Document:

Filed by Bowne Pure Compliance

 

Exhibit 10.37

MORTGAGE

Recorder’s Cover Sheet

Preparer Information: (name, address and phone number)

Rodney L. Janssen, 321 E. Walnut, Suite 200, Des Moines, Iowa 50309, (515) 237-1187

Taxpayer Information: (name and complete address)

Homeland Energy Solutions, LLC

951 North Linn Avenue

New Hampton, IA 50609

Return Document To: (name and complete address)

Gray, Plant, Mooty, Mooty & Bennett, P.A.

c/o Phillip L. Kunkel

1010 West St. Germain

Suite 600

St. Cloud, MN 56301

Grantors:

HOMELAND ENERGY SOLUTIONS, LLC

Grantees:

HOME FEDERAL SAVINGS BANK

Legal Description: See next page 2

Document or instrument number of previously recorded documents: N/A

 

 

 

Legal Description

Parcel A:

Parcel A in the Southeast Quarter of Section 1 lying southeasterly of railroad in Township 95
North, Range 12 West of the 5th P.M., Chickasaw County, Iowa, as shown in Document No.
2007-0823, in the office of the Chickasaw County Recorder.

AND

Parcel A in Section 1 lying northwesterly of railroad in Township 95 North, Range 12 West of the
5th P.M., Chickasaw County, Iowa, as shown in Document No. 2007-0823, in the office of
the Chickasaw County Recorder.

AND

Parcel A in the Northwest Quarter of Section 12 lying northwesterly of railroad in Township 95
North, Range 12 West of the 5th P.M., Chickasaw County, Iowa, as shown in Document No.
2007-0823, in the office of the Chickasaw County Recorder.

AND

Parcel D:

Parcel D in the Southwest Quarter of the Northwest Quarter and that part of the Northwest Quarter
of the Southwest Quarter in Section 6 lying northwesterly of railroad in Township 95 North, Range
11 West of the 5th P.M., Chickasaw County, Iowa, as shown in Document No. 2007-0823, in
the office of the Chickasaw County Recorder.

AND

Parcel E:

Parcel E in the Southwest Quarter of Section 6, Township 95 North, Range 11 West of the
5th P.M., Chickasaw County, Iowa, as shown in Document No. 2007-1956, in the office of
the Chickasaw County Recorder.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

2

 

MORTGAGE

Open End

THIS MORTGAGE (“Mortgage”) encumbers real property, contains an after-acquired property clause
and secures present and future loans and advances.

PARTIES to this Mortgage are:

	 	 	 
	Mortgagor:

	 	HOMELAND ENERGY SOLUTIONS, LLC
	 

	 	an Iowa Limited Liability Company
	 

	 	106 WEST MAIN STREET
	 

	 	PO BOX C
	 

	 	RICEVILLE IA 50466
	 
	 	 
	Mortgagee:

	 	HOME FEDERAL SAVINGS BANK
	 

	 	50 – 14TH AVENUE EAST, SUITE 100
	 

	 	SARTELL, MN 56377

NOTICE: This Mortgage secures credit in the amount up to One Hundred Million Dollars
($100,000,000.00) (the “Secured Indebtedness”). Loans and advances up to this amount, together
with the interest rates as set forth in the promissory notes are senior to indebtedness to other
creditors under subsequently recorded or filed mortgages and liens.

THIS Mortgage also constitutes a Construction Mortgage as defined in the Iowa Code.

1. Grant of Mortgage and Security Interest. Mortgagor hereby grants, pledges, sells, conveys
and mortgages unto Mortgagee a security interest to Mortgagee in the following described property:

a. Land and Buildings. All of Mortgagor’s right, title and interest in and to the
following described real estate situated in Chickasaw County, Iowa (the “Land”).

See Page 2 for legal description

and all buildings, structures and improvements now standing or at any time hereafter constructed
or placed upon the Land (the “Buildings”), including all hereditaments, easements,
appurtenances, riparian rights, mineral rights, water rights, rights in and to the lands lying
in streets, alleys and roads adjoining the land, estates and other rights and interests now or
hereafter belonging to or in any way pertaining to the Land.

b. Personal Property. All fixtures and other personal property integrally belonging to, or
hereafter becoming an integral part of the Land or Buildings, whether attached or detached,
including equipment and all proceeds, products,
increase, issue, accessions, attachments, accessories, parts, additions, repairs, replacements
and substitutes of, to, and for the foregoing (the “Personal Property”).

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

3

 

c. Revenues and Income. All rents, issues, profits, leases, condemnation awards and
insurance proceeds now or hereafter arising from the ownership, occupancy or use of the Land,
Buildings and Personal Property, or any part thereof (the “Revenues and Income”).

TO HAVE AND TO HOLD the Land, Buildings, Personal Property and Revenues and Income
(collectively called the “Mortgaged Property”), together with all privileges, hereditaments
thereunto now or hereafter belonging, or in any way appertaining and the products and proceeds
thereof, unto Mortgagee, its successors and assigns.

2. Obligations. This Mortgage secures the following (hereinafter collectively referred to as
the “Obligations”):

a. The payment of the loan made by Mortgagee to Mortgagor evidenced by a Master Loan
Agreement dated the 30th day of November 2007 (the “MLA”) and supplemented with a
First Supplement to Master Loan Agreement, Construction Note, a Second Supplement to Master Loan
Agreement, Term Revolving Note, and a Third Supplement to Master Loan Agreement, Revolving Line
of Credit Note, with a due date of July 1, 2014, any renewals, extensions, modifications or
refinancing thereof and any additional supplements to the Master Loan Agreement issued in
substitution therefor; and

b. All other obligations of Mortgagor to Mortgagee, now existing or hereafter arising,
whether direct or indirect, contingent or absolute and whether as maker or surety, including,
but not limited to, future advances and amounts advanced and expenses incurred by Mortgagee
pursuant to this Mortgage.

THIS PARAGRAPH SHALL NOT CONSTITUTE A COMMITMENT TO MAKE ADDITIONAL LOANS IN ANY AMOUNT.

3. Representations and Warranties of Mortgagor. Mortgagor represents, warrants and covenants
to Mortgagee that (i) Mortgagor holds good and marketable title to the Mortgaged Property and title
in fee simple in the Land; (ii) Mortgagor has the right, power and authority to execute this
Mortgage and to mortgage, and grant a security interest in the Mortgaged Property; (iii) the
Mortgaged Property is free and clear of all liens and encumbrances, except for real estate taxes
not yet delinquent, except for the Permitted Encumbrances set forth in the MLA and on Exhibit A
attached hereto and except as otherwise stated in subparagraph la. herein; (iv) Mortgagor will
warrant and defend title to the Mortgaged Property and the lien and priority of this Mortgage
against all claims and demands of all persons, whether now existing or hereafter arising; and (v)
all buildings and improvements now or hereafter located on the Land are, or will be, located
entirely within the boundaries of the Land.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

4

 

4. Payment and Performance of the Obligations. Mortgagor will pay all amounts payable under
the Obligations in accordance with the terms of the Obligations when and as due and will timely
perform all other obligations of Mortgagor under the Obligations.

5. Taxes. Mortgagor shall pay each installment of all taxes and special assessments of every
kind, now or hereafter levied against the Mortgaged Property before the same become delinquent,
without notice or demand, and shall upon request deliver to Mortgagee proof of such payment within
fifteen (15) days after the date in which such tax or assessment becomes delinquent.

6. Liens. Mortgagor shall not create, incur or suffer to exist any lien, encumbrance,
security interest or charge on the Mortgaged Property or any part thereof which might or could be
held to be equal or prior to the lien of this Mortgage, other than the lien of current real estate
taxes and installments of special assessments with respect to which no penalty is yet payable,
without Mortgagee’s prior written consent. Mortgagor shall pay, when due, all lawful claims of all
persons supplying labor or materials to or in connection with the Mortgaged Property.

7. Compliance with Laws. Mortgagor shall comply with all present and future statutes, laws,
rules, orders, regulations and ordinances affecting the Mortgaged Property, any part thereof or the
use thereof.

8. Permitted Contests. Mortgagor shall not be required to (I) pay any tax, assessment or
other charge referred to in paragraph 5 hereof, (ii) discharge or remove any lien, encumbrance or
charge referred to in paragraph 6 hereof, or (iii) comply with any statute, law, rule, regulation
or ordinance referred to in paragraph 7 hereof, so long as Mortgagor shall contest, in good faith,
the existence, amount or the validity thereof, the amount of damages caused thereby or the extent
of Mortgagor’s liability therefor, by appropriate proceedings which shall operate during the
pendency thereof to prevent (A) the collection of, or other realization upon the tax, assessment,
charge or lien, encumbrances or charge so contested, (B) the sale, forfeiture or loss of the
Mortgaged Property or any part thereof, and (C) any interference with the use or occupancy of the
Mortgaged Property or any part thereof. Mortgagor shall give prompt written notice to Mortgagee of
the commencement of any contest referred to in this paragraph 8.

9. Care of Property. Mortgagor shall take good care of the Mortgaged Property; shall keep the
Buildings and Personal Property now or later placed upon the Mortgaged Property in good and
reasonable repair and shall not injure, destroy or remove either the Buildings or Personal Property
during the term of this Mortgage. Mortgagor shall not make any material alteration to the Mortgaged
Property without the prior written consent of Mortgagee. Mortgagor shall have the right to replace
any Personal Property with equal or better quality or function without Mortgagee’s consent.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

5

 

10. Insurance. The Mortgagor shall obtain and keep in full force and effect during the term
of this Mortgage at its sole cost and expense, the following policies of insurance:

a. Property insurance, in broad form covering causes of loss customarily covered in the
industry of Mortgagor’s business, including the cost of debris removal, together with a
vandalism and malicious mischief endorsement, all in the amounts of not less than the full
insurable value or full replacement cost, without deduction for depreciation, of the
improvements on the Premises, whichever is greater, covering all buildings, structures,
fixtures, personal property and other improvements now existing or hereafter erected or
placed on the Premises, which insurance shall at all times be in an amount at least equal to
the unpaid Secured Indebtedness at any given time.

b. If the Mortgaged Premises are now or hereafter located in a flood plain as defined by the
Federal Insurance Administration, the Mortgagor shall obtain flood insurance in the maximum
obtainable amount.

c. If steam boilers or similar equipment for the generation of steam are located in, on or
about the Mortgaged Premises, the Mortgagor shall maintain insurance against loss or damage
by explosion, rupture or bursting of such equipment and appurtenances thereto, without a
co-insurance clause, in an amount satisfactory to the Mortgagee.

d. Comprehensive general public liability insurance covering the legal liability of the
Mortgagor against claims for bodily injury, death or property damage occurring on, in or
about the Mortgaged Premises in such amounts and with such limits as the Mortgagee may
reasonably require.

e. Business interruption insurance in an amount at least equal to coverage over one year’s
debt service and required escrow account.

f. During the period of construction:

i. Mortgagor will maintain builder’s risk insurance, written on the so-called
“builder’s risk-completed value basis”, in an amount equal to 100% of the insurable value of
the Mortgaged Property at the date of completion, and with coverage available on the
so-called “all risk”, non-reporting form of policy; provided that, to the extent that any
contractor for such construction shall provide a duplicate insurance policy or builder’s
risk policy or certificate of insurance showing that the same coverage as is herein required
is being carried by such contractor and adequately protects the interest of Mortgagee and
Mortgagor with respect to the Mortgaged Property or a part thereof, Mortgagee shall not be
required to maintain separate coverage. The insurance provided for by this subparagraph (i)
with respect to the Mortgaged Property or such part thereof shall not be required while the
Mortgaged Property or part thereof is so insured.
Mortgagee’s interest shall be protected in accordance with a standard mortgagee clause.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

6

 

ii. During the period of construction, Mortgagor will maintain comprehensive general
liability insurance (including operations, contingent liability, operations of
subcontractors, complete operations and contractual liability insurance) against bodily
injury and property damage in amounts satisfactory to Mortgagee.

iii. During the period of construction, Mortgagor will maintain worker’s compensation
insurance with respect to all employees of Mortgagor and each contractor.

All such insurance shall be written on forms and with companies satisfactory to the Mortgagee,
shall name as the insured parties the Mortgagor and the Mortgagee as their interests may appear,
shall be in amounts sufficient to prevent the Mortgagor from becoming a co-insurer of any loss
thereunder, shall name the Mortgagee as a loss payee, shall bear a satisfactory mortgagee clause in
favor of the Mortgagee, and shall contain an agreement of the insurer that the coverage shall not
be terminated or materially modified without providing to the Mortgagee thirty (30) days’ prior
written notice of such termination or modification. All required policies of insurance or
acceptable certificates thereof, together with evidence of the payment of current premiums therefor
shall be delivered to the Mortgagee. The Mortgagor shall, within thirty (30) days prior to the
expiration of any such policy, deliver other original policies or certificates of the insurer
evidencing the renewal of such insurance together with evidence of the payment of current premiums
therefor. In the event of a foreclosure of this Mortgage or any acquisition of the Mortgaged
Premises by the Mortgagee, all such policies and any proceeds payable therefrom, whether payable
before or after a foreclosure sale, or during the period of redemption, if any, shall become the
absolute property of the Mortgagee to be utilized at its discretion. In the event of foreclosure
or the failure to obtain and keep any required insurance, the Mortgagor empowers the Mortgagee to
effect insurance upon the Mortgaged Premises at the Mortgagor’s expense and for the benefit of the
Mortgagee in the amounts and types aforesaid for a period of time covering the time of redemption
from a foreclosure sale, and if necessary therefore, to cancel any or all existing insurance
policies. The Mortgagor agrees to furnish the Mortgagee with copies of all inspection reports and
insurance recommendations received by the Mortgagor from any insurer.

11. Inspection. Mortgagee, and its agents, shall have the right at all reasonable times to
enter upon the Mortgaged Property for the purpose of inspecting the Mortgaged Property or any part
thereof; provided, however, Mortgagee and its agents shall comply with all safety standards and
protocols of Mortgagor and shall not disrupt the operations of Mortgagor when conducting the
inspection. Mortgagee shall, however, have no duty to make such inspection. Any inspection of the
Mortgaged Property by Mortgagee shall be entirely for its benefit and Mortgagor shall in no way
rely or claim reliance thereon.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

7

 

12. Protection of Mortgagee’s Security. Subject to the rights of Mortgagor under paragraph 8
hereof, if Mortgagor fails to perform any of the covenants and agreements contained in this
Mortgage or if any action or proceeding is commenced which materially adversely affects the
Mortgaged Property or the interest of the Mortgagee therein, or the title thereto, then Mortgagee,
at Mortgagee’s option, may perform such covenants and agreements, defend against or investigate
such action or proceeding, and take such other action as Mortgagee deems necessary to protect
Mortgagee’s interest. Any amounts or expenses disbursed or incurred by Mortgagee in good faith
pursuant to this paragraph 12 with interest thereon at the highest rate specified in the Master
Loan Agreement, shall become an Obligation of Mortgagor secured by this Mortgage. Such amounts
advanced or disbursed by Mortgagee hereunder shall be immediately due and payable by Mortgagor
unless Mortgagor and Mortgagee agree in writing to other terms of repayment. Mortgagee shall, at
its option, be subrogated to the lien of any mortgage or other lien discharged in whole or in part
by the Obligations or by Mortgagee under the provisions hereof, and any such subrogation rights
shall be additional and cumulative security for this Mortgage. Nothing contained in this paragraph
shall require Mortgagee to incur any expense or do any act hereunder, and Mortgagee shall not be
liable to Mortgagor for any damage or claims arising out of action taken by Mortgagee pursuant to
this paragraph.

13. Condemnation. Mortgagor shall give Mortgagee prompt notice of any action, actual or
threatened, in condemnation or eminent domain and hereby assign, transfer and set over to Mortgagee
the entire proceeds of any award or claim for damages for all or any part of the Mortgaged Property
taken or damaged under the power of eminent domain or condemnation. Mortgagee is hereby authorized
to intervene in any such action in the names of Mortgagor, to compromise and settle any such action
or claim, and to collect and receive from the condemning authorities and give proper receipts and
acquittances for such proceeds. Any reasonable expenses incurred by Mortgagee in intervening in
such action or compromising and settling such action or claim, or collecting such proceeds shall be
reimbursed to Mortgagee first out of the proceeds. The remaining proceeds or any part thereof shall
be applied to reduction of that portion of the Obligations then most remotely to be paid, whether
due or not, without application of any pre-payment penalty, or to the restoration or repair of the
Mortgaged Property, the choice of application to be solely at the discretion of Mortgagee.

14. Fixture Filing. From the date of its recording, this Mortgage shall be effective as a
financing statement filed as a fixture filing with respect to the Personal Property and for this
purpose the name and address of the debtor is the name and address of Mortgagor as set forth in
paragraph 20 herein and the name and address of the secured party is the name and address of the
Mortgagee as set forth in paragraph 20 herein.

15. Events of Default. Each of the following occurrences shall constitute an event of default
hereunder (“Event of Default”):

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

8

 

a. Mortgagor shall default in the due observance or performance of or breach its agreement
contained in paragraph 4 hereof or shall default in the due observance or performance of or
breach of any other covenant, condition or agreement on its part to be observed or performed
pursuant to the terms of this Mortgage beyond any cure period, if any.

b. An Event of Default, shall occur under the Master Loan Agreement, Supplements, Notes, or
any other mortgage, assignment or other security document constituting a lien on the Mortgaged
Property or any part thereof.

16. Acceleration; Foreclosure, Receiver. Upon the occurrence of any Event of Default and at
any time thereafter while such Event of Default exists, Mortgagee may, at its option, after such
notice as may be required by law, exercise one or more of the following rights and remedies (and
any other rights and remedies available to it):

a. Mortgagee may declare immediately due and payable all Obligations secured by this
Mortgage, and the same shall thereupon be immediately due and payable, without further notice or
demand.

b. Mortgagee shall have and may exercise with respect to the Personal Property, all the
rights and remedies accorded upon default to a secured party under the Iowa Uniform Commercial
Code. If notice to Mortgagor of intended disposition of such property is required by law in a
particular instance, such notice shall be deemed commercially reasonable if given to Mortgagor
at least ten (10) days prior to the date of intended disposition.

c. Mortgagee may (and is hereby authorized and empowered to) foreclose this Mortgage in
accordance with the law of the State of Iowa, and at any time after the commencement of an
action in foreclosure, or during the period of redemption, the court having jurisdiction of the
case shall at the request of Mortgagee appoint a receiver to take immediate possession of the
Mortgaged Property and of the Revenues and Income accruing therefrom, and to rent or cultivate
the same as he may deem best for the interest of all parties concerned, and such receiver shall
be liable to account to Mortgagor only for the net profits, after application of rents, issues
and profits upon the costs and expenses of the receivership and foreclosure and upon the
Obligations.

d. Mortgagee may employ a receiver to deal with the aforesaid matter, such receiver’s
reasonable salary and remuneration for the account of the Mortgagor. Such receiver shall be
regarded as the agent of the Mortgagor and the Mortgagor shall be wholly responsible for the
acts and omissions of such receiver, provided that such receiver is reasonably qualified to
perform its duties as receiver, and provided that Mortgagor shall not be liable for receiver’s
negligence, bad faith, or willful misconduct.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

9

 

e. Subject to the provisions of the terms of the Obligations, the Mortgagee shall have the
power to dispose of any Mortgaged Property or any part thereof in accordance with the law of the
State of Iowa without the consent of the Mortgagor or other persons. The Mortgagee shall have
the power to execute all documents relating to the sale and lease of the Mortgaged Property and
any loss arising shall not be borne by the Mortgagee.

f. The Mortgagee can dispose of the Mortgaged Property or appoint a receiver to dispose of
the Mortgaged Property in accordance with this Mortgage Agreement and, subject to the provisions
of the Obligations can apply the monies received from the disposition of Mortgaged Property in
the following order of priority:

(1) firstly, in payment of all reasonable costs in the disposition of the Mortgaged
Property, including (but without limitation) the fees and remuneration of the receiver;

(2) secondly, in payment of all the custom duties and other taxes required by law in
connection with the Mortgaged Property;

(3) thirdly, in payment of all necessary costs to maintain the property, including the
cost of insurance and any other benefit to the property;

(4) fourthly, in payment of the balance of Mortgagor’s obligations to Mortgagee as defined
in the Obligations; and

(5) fifthly, in satisfaction of any other secured indebtedness; and the remaining balance,
after the above deductions, shall be paid to the Mortgagor and other persons entitled to the
above sum in full by the Mortgagee.

17. Redemption. It is agreed that if this Mortgage covers less than ten (10) acres of land,
and in the event of the foreclosure of this Mortgage and sale of the property by sheriff’s sale in
such foreclosure proceedings, the time of one year for redemption from said sale provided by the
statues of the State of Iowa shall be reduced to six (6) months provided the Mortgagee, in such
action files an election to waive any deficiency judgment against Mortgagor which may arise out of
the foreclosure proceedings; all to be consistent with the provisions of Chapter 628 of the Iowa
Code. If the redemption period is so reduced, for the first three (3) months after sale such right
of redemption shall be exclusive to the Mortgagor, and the time periods in Sections 628.5, 628.15
and 628.16 of the Iowa Code shall be reduced to four (4) months.

It is further agreed that the period of redemption after a foreclosure of this Mortgage shall
be reduced to sixty (60) days if all of the three following contingencies develop: (1) The real
estate is less than ten (10) acres in size; (2) the Court finds affirmatively that the said real
estate has been abandoned by the owners and those persons personally liable under this Mortgage at
the time of such foreclosure; and (3) Mortgagee in such action files an election to waive any
deficiency judgment against Mortgagor or their successors in interest in such action.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

10

 

If the redemption period is so reduced,
Mortgagor or their successors in interest or the owner shall have the exclusive right to redeem for
the first thirty (30) days after such sale, and the time provided for redemption by creditors as
provided in Sections 628.5, 628.15 and 628.16 of the Iowa Code shall be reduced to forty (40) days.
Entry of appearance by pleading or docket entry by or on behalf of Mortgagor shall be a presumption
that the property is not abandoned. Any such redemption period shall be consistent with all of the
provisions of Chapter 628 of the Iowa Code. This paragraph shall not be construed to limit or
otherwise affect any other redemption provisions contained in Chapter 628 of the Iowa Code.

18. Attorneys’ Fees. Mortgagor shall pay on demand all costs and expenses incurred by
Mortgagee in enforcing or protecting its rights and remedies hereunder, including, but not limited
to, reasonable attorneys’ fees and legal expenses.

19. Forbearance not a Waiver, Rights and Remedies Cumulative. No delay by Mortgagee in
exercising any right or remedy provided herein or otherwise afforded by law or equity shall be
deemed a waiver of or preclude the exercise of such right or remedy, and no waiver by Mortgagee of
any particular provisions of this Mortgage shall be deemed effective unless in writing signed by
Mortgagee, All such rights and remedies provided for herein or which Mortgagee or the holder of the
Obligations may have otherwise, at law or in equity, shall be distinct, separate and cumulative and
may be exercised concurrently, independently or successively in any order whatsoever, and as often
as the occasion therefor arises.

20. Notices. All notices required to be given hereunder shall be in writing and deemed given
when personally delivered or deposited in the United States mail, postage prepaid, sent certified
or registered, addressed as follows:

	 	 	 	 	 
	 

	 	a. If to Mortgagor, to:
	 	Homeland Energy Solutions, LLC
	 

	 	 	 	106 West Main Street
	 

	 	 	 	P.O. Box C
	 

	 	 	 	Riceville, IA 50466
	 

	 	 	 	Telephone: (641) 985-4025
	 

	 	 	 	Fax: (641) 985-4046 Attention: President
	 
	 	 	 	 
	 

	 	With a copy to:
	 	Brown Winick, Attorneys at Law
	 

	 	 	 	666 Grand Avenue
	 

	 	 	 	Suite 200 Ruan Center
	 

	 	 	 	Des Moines, IA 50309
	 

	 	 	 	Telephone: (515) 242-2400
	 

	 	 	 	Fax: (515) 323-8514
	 

	 	 	 	Attn. Thomas D. Johnson

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

11

 

	 	 	 	 	 
	 

	 	b. If to Mortgagee, to:
	 	Home Federal Savings Bank
	 

	 	 	 	50 – 14th Avenue East, Suite 100
	 

	 	 	 	Sartell, MN 56377
	 

	 	 	 	Telephone: (320) 654-4021
	 

	 	 	 	Facsimile: (320) 252-6516
	 

	 	 	 	Attention: Eric Oftedahl
	 
	 	 	 	 
	 

	 	With copy to:
	 	Phillip L. Kunkel
	 

	 	 	 	Gray Plant Mooty
	 

	 	 	 	1010 West St. Germain, Suite 600
	 

	 	 	 	St. Cloud, MN 56301
	 

	 	 	 	Telephone: (320) 252-4414
	 

	 	 	 	Facsimile: (320) 252-4482

or to such other address or person as hereafter designated in writing by the applicable party in
the manner provided in this paragraph for the giving of notices.

21. Severability. In the event any portion of this Mortgage shall, for any reason, be held to
be invalid, illegal or unenforceable in whole or in part, the remaining provisions shall not be
affected thereby and shall continue to be valid and enforceable and if, for any reason, a court
finds that any provision of this Mortgage is invalid, illegal, or unenforceable as written, but
that by limiting such provision it would become valid, legal and enforceable then such provision
shall be deemed to be written, construed and enforced as so limited.

22. Further Assurances. At any time and from time to time until payment in full of the
Obligations, Mortgagor will, at the request of Mortgagee, promptly execute and deliver to Mortgagee
such additional instruments as may be reasonably required to further evidence the lien of this
Mortgage and to further protect the security interest of Mortgagee with respect to the Mortgaged
Property, including, but not limited to, additional security agreements, financing statements and
continuation statements. Any expenses incurred by Mortgagee in connection with the recordation of
any such instruments shall become additional Obligations of Mortgagor secured by this Mortgage.
Such amounts shall be immediately due and payable by Mortgagor to Mortgagee.

23. Successors and Assigns bound; Number; Gender; Agents; Captions. The rights, covenants and
agreements contained herein shall be binding upon and inure to the benefit of the respective legal
representatives, successors and assigns of the parties. Words and phrases contained herein,
including acknowledgment hereof, shall be construed as in the singular or plural number, and as
masculine, feminine or neuter gender according to the contexts. The captions and headings of the
paragraphs of this Mortgage are for convenience only and are not to be used to interpret or define
the provisions hereof.

24. Governing Law. This Mortgage shall be governed by and construed in accordance with the
laws of the State of Iowa.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

12

 

25. Waiver of any Exemption. The undersigned hereby waives all rights of exemption as to any
of the Mortgaged Property.

26. Acknowledgment of Receipt of Copies of Debt Instrument. Mortgagor hereby acknowledges the
receipt of a copy of this Mortgage together with a copy of the Master Loan Agreement and all
supplements secured hereby.

27. Additional Provisions. Add Addendum Page.

Dated this 30th day of November 2007

HOMELAND ENERGY SOLUTIONS, LLC

an Iowa limited liability company

	 	 	 	 	 
	By

	 	/s/ Stephen K. Eastman
 

Stephen K. Eastman 

Its: President
	 	 

STATE OF MINNESOTA, COUNTY OF OLMSTEAD

This instrument was acknowledged before me on the 30 day of November 2007 by
Stephen K. Eastman as Eastman of HOMELAND ENERGY SOLUTIONS, LLC.

	 	 	 	 	 
	 	 	 
	 	      /s/ Mitchell J. Rengel
 	 
	 	Notary Public 	 
	 	[MITCHELL J. RENGEL]

[NOTARY PUBLIC-MINNESOTA]

[My Comm. Exp. Jan. 31, 2010] 	 
	 

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

13

 

EXHIBIT A

PERMITTED ENCUMBRANCES

Terms and conditions of Assessment of Damages, in which a right of way is given to Railroad, dated
12/01/1868, filed of record 01/06/01871, in Book O, Page 588, and dated 09/15/1868, filed of record
01/06/1871, in Book O, Page 501, and dated 09/15/1868, filed of record 01/06/1871, in Book O, Page
499.

Easement for snow fences, in favor of Chicago, Milwaukee and St. Paul Railroad Company, as set
forth in Easement, dated 10/16/1888, filed of record 10/18/1888, in Book 32, Page 574, and dated
10/18/1888, filed or record 10/18/1888, in Book 32, Page 577, and dated 11/04/1893, filed of record
11/14/1893, in Book 38 of Deeds, Page 326.

Easement in favor of State of Iowa, as set forth in Easement, dated 03/04/1939, filed of record
04/01/1939, in Book 69, Page 503.

Easement for utility, in favor of Hawkeye Tri-County Electric Co-op, as set forth in Easement,
filed of record 08/10/1981, in Book 124, Page 385.

Terms and conditions of Fencing Agreement, dated 04/05/1982, filed of record 04/08/1982, in Book 1,
Page 86.

Terms and conditions of Agreement and Easement, dated 03/15/2007, filed of record 03/23/2007, as
document number 2007-0566.

Easement for utility, in favor of Hawkeye Tri-County Electric Co-op, as set forth in Right of Way
Easement, dated 07/26/2007, filed of record 09/06/2007, as documents number 2007-1781.

Easement in favor of State of Iowa, as set forth in document dated 01/14/1939, filed of record
01/27/1939, in Book 69, Page 449 and dated 01/14/1940, filed of record 01/27/1940 in Book 69, Page
451.

Terms and conditions of Agreement and Easement to Paul H. Galligan and Agnes Galligan, dated
08/07/1963, filed of record 08/07/1963, in Book 87, Page 403.

Mortgage

Homeland Energy Solutions, LLC — Home Federal Savings Bank

 

14Filed by Bowne Pure Compliance

 

Exhibit 10.38

SECURITY AGREEMENT

	 	 	 
	Date:

	 	November 30, 2007
	 
	 	 
	Debtor:

	 	HOMELAND ENERGY SOLUTIONS, LLC
	 

	 	106 W. MAIN STREET
	 

	 	P.O. BOX C
	 

	 	RICEVILLE, IA 50466
	 
	 	 
	Secured Party:

	 	HOME FEDERAL SAVINGS BANK
	 

	 	50 – 14TH AVENUE EAST, SUITE 100
	 

	 	SARTELL, MN 56377

RECITALS

A. Pursuant to that certain Master Loan Agreement and any and all Supplements of even date
herewith between the Debtor and Secured Party (collectively, as amended, modified, supplemented,
extended or restated from time to time, the “Credit Agreement”) the Secured Party has agreed to
make certain financial accommodations and loans to the Debtor.

B. In order to secure the performance of the Loan Obligations under the Credit Agreement and
the other Loan Documents, the Debtor desires to grant to the Secured Party for the benefit of the
Secured Party a security interest in various collateral, all as more particularly described in this
Security Agreement.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

1. Definitions. All capitalized terms used in this Security Agreement shall have the
meaning as set forth in the Credit Agreement or in the Uniform Commercial Code (the “UCC”), as
enacted in the State of Iowa, and as amended from time to time and such meanings shall
automatically change at the time that any amendment to the UCC, which changes such meanings, shall
become effective.

2. Grant of Security Interest. To secure the payment and performance of the Loan
Obligations, the Debtor grants the Secured Party, a security interest in the following property
(the “Collateral”):

 

 

 

All of the personal property of the Debtor, wherever located, and now owned or
hereafter acquired, including, but not limited to:

All Accounts and other rights to payment whether or not earned by
performance, and including, but not limited to, payment for property
sold, leased, rented, licensed or assigned or services
rendered or to be rendered; Goods; Farm Products; Chattel Paper;
Inventory; Equipment; Instruments; Investment Property; Documents;
Deposit Accounts; Money; Letter-of-Credit Rights; General
Intangibles; Payment Intangibles; Software; Supporting Obligations;
and to the extent not included in the foregoing as original
collateral, the proceeds and products of the foregoing.

All payments, rights to payment whether or not earned by
performance, accounts, general intangibles and benefits, including,
but not limited to, payments in kind, deficiency payments, letters
of entitlement, storage payments, emergency assistance, diversion
payments, production flexibility contracts, contract reserve
payments, ethanol incentive funds, bioenergy programs, under or from
any preexisting, current or future federal or state government
program and, to the extent not included in the foregoing as original
collateral, the proceeds and products of the foregoing.

3. Representations, Warranties, Covenants and Agreements. The Debtor represents,
warrants, covenants and agrees as follows:

	 	a.	 	The legal name of the Debtor is as set forth at the top of the first page of
this Agreement. The Debtor has not used any trade name, assumed name or other name
except the Debtor’s name stated above or otherwise set forth in the Credit Agreement.
The Debtor shall give the Secured Party prior written notice of any change in its name
or if the Debtor uses any other name.

	 
	 	b.	 	The Debtor is a limited liability company whose state of organization is Iowa.
The Debtor shall not change its state of organization without the prior written consent
of the Secured Party.

	 
	 	c.	 	The address of the Debtor’s chief executive office is shown at the beginning of
this Agreement. The chief executive office of the Debtor will change to the site of
the Debtor’s ethanol plant upon completion of construction. The Debtor shall give the
Secured Party prior written notice of any change in such address. The Debtor has
authority to execute and perform this Agreement.

	 
	 	d.	 	The Debtor hereby authorizes the Secured Party to file all financing statements
and amendments to financing statements describing the Collateral in any offices as
Secured Party, in its sole discretion, may determine. The Debtor hereby further
authorizes the Secured Party to file a financing statement describing any agricultural
liens or other statutory liens held by Secured Party in any offices as Secured Party,
in its sole discretion, may determine.

 

2

 

	 	e.	 	The Debtor is the owner of the Collateral, will be the owner of the Collateral
hereafter acquired, or has sufficient rights in the Collateral to transfer an interest,
free of all security interests, liens and encumbrances other than the Security
Interest and any other security of the Secured Party, and other than Permitted
Liens. The Debtor shall not permit any security interest, lien or encumbrance,
other than liens permitted by the Master Loan Agreement, the Security Interest, and
any other security interests of the Secured Party, to attach to any Collateral
without the prior written consent of the Secured Party. The Debtor shall defend the
Collateral against the claims and demands of all persons other than the Secured
Party, and shall promptly pay all taxes, assessments and other government charges
upon or against the Debtor, any Collateral and the Security Interest. No financing
statement covering any Collateral other than related to liens subordinated to the
Secured Party is on file in any public office other than Permitted Liens. If any
Collateral is or will become a fixture, the Debtor, at the request of the Secured
Party, shall furnish the Secured Party with a statement or statements executed by
all persons who have or claim an interest in the real estate, in form acceptable to
the Secured Party, which statement or statements shall provide that such persons
consent to the Security Interest.

	 
	 	f.	 	The Debtor shall not sell or otherwise dispose of any Collateral or any
interest therein without the prior written consent of the Secured Party, except that,
until the occurrence of any Event of Default and subject to the provisions of this
Agreement, the Debtor may sell or lease any Collateral constituting Inventory or Farm
Products in the ordinary course of business at prices constituting the fair market
value thereof and to replace equipment as warranted. For purposes of this Agreement, a
transfer in partial or total satisfaction of a debt, obligation or liability shall not
constitute a sale or lease in the ordinary course of business.

	 
	 	g.	 	For each deposit account that the Debtor at any time opens or maintains, the
Debtor shall, at the Secured Party’s request and option, pursuant to an agreement in
form and substance reasonably satisfactory to the Secured Party, either (a) cause the
depositary bank to comply at any time with instructions from the Secured Party to such
depositary bank directing the disposition of funds from time to time credited to such
deposit account, without further consent of the Debtor, or (b) arrange for the Secured
Party to become the customer of the depositary bank with respect to the deposit
account, with the Debtor being permitted, only with the consent of the Secured Party,
to exercise rights to withdraw funds from such deposit account. The Secured Party
agrees with the Debtor that the Secured Party shall not give any such instructions or
withhold any withdrawal rights from the Debtor, unless an Event of Default has occurred
and is continuing, or would occur, if effect were given to any withdrawal not otherwise
permitted by the Loan Documents. The provisions of this paragraph shall not apply to
(i) any deposit account for which the Debtor, the depositary bank and the Secured Party
have entered into a cash collateral agreement specially negotiated among the Debtor,
the depositary bank and the Secured Party for the specific purpose set forth therein,
(ii) a deposit account for which the Secured Party is the depositary bank and is in
automatic control, and (iii) deposit accounts specially and exclusively used for
payroll, payroll taxes and other employee wage and benefit payments to
or for the benefit of the Debtor’s employees. The Debtor shall not grant any other
person a security interest, lien or other encumbrance in any such deposit accounts.

 

3

 

	 	h.	 	The Debtor shall execute and deliver to the Secured Party all assignments,
transfers and other documents required by the Secured Party to transfer, convey and
assign to the Secured Party all federal and state government program payments, rights
to payment whether or not earned by performance, accounts, general intangibles and
benefits.

	 
	 	i.	 	Each account, instrument, chattel paper, other right to payment and general
intangible constituting Collateral is, or will be when acquired, the valid, genuine and
legally enforceable obligation of the account debtor or other obligor named therein or
in the Debtor’s records pertaining thereto as being obligated to pay such obligation,
subject to no defense, setoff or counterclaim. The Debtor shall not, without the prior
written consent of the Secured Party, agree to any material modification or amendment
of any such obligation or agree to any subordination or cancellation of any such
obligation.

	 
	 	j.	 	All tangible Collateral shall be located at the Debtor’s address(es) set forth
at the beginning of this Agreement, at the Debtor’s ethanol plant site, or as disclosed
in writing to the Secured Party. No such Collateral shall be located at any other
address without the prior written consent of the Secured Party. At the request of the
Secured Party, the Debtor shall provide the Secured Party with the location of all farm
products, machinery and equipment on a quarterly basis so long as the obligations
remain unpaid. Notwithstanding the foregoing, Collateral may be located away from
Debtor’s location for shipping purposes in the ordinary course of business.

	 
	 	k.	 	The Debtor shall: (1) keep all tangible Collateral in good condition and
repair, normal wear and tear and depreciation excepted; (2) from time to time replace
any worn, broken or defective parts thereof if necessary for the Debtor’s operations;
(3) promptly notify the Secured Party of any material loss of or material damage to any
Collateral or of any adverse change in the prospect of payment of any account,
instrument, chattel paper, other right to payment or general intangible constituting
Collateral; (4) not permit any Collateral to be used or kept for any unlawful purpose
or in violation of any federal, state or local law; (5) keep all tangible Collateral
insured in such amounts, against such risks and in such companies as shall be
reasonably acceptable to the Secured Party, with loss payable clauses in favor of the
Secured Party to the extent of its interest in form reasonably acceptable to the
Secured Party (including without limitation a provision for at least ten (10) days’
prior written notice to the Secured Party of any cancellation or modification of such
insurance), and deliver polices or certificates of such insurance to the Secured Party;
(6) at the Debtor’s chief executive office, keep accurate and complete records
pertaining to the Collateral and the Debtor’s financial condition, business and
property, and submit to the Secured Party such periodic reports concerning the
Collateral and the Debtor’s
financial condition, business and property as the Secured Party may from time to
time request;

 

4

 

(7) at all reasonable times permit the Secured Party and its
representatives to examine and inspect any Collateral, and to examine, inspect and
copy the Debtor’s records pertaining to the Collateral and the Debtor’s financial
condition, business and property; (8) at the Secured Party’s request, promptly
execute, endorse and deliver such financing statements and other instruments,
documents, chattel paper and writings and take such other actions deemed by the
Secured Party to be necessary or desirable to establish, protect, perfect or enforce
the Security Interest and the rights of the Secured Party under this Agreement and
applicable law, and pay all costs of filing financing statements and other writings
in all public offices where filing is deemed by the Secured Party to be necessary or
desirable.

	 	l.	 	Debtor will cooperate with Secured Party in obtaining control with respect to
Collateral consisting of deposit accounts, investment property, letter-of-credit
rights, and electronic chattel paper. Debtor will not create any chattel paper without
placing a legend on the chattel paper acceptable to the Secured Party indicating that
Secured Party has a security interest in the chattel paper.

	 
	 	m.	 	To the extent Debtor uses the proceeds of loan(s) extended by Secured Party to
purchase Collateral, Debtor’s repayment of said loan(s) shall apply on a
“first-in-first-out” basis so that the portion of the loan(s) used to purchase a
particular item of Collateral shall be paid in the chronological order the Debtor
purchased the Collateral.

	 
	 	n.	 	The Debtor shall comply, in all material respects, with the provisions of all
federal or state government programs, agreements and contracts to which it is a party.

	 
	 	o.	 	In the Secured Party’s discretion, if the Debtor fails to do so, the Secured
Party may discharge taxes and other encumbrances at any time levied or placed on any of
the Collateral, maintain any of the Collateral, make repairs thereto and pay any
necessary filing fees or insurance premiums. The Debtor agrees to reimburse the Secured
Party on demand for all expenditures so made. The Secured Party shall have no
obligation to the Debtor to make any such expenditures, nor shall the making thereof be
construed as the waiver or cure of any Default or Event of Default.

	 
	 	p.	 	Anything herein to the contrary notwithstanding, the Debtor shall remain
obligated and liable under each contract or agreement comprised in the Collateral to be
observed or performed by the Debtor thereunder. The Secured Party shall not have any
obligation or liability under any such contract or agreement by reason of or arising
out of this Agreement or the receipt by the Secured Party of any payment relating to
any of the Collateral, nor shall the Secured Party be obligated in any manner to
perform any of the obligations of the Debtor under or pursuant to any such contract or
agreement, to make inquiry as to the nature or

 

5

 

	 	 	 	sufficiency of any payment received by the Secured Party in respect of the
Collateral or as to the sufficiency of any performance by any party under any such
contract or agreement, to present or file any claim, to take any action to enforce
any performance or to collect the payment of any amounts which may have been
assigned to the Secured Party or to which the Secured Party may be entitled at any
time or times. The Secured Party’s sole duty with respect to the custody, safe
keeping and physical preservation of the Collateral in its possession shall be to
deal with such Collateral in the same manner as the Secured Party deals with similar
property for its own account.

	 	q.	 	The powers conferred on the Secured Party hereunder are solely to protect its
interests in the Collateral and shall not impose any duty upon it to exercise any such
powers. The Secured Party shall be accountable only for the amounts that it actually
receives as a result of the exercise of such powers, and neither it nor any of its
officers, directors, employees or Secured Parties shall be responsible to the Debtor
for any act or failure to act, except for the Secured Party’s own gross negligence or
willful misconduct.

4. Collection Rights. At any time after an Event of Default has occurred and is
continuing, the Secured Party may, and at the request of the Secured Party the Debtor shall,
promptly notify any account debtor or obligor of any account, instrument, chattel paper, other
right to payment or general intangible constituting Collateral that the same has been assigned to
the Secured Party and shall direct such account debtor or obligor to make all future payments to
the Secured Party. At any time after an Event of Default has occurred and is continuing, the
Secured Party may notify any governmental agency or unit of government which is obligated to the
Debtor under any federal or state governmental program that the same has been assigned to the
Secured Party, and direct such governmental agency or unit of government to make all future
payments to the Secured Party. In connection with any such notice, the Secured Party is
authorized to forward to such government agency or unit of government any and all instruments of
assignment or notices of assignment required by such government agency or unit of government
previously executed and delivered to Secured Party by the Debtor.

5. Limited Power of Attorney. If the Debtor at any time fails to perform or observe
any agreement herein, the Secured Party, in the name and on behalf of the Debtor or, at its option,
in its own name, may perform or observe such agreement and take any action which the Secured Party
may deem necessary or desirable to cure or correct such failure. The Debtor irrevocably authorizes
Secured Party and grants the Secured Party a limited power of attorney in the name and on behalf of
the Debtor or, at its option, in its own name, to collect, receive, receipt for, create, prepare,
complete, execute, endorse, deliver, and file any and all financing statements, insurance
applications, remittances, instruments, documents, chattel paper, and other writings, to grant an
extension to, compromise, settle, waive, notify, amend, adjust, change, and release any obligation
of any account debtor, obligor, insurer, or other person pertaining to any Collateral, and take any
other action deemed by the Secured Party to be necessary or desirable to establish, perfect,
protect, or enforce the Security Interest. All of the Secured Party’s advances, charges, costs,
and expenses, including without limitation reasonable attorneys’ fees, in connection with the Loan
Obligations and in the protection and exercise of any rights or
remedies hereunder, together with interest thereon at the highest rate then applicable to any of
the Loan Obligations, shall be secured hereunder and shall be paid by the Debtor to the Secured
Party on demand.

 

6

 

6. Remedies. Upon the occurrence of any Event of Default and at any time thereafter,
the Secured Party may exercise any one or more of the following rights and remedies: (a) declare
all Loan Obligations to be immediately due and payable, and the same shall thereupon be immediately
due and payable, without presentment or other notice or demand, all of which are hereby waived by
the Debtor; (b) require the Debtor to assemble all or any part of the Collateral and make it
available to the Secured Party at a place to be designated by the Secured Party which is reasonably
convenient to both parties; (c) exercise and enforce any and all rights and remedies available upon
default under the Credit Agreement, this Agreement, the Uniform Commercial Code, and any other
applicable agreements and laws. If notice to the Debtor of any intended disposition of Collateral
or other action is required, such notice shall be deemed reasonably and properly given if mailed by
regular or certified mail, postage prepaid, to the Debtor at the address stated at the beginning of
this Agreement or at the most recent address shown in the Secured Party’s records, at least ten
(10) days prior to the action described in such notice. The Debtor hereby irrevocably submits and
consents to the jurisdiction of the state and federal courts located in the State of Minnesota over
any controversy, action or proceeding arising out of or relating to this Security Agreement, the
Collateral, the Security Interest, the Loan Obligations and any instrument, agreement or document
related hereto or thereto, and the Debtor hereby irrevocably agrees that all claims in respect of
such action or proceeding may be heard and determined in such Minnesota state or federal court. The
Debtor hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an
inconvenient forum to the maintenance of such action or proceeding. Nothing in this Security
Agreement shall affect the right of the Lender to bring any action or proceeding against the Debtor
or its property in the courts of any other jurisdiction to the extent permitted by law.

7. Standards for Exercising Rights and Remedies. To the extent that applicable law
imposes duties on the Secured Party to exercise remedies in a commercially reasonable manner, the
Debtor acknowledges and agrees that it is not commercially unreasonable for the Secured Party (a)
to fail to incur expenses reasonably deemed significant by the Secured Party to prepare Collateral
for disposition or otherwise to fail to complete raw material or work in process into finished
goods or other finished products for disposition, (b) to fail to obtain third party consents for
access to Collateral to be disposed of, or to obtain or, if not required by other law, to fail to
obtain governmental or third party consents for the collection or disposition of Collateral to be
collected or disposed of, (c) to fail to exercise collection remedies against account debtors or
other persons obligated on Collateral or to fail to remove liens or encumbrances on or any adverse
claims against Collateral, (d) to exercise collection remedies against account debtors and other
persons obligated on Collateral directly or through the use of collection agencies and other
collection specialists, (e) to advertise dispositions of Collateral through publications or media
of general circulation, whether or not the Collateral is of a specialized nature, (f) to contact
other persons, whether or not in the same business as the Debtor, for expressions of interest in
acquiring all or any portion of the Collateral, (g) to hire one or more professional auctioneers to
assist in the disposition of Collateral, whether or not the collateral is of a specialized nature,

 

7

 

(h) to dispose of Collateral by utilizing Internet sites that provide for the auction of assets of
the
types included in the Collateral or that have the reasonable capability of doing so, or that match
buyers and sellers of assets, (i) to dispose of assets in wholesale rather than retail markets, (j)
to disclaim disposition warranties, (k) to purchase insurance or credit enhancements to insure the
Secured Party against risks of loss, collection or disposition of Collateral or to provide to the
Secured Party a guaranteed return from the collection or disposition of Collateral, or (l) to the
extent deemed appropriate by the Secured Party, to obtain the services of other brokers, investment
bankers, consultants and other professionals to assist the Secured Party in the collection or
disposition of any of the Collateral. The Debtor acknowledges that the purpose of this Section 7 is
to provide non-exhaustive indications of what actions or omissions by the Secured Party would
fulfill the Secured Party’s duties under the Uniform Commercial Code or other applicable law in the
Secured Party’s exercise of remedies against the Collateral and that other actions or omissions by
the Secured Party shall not be deemed to fail to fulfill such duties solely on account of not being
indicated in this Section 7. Without limitation upon the foregoing, nothing contained in this
Section 7 shall be construed to grant any rights to the Debtor or to impose any duties on the
Secured Party that would not have been granted or imposed by this Agreement or by applicable law in
the absence of this Section 7.

8. Suretyship Waivers by Debtor. The Debtor waives demand, notice, protest, notice of
acceptance of this Agreement, notice of loans made, credit extended, Collateral received or
delivered or other action taken in reliance hereon, notice of acceleration, notice of intent to
accelerate, and all other demands and notices of any description. With respect to both the Loan
Obligations and the Collateral, the Debtor assents to any extension or postponement of the time of
payment or any other indulgence, to any substitution, exchange or release of or failure to perfect
any security interest in any Collateral, to the addition or release of any party or person
primarily or secondarily liable, to the acceptance of partial payment thereon and the settlement,
compromising or adjusting of any thereof, all in such manner and at such time or times as the
Secured Party may deem advisable. The Secured Party shall have no duty as to the collection or
protection of the Collateral or any income therefrom, the preservation of rights against prior
parties, or the preservation of any rights pertaining thereto beyond the safe custody of such
Collateral. The Debtor further waives any and all other suretyship defenses.

9. Marshalling. The Secured Party shall not be required to marshal any present or
future collateral security (including but not limited to the Collateral) for, or other assurances
of payment of, the Loan Obligations or any of them or to resort to such collateral security or
other assurances of payment in any particular order, and all of its rights and remedies hereunder
and in respect of such collateral security and other assurances of payment shall be cumulative and
in addition to all other rights and remedies, however existing or arising. To the extent that it
lawfully may, the Debtor hereby agrees that it will not invoke any law relating to the marshalling
of collateral which might cause delay in or impede the enforcement of the Secured Party’s rights
and remedies under this Agreement or under any other instrument creating or evidencing any of the
Loan Obligations or under which any of the Loan Obligations is outstanding or by which any of the
Loan Obligations is secured or payment thereof is otherwise assured, and, to the extent that it
lawfully may, the Debtor hereby irrevocably waives the benefits of all such laws.

 

8

 

10. Miscellaneous. A carbon, photographic, or other reproduction of this Agreement is
sufficient as a financing statement. This Agreement cannot be waived, modified, amended,
abridged, supplemented, terminated, or discharged, and the Security Interest cannot be released or
terminated, except by a writing duly executed by the Secured Party and Debtor. A waiver shall be
effective only in the specific instance and for the specific purpose given. No delay or failure to
act shall preclude the exercise or enforcement of any of the Secured Party’s rights or remedies.
All rights and remedies of the Secured Party shall be cumulative and may be exercised singularly,
concurrently, or successively at the Secured Party’s option, and the exercise or enforcement of any
one such right or remedy shall not be a condition to or bar the exercise or enforcement of any
other. This Agreement shall be binding upon and inure to the benefit of the heirs, legatees,
executors, administrators, successors and assigns of Secured Party and shall bind all persons and
parties who become bound as a debtor to this Security Agreement. If any provision or application
of this Agreement is held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be given effect, and
this Agreement shall be construed as if the unlawful or unenforceable provision or application had
never been contained herein or prescribed hereby. All representations and warranties contained in
this Agreement shall survive the execution, delivery, and performance of this Agreement and the
creation, payment, and performance of the Loan Obligations. This Agreement shall be governed by
and construed in accordance with the laws of the State of Minnesota.

11. Severability. The unenforceability or invalidity of any provision or provisions
hereof shall not render any other provision or provisions herein contained unenforceable or
invalid.

THE DEBTOR REPRESENTS, CERTIFIES, WARRANTS, AND AGREES THAT THE DEBTOR HAS READ ALL OF THIS
AGREEMENT AND UNDERSTANDS ALL OF THE PROVISIONS OF THIS AGREEMENT.

	 	 	 	 	 
	 	HOMELAND ENERGY SOLUTIONS, 

LLC, an Iowa limited liability company

 	 
	 	/s/ Stephen K. Eastman
 	 
	 	By:  Stephen K. Eastman 	 
	 	Its:  President 	 
	 

 

9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}]]