Document:

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                         [FORM OF FACE OF CERTIFICATE]

              Organized Under the Laws of the State of South Dakota

                                                           CLASS A CAPITAL UNITS

A-

                            SOYBEAN PROCESSORS, LLC

   THIS CERTIFIES THAT______________________________________ IS THE OWNER AND
  REGISTERED HOLDER OF___________________________________ CLASS A CAPITAL UNITS

                           in Soybean Processors, LLC

TRANSFERABLE ONLY ON THE BOOKS OF THE LIMITED LIABILITY COMPANY BY THE HOLDER
HEREOF IN PERSON OR BY DULY AUTHORIZED ATTORNEY UPON SURRENDER OF THIS
CERTIFICATE PROPERLY ENDORSED.

              IN WITNESS WHEREOF, THE SAID LIMITED LIABILITY COMPANY HAS CAUSED
              THIS CERTIFICATE TO BE SIGNED BY ITS DULY AUTHORIZED OFFICERS THIS
              DAY OF , 200__.

   ___________________________                   ___________________________
           SECRETARY                                      PRESIDENT

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                        [FORM OF REVERSE OF CERTIFICATE]

           The sale and transfer of the Capital Units represented
           by this Certificate are restricted by, and subject to,
           the provisions of the Operating Agreement of Soybean
           Processors, LLC. The Operating Agreement provides, among
           other things, that no sale, assignment, transfer, gift,
           exchange or other disposition of these Capital Units is
           valid except as specifically provided for in the
           Operating Agreement. Copies of the Operating Agreement
           and instructions for transfer, sale or other disposition
           of these Capital Units are available for inspection at
           the Company's principal office.

FOR VALUE RECEIVED __________ HEREBY SELL, ASSIGN AND TRANSFER UNTO ___________
_______________________________________________________________________________
_____________ CAPITAL UNITS REPRESENTED BY THE WITHIN CERTIFICATE, AND DO HEREBY
IRREVOCABLY CONSTITUTE AND APPOINT ________________________________ ATTORNEY TO
TRANSFER THE SAID CAPITAL UNITS ON THE BOOKS OF THE WITHIN NAMED LIMITED
LIABILITY COMPANY WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.

DATED         ____________________, 20_____

IN PRESENCE OF ___________________________________________________

NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THIS CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.<Page>

              FORM OF MORTGAGE - COLLATERAL REAL ESTATE MORTGAGE -
                                  SOUTH DAKOTA

      THIS MORTGAGE, made this 2nd day of October, 1995, between South Dakota
Soybean Processors, Volga, South Dakota, organized and existing under the laws
of the State of South Dakota, hereinafter called "Mortgagor", and CoBank, ACB,
a/k/a CoBank, organized, chartered and existing under the Farm Credit Act of
1971, and any amendments thereto, (hereinafter called the "Mortgagee").

      WHEREAS, in accordance with the Line of Credit Agreement(s) and/or Loan
Agreement(s) and any amendments, thereto, hereinafter called the "Agreement",
Mortgagor and Mortgagee have established and evidenced the willingness of
Mortgagee to loan money to Mortgagor in accordance with the terms and conditions
of the Agreement.

      WHEREAS, Mortgagor's obligation to repay any loans made by Mortgagee to
Mortgagor will be evidenced by said Agreement, and by one or more Notes
aggregating in principal amounts the amount of money which the Mortgagee has
committed to lend to the Mortgagor and, in addition to obligation to repay the
foregoing described loans, Mortgagor has other indebtedness, liabilities and
obligations to Mortgagee as is provided in said Agreement.

      WHEREAS, from time to time after the date hereof, at the option of the
parties, Mortgagor and Mortgagee may enter into one or more Agreement(s) to
provide for the Mortgagee making additional loans to the Mortgagor and changing
the other obligations of Mortgagor to Mortgagee, PROVIDED, HOWEVER, THIS RECITAL
SHALL NOT CONSTITUTE A COMMITMENT TO MAKE ADDITIONAL LOANS IN ANY AMOUNT.

      WHEREAS, Mortgagor's obligation to repay all future loans, additional
advances and increased advances other than those made in accordance with the
Agreement, will be evidenced by said Agreement, and by one or more Notes.

      WHEREAS, Mortgagor desires to mortgage the real estate described herein to
secure the payment of all Mortgagor's indebtedness, liabilities and obligations
to Mortgagee, including the indebtedness, liabilities and obligations evidenced
by said Agreement, and by one or more Notes dated on or before the date hereof,
and including all future loans, additional advances, increased advances and all
future indebtedness, liabilities and obligations of Mortgagor to Mortgagee,
evidenced by said Agreement, and by one or more Notes dated after the date
hereof.

      WHEREAS, THE PARTIES AGREE THAT THIS MORTGAGE CONSTITUTES A COLLATERAL
REAL ESTATE MORTGAGE PURSUANT TO SDCL 44-8-26.

      NOW, THEREFORE, for and in consideration of the premises and the amount of
the initial advance made to Mortgagor by Mortgagee in accordance with said
Agreement, and to induce Mortgagee to make future advances to Mortgagor, in
order to secure the payment of all of Mortgagor's indebtedness, liabilities and
obligations to Mortgagee, including the indebtedness, liabilities and
obligations evidenced by said Agreement, and by one or more Notes, and including
all future loans, additional advances increased advances and all future
obligations of

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Mortgagor to Mortgagee made and incurred prior to (the final date up to which
future advances may be made) the principal amount of all of which, not including
sums advanced to protect the hereinafter defined property, shall not exceed (the
ultimate future advance amount), the Mortgagor has executed and delivered this
Mortgage and hereby mortgages to the said Mortgagee the following described
Property, to wit:

                   (DESCRIPTION - SEE ATTACHED EXHIBIT "A")

Together with all of the improvements now or hereafter erected on the foregoing
described Property, and all easements, rights, appurtenances, rents, royalties,
mineral, oil and gas rights and profits, water, water rights and water stock,
and all fixtures now or hereafter attached to the foregoing described Property,
all of which, including replacements and additions thereto, shall be deemed to
be and remain part of the Property covered by this Mortgage; and all of the
foregoing, together with said foregoing described Property (or the leasehold
estate in the event this Mortgage is on leasehold) are herein referred to as the
"Property."

      TO HAVE AND TO HOLD the Property unto the Mortgagee, forever, the
intention being to convey an absolute title in fee to said Property and the
Mortgagor covenants and agrees:

      FIRST. That it will keep the Property and all parts thereof insured by
policies of insurance, of such kinds and in forms and amounts and with a company
or companies satisfactory to the Mortgagee, with a clause or clauses attached
making loss payable to the Mortgagee as its interest may appear; if so requested
by the Mortgagee, the said policies of insurance are to be delivered to the
Mortgagee. The Mortgagee is hereby given a first lien on any insurance proceeds
paid as a result of loss or damage to the Property. Any insurance funds paid to
the Mortgagee as a result of damage or loss to the Property shall, at the option
of the Mortgagee, be credited against the payment or payments of the
indebtedness, liabilities and obligations secured by this Mortgage.

      SECOND. That it will pay all premiums upon insurance policies, licenses,
or fees legally owing by the Mortgagor, and all taxes and assessments which may
be levied or assessed upon the Property, and in default thereof the Mortgagee
may pay the said insurance premiums, licenses, fees, taxes, or assessments due,
and any amount so paid shall become a part of the principal debt, shall bear
interest from the date of payment at the rate of eighteen percent per annum,
shall, together with interest, be a lien on the Property and be secured by this
Mortgage and shall be immediately due and payable.

      THIRD. That it will keep all buildings and equipment subject to this
Mortgage in good and substantial repair during the continuance hereof and will
not cause, suffer, or permit waste thereof.

      FOURTH. That it will bear all expenses or costs incident to the release
of the lien of this Mortgage, in whole or in part.

      FIFTH. That it will, at all times during the existence of any part of the
lien herein provided for, maintain and operate its business in such a manner
that it will remain an entity

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qualified to borrow under the provisions of the Act of Congress known as the
Farm Credit Act of 1971, as amended.

      SIXTH. That it will not, during the existence of any part of the lien
herein provided for, sell, lease, or assign all, or any part of the Property
without the prior written consent of the Mortgagee approving such sale, lease,
or assignment. If all or part of the Property is sold without the prior written
consent of the Mortgagee, then the entire balance owing at that time at the
option of the Mortgagee may be declared immediately due and payable upon sixty
(60) days' notice to the Mortgagor, and if the entire balance due and payable is
not paid, this Mortgage may be foreclosed as provided for under the laws of the
State of South Dakota.

      SEVENTH. That no remedy herein conferred on or reserved to the Mortgagee
is intended to be exclusive of any other remedy or remedies, and each and every
such remedy shall be cumulative to and shall be in addition to every other
remedy given hereunder, and now or hereafter existing at law or in equity or, by
statute, by operations of law or otherwise.

      EIGHTH. That every right, remedy, privilege, covenant, agreement, and
power granted hereunder to the said Mortgagee shall run, inure and be likewise
for the benefit of any or all successors or assigns of said Mortgagee.

      NINTH. That it is lawfully seized of the Property, has good right to sell
and convey same, free of all encumbrances, that it will defend the quiet
enjoyment thereof by the Mortgagee, and will warrant and defend the same against
all lawful claims of any person whomsoever; that it will not remove all or any
portion of the said Property from the county.

      TENTH. Mortgagor further makes the following representations, warranties,
and covenants, all of which are subject to any exceptions that Mortgagor may
have previously disclosed in writing to Mortgagee, and which, to the extent that
they deal with representations of fact, are based on Mortgagor's present
knowledge, arrived at after reasonable inquiry.

(1) USE OF PROPERTY AND FACILITIES. (a) Mortgagor will (i) use, handle,
transport or store Hazardous Materials as defined under any Environmental Law or
(ii) store or treat nonhazardous wastes (a) in a good and prudent manner in the
ordinary course of business, and (b) in compliance with all applicable
Environmental Laws.

      (b) Mortgagor will not conduct or allow to be conducted, in violation of
any Environmental Law, any business, operations or activity on the Property, or
employ or use the Property to generate, use, handle, manufacture, treat, store,
process, transport or dispose. of any Hazardous Materials, or any other
substance which is prohibited, controlled or regulated under applicable law, or
which poses a threat or nuisance to public safety, health or the environment or
cause, or allow to be caused, a known or suspected release of Hazardous
Materials on, under or from the Property.

      (c) Mortgagor will not do or permit any act or thing, business or
operation; that poses an unreasonable risk of harm, or impairs, or may impair,
the value of the Property, or any part thereof.

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(2) CONDITION OF PROPERTY. (a) Mortgagor shall take all appropriate response
action, including any removal and remedial action, in the event of a release,
emission, discharge or disposal of Hazardous Materials in, on, under or about
the Property, so as to remain in compliance with Environmental Law as
hereinafter defined.

      (b) Underground tanks, wells (except domestic water wells), septic tanks,
ponds, pits, or any other storage tanks (whether currently in use or abandoned)
on the Property, if any, are maintained in compliance with applicable
Environmental Law.

(3) NOTICE OF ENVIRONMENTAL PROBLEM OR LITIGATION. Neither Mortgagor nor any of
its tenants have given, nor were they required to give, nor have they received,
any notice, letter, citation, order, warning, complaint, inquiry, claim or
demand that: (i) Mortgagor and/or any tenants have violated, or are about to
violate, any Environmental Law, judgment or order; (ii) there has been a
release, or there is a threat of release, of Hazardous Materials from the
Property; (iii) Mortgagor and/or tenants may be or are liable, in whole or in
part, for the costs or cleaning up, remediating, removing or responding to a
release or threatened release of Hazardous Materials; (iv) the Property is
subject to a lien in favor of any governmental entity or any liability, costs or
damages, under any Environmental Law arising from or costs incurred by such
governmental entity in response to a release or a threatened release of a
Hazardous Material. Mortgagor further represents and warrants that no conditions
currently exist or are currently reasonably foreseeable, that would subject
Mortgagor to any such investigation, litigation, administrative enforcement or
any damages, penalties, injunctive relief, or cleanup costs under any
Environmental Law. In the event of such notice, Mortgagor and any tenants shall
immediately provide a copy to the Mortgagee.

(4) RIGHT OF INSPECTION. Mortgagor hereby grants, and will cause any tenants to
grant, to Mortgagee, its agents, attorneys, employees, consultants, contractors,
successors and assigns, an irrevocable license and authorization, upon
reasonable notice, to enter upon and inspect the Property and facilities
thereon, and perform such tests, including without limitation, subsurface
testing, soils and groundwater testing, and other tests which may physically
invade the Property thereon, as the Mortgagee in its sole discretion, determines
are necessary to protect its security interest, provided however, that under no
circumstances shall the Mortgagee be obligated to perform such inspections or
tests.

(5) INDEMNITY. Mortgagor agrees to indemnify and hold Mortgagee, its directors,
employees, agents, and its successors and assigns, harmless from and against any
and all claims, losses, damages, liabilities, fines, penalties, charges,
judgments, administrative orders, remedial action requirements, enforcement
actions of any kind, and all costs and expenses incurred in connection therewith
(including, but not limited to, attorney's fees and expenses) arising directly
or indirectly, in whole or in part, out of any failure of Mortgagor to comply
with the environmental representations, warranties and covenants contained
herein.

(6) CONTINUATION OF REPRESENTATIONS, WARRANTIES, COVENANTS AND INDEMNITIES.
Mortgagor's representations, warranties, covenants and indemnities contained
herein shall survive the occurrence of any event whatsoever; including without
limitation, the satisfaction of the

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promissory note(s) secured hereby, the reconveyance or foreclosure of this
mortgage, the acceptance by Mortgagee of a deed in lieu of foreclosure, or any
transfer or abandonment of the Property.

(7) CORRECTIVE ACTION. In the event the Mortgagor is in breach of any of its
representations, warranties or agreements as set forth above, Mortgagor at its
sole expense, shall take all action required, including environmental cleanup of
the Property, to comply with the representations, warranties and covenants
herein or applicable legal requirements and, in any event, shall take all action
deemed necessary under all applicable Environmental Laws.

(8) HAZARDOUS MATERIALS DEFINED. The term "Hazardous Materials" shall mean
dangerous, toxic, or hazardous pollutants, contaminants, chemicals, wastes,
materials or substances, as defined in or governed by the provisions of any
Environmental Law:

(9) ENVIRONMENTAL LAW DEFINED. The term "Environmental Law" shall mean any
federal, state or local law, statute, ordinance, rule, regulations,
administrative order and permit now in effect or hereinafter enacted, pertaining
to the public health, safety, industrial hygiene, or the environmental
conditions on, under or about the Property.

      ELEVENTH. That in the event the Mortgagor defaults in the payment of all
or any of the indebtedness, liabilities and obligations of Mortgagor to
Mortgagee evidenced by said Agreement and by one or more Notes, when due whether
by acceleration or otherwise, or defaults in the payment of any insurance
premiums or taxes, or in the event of the violation of any of the other
conditions, agreements or covenants, or in the event the Mortgagor fails or
refuses to make the investment in the Mortgagee as required by the Farm Credit
Act of 1971, as amended, or upon any change of ownership by legal process,
execution, judicial sale, or operation of law, or if the Mortgagor shall cease
the operation of its plant, then the Mortgagee may elect, upon twenty (20) days'
notice, that the whole of the principal sum hereby secured, or so much as shall
then remain unpaid, together with any interest accrued thereon, shall
immediately become due and payable, and the Mortgagee may immediately foreclose
this Mortgage or pursue any other available legal remedy. Provided that in the
event of such default and prior to said foreclosure and sale, the Mortgagee is
hereby. authorized to enter upon the Property, to take possession of the same,
and to rent or lease any of the Property to any person, who is hereby authorized
to occupy the said Property, the proceeds thereof, after deducting all necessary
expenses, to be applied to the payment of the indebtedness, liabilities and
obligations secured hereby; and said Mortgagor hereby appoints and designates
the Mortgagee, or any person appointed by it therefor, as its agent and attorney
in fact, with full power and authority to execute, in the name of and by
authority of the Mortgagor, any instrument by which the Mortgagee exercise any
of the rights and privileges herein conferred. In the event of any action by the
Mortgagee to enforce collection of said indebtedness, liabilities or
obligations, the Mortgagor agrees that all costs of such action, including
reasonable attorney's fees and actual disbursements necessarily incurred, shall
be paid for by the Mortgagor and recovered by the Mortgagee. In the case of
foreclosure, and during the period of redemption, the Mortgagor hereby assigns
all of its right and interest to the rents and income of the mortgaged premises
to the Mortgagee. In the case of foreclosure, the Mortgagor shall pay to the
holder of this Mortgage,

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the difference between the sums due and secured by the Mortgage and the net
proceeds of sale, if less than the total due.

      TWELFTH. That the omission of the Mortgagee to exercise any option
hereunder, in case of any default by the Mortgagor, shall not preclude it from
the exercise thereof at any subsequent time, or for any subsequent default, and
nothing but a written contract of the Mortgagee shall be a waiver of any such
option.

      THIRTEENTH. It is further agreed that in case of default in respect to any
of the terms of this Mortgage, the Mortgagee, either before or on the
commencement of an action to foreclose this Mortgage, or at any time thereafter,
shall be entitled to the appointment of a receiver, who shall have the power to
take and hold possession of said Property and to rent the same, collect the
rents and profits therefrom for the benefit of said Mortgagee, pay the taxes
levied against said Property, and keep the same in repair, and such right shall
in no event be barred, forfeited, or retarded by reason of judgment, decree or
sale in such foreclosure, and the right to have such receiver appointed upon
application of the Mortgagee shall exist regardless of the fact of solvency or
insolvency of the Mortgagor, and regardless of the value of said mortgaged
premises, or the waste, loss, and destruction of the rents and profits of said
mortgaged premises during the statutory period of redemption. The right to the
appointment of such receiver shall be construed as auxiliary to and in aid of
any other rights under this Mortgage as hereinbefore provided, and in no manner
as detracting from or in derogation of said lien.

      FOURTEENTH. And whereas the said Mortgagor in making application for a
loan has made certain representations to the Mortgagee as to the purpose or
purposes for which the money loaned on this Mortgage was borrowed, such
representations are hereby specifically referred to and made a part of this
Mortgage. It is further agreed that this Mortgage is made pursuant, and is
subject to all the provisions of the Act of Congress known as the Farm Credit
Act of 1971, and all Acts amendatory thereof or supplementary thereto.

      PROVIDED, NEVERTHELESS, that this Mortgage and all the conditions hereof,
shall be and become null and void upon the making by the Mortgagor of the
payments and meeting of conditions and covenants herein stated and stated in the
Agreement, otherwise to remain in full force and effect.

      The Mortgagor hereby acknowledges that the Mortgagee has delivered to it,
and it has, at the time of the delivery of this Mortgage, received a true
duplicate copy of said instrument.

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      IN WITNESS WHEREOF, the Mortgagor having complied with all the conditions
necessary to render this a valid mortgage, and its officers being duly
authorized to do so, has executed this Mortgage and affixed its seal thereto on
the day and year first above written.

                                         South Dakota Soybean Processors

                                         MORTGAGOR

(Corporate Seal)
                                         By:
                                            ------------------------------
                                                  President

                                         ---------------------------------
                                                  (Print)

ATTEST:
         -------------------------
         Secretary

         -------------------------
         (Print)

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                                 ACKNOWLEDGMENT

STATE OF SOUTH DAKOTA         )
                              )ss.
COUNTY OF    _____________    )

On this ____day of ___________________, 19___, before me ______________, a

Notary Public in and for said County, personally appeared

____________________________ and ________ _________________________, to me

personally known, who, being by me duly sworn did say that they are

respectively, President and Secretary of South Dakota Soybean Processors, Volga,

South Dakota,

** that the seal affixed to said instrument is the seal of said corporation,

** that said corporation has no corporate seal, and that the instrument was

signed and sealed on behalf of said corporation by authority of its Board of

Directors, and that said officers above named acknowledged the execution of said

instrument to be the voluntary act and deed of said corporation, and by it

voluntarily executed.

      IN WITNESS WHEREOF, I have hereunto signed my name and affixed my Notarial

Seal at _____________________________, in said County, the day and year last

above written.

      My commission expires ______________________________________.

                                  ----------------------------------------------
                                  Notary Public in and for said County and State
(SEAL IF ANY)

**CROSS OUTLINE NOT APPLICABLE

-----------------------------------------------------------------------
THIS INSTRUMENT WAS DRAFTED BY:
PATTY MAESTAS, COLLATERAL APPRAISAL ASSISTANT FOR
COBANK, ACB
OMAHA BANKING CENTER
11837 MIRACLE HILLS DRIVE
SUITE 200
OMAHA, NEBRASKA 68154-4404
PHONE NUMBER:  (402) 492-2000
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ALL OF THE FOLLOWING DESCRIBED REAL ESTATE IN BROOKINGS COUNTY, SOUTH DAKOTA, TO
WIT:

A tract of land (to be platted and known as "South Dakota Soybean Processor's
Tract One (1) in the NW 1/4 of Section Twenty-four (24), Township One Hundred
Ten (110) North, Range Fifty-one (51) West of the 5th P.M., in Brookings
County, South Dakota)

Said Tract is a part of the NW 1/4 - 24-T110N-R51W of the 5th P.M., EXCEPT Lot
H-1 thereof, and EXCEPT the railroad right of way thereof, and EXCEPT Lots 1, 2,
3 of Volga Lagoon Addition thereof, and EXCEPT Lots "A" and "B" thereof, and
EXCEPT O.L. "T" thereof, and EXCEPT East 152.5' of West 362.5' of North 285.5'
of South 500' thereof, and EXCEPT the East 441' of the West 651' of the South
214.5' thereof, all in Brookings County, South Dakota. (Copy of proposed plat
attached)

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[PLAT OF SOUTH DAKOTA SOYBEAN PROCESSOR'S TRACT ONE]

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                                   COBANK, ACB

                           FORM OF SECURITY AGREEMENT

This Security Agreement is executed and delivered by South Dakota Soybean
Processors, (the  "Debtor"), having its place of business (or chief executive
office if more than one place of business) located at Box 500, Volga, South
Dakota, 57071 and whose taxpayer identification number is 46-0429869, to
CoBank, ACB, a/k/a CoBank (the "Secured Party"), whose mailing address for
its St. Louis Banking Center is: 1415 Olive Street, St. Louis, Missouri
63103.

SECTION 1.  GRANT OF SECURITY INTEREST.

For valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Debtor hereby grants to the Secured Party a security interest
in all of the following property, wherever located and whether now existing or
hereafter acquired, together with all accessions and additions thereto, and all
products and proceeds thereof:

accounts; inventory (including without limitation, returned or repossessed
goods); chattel paper; instruments (including certificated securities); letters
of credit; documents; equipment; farm products; fixtures; general intangibles
(including without limitation, choses or things in action, litigation rights and
resulting judgments, goodwill, patents, trademarks and other intellectual
property, tax refunds, miscellaneous rights to payment, entitlements,
uncertificated investment securities and investments, equities and patronage
rights in all cooperatives, margin accounts, computer programs, invoices, books,
records and other information relating to or arising out of the Debtor's
business); and, to the extent not covered by the above, all other personal
property of the Debtor of every type and description, including without
limitation, interests or claims in or under any policy of insurance, tort
claims, deposit accounts, money, and judgments (the "Collateral").

Where applicable, all terms used herein shall have the same meaning as set forth
in the Uniform Commercial Code (the "UCC").

SECTION 2.  THE OBLIGATIONS.

The security interest granted hereunder shall secure the payment of all
indebtedness and the performance of all obligations of the Debtor to the Secured
Party of every type and description, whether now existing or hereafter arising,
fixed or contingent, as primary obligor or as guarantor or surety, acquired
directly or by assignment or otherwise, liquidated or unliquidated, regardless
of how they arise or by what agreement or instrument they may be evidenced,
including without limitation all loans, advances and other extensions of credit
and all covenants, agreements, and provisions contained in all loan and other
agreements between the parties (the "Obligations").

SECTION 3.  REPRESENTATIONS, WARRANTIES AND COVENANTS.

The Debtor represents, warrants and covenants as follows:

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A.    TITLE TO COLLATERAL. Except as permitted by any other written agreement
      between the parties, and except for any security interest in favor of
      the Secured Party, the Debtor has clear title to all Collateral free of
      all adverse claims, interests, liens, or encumbrances. Without the
      prior written consent of the Secured Party, the Debtor shall not create
      or permit the existence of any adverse claims, interests, liens, or
      other encumbrances against any of the Collateral. The Debtor shall
      provide prompt written notice to the Secured Party of any future
      adverse claims, interests, liens, or encumbrances against all
      Collateral, and shall defend diligently the Debtor's and the Secured
      Party's interests in all Collateral.

B.    VALIDITY OF SECURITY AGREEMENT:  CORPORATE AUTHORITY. This Security
      Agreement is the valid and binding obligation of the Debtor,
      enforceable in accordance with its terms. The Debtor has the corporate
      power to execute, deliver and carry out the terms and provisions of
      this Security Agreement and all related documents, and has taken all
      necessary corporate action to authorize the execution, delivery and
      performance of this Security Agreement and all related documents.

C.    LOCATION OF THE DEBTOR. The Debtor's place of business (or chief
      executive office if more than one place of business) is located at the
      address shown above.

D.    LOCATION OF COLLATERAL. All equipment, inventory, farm products and
      fixtures, now at the Debtor's places of business located in Brookings
      County, South Dakota, and any other locations in the State of South
      Dakota, as the Debtor may direct.

E.    NAME, IDENTITY, AND CORPORATE STRUCTURE.  Except as otherwise disclosed
      to the Secured Party in writing, the Debtor has not within the past ten
      years changed its name, identity or corporate structure through
      incorporation, merger, consolidation, joint venture or otherwise.

F.    CHANGE IN NAME, LOCATION OF COLLATERAL, ETC. Without giving at least
      thirty days' prior written notice to the Secured Party, the Debtor shall
      not change its name, identity or corporate structure, the location of its
      place of business (or chief executive office if more than one place of
      business), or the location of the Collateral.

G.    FURTHER ASSURANCES. Upon the request of the Secured Party, the Debtor
      shall do all acts and things as the Secured Party may from time to time
      deem necessary or advisable to enable it to perfect, maintain, and
      continue the perfection and priority of the security interest of the
      Secured Party in the Collateral, or to facilitate the exercise by the
      Secured Party of any rights or remedies granted to the Secured Party
      hereunder or provided by law. Without limiting the foregoing, the
      Debtor agrees to execute, in form and substance satisfactory to the
      Secured Party, such financing statements, amendments thereto,
      supplemental agreements, assignments, notices of assignments, and other
      instruments and documents as the Secured Party may from time to time
      request. In addition, in the event the Collateral or any part thereof
      consists of instruments, documents, chattel paper, or money (whether or
      not proceeds of the Collateral), the Debtor shall, upon the request of
      the Secured Party, deliver possession thereof to the Secured Party (or
      to an agent of the Secured Party retained for that purpose), together
      with any appropriate endorsements

<Page>

      and/or assignments. The Secured Party shall use reasonable care in the
      custody and preservation of such Collateral in its possession, but shall
      not be required to take any steps necessary to preserve rights against
      prior parties. All costs and expenses incurred by the Secured Party to
      establish, perfect, maintain, determine the priority of, or release the
      security interest granted hereunder (including the cost of all filings,
      recordings, and taxes thereon and the fees and, expenses of any agent
      retained by Secured Party) shall become part of the Obligations secured
      hereby and be paid by the Debtor on demand.

H.    INSURANCE. The Debtor shall maintain such property and casualty
      insurance with such insurance companies, in such amounts, and covering
      such risks, as are at all times satisfactory to the Secured Party. All
      such policies shall provide for loss payable clauses or endorsements in
      form and content acceptable to the Secured Party. Upon the request of
      the Secured Party, all policies (or such other proof of compliance with
      this Section as may be satisfactory to the Secured Party) shall be
      delivered to the Secured Party. The Debtor shall pay all insurance
      premiums when due. In the event of loss, damage, or injury to any
      insured Collateral, the Secured Party shall have full power to collect
      any and all insurance proceeds due under any of such policies, and may,
      at its option, apply such proceeds to the payment of any of the
      Obligations secured hereby, or may apply such proceeds to the repair or
      replacement of such Collateral.

I.    TAXES, LEVIES, ETC.  The Debtor has paid and shall continue to pay when
      due all taxes, levies, assessments, or other charges which may become
      an enforceable lien against the Collateral.

J.    DISPOSITION AND USE OF COLLATERAL BY THE DEBTOR. Without the prior written
      consent of the Secured Party and provided the Debtor is not in default
      hereunder, the Debtor shall not at any time sell, transfer, lease,
      abandon, or otherwise dispose of any Collateral except in the ordinary
      course of its business. The Debtor shall not use any of the Collateral in
      any manner which violates any statute, regulation, ordinance, rule,
      decree, order, or insurance policy.

K.    RECEIVABLES. The Debtor shall preserve, enforce, and collect all
      accounts, chattel paper, instruments, documents and general
      intangibles, whether now owned or hereafter acquired or arising (the
      "Receivables"), in a diligent fashion and, upon the request of the
      Secured Party, the Debtor shall execute an agreement in form and
      substance satisfactory to the Secured Party by which the Debtor shall
      direct all account debtors and obligors on instruments to make payment
      to a lock box deposit account under the exclusive control of the
      Secured Party.

L.    CONDITION OF COLLATERAL.  All tangible Collateral is now in good repair
      and condition and the Debtor shall at all times hereafter, at its own
      expense, maintain all such Collateral in good repair and condition.

M.    CONDITION OF BOOKS AND RECORDS. The Debtor has maintained and shall
      maintain complete, accurate and up-to-date books, records, accounts, and
      other information relating to all Collateral in such form and in such
      detail as may be satisfactory to the

<Page>

      Secured Party, and shall allow the Secured Party or its representatives at
      any reasonable time to examine and copy such books, records, accounts, and
      other information.

N.    RIGHT OF INSPECTION.  At all reasonable times upon the request of the
      Secured Party, the Debtor shall allow the Secured Party or its
      representatives to visit any of the Debtor's properties or locations so
      that the Secured Party or its representatives may confirm, inspect and
      appraise any of the Collateral.

SECTION 4.  DEFAULT.

The breach of any of the Obligations secured hereby, and/or the breach of any
representation, warranty, covenant, or agreement contained in this Security
Agreement, shall constitute default hereunder.

SECTION 5.   RIGHTS AND REMEDIES.

Upon the Debtor's default and at any time thereafter, the Secured Party may
declare all Obligations to be immediately due and payable and may exercise any
and all rights and remedies of the Secured Party in the enforcement of its
security interest under the UCC, this Security Agreement, or any other
applicable law. Without limiting the foregoing:

A.    DISPOSITION OF COLLATERAL.  The Secured Party may sell, lease, or
      otherwise dispose of all or any part of the Collateral, in its then
      present condition or following any commercially reasonable preparation
      or processing thereof, whether by public or private sale or at any
      brokers' board, in lots or in bulk, for cash, on credit or otherwise,
      with or without representations or warranties, and upon such other
      terms as may be acceptable to the Secured Party, and the Secured Party
      may purchase at any public sale. At any time when advance notice of
      sale is required, the Debtor agrees that ten days' prior written notice
      shall be reasonable. In connection with the foregoing, the Secured
      Party may:

      1.    require the Debtor to assemble the Collateral and all records
            pertaining thereto and make such Collateral and records available to
            the Secured Party at a place to be designated by the Secured Party
            which is reasonably convenient to both parties;

      2.    enter the premises of the Debtor or premises under the Debtor's
            control and take possession of the Collateral;

      3.    without charge, use or occupy the premises of the Debtor or
            premises under the Debtor's control, including without
            limitation, warehouse and other storage facilities;

      4.    without charge, use any patent, trademark, tradename, or other
            intellectual property or technical process used by the Debtor in
            connection with any of the Collateral; and

<Page>

      5.    rely conclusively upon the advice or instructions of any one or more
            brokers or other experts selected by the Secured Party to determine
            the method or manner of disposition of any of the Collateral and, in
            such event, any disposition of the Collateral by the Secured Party
            in accordance with such advice or instructions shall be deemed to be
            commercially reasonable.

B.    COLLECTION OF RECEIVABLES.  The Secured Party may, but shall not be
      obligated to, take all actions reasonable or necessary to preserve,
      enforce or collect the Receivables, including without limitation, the
      right to notify account debtors and obligors on instruments to make
      direct payment to the Secured Party, to permit any extension,
      compromise, or settlement of any of the Receivables for less than face
      value, or to sue on any Receivable, all without prior notice to the
      Debtor.

C.    PROCEEDS.  The Secured Party may collect and apply all proceeds of the
      Collateral, and may endorse the name of the Debtor in favor of the
      Secured Party on any and all checks, drafts, money orders, notes,
      acceptances, or other instruments of the same or a different nature,
      constituting, evidencing, or relating to the Collateral. The Secured
      Party may receive and open all mail addressed to the Debtor and remove
      therefrom any cash or non-cash items of payment constituting proceeds
      of the Collateral.

D.    INSURANCE ADJUSTMENTS. The Secured Party may adjust, settle, and cancel
      any and all insurance covering any Collateral, endorse the name of the
      Debtor on any and all checks or drafts drawn by any insurer, whether
      representing payment for a loss or a return of unearned premium, and
      execute any and all proofs of claim and other documents or instruments of
      every kind required by any insurer in connection with any payment by such
      insurer.

The net proceeds of any disposition of the Collateral may be applied by the
Secured Party, after deducting its reasonable expenses incurred in such
disposition, to the payment in whole or in part of the Obligations in such order
as the Secured Party may elect. The enumeration of the foregoing rights and
remedies is not intended to be exhaustive, and the exercise of any right and/or
remedy shall not preclude the exercise of any other rights or remedies, all of
which are cumulative and non-exclusive.

SECTION 6.  OTHER PROVISIONS.

A.    AMENDMENT, MODIFICATION, AND WAIVER.  Without the prior written consent
      of the Secured Party, no amendment, modification, or waiver of, or
      consent to any departure by the Debtor from, any provision hereunder
      shall be effective. Any such amendment, modification, waiver, or
      consent shall be effective only in the specific instance and for the
      specific purpose for which given. No delay or failure by the Secured
      Party to exercise any remedy hereunder shall be deemed a waiver thereof
      or of any other remedy hereunder. A waiver on any one occasion shall
      not be construed as a bar to or waiver of any remedy on any subsequent
      occasion.

<Page>

B.    COSTS AND ATTORNEYS' FEES. Except as prohibited by law, if at any time
      the Secured Party employs counsel in connection with the creation,
      perfection, preservation, or release of the Secured Party's security
      interest in the Collateral or the enforcement of any of the Secured
      Party's rights or remedies hereunder, all of the Secured Party's
      reasonable attorney's fees arising from such services and all expenses,
      costs, or charges relating thereto shall become part of the Obligations
      secured hereby and be paid by the Debtor on demand.

C.    NO OBLIGATION TO MAKE LOANS.  Nothing contained herein or in any
      financing statement or other document executed or filed in connection
      herewith shall be construed to obligate the Secured Party to make any
      loans or advances to the Debtor, whether pursuant to a commitment or
      otherwise.

D.    REVIVAL OF OBLIGATIONS.  To the extent the Debtor or any third party
      makes a payment or payments to the Secured Party or the Secured Party
      enforces its security interest or exercises any right of setoff, and
      such payment or payments or the proceeds thereof are subsequently
      invalidated, declared to be fraudulent or preferential, set aside,
      and/or required to be repaid to a trustee, receiver, or any other party
      under any bankruptcy, insolvency or other law or in equity, then, to
      the extent of such recovery, the Obligations or any part thereof
      originally intended to be satisfied shall be revived and continued in
      full force and effect as if such payment or payments had not been made,
      or such enforcement or setoff had not occurred.

E.    PERFORMANCE BY THE SECURED PARTY.  In the event the Debtor shall at any
      time fail to pay or perform punctually any of its duties hereunder, the
      Secured Party may, at its option and without notice to or demand upon
      the Debtor, without obligation and without waiving or diminishing any
      of its other rights or remedies hereunder, fully perform or discharge
      any of such duties. All costs and expenses incurred by the Secured
      Party in connection therewith, together with interest thereon at the
      Secured Party's National Variable Rate plus four percent per annum,
      shall become part of the Obligations secured hereby and be paid by the
      Debtor upon demand.

F.    INDEMNIFICATION, ETC. The Debtor hereby expressly indemnifies and holds
      the Secured Party harmless from any and all claims, causes of action,
      or other proceedings, and from any and all liability, loss, damage and
      expense of every nature, arising by reason of the Secured Party's
      enforcement of its rights and remedies hereunder, or by reason of the
      Debtor's failure to comply with any environmental or other law or
      regulation. As to any action taken by the Secured Party hereunder, the
      Secured Party shall not be liable for any error of judgment or mistake
      of fact or law, absent gross negligence or willful misconduct on its
      part.

G.    POWER OF ATTORNEY.  The Debtor hereby appoints the Secured Party or the
      Secured Party's designee as its attorney-in-fact, which appointment is
      irrevocable, durable, and coupled with an interest, with full power of
      substitution, in the name of the Debtor or in the name of the Secured
      Party, to take any action which the Debtor is obligated to perform
      hereunder or which the Secured Party may deem necessary or advisable to
      accomplish

<Page>

      the purposes of this Security Agreement. In taking any action in
      accordance with this Section, the Secured Party shall not be deemed to be
      the agent of the Debtor. The powers conferred upon the Secured Party in
      this Section are solely to protect its interest in the Collateral and
      shall not impose any duty upon the Secured Party to exercise any such
      powers.

H.    CONTINUING EFFECT. This Security Agreement, the Secured Party's security
      interest in the Collateral, and all other documents or instruments
      contemplated hereby shall continue in full force and effect until all of
      the Obligations have been satisfied in full, the Secured Party has no
      commitment to make any further advances to the Debtor, and the Debtor has
      sent a valid written demand to the Secured Party for termination of this
      Security Agreement.

I.    BINDING EFFECT. This Security Agreement shall be binding upon and inure
      to the benefit of the Debtor and the Secured Party and their respective
      successors and assigns.

J.    SECURITY, AGREEMENT AS FINANCING STATEMENT.  A photographic copy or
      other reproduction of this Security Agreement may be used as a
      financing statement.

K.    GOVERNING LAW.  Subject to any applicable federal law, this Security
      Agreement shall be construed in accordance with and governed by the
      laws of the State of South Dakota.

L.    NOTICES.  All notices, requests, demands, or other communications
      required or permitted hereunder shall be in writing and shall be deemed
      to have been given when sent by registered or certified mail, return
      receipt requested, addressed to the other party at the respective
      addresses given above, or to such other person or address as either
      party designates to the other in the manner herein prescribed.

M.    SEVERABILITY.  The determination that any term or provision of this
      Security Agreement is unenforceable or invalid shall not affect the
      enforceability or validity of any other term or provision hereof.

      IN WITNESS WHEREOF, the Debtor has executed this Security Agreement by its
duly authorized officer as of the day and year shown below.

                                     DEBTOR:
                         South Dakota Soybean Processors
                                     Box 500
                            Volga, South Dakota 57071

Date:  October 2, 1995                          By:
                                                   ---------------------------

                                                ------------------------------
                                                      Title

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