	
				
				  Date: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				  Date: 
				

			 	
				
				   
				

			 
	 	 	 	 	 

 

	 
		 
	 

	 
			
				
				  CARGILL, INCORPORATED
				

			 	
				
				   
				

			 	
				
				   
				

			 
	
				
				  
 By: 
				

			 	
				
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				

			 
	 	 	 	 	  
	
				
				  Name: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	 	 	 	  
	
				
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				  Date: 
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 	
				
				   
				

			 
	 	 	 	 	  

 

	 
		 
	 

	 
		C-4

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