Document:

exv10w39

 

EXHIBIT 10.39

     FOURTH AMENDMENT TO CONSTRUCTION LOAN AGREEMENT

This Fourth Amendment to Construction Loan Agreement is dated as of the 11th day of
December, 2007, and is by and between RED TRAIL ENERGY, LLC, a North Dakota limited liability
company (“BORROWER”), and FIRST NATIONAL BANK OF OMAHA (“BANK”), a national banking association
established at Omaha, Nebraska.

WHEREAS, the BANK and BORROWER executed a written Construction Loan Agreement dated as of
December 16, 2005 (“AGREEMENT”).

Now, Therefore, in consideration of the AGREEMENT, and their mutual promises made herein, BANK and
BORROWER agree as follows:

     1. Terms which are typed herein as all capitalized words and are not defined herein shall have
same meanings as when described in the AGREEMENT.

     2. On April 16, 2007, pursuant to Section 2.5 of the AGREEMENT, BORROWER executed and
delivered to BANK its VARIABLE RATE NOTE, in the principal amount of $17,605,870.00; its
LONG TERM REVOLVING NOTE, in the principal amount of $10,000,000.00; and its FIXED RATE
NOTE, in the principal amount of $27,605,870.00. BORROWER has requested BANK to permit
the replacement of the VARIABLE RATE NOTE in order to reduce the amount of borrowed funds
subject to variable rates and to increase the portion of the OBLIGATIONS represented by
fixed rate financing. As the result, on execution of this amendment, BORROWER will deliver a
replacement of the VARIABLE RATE NOTE, with such replacement having the principal amount of
$6,777,887.23, and a new note (“2007 FIXED RATE NOTE”) having a principal amount of
$10,000,000.00.

     3. Effective immediately, Section 1.24 of the AGREEMENT is amended to read:

     1.24 “LOAN TERMINATION DATE” means the earliest to occur of the following: (i) as to the
REVOLVING NOTE, July 17, 2008, as to FIXED RATE NOTE, 2007 FIXED RATE NOTE, VARIABLE RATE
NOTE and as to LONG TERM REVOLVING NOTE, April 16, 2012, (ii) the date the OBLIGATIONS are
accelerated pursuant to this AGREEMENT, and (iii) the date BANK has received (a) notice in
writing from BORROWER of BORROWER’s election to terminate this AGREEMENT and (b)
indefeasible payment in full of the OBLIGATIONS.

     4. Effective immediately, Section 2.5 of the AGREEMENT is amended to read:

     2.5 TERM LOAN. The existing balance on the CONSTRUCTION LOAN, including any advance
made to increase WORKING CAPITAL, as of COMPLETION DATE will be restated and said balance
will be paid by four promissory notes (“TERM NOTES”), hereafter called “FIXED RATE
NOTE”,“2007 FIXED RATE NOTE”, “VARIABLE RATE NOTE”, and “LONG TERM REVOLVING NOTE”, in form

 Page 1 of 4 

 

mutually acceptable to BANK and BORROWER. The TERM NOTES evidence “TERM LOANS”. Payments on
such TERM NOTES shall be as follows:

     On the sixteenth day of every third month, commencing three months after COMPLETION DATE,
BORROWER shall pay to BANK the scheduled principal payment shown in Schedule I, attached
hereto and by this reference made a part hereof, plus accrued interest on FIXED RATE NOTE,
together with the scheduled principal payment shown in Schedule II, attached hereto and to
the 2007 FIXED RATE NOTE, by this reference made a part hereof, plus accrued interest on
2007 FIXED RATE NOTE.

     In addition, on the sixteenth day of every third month, commencing three months after
COMPLETION DATE, BORROWER shall pay $634,729.57 to BANK, which shall be allocated as
follows:

     a. first to accrued interest on LONG TERM REVOLVING NOTE;

     b. next to accrued interest on VARIABLE RATE NOTE;

     c. next to principal on VARIABLE RATE NOTE;

     After VARIABLE RATE NOTE has been fully paid, such quarterly payments shall be
allocated first to accrued interest on LONG TERM REVOLVING NOTE, and thence to
principal, reducing available revolving loan capacity. All unpaid
principal and accrued interest under the TERM LOANS shall be due and
payable on LOAN
TERMINATION DATE, if not sooner paid.

     5. BORROWER
certifies by its execution hereof that the representations and warranties set
forth in Section 5 of the AGREEMENT are true as of this date, and that no EVENT OF
DEFAULT under the AGREEMENT, and no event which, with the giving of notice or passage of
time or both, would become such an EVENT OF DEFAULT, has occurred as of this date.

     6. Except
as amended hereby the parties ratify and confirm as binding upon them all of
the terms of the AGREEMENT.

     IN WITNESS whereof the parties set their hands as of the date first written above.

	 	 	 	 	 	 	 	 	 
	First National Bank of Omaha	 	 	 	Red Trail Energy, LLC
	 
	 	 	 	 	 	 	 	 
	By:	 	/s/ Andrew Wong	 	 	 	By:	 	/s/ Frank Kirschenheiter
	 	 	 
	 	 	 	 	 	 
	 	 	Andrew Wong
	 	 	 	 	 	 
	 	 	Commercial Loan Officer
	 	 	 	Name:	 	Frank Kirschenheiter
	 	 	 	 	 	 		 	 
	 	 		 	 	 	 	 	 
	 	 	 
	 	 	 	Title:	 	Secretary
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	And	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	/s/ Mike Appert
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	
	 	 	 	 	 	 	Name:	 	Mike Appert
	 	 	 	 	 	 		 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Title:	 	Chairman
	 	 	 	 	 	 	 	 	 

 Page 2 of 4 

 

	 	 	 	 	 	 	 
	STATE OF NORTH DAKOTA

	 	 	)	 	 	 
	 

	 	        ) ss.
	 	 
	COUNTY OF STARK

	 	 	)	 	 	 

On this 27 day of December, 2007, before me, the undersigned Notary Public, personally
appeared SECRETARY, the Secretary of Red Trail Energy, LLC,
on behalf of said entity, and each acknowledged that he executed the foregoing Amendment to Loan
Agreement as his voluntary act and deed and that of Red Trail Energy, LLC.

/s/
Deell Hoff
                                              
Notary Public

	 	 	 	 	 	 	 
	STATE OF NORTH DAKOTA

	 	 	)	 	 	DEELL HOFF
	 

	 	        ) ss.
	 	Notary Public
	COUNTY OF STARK

	 	 	)	 	 	State of North Dakota
	 

	 	 	 	 	 	My Commission Expires Oct. 21, 2011

On this 27 day of December, 2007, before me, the undersigned Notary Public,
personally appeared Mike Appert, the Chairman of Red Trail Energy, LLC,
on behalf of said entity, and each acknowledged that he executed the
foregoing Amendment to Loan Agreement as his voluntary act and deed and that of Red Trail Energy,
LLC.

/s/ Deell Hoff                                               
Notary Public

	 	 	 
	 

	 	DEELL HOFF

Notary Public

State of North Dakota

My Commission Expires Oct. 21, 2011

Page 3 of 4

 

 

SCHEDULE “II” TO SWAP NOTE

AMORTIZATION
SCHEDULE — U.S. RULE (NO COMPOUNDING), 360 DAY YEAR

Red Trail Energy Swap Note Principal Schedule for Payments

AMORTIZATION SCHEDULE — U.S. Rule (no compounding), 360 Day Year

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Beginning	 	 	 	 
	 	 	Date	 	 	Balance	 	 	Principal	 
	Loan
	 	 	12/11/2007	 	 	 	10,000,000.00	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	1
	 	 	1/16/2008	 	 	 	 	 	 	 	285,183.83	 
	2
	 	 	4/16/2008	 	 	 	 	 	 	 	182,995.86	 
	3
	 	 	7/16/2008	 	 	 	 	 	 	 	186,511.41	 
	4
	 	 	10/16/2008	 	 	 	 	 	 	 	188,121.60	 
	2008
	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	842,812.70	 
	5
	 	 	1/16/2009	 	 	 	 	 	 	 	191,775.34	 
	6
	 	 	4/16/2009	 	 	 	 	 	 	 	199,285.44	 
	7
	 	 	7/16/2009	 	 	 	 	 	 	 	201,221.24	 
	8
	 	 	10/16/2009	 	 	 	 	 	 	 	203,278.78	 
	2009
	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	795,560.80	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	9
	 	 	1/16/2010	 	 	 	 	 	 	 	207,226.90	 
	10
	 	 	4/16/2010	 	 	 	 	 	 	 	214,694.68	 
	11
	 	 	7/16/2010	 	 	 	 	 	 	 	217,097.72	 
	12
	 	 	10/16/2010	 	 	 	 	 	 	 	219,638.08	 
	2010
	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	858,657.38	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	13
	 	 	1/16/2011	 	 	 	 	 	 	 	223,903.94	 
	14
	 	 	4/16/2011	 	 	 	 	 	 	 	231,326.03	 
	15
	 	 	7/16/2011	 	 	 	 	 	 	 	234,233.37	 
	16
	 	 	10/16/2011	 	 	 	 	 	 	 	237,294.85	 
	2011
	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	926,758.19	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	17
	 	 	1/16/2012	 	 	 	 	 	 	 	241,903.64	 
	18
	 	 	4/16/2012	 	 	 	 	 	 	 	6,334,307.29	 
	2012
	 	 	 	 	 	 	 	 	 	 	 	 
	Totals
	 	 	 	 	 	 	 	 	 	 	6,576,210.93	 
	Loan
	 	 	12/11/2007	 	 	 	10,000,000.00	 	 	 	 	 

Page 4 of 4exv10w40

 

EXHIBIT  10.40

FIRST NATIONAL BANK OF OMAHA

CONFIRMATION

	 	 	 
	To:
	 	Red Trail Energy, LLC
	 
	 	P.O. Box 11
	 
	 	Richardton, ND 58652
	 
	 	 
	Attn:
	 	Mark Klimpel/DeEll Hoff
	Fax:
	 	701-974-3309
	 
	 	 
	From:
	 	First National Bank of Omaha
	Date:
	 	11th December, 2007
	Our Ref:
	 	22173

The purpose of this letter agreement is to set forth the terms and conditions of the Swap
Transaction entered into between First National Bank of Omaha and Red Trail Energy, LLC (the
“Counterparty”) on the Trade Date specified below (the “Swap Transaction”). This letter agreement
constitutes a “Confirmation” as referred to in the Master Agreement specified below.

I. The
definitions and provisions contained in the 2006 ISDA Definitions (as published by the
International Swaps and Derivatives Association, Inc.) (the “Definitions”) are incorporated into
this Confirmation.

This
Confirmation supplements, forms a part of, and is subject to, a certain ISDA Master Agreement
(the “Master Agreement”) which has been, or will be executed between Counterparty and First
National Bank of Omaha. All provisions contained or incorporated by reference in such Master
Agreement shall govern this Confirmation except as expressly modified
below. In the event of any
inconsistency between this Confirmation and the Definitions or the Master Agreement, this
Confirmation will govern.

This Confirmation will be governed by and construed in accordance with the laws of the State of
New York, without reference to choice of law doctrine, provided that this provision will be
superseded by any choice of law provision on the Master Agreement.

2. This Confirmation constitutes a Swap Transaction under the Master Agreement and the terms
of the Swap Transaction to which this Confirmation relates are as follows:

 

 

	 	 	 
	Red Trail Energy, LLC
	 	 
	Our ref: 22173

	 	

	 	 	 
	Notional Amount:

	 	For each Calculation Period, the amount listed under the heading “Notional Amount (USD)” in Schedule A, attached.
	 
	 	 
	Trade Date:

	 	 11th December, 2007
	 
	 	 
	Effective Date:

	 	 13th December, 2007
	 
	 	 
	Termination Date:

	 	 16th April, 2012
	 
	 	 
	Fixed
Amounts:
	 	 
	Fixed Rate Payer:

	 	Red Trail Energy, LLC
	 
	 	 
	Fixed Rate Payer Payment Dates:

	 	Commencing the 16th day of January,
2008 and quarterly thereafter on the 16th
calendar day of April, July, October,
and January up to and including the
Temination Date, subject to adjustment in
accordance with Following Business Day
Convention.
	 
	 	 
	Period End Dates:

	 	The 16th calendar day of April, July,
October, and January commencing January,
2008 and ending on the Termination Date.
No Adjustment.
	 
	 	 
	Fixed Rate:

	 	 7.69500%
	 
	 	 
	Fixed Rate Day Count Fraction:

	 	 Act/360
	 
	 	 
	Floating
Amounts:
	 	 
	Floating Rate Payer:

	 	First National Bank of Omaha
	 
	 	 
	Floating Rate Payer
 Payment
Dates:

	 	Commencing the 16th day of January, 2008
and quarterly thereafter on the 16th
calendar day of April, July, October,
and January up to and including the
Temination Date, subject to adjustment
in accordance with Following Business
Day Convention.
	 
	 	 
	Period End Dates:

	 	The 16th calendar day of April, July,
October, and January commencing January,
2008 and ending on the Termination Date.
No Adjustment.
	 
	 	 
	Floating Rate for Initial 

Calculation Period:

	 	 8.51125% inclusive of Spread
	 
	 	 
	Floating Rate Option:

	 	 USD-LIBOR-BBA

 

 

	 	 	 
	Red Trail Energy, LLC

	 	 
	Our ref: 22173

	 	

	 	 	 
	Designated Maturity:

	 	 3 months
	 
	 	 
	Spread:

	 	 3,40000%
	 
	 	 
	Floating Rate Day: 
Count
Fraction:

	 	 Act/360
	 
	 	 
	Reset Dates:

	 	The first day of each Floating Rate
Payer Calculation Period.
	 
	 	 
	Calculation Agent:

	 	First National Bank of Omaha
	 
	 	 
	Business Days:

	 	New York, London
	 
	 	 
	Other Terms and Conditions:

	 	None
	 
	 	 
	Payment Method:

	 	 ACCT#110193357

Please
confirm the foregoing correctly sets forth the terms of our Agreement by executing
the copy of this Confirmation and returning it to us.

	 	 	 	 	 	 	 
	 	 	Regards,	 	 
	 	 	First National Bank of Omaha	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 	 
	Accepted and confirmed as
of the Trade Date

	 	 
	 
	 	 
	Red Trail Energy, LLC
	 	 
	 
	 	 
	/s/
Mark E. Klimpel, CFO 12-12-07
	 	 
	 

Name: Mark E. Klimpel

	 	 
	 
	 	 
	/s/
Mike Appert, Chairman 12-12-07
	 	 
	 

Name: Mike Appert

	 	 

 

 

	 	 	 
	Red Trail Energy, LLC

	 	 
	Our ref: 22173

	 	

	 	 	 
	Designated Maturity:

	 	 3 months
	 
	 	 
	Spread:

	 	 3.40000%
	 
	 	 
	Floating Rate Day:

Count Fraction:

	 	Act/360
	 
	 	 
	Reset Dates:

	 	The first day of each Floating Rate Payer Calculation Period.
	 
	 	 
	Calculation Agent:

	 	First National Bank of Omaha
	 
	 	 
	Business Days:

	 	New York, London
	 
	 	 
	Other Terms
and Conditions:

	 	None
	 
	 	 
	Payment Method:

	 	 ACCT#I10193357

Please
confirm the foregoing correctly sets forth the terms of our Agreement
by executing the copy
of this Confirmation and returning it to us.

	 	 	 	 	 	 	 
	 	 	Regards,	 	 
	 	 	First National Bank of Omaha	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ MARK A. POTTS	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	MARK A. POTTS	 	 
	 

	 	 	 	 	 	 

	 	 	 
	Accepted and confirmed
as of the Trade Date
	 	 
	 
	 	 
	Red Trail Energy, LLC
	 	 
	 
	 	 
	 

Name:

	 	 
	 
	 	 
	 

Name:

	 	 

 

 

	 	 	 
	Red Trail Energy, LLC

	 	 
	Our ref: 22173

	 	

Schedule A

	 	 	 	 	 	 	 
	Period Start	 	Period End	 	Notional Amount (USD)	 	Notional Amortization
	13-Dec-07
	 	16-Jan-08	 	10,000,000.00	 	285,183.83
	16-Jan-08
	 	16-Apr-08	 	9,714,816.17	 	182,995.86
	16-Apr-08
	 	16-Jul-08	 	9,531,820.31	 	186,511.41
	16-Jul-08
	 	16-Oct-08	 	9,345,308.90	 	188,121.60
	16-Oct-08
	 	16-Jan-09	 	9,157,187.30	 	191,775.34
	l6-Jan-09
	 	16-Apr-09	 	8,965,411.96	 	199,285.44
	16-Apr-09
	 	16-Jul-09	 	8,766,126.52	 	201,221.24
	16-Jul-09
	 	16-Oct-09	 	8,564,905.28	 	203,278.78
	16-Oct-09
	 	16-Jan-10	 	8,361,626.50	 	207,226.90
	16-Jan-10
	 	16-Apr-10	 	8,154,399.60	 	214,694.68
	16-Apr-10
	 	16-Jul-10	 	7,939,704.92	 	2! 7,097.72
	16-Jul-10
	 	16-Oct-10	 	7,722,607.20	 	219,638.08
	16-Oct-10
	 	16-Jan-11	 	7,502,969.12	 	223,903.94
	16-Jan- 11
	 	16-Apr- 11	 	7,279,065.18	 	231,326.03
	16-Apr-11
	 	16-Jul-11	 	7,047,739.15	 	234,233.37
	16-Jul-11
	 	16-Oct-11	 	6,813,505.78	 	237,294.85
	16-Oct-l1
	 	16-Jan-12	 	6,576,210.93	 	241,903.64
	16-Jan-12
	 	16-Apr-12	 	6,334,307.29	 	6,334,307.29

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